BUSINESS FORECASTING – AUSTRALIA

The sharemarket is not working as capital provider: Credit Suisse

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Original article by Vesna Poljak
The Australian Financial Review – Page: 17 : 3-Aug-17

Annual net equity issuance via the Australian sharemarket has averaged $A40bn over the last 10 years. However, Hasan Tevfik of Credit Suisse estimates that just $A1bn has been raised so far in 2017, saying contributing factors include the limited number of IPOs and access to corporate debt at interest rates of around three per cent. Meanwhile, Credit Suisse has identified BHP Billiton, Qantas and Lend Lease as being among the companies that could potentially announce share buybacks during the August reporting season.

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, BHP BILLITON LIMITED – ASX BHP, QANTAS AIRWAYS LIMITED – ASX QAN, LEND LEASE GROUP LIMITED – ASX LLC, COMPUTERSHARE LIMITED – ASX CPU, YANCOAL AUSTRALIA LIMITED – ASX YAL, ZIP INDUSTRIES AUSTRALIA, CRAVEABLE BRANDS LIMITED, ACCOLADE WINES LIMITED, SUPER A-MART PTY LTD, ALINTA ENERGY (AUSTRALIA) PTY LTD, OFFICEWORKS SUPERSTORES PTY LTD, CHOW TAI FOOK ENTERPRISES LIMITED, STANDARD AND POOR’S ASX 200 INDEX, CITIGROUP INCORPORATED

ANZ restructure raises union fears of significant job losses

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Original article by David Marin-Guzman, James Frost
The Australian Financial Review – Page: 13 & 16 : 1-Aug-17

ANZ Bank CEO Shayne Elliott will emphasis on 1 August 2017 via a video to all staff that its Australasian focus is on retail customers and on corporate customers in Asia. The video will follow on from a message sent by Elliott on the previous day in which he called for changes to ANZ’s work practices and flexibility. Julia Angrisano of the Finance Sector Union says it is concerned that what appears to be a major reorganisation by ANZ will lead to job cuts at the bank.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, FINANCE SECTOR UNION, WESTPAC BANKING CORPORATION – ASX WBC, ST GEORGE BANK LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MACQUARIE GROUP LIMITED – ASX MQG

Rio’s chance to reward investors with jump in returns

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Original article by Matt Chambers
The Australian – Page: 17 & 28 : 1-Aug-17

Rio Tinto is widely tipped to post a 2017 interim underlying profit of $US4.12bn ($A5.16bn), compared with $US1.56bn previously. Market watchers also anticipate that Rio will lift its interim dividend from $US0.45 per share to $US1.18, with the prospect of a full-year payout of $US2.50 per share. Paul Hissey of RBC Capital Markets forecasts that a special dividend will boost Rio Tinto’s interim payout to $US1.42 a share. However, Glyn Lawcock of UBS expects the interim dividend to be $US0.93.

CORPORATES
RIO TINTO LIMITED – ASX RIO, RBC CAPITAL MARKETS, UBS HOLDINGS PTY LTD, BHP BILLITON LIMITED – ASX BHP, ANGLO AMERICAN PLC, GLENCORE PLC, VALE SA, GREAT BRITAIN. SERIOUS FRAUD OFFICE

China pullback won’t dent local M&A

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Original article by Joyce Moullakis
The Australian Financial Review – Page: 20 : 31-Jul-17

Data from Dealogic shows that $US40.7bn ($A50.9bn) worth of mergers and acquisitions involving Australian companies have been announced so far in 2017. Minter Ellison partner Alberto Colla expects Japanese corporate raiders to continue to target local companies following a number of deals over the last 18 months. The law firm anticipates that US and Canadian companies will also be key drivers of M&A activity in Australia, particularly if Chinese deal-making is affected by China’s new regulations on financial outflows.

CORPORATES
DEALOGIC (AUSTRALIA) PTY LTD, MINTER ELLISON, TOLL HOLDINGS LIMITED, JAPAN POST COMPANY LIMITED, BRADKEN LIMITED, HITACHI CONSTRUCTION MACHINERY COMPANY LIMITED, ASG GROUP LIMITED, NOMURA RESEARCH INSTITUTE, PROGRAMMED MAINTENANCE SERVICES LIMITED – ASX PRG, PERSOL, SPOTLESS GROUP HOLDINGS LIMITED – ASX SPO, DOWNER EDI LIMITED – ASX DOW, VOCUS GROUP LIMITED – ASX VOC, FAIRFAX MEDIA LIMITED – ASX FXJ, AUSTRALIAN TAXATION OFFICE, AUSTRALIA. FOREIGN INVESTMENT REVIEW BOARD, CORNERSTONE RESEARCH GROUP, STANFORD UNIVERSITY, KATANA ASSET MANAGEMENT LIMITED, SLATER AND GORDON LIMITED – ASX SGH, QUINDELL PLC, CIMIC GROUP LIMITED – ASX CIM

Chevron on the cusp of starting up Wheatstone

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 : 31-Jul-17

Chevron has advised that the first production train at the Wheatstone LNG project in Western Australia is in the final stages of commissioning, and production is expected to begin in August 2017. Chevron’s Jay Johnson adds that the second production train is slated to become operational about 6-8 months later. He also says some efficiency improvements are likely when the second train begins production, as was Chevron’s experience at the Gorgon LNG project.

