1 Walmart profit
warning hits shares (BBC) Shares in the world's biggest retailer, Wal-Mart,
have plunged after it cut its profit forecast. The company said it expected earnings
per share to drop by between 6% and 12% in the next financial year. The
announcement sent shares of the company tumbling by 8%, their biggest fall in
six years.
Wal-Mart said the lower
profit forecast was because it was investing in e-commerce as well as
increasing employee wages. The retailer's spending efforts are in part a
reaction to slowing sales, and competition from online retailers like Amazon.
It is also spending
more to train and retain employees. In April, the company raised its base
salary to $9 per hour and will increase it to $10 next year. The company
revised down earnings figures for this year as well, predicting growth would be
flat, rather than the previously forecast growth of 1%-2%.
Wal-Mart has blamed the
fall in part on the strong dollar affecting overseas sales, something that has
also affected other US retailers. Profits for the company dipped over the
summer as sales in its UK supermarket chain, Asda, declined. The retailer also
announced it would repurchase $20bn in shares from investors.
2 Easy Jet records
profit for fifth year (Sean Farrell in The Guardian) Air passengers have failed
to show up for flights to and from France after the Paris attacks, but people’s
desire to travel will override fears, Carolyn McCall, easyJet’s chief executive
said, as the budget airline announced record annual profits.
Pre-tax profit for the
year to the end of September increased by 18% to £686m – easyJet’s fifth
straight year of record profits – as passenger numbers rose 6% to 68.6 million.
The company filled record numbers of seats on planes in July and August as
holidaymakers headed for the sun.
McCall said said
easyJet was allowing passengers to defer or reroute flights to and from France,
and that this had happened “a bit – it’s not one thing that is overwhelming”. McCall
added that travel was now a part of everyday life and demand would resume as it
did after the 2007 bombings in London and the Germanwings plane crash in March.
The easyJet chief
executive said she was confident in the longer term outlook for the business
and announced the order of 36 Airbus A320 planes. The airline increased its
annual dividend by 22% to 55.2p a share.
EasyJet’s rival
no-frills carrier Ryanair has predicted intensifying price competition between
airlines, but McCall said such battles would be isolated and that her main
competition was large national airlines, because there was little overlap
between easyJet and Ryanair.
“This isn’t like a
supermarket price war. What is a price war? We are watching prices all the
time, but because we are 30% cheaper than the largest carriers at [main]
airports, our prices have held up really well,” she said.
3 Bahrain plans more
subsidy cuts, new charges (Khaleej Times) Bahrain is planning more subsidy cuts
and intends to impose charges for government services next year in order to
boost revenues hit by slumping oil prices, the kingdom's minister for industry
and commerce has said.
Like other Gulf
oil-exporting states, Bahrain has for many years subsidised goods and services
such as food, fuel, electricity and water, keeping prices ultra-low in an
effort to maintain social peace.
But since its oil
income began to plunge last year, the government's budget deficit has widened
and the subsidies have become much harder for Bahrain to afford. "We have
already started cutting subsidies and we are now looking at others -
electricity, fuel, those are next year," Zayed bin Rashed Al Zayani said.
Governments around the
Gulf have begun restraining expenditure and studying whether to cut subsidies,
but most do not face as much pressure as Bahrain, which lacks the huge
financial reserves of its neighbours.
Bahrain's revenues have
dropped 60-70 percent because of low oil prices, Zayani said. Last month,
Bahrain more than doubled prices of beef and chicken as it removed meat
subsidies; local citizens but not foreigners will receive some compensation in
the form of cash handouts.
In April, the
government raised the price of natural gas sold to industry. The kingdom is
also looking at boosting revenues by imposing charges on government services
that are currently free or carry minimal fees. As part of efforts to diversify
its economy beyond oil, Bahrain will in the first quarter of 2016 unveil a new
short- and medium-term industrial strategy, now in the final stages of
planning.
No comments:
Post a Comment