Fortescue confident of even more cost cutting

Original article by Tess Ingram
The Australian Financial Review – Page: 15 : 29-Jun-17

Iron ore miner Fortescue Metals Group aims to achieve a "C1" unit cost of production of between $US12 and $US13 per tonne in 2016-17, compared with $U50/tonne several years ago. Greg Lilleyman, Fortescue’s director of operations, is confident that the company can further reduce its costs. While he acknowledges that it will be hard to match its recent cost performance in coming years, he says there are still opportunities for more cost savings. Lilleyman also expects the price discount of lower-grade iron compared with the benchmark price to narrow.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO

Fortescue conveyor belts to lower costs

Original article by Tess Ingram
The Australian Financial Review – Page: 27 : 28-Jun-17

The introduction of self-driving haulage trucks has increased productivity at Fortescue Metals Group’s Solomon mining hub by about 20 per cent since 2012. The pure-pure iron ore miner has 56 autonomous trucks at Solomon, with plans to convert another 12. Fortescue will also begin converting 100 trucks at its Chichester hub in fiscal 2018. It also intends to undertake a trial of relocatable overland conveyor belt technology at the Cloudbreak mine, which could allow its fleet of haulage trucks to be reduced.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO, VALE SA, BHP BILLITON LIMITED – ASX BHP, SHAW AND PARTNERS LIMITED

Journalist cuts ‘will help drive Fairfax profits’

Original article by Scott Murdoch
The Australian – Page: 4 : 5-May-17

Fairfax Media CEO Greg Hywood says back-office functions rather the editorial department have borne the brunt of its cost-cutting over the last five years. Hywood also says the latest round of redundancies will be the last, and he argues that Fairfax’s newspapers must be both profitable and sustainable in the long-term. Fairfax journalists hope that shareholders and advertisers will support their seven-day strike in response to the latest downsizing, which will result in the loss of 125 newsroom jobs.

CORPORATES
FAIRFAX MEDIA LIMITED – ASX FXJ, AUSTRALIA. FAIR WORK COMMISSION

Ten review to cut costs in ‘every dark corner’

Original article by Mitchell Bingemann
The Australian – Page: 21 : 28-Apr-17

Ten Network has posted a 2016-17 interim loss of $A232.2m and advised that it expects to book a full-year underlying EBITDA loss of between $A25m and $A30m. CEO Paul Anderson has revealed plans for an 18-month "transformation program" that will seek to increase revenue and aggressively reduce costs. Ten’s directors have conceded that there is significant doubt about its ability to continue as a going concern, with a $A200m debt facility due to expire at the end of 2017.

CORPORATES
TEN NETWORK HOLDINGS LIMITED – ASX TEN, FOXTEL MANAGEMENT PTY LTD, WIN CORPORATION PTY LTD, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Jobs to go at NAB as banks face cost squeeze

Original article by Richard Gluyas
The Australian – Page: 19 : 20-Apr-17

Australian banks are continuing to downsize their workforces amid rising costs, falling net interest margins and new capital requirements. The ANZ Bank has advised that it shed 35 IT jobs in early 2017, while National Australia Bank recently told staff that it intends to cut about 500 jobs. However, NAB will create 400 new jobs, with some displaced staff likely to be redeployed. There was a 2.4 per cent reduction in full-time staff in Australia’s banking industry in 2015-16.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

News to cut jobs in $40m cost saving

Original article by Max Mason
The Australian Financial Review – Page: 14 : 12-Apr-17

News Corp Australia has revealed plans for its third round of redundancies in less than two years. The staff cuts are expected to result in a significant reduction in the number of photographers at some metropolitan mastheads, while some journalists are also likely to be retrenched. News Corp is expected to rely more on the use of freelance photographers and wire agencies as it seeks to reduce costs by $A40m. Fairfax Media recently announced plans to reduce costs by $A30m.

