Company news in brief
Load shedding hit Mr PriceValue retailer Mr Price recorded a 6% increase in its retail sales to R6.6 billion for the 13 weeks to 2 July.
The non-payment of the Covid-19 social relief of distress grant for two months "negatively impacted household disposable income" and hit its sales growth, the group said.
Sales growth for the first three weeks of July 2022 was 18%, which effectively takes sales growth for 3 April to 23 July to 8%.
Apparel sales represented 74% of the group's first-quarter sales, while homeware contributed 22%. Home sales increased by less than 2%, while apparel sales rose 8%.
Cash sales grew by 5% in the first quarter, and constituted almost 85% of total retail sales.
Mr Price opened 27 new stores in the period, taking the group’s total store footprint to 1 745 stores. – Fin24
Lufthansa ground staff to strike
Ground staff at Deutsche Lufthansa will stage a one-day strike today in pursuit of a 9.5% pay claim, adding to travel disruption during the busy summer travel season.
Strikes and staff shortages have already forced airlines including Lufthansa to cancel thousands of flights and caused hours-long queues at major airports, frustrating holidaymakers keen to travel after Covid-19 related lockdowns.
Verdi last month demanded a 9.5% pay rise, or at least 350 euro more per month for 12 months, for around 20 000 workers who it says are being squeezed by inflation and have been overworked due to staffing shortages at airports.
Lufthansa had offered an increase of 150 euro per month for the rest of this year and another 100 euro more from the start of 2023, plus a 2% increase from mid-2023 dependent on the company's financial results.
Verdi rejected the offer, saying it was insufficient to offset soaring inflation, which hit 8.2% in Germany in June. – Reuters
Rio Tinto, Fortescue face dim demand
Australian iron ore miners Rio Tinto and Fortescue Metals Group Ltd are unlikely to see a repeat of record profits booked in recent years as they face soaring costs, falling prices and a tight labour market.
Rio Tinto, the world's biggest iron ore producer, may see its first-half earnings drop by about a third, while Fortescue could report up to a 40% drop in annual profit, according to Refinitiv estimates.
A persistent downward trend in iron ore prices is expected to weigh significantly on earnings of top Australian miners, UBS analyst Lachlan Shaw said.
However, full-year earnings at BHP Group, the world's biggest listed miner, are expected to jump 30%, partly benefiting from exposure to a variety of commodities including coal, whose prices have rocketed during the Ukraine conflict.
Rio and BHP's profits nearly doubled from 2019 levels in 2021, while Fortescue's earnings have more than tripled over the past two years.
Rio Tinto will report half-year results on July 27, while BHP and Fortescue will report fiscal 2022 results on Aug. 16 and 29. – Reuters
Harley profit outlook at risk
Harley Davidson Inc's two-week production shutdown beginning May 19 that expanded the motorcycle maker's order backlog has increased the likelihood of the manufacturer revising its full-year outlook, analysts said.
The company is expected to report a drop in profit on lower revenue from motorcycle sales when it delivers results on July 28.
Surging raw material costs and global semiconductor shortages have clipped Harley’s gross margins, even as demand for its motorcycles remains strong.
Analysts expect the iconic motorcycle maker to post a decrease in second-quarter profit of US$164.35 million, down from US$180.54 million a year ago, according to Refinitiv data.
The company forecast year-over-year revenue growth of 5% to 10% for its motorcycle segment for 2022, but recouping profit after the production stoppage will be a challenge, said Chris Hodson, senior analyst at Edgewater Research. – Reuters
UBS quarterly profit disappoints
Swiss bank UBS yesterday posted a smaller-than-expected rise in second-quarter net profit as its investment banking and wealth management businesses struggled in tough markets.
UBS kicks off a round of earnings by major banks across Europe, where analysts are watching for signs that a weaker economy, higher interest rates and the war in Ukraine are weighing on their operations and outlooks.
Profit in the three months ended June rose 5% to US$2.1 billion. That compared with US$2.0 billion a year earlier and lagged expectations for a 19.8% rise to US$2.4 billion in a poll of 19 analysts compiled by the bank.
"The second quarter was one of the most challenging periods for investors in the last 10 years," chief executive Ralph Hamers said in a statement. He said the operating environment in the second half of the year "remains uncertain".
In recent months, the bank has signalled that its wealth management clients will continue to remain cautious due to geopolitical and macro-economic uncertainties. - Reuters