BUSINESS FORECASTING – AUSTRALIA

Builders a sitting duck as banking royal commission comes hurtling down the track

roymorgansocial Leave a comment

Original article by Robert Gottliebsen
The Australian – Page: 28 : 17-Apr-18

Australia’s builders and property developers do not seem to realise the potential impact that the banking royal commission could have on their business. They seem unaware that one of the commission’s areas of focus is on banks that having been making loans to home buyers on the basis of living expense estimates that are flawed, and that a clampdown on this practice could reduce the number of mortgage loans being issued by banks. Developers and builders could be hit hard by this, and some could potentially collapse as a result.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, UBS HOLDINGS PTY LTD, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION

Cricket loss not all bad for Nine

roymorgansocial Leave a comment

Original article by Samantha Bailey, Dana McCauley
The Australian – Page: 19 : 17-Apr-18

Tennis and cricket broadcasting rights generate a loss for the Seven and Nine networks, and this is likely to continue when the sports change networks. Nine is estimated to have lost around $A50m a year from its cricket coverage, but Citigroup forecasts that its annual losses from tennis broadcasts will be within the range of $A20m to $A30m. Meanwhile, UBS forecasts that Seven will gain an increased share of advertising revenue at the expense of Nine and Ten following their loss of cricket broadcasting rights.

CORPORATES
SEVEN NETWORK LIMITED, SEVEN WEST MEDIA LIMITED – ASX SWM, NINE NETWORK AUSTRALIA LIMITED, NINE ENTERTAINMENT COMPANY HOLDINGS LIMITED – ASX NEC, TEN NETWORK HOLDINGS LIMITED, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, FOXTEL MANAGEMENT PTY LTD, CRICKET AUSTRALIA, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS

Activism to rise as M&A at highest since 2007

roymorgansocial Leave a comment

Original article by Joyce Moullakis
The Australian Financial Review – Page: 25 : 13-Apr-18

Data from Dealogic shows that $US32.8bn ($A42.3bn) worth of mergers and acquisitions have been announced in Australia so far in 2018. Neil Pathak of Gilbert + Tobin says M&A activity in the near-term is unlikely to be affected by heightened financial market volatility or concerns about a trade war between the US and China. The law firm also anticipates that shareholder activists will continue to target listed companies.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, GILBERT AND TOBIN LAWYERS, BHP BILLITON LIMITED – ASX BHP, ELLIOTT MANAGEMENT CORPORATION, ARDENT LEISURE GROUP – ASX AAD, QUINTIS LIMITED – ASX QIN, AWE LIMITED – ASX AWE, ISENTIA GROUP LIMITED – ASX ISD, MYER HOLDINGS LIMITED – ASX MYR, SANTOS LIMITED – ASX STO, HARBOUR ENERGY LIMITED, TRIBECA INVESTMENT PARTNERS PTY LTD, BENNELONG FUNDS MANAGEMENT PTY LTD, WESTFIELD CORPORATION – ASX WFD, UNIBAIL-RODAMCO, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD

Under-pressure HT&E rejects oOh!Media offer for Adshel

roymorgansocial Leave a comment

Original article by Dana McCauley, Bridget Carter, Scott Murdoch
The Australian – Page: 19 : 12-Apr-18

Australian-listed HT&E has advised that oOh!Media has made a non-binding and conditional offer for its Adshel outdoor advertising division. However, HT&E’s board has deemed that the offer undervalues Adshel. Meanwhile, the company has indicated that Adshel’s revenue for the March quarter was consistent with guidance issued in February. HT&E has forecast that EBITDA for 2018 will be within the range of $A113m to $A114m.

CORPORATES
HT&E LIMITED – ASX HT1, ADSHEL PTY LTD, OOH!MEDIA LIMITED – ASX OML, AUSTRALIAN RADIO NETWORK PTY LTD, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS

Santos suitor could offload key gas assets

roymorgansocial Leave a comment

Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 17 : 5-Apr-18

Mark Samter of Credit Suisse has identified the Cooper Basin infrastructure at the Moomba gas plant as one of the Santos assets that Harbour Energy could potentially agree to divest in order to secure approval from the Foreign Investment Review Board. Samter says Santos’s assets in Western Australia could also be earmarked for sale if the $A13.5bn takeover bid succeeds. Approval from the FIRB is widely seen as a key risk for Harbour’s bid.

