STRATEGIC PLANNING – AUSTRALIA

Rio Tinto mulls iron ore boost as Vale struggles

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Original article by Peter Ker
The Australian Financial Review – Page: 17 & 24 : 10-May-19

Rio Tinto Jean-Sebastien Jacques says the resources giant will only increase its Pilbara iron ore shipments if doing so makes financial sense. The price of the steel input has rallied in the wake of supply disruptions following a tailings dam collapse at a Vale mine in January, and it was trading above $US94 per tonne on 9 May. Meanwhile, just six per cent of shareholders at Rio Tinto’s Australian annual meeting supported a Market Forces resolution which would have required Rio Tinto to set carbon emission reduction targets for its customers.

CORPORATES
RIO TINTO LIMITED – ASX RIO, VALE SA, MARKET FORCES, FRIENDS OF THE EARTH, GRANGE RESOURCES LIMITED – ASX GRR, BHP GROUP LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, ROY HILL HOLDINGS PTY LTD

Clock ticks on digital bank’s goals

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Original article by Joyce Moullakis
The Australian – Page: 21 : 9-May-19

Digital bank 86400 will seek to attract new shareholders via a capital raising that will be managed by Morgan Stanley. 86400 could potentially raise up to $250m, but CEO Robert Bell says the final amount will depend on demand from local and international investors. The company has applied for a full banking licence, and Bell expects this to be granted shortly. Rival digital bank Judo recently gained a full banking licence.

CORPORATES
86400 PTY LTD, JUDO BANK PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED, CUSCAL, MACQUARIE GROUP LIMITED – ASX MQG, ATOM BANK, METRO BANK, VOLT BANK LIMITED, XINJA BANK LIMITED, TEMENOS, AMP LIMITED – ASX AMP

Smart trucks for Rio’s future mine

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Original article by Brad Thompson
The Australian Financial Review – Page: 15 : 8-May-19

WesTrac has secured a deal to supply Rio Tinto’s Koodaideri iron ore mine in the Pilbara with 20 autonomous Caterpillar haulage trucks. The contract, which is said to be worth about $US200m ($285m), also includes four autonomous blast drills and other industrial equipment. WesTrac CEO Jarvas Croome notes that miners are increasingly opting to buy haulage trucks that are autonomous-ready rather than converting them after purchase. Production at Koodaideri is slated to commence in 2021.

CORPORATES
RIO TINTO LIMITED – ASX RIO, WESTRAC HOLDINGS PTY LTD, CATERPILLAR, SEVEN GROUP HOLDINGS LIMITED – ASX SVW, BHP GROUP LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG

ANZ to cut $1bn in search of growth

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Original article by Joyce Moullakis
The Australian – Page: 17 & 22 : 2-May-19

The ANZ Bank has posted a 2018-19 interim cash profit of $3.56bn, which is two per cent higher than previously. The result for the six months to 31 March included provision for $175m worth of remediation charges. CEO Shayne Elliott has flagged further cost-cutting measures in coming years, although he has downplayed talk of further staff cuts and branch closures. Meanwhile, Elliott says the banking sector’s mortgage loan repayment buffer of 7.25 per cent should be revised, given that the cash rate is just 1.5 per cent at present.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, TRIBECA INVESTMENT PARTNERS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA

Rio fast-tracks copper in hunt for growth

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Original article by Nick Evans
The Australian – Page: 20 : 2-May-19

Resources group Rio Tinto has signalled that it will ramp up its capital investment in coming years. Rio executive Stephen McIntosh has told a conference that its capital expenditure has risen above depreciation levels again, after falling in 2016 following the completion of iron ore expansion projects. McIntosh says a priority for Rio Tinto will be to determine the extent of the copper resources at its Winu discovery in Western Australia.