CORPORATES
CHEVRON CORPORATION, WOODSIDE PETROLEUM LIMITED – ASX WPL, APACHE CORPORATION

Looking to profits to solve economy’s jumbled puzzle

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Original article by Vesna Poljak
The Australian Financial Review – Page: 15 & 20 : 25-Jul-17

PM Capital’s Uday Cheruvu says the August 2017 earnings season will be more important than usual given that business confidence seems to be improving but consumer confidence remains subdued. Cheruvu adds that capital expenditure intentions will also be a key metric in the upcoming reporting season, suggesting that building materials group in particular may increase capex. Meanwhile, Goldman Sachs says companies whose earnings could exceed expectations include BlueScope Steel, Crown Resorts, Telstra and South32.

CORPORATES
PM CAPITAL LIMITED, GOLDMAN SACHS AUSTRALIA PTY LTD, BLUESCOPE STEEL LIMITED – ASX BSL, CROWN RESORTS LIMITED – ASX CWN, TELSTRA CORPORATION LIMITED – ASX TLS, SOUTH32 LIMITED – ASX S32, BRAVURA SOLUTIONS LIMITED.- ASX BVS, COSTA GROUP HOLDINGS LIMITED – ASX CGC, SKYCITY ENTERTAINMENT GROUP LIMITED – ASX SKC, COCA-COLA AMATIL LIMITED – ASX CCL, MEDIBANK PRIVATE LIMITED – ASX MPL, THE STAR ENTERTAINMENT GROUP LIMITED – ASX SGR, CITIGROUP PTY LTD, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, RESERVE BANK OF AUSTRALIA, MYER HOLDINGS LIMITED – ASX MYR, ADAIRS LIMITED – ASX ADH, CREDIT SUISSE (AUSTRALIA) LIMITED, CYAN INVESTMENT MANAGEMENT PTY LTD, AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED – ASX AFI, UNITED STATES. FEDERAL RESERVE BOARD, RIO TINTO LIMITED – ASX RIO, RESMED INCORPORATED – ASX RMD, SUNCORP GROUP LIMITED – ASX SUN, TABCORP HOLDINGS LIMITED – ASX TAH

Foreign apartment buyers to halve

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Original article by Michael Bleby
The Australian Financial Review – Page: 31 : 24-Jul-17

The number of new apartments funded by foreign investors in Australia is tipped to fall significantly over the period from 2016 to 2019, according to Master Builders Australia. It attributes the expected decline to federal and New South Wales government curbs on foreign property investors. The MBA also expects foreign investment in new standalone properties to decline, but by not as much as apartment investment. The MBA expects NSW to feel the biggest impact in terms of a decline in new foreign investor-funded apartments, but Tim Lawless of CoreLogic suggests that Victoria instead will be most affected.

CORPORATES
MASTER BUILDERS OF AUSTRALIA, CORELOGIC AUSTRALIA PTY LTD

Ore lift backs BHP ‘surprise’ on dividend

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Original article by Matt Chambers
The Australian – Page: 19 : 20-Jul-17

Citigroup expects BHP Billiton to post an underlying profit of $US6.76bn for 2016-17, compared with $US1.22bn previously. BHP’s activities report for the June 2017 quarter shows that it produced 268 million tonnes of iron ore in Western Australia during 2016-17, while copper output at the Olympic Dam mine in South Australia fell 16 per cent to 166,000 tonnes. Strike action at the Escondida copper mine in Chile resulted in annual output falling to 772,000 tonnes, but output of up to 1.23 million tonnes is expected in 2017-18.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, CITIGROUP PTY LTD, MINERA ESCONDIDA LIMITADA, RIO TINTO LIMITED – ASX RIO, UBS HOLDINGS PTY LTD, MORGANS FINANCIAL LIMITED

Investors twitchy ahead of new capital rules

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Original article by James Eyers, James Frost
The Australian Financial Review – Page: 7 : 19-Jul-17

The Australian Prudential Regulation Authority is poised to unveil its revised capital rules for the banking sector on 19 July. There has been speculation that APRA will require banks to increase their equity capital. Meanwhile, Morgan Stanley forecasts that the Commonwealth Bank of Australia will report a common equity tier 1 capital ratio of about 9.9 per cent for fiscal 2017. Richard Wiles of Morgan Stanley says APRA’s new capital requirements constitute the biggest source of risk for CBA in the near-term.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, MORGAN STANLEY AUSTRALIA LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, GOLDMAN SACHS AUSTRALIA PTY LTD

Rio lowers iron ore production guidance

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Original article by Paul Garvey
The Australian – Page: 19 : 19-Jul-17

Rio Tinto has advised that its iron ore output in the Pilbara is now likely to be about 330 million tonnes in calendar 2017, compared with previous guidance of between 330 million and 340 million tonnes. It has cited factors such as inclement weather and rail maintenance work for the revised production forecast. Rio Tinto’s Pilbara iron ore shipments totalled 154.3 million tonnes in the first half. Meanwhile, Citigroup expects Rio Tinto’s full-year dividend to rise from $US1.70 per share in 2016 to $US2.42 in 2017.

CORPORATES
RIO TINTO LIMITED – ASX RIO, CITIGROUP PTY LTD, COAL AND ALLIED INDUSTRIES LIMITED, YANCOAL AUSTRALIA LIMITED – ASX YAL, GOLDMAN SACHS AUSTRALIA PTY LTD