CORPORATES
SANTOS LIMITED – ASX STO, HARBOUR ENERGY LIMITED, CREDIT SUISSE (AUSTRALIA) LIMITED, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, WATERMARK FUNDS MANAGEMENT PTY LTD, QUADRANT ENERGY PTY LTD, SOUTH AUSTRALIA. DEPT OF THE PREMIER AND CABINET, HONY CAPITAL, ENN GROUP

Gas crisis looms as Bass Strait dries up

roymorgansocial Leave a comment

Original article by Glenda Korporaal
The Australian – Page: 19 : 29-Mar-18

A report from the Australian Energy Market Operator forecasts that Victoria’s gas production will fall to 187 petajoules in 2022, compared with 435 petajoules in 2017. Damien Sanford of AEMO has warned that Victoria faces a gas supply shortfall from 2022 unless new sources of gas are found. The Bass Strait gas fields are rapidly being depleted, and AEMO says Victorians could face the prospect of having to restrict gas consumption on days of peak demand from 2022.

CORPORATES
AUSTRALIAN ENERGY MARKET OPERATOR LIMITED, ESSO AUSTRALIA PTY LTD, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Fortescue faces iron ore discount dilemma

roymorgansocial Leave a comment

Original article by James Thomson
The Australian Financial Review – Page: 20 : 28-Mar-18

China’s growing demand for higher-grade iron ore has boosted the profits of BHP Billiton and Rio Tinto, while the widening discount for lower-grade ore slashed the interim earnings of Fortescue Metals Group. The pure-play miner has advised that its iron ore is now expected to fetch 65 per cent of the benchmark price, compared with its recent forecast of 70-75 per cent. The discount has widened from just five per cent in the March 2016 quarter to 35 per cent, but Fortescue still maintains that it is cyclical and will narrow over time. However, rival producers argue that the discount is structural.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, VALE SA, CLEVELAND-CLIFFS INCORPORATED

BHP content with iron ore grade boost for now

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 19 : 22-Mar-18

BHP Billiton is tipped to make an investment decision on the South Flank iron ore project in Western Australia by mid-2018. The company’s average iron ore grade is 61 per cent at present, but this would rise to 62 per cent if the project is approved. However, BHP’s Edgar Basto says that aside from South Flank, BHP is unlikely to increase its average iron ore grades in the near-term. He adds that factors such as the stronger Australian dollar and rising labour costs have contributed to an increase in the expected cost of the project.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, VALE SA

M&A’s hot sectors to drive healthy flow

roymorgansocial Leave a comment

Original article by Joyce Moullakis
The Australian Financial Review – Page: 19 : 19-Mar-18

Data from Dealogic shows that $US13.1bn ($A17bn) worth of mergers and acquisitions have been announced so far in 2018, which is 25 per cent higher than the same period in 2017. Herbert Smith Freehills partner Tony Damian anticipates strong M&A activity during 2018, citing healthcare as a sector which is likely to continue to attract suitors. The law firm also identifies financial services, renewable energy and infrastructure as Australian sectors in which M&A activity is likely to be high.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, HERBERT SMITH FREEHILLS PTY LTD, WOODSIDE PETROLEUM LIMITED – ASX WPL, EXXONMOBIL CORPORATION, AWE LIMITED – ASX AWE, MITSUI AND COMPANY LIMITED, I-MED/MIA NETWORK LIMITED, PERMIRA PRIVATE EQUITY LIMITED, DEUTSCHE BANK AG, COALITION, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AMP LIMITED – ASX AMP, SUNCORP GROUP LIMITED – ASX SUN, WESFARMERS LIMITED – ASX WES, COLES SUPERMARKETS AUSTRALIA PTY LTD, QUALCOMM INCORPORATED, BROADCOM CORPORATION, UBS HOLDINGS PTY LTD, LAZARD PTY LTD, GOLDMAN SACHS AUSTRALIA PTY LTD, CREDIT SUISSE (AUSTRALIA) LIMITED, MACQUARIE CAPITAL PTY LTD

Newcrest in dark on Cadia restart

roymorgansocial Leave a comment

Original article by Matt Chambers
The Australian – Page: 21 : 16-Mar-18

Analysts have scaled back their 2017-18 production forecasts for Newcrest Mining’s Cadia gold mine after the company advised that it is uncertain when production will resume. Peter O’Connor of Shaw Stockbroking expects output for the fiscal year to be about 570,000 ounces following the collapse of a tailings dam wall. Full-year output at the mine had been slated to be within the range of 680,00 to 780,000 ounces. Newcrest CEO Sandeep Biswas says the cause of the incident remains unknown, and it does not appear to be linked to recent seismic activity.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, SHAW STOCKBROKING LIMITED, BHP BILLITON LIMITED – ASX BHP, RBC CAPITAL MARKETS, SAMARCO MINERACAO SA