CORPORATES
RIO TINTO LIMITED – ASX RIO, ALUMINIUM CORPORATION OF CHINA LIMITED

News mulls its options in big Fox refinance

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Original article by Max Mason, Tony Boyd
The Australian Financial Review – Page: 30 : 29-Apr-19

Asian investors are said to have expressed interest in a potential $2.5bn refinancing deal for pay-TV group Foxtel. Major shareholder News Corp is believed to be considering a range of options for the refinancing, rather than raising the entire amount via debt. These options are said to include an equity injection of up to $500m or a direct loan from News Corp. Foxtel is facing growing competition from subscription video-on-demand services such as Stan and Netflix; it could also potentially lose customers to its own Kayo Sports streaming service.

CORPORATES
FOXTEL MANAGEMENT PTY LTD, NEWS CORP AUSTRALIA PTY LTD, NEWS CORPORATION – ASX NWS, TELSTRA CORPORATION LIMITED – ASX TLS, STAN ENTERTAINMENT PTY LTD, NETFLIX INCORPORATED, KAYO SPORTS, FOX SPORTS AUSTRALIA PTY LTD

ANZ set for growth as it turns corner in Asia

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Original article by James Eyers
The Australian Financial Review – Page: 17 & 20 : 5-Apr-19

The ANZ Bank has been progressively rebuilding its institutional banking business in Asia, which has been its key focus in the region since abandoning retail banking growth plans. ANZ now boasts about 6,500 institutional customers in Asia, compared with some 28,000 at its peak, while staff numbers in the region have been reduced from 8,000 to 6,000 and there was a 16 per cent reduction in costs during 2017-18.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, HSBC HOLDINGS PLC, STANDARD CHARTERED BANK PLC, CITIGROUP INCORPORATED, GREENWICH ASSOCIATES PTY LTD

Woolworths bites the bullet on Big W

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Original article by Sue Mitchell
The Australian Financial Review – Page: 13 & 18 : 2-Apr-19

Woolworths has advised that it will close 30 of its Big W department stores, which will reduce the number of outlets by about 16 per cent. Two of Big W’s distribution centres will also be closed as part of the restructuring program, which will result in a one-off impairment charge of $370m. Woolworths has forecast that Big W will post a loss of least $80m in fiscal 2019, but CEO Brad Banducci says the retail giant is committed to restoring the chain to profitability. The store closures could result in the loss of up to 1,000 jobs, but Woolworths hopes to redeploy many employees.

CORPORATES
WOOLWORTHS GROUP LIMITED – ASX WOW, BIG W DISCOUNT STORES, EG GROUP, PLATO INVESTMENT MANAGEMENT LIMITED, CREDIT SUISSE (AUSTRALIA) LIMITED, KMART AUSTRALIA LIMITED

Chronican plans to put NAB back in business

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Original article by James Eyers
The Australian Financial Review – Page: 1 & 18 : 25-Mar-19

Business banking will be a key focus of National Australia Bank’s growth strategy, says incoming chairman Philip Chronican. He notes that NAB has the biggest presence in Australia’s business banking market, particularly in the small business sector. Chronican has also identified automation as an area in which NAB is lagging behind its rivals, and stresses the need to reduce costs. Other priorities for NAB include appointing a successor to former CEO Andrew Thorburn and restoring its reputation in the wake of the Hayne royal commission.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, FINANCE SECTOR UNION

Westpac retreats from financial advice

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Original article by James Frost
The Australian Financial Review – Page: 1 & 16 : 20-Mar-19

Westpac will cease serving its existing personal financial advice customers at the end of June, after striking a deal with Viridian to exit the sector. Westpac CEO Brian Hartzer concedes that its personal finance advice business has not been profitable for some time, and increased regulation was a major factor in its decision to withdraw from the sector. Westpac faces restructuring costs of $250m to $300m, while about 900 full-time equivalent employees will be impacted by the decision to exit financial advice. Westpac expects the move to result in annual savings of $280m by 2020.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, VIRIDIAN ADVISORY PTY LTD