CORPORATES
NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, FAIRFAX MEDIA LIMITED – ASX FXJ, AUSTRALIAN ASSOCIATED PRESS PTY LTD, GOOGLE INCORPORATED, FACEBOOK INCORPORATED, FOXTEL MANAGEMENT PTY LTD, TEN NETWORK HOLDINGS LIMITED – ASX TEN

Forrest cautious on iron outlook

Original article by Andrew White
The Australian – Page: 15 & 16 : 13-Jan-17

Iron ore is trading at around $US80 a tonne, although it is tipped to fall to $US51.60 by mid-2017 and $US46.70 in 2018. The price of the steel input bottomed at $US36 per tonne in 2015, prompting Fortescue Metals Group to slash its debt and reduce its workforce. Fortescue also reduced its costs to just $US14.31 per tonne, but chairman Andrew Forrest says the group aims to achieve further cost reductions given the outlook for the iron ore price. Forrest also continues to advocate action to end slavery, and he has urged all Australian companies to take a similar stance.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, WALK FREE FOUNDATION, MINDEROO FOUNDATION, ROY HILL IRON ORE PTY LTD, VALE SA, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Westpac returns hit by need to build capital

Original article by James Eyers
The Australian Financial Review – Page: 11 & 15 : 8-Nov-16

Westpac has posted a 2015-16 cash profit of $A7.8bn. Its return on equity fell by 1.85 per cent to 14 per cent in the year to 30 September 2016, and its ROE target has been scaled back from 15 per cent to 13-14 per cent due to factors such as new capital requirements for the banking sector. PwC estimates that the combined ROE of the four major banks fell by 127 basis points to 13.75 per cent in 2015-16. Meanwhile, Westpac will seek to reduce its cost-to-income ratio from 42 per cent at present to less than 40 per cent

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, PRICEWATERHOUSECOOPERS AUSTRALIA (INTERNATIONAL) PTY LTD, CITIGROUP PTY LTD, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, BANK FOR INTERNATIONAL SETTLEMENTS. BASEL COMMITTEE ON BANKING SUPERVISION, KPMG AUSTRALIA PTY LTD, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Fortescue to challenge Rio Tinto’s cost crown

Original article by Peter Ker
The Australian Financial Review – Page: 17 & 22 : 28-Jul-16

Fortescue Metals Group’s iron ore production cost fell to $US13.10 per tonne in June 2016, and averaged $US14.31/tonne during the June quarter. Fortescue expects its C1 production costs to be within the range of $US12 to $US13/tonne in 2016-17, and the group expects its iron ore shipments to be between 165 million and 170 million tonnes for the year. Fortescue has significantly reduced its production costs in recent years, with unit costs averaging $US34.03 per tonne in 2014. Fortescue shares rose $A0.29 to $A4.41 on 27 July.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, VALE SA, MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD

Low prices knock sense into producers

Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 27 : 10-Jun-16

There is growing recognition among Australian energy groups of the need to continue reducing costs, amid sustained weakness in the crude oil price and a growing oversupply in the LNG market. Santos CEO Kevin Gallagher has suggested greater collaboration among rival LNG groups and has raised the possibility of LNG infrastructure being owned by independent operators rather than producers. Meanwhile, Woodside Petroleum CEO Peter Coleman has acknowledged that the LNG projects in Queensland have cost much more than originally budgeted.

CORPORATES
SANTOS LIMITED – ASX STO, WOODSIDE PETROLEUM LIMITED – ASX WPL, OIL SEARCH LIMITED – ASX OSH, NOVA SYSTEMS, ORIGIN ENERGY LIMITED – ASX ORG, AUSTRALIAN PETROLEUM PRODUCTION AND EXPLORATION ASSOCIATION LIMITED, INTERNATIONAL ENERGY AGENCY, CLOUGH LIMITED, McKINSEY AND COMPANY, CB&I INCORPORATED, SHELL COMPANY OF AUSTRALIA LIMITED