(Alliance News) - The following is a summary of top news stories Thursday.
----------
COMPANIES
----------
Oil major Royal Dutch Shell outlined an ambitious plan to go net zero on carbon emission by 2050, while also aiming to reduce debt and maintain a "progressive dividend policy". Shell said it wants to reduce net debt to USD65 billion. It also aims to "maintain the progressive dividend policy", planning payout growth of around 4% per year. Shell said it thinks carbon emissions for the company peaked in 2018, and oil production peaked in 2019. "Shell will continue with short-term targets that will drive down carbon emissions as we make progress towards our 2050 target, linked to the remuneration of more than 16,500 staff," the company said. Shell aims to reduce net carbon emissions by 45% by 2035 and to eliminate net emissions completely by 2050.
----------
Drugmaker AstraZeneca's 2020 revenue rose 9.2% to USD26.62 billion from USD24.38 billion, with pretax profit more than doubling to USD3.92 billion from USD1.55 billion. Revenue was up 10% at constant currency. For the final quarter, revenue jumped 11% to USD7.41 billion, beating company-compiled consensus estimates of USD7.20 billion. Its annual payout was unchanged at USD2.80. For 2021, total revenue is "expected to increase by a low-teens percentage", though guidance does not account for any sales of its Covid-19 jab, nor does it include the contribution from soon-to-be acquired Alexion Pharmaceuticals. That deal is expected to close in the third quarter of the year.
----------
The World Health Organisation said Wednesday that AstraZeneca's vaccine could be used on people aged over 65 and also in places where new variants of the virus are circulating, following recent questions over the efficacy of the firm's jab. AstraZeneca commented on Thursday: "The University of Oxford, however, subsequently announced that a separate exploratory analysis of the COV005 phase 1/2 South Africa trial, to be published in preprint in due course, showed that the vaccine had limited efficacy against mild-moderate disease caused by the B.1.351 South African variant. It was not possible to ascertain efficacy against severe disease and hospitalisation caused by this variant, given that subjects in the trial were predominantly young, healthy adults."
----------
Soft drinks bottler Coca-Cola HBC posted a 13% fall in net sales revenue in 2020 to EUR6.13 billion from EUR7.03 billion. According to the market consensus cited by Vuma, total reported revenue was expected to fall by 12% in 2020 to EUR6.15 billion. Annual pretax profit was 10% lower at EUR593.9 million from EUR661.2 million. But the bottler edged its payout 3.2% higher to EUR0.64, with consensus forecasts tipping a 16% cut to EUR0.52. Unit cases fell 5.7% annually, demonstrating how badly volumes were hit by Covid-19 lockdowns. However, a slightly greater fall of 6.0% was expected.
----------
Coca-Cola European Partners posted a 9.5% fall in volumes in 2020, or 10% on a comparable basis. Revenue dropped 12% to EUR10.61 billion from EUR12.02 billion and pretax profit plunged 52% to EUR1.45 billion. The company noted that its takeover of Australian peer Coca-Cola Amatil remains subject to shareholder approval, court approval, and a green light from the New Zealand Overseas Investment Office. "Further updates will be provided in due course," CCEP added.
----------
RELX posted a drop in profit for 2020 as, while its three largest business areas performed well, its Exhibitions segment was hit by the coronavirus pandemic. Revenue for 2020 fell 10% to GBP7.11 billion, while pretax profit declined 20% to GBP1.48 billion from GBP1.85 billion. The information and analytics firm noted that its three largest business areas, STM, Risk and Legal, reported combined revenue of GBP6.75 billion, up 2% from GBP6.61 billion the year prior and representing 95% of the group's total revenue for 2020.
----------
Royal Mail hailed its "busiest ever quarter", amid a surge in e-commerce related deliveries over the festive period. Third quarter revenue jumped 20%, including a 43% rise in parcel revenue. The company said 496 million parcels were handled. "On our busiest day we delivered 11.7 million parcels, 32% more than our busiest day during the first national lockdown in 2020," the company said. "We now believe that Royal Mail revenue growth for the full year 2020-21 will be significantly beyond the top end of the scenario presented in November of GBP380 million to GBP580 million."
----------
Telstra said its earnings were hurt by the coronavirus pandemic in 2020. The Australian telecommunications company reported revenue of AUD10.98 billion - about USD8.50 billion - for the six months to the end of 2020, down 9.7% when compared to the prior year's revenue of AUD12.16 billion. Profit for the half-year slipped by 2.2% year-on-year to AUD1.13 billion. Underlying earnings before interest, tax, depreciation and amortization declined by 14% to AUD4.07 billion on a guidance basis with the two largest contributors to the decline being the estimated impact from the in-year national broadband network headwind and impact from Covid-19. Excluding these impacts, underlying Ebitda was broadly flat compared with the prior year. Telstra maintained its dividend at 8 Australian dollar cents per share.
----------
Zurich Insurance Group reported a decline in profit in 2020, with the first half hurt by Covid-19, though it reported a return to growth in the second half. Zurich said business operating profit came in 20% lower year-on-year in 2020 at EUR4.24 billion, with net income slipping by 8% on the prior year to EUR3.83 billion. Zurich Insurance explained that the Covid-19-related impact was USD852 million, including USD450 million in the property and casualty business. In addition, catastrophe losses were USD588 million higher than in 2019. More positively, the company said commercial insurance gross written premiums, which make up around two-thirds of the firm's Property & Casualty premiums, grew by 7% on a like-for-like basis in 2020. This was supported by significant rate increases in North America and Europe, as well as by improved customer retention.
----------
Deutsche Boerse said it is set for a further revenue growth following strong 2020 results. The Frankfurt stock exchange operator said net revenue in 2020 increased 9% when compared to the prior year to EUR3.21 billion, resulting in a EUR1.20 billion profit achieved in the year, in line with guidance and up 9% year-on-year. For 2021, the company said it expects to generate net revenue of EUR3.5 billion. The company also said it expects an grow Ebitda to around EUR2.0 billion.
----------
Credit Agricole reported a double-digit income fall in 2020. The Montrouge, France-based financial institution said group revenue in 2020 declined by 0.9% when compared to the prior year to EUR33.60 billion, resulting in a 35% fall in net income year-on-year to EUR4.69 billion. Overall, the company said the levels of activity across all of its business lines demonstrated good resilience over the full year. Credit Agricole said its Assurances unit recorded rebound in activities in the final quarter of 2020, with business volumes rising by 19% when compared to the third quarter. The company declared a dividend of EUR0.80 per share for 2020 compared to EUR0.70 paid the year ago.
----------
Dutch number two Rabobank said it plans to slash some 5,000 jobs over the next five years, partly blamed on the impact of the coronavirus crisis. Releasing its 2020 results, the Utrecht-based cooperative bank said "Covid-19 significantly affected the financial performance of Rabobank." Net profit fell by half from EUR2.2 billion in 2019 to EUR1.1 billion, it said in a statement. Bank top executive Wiebe Draijer however also blamed dipping figures on lower interest rates, a tightening of legislation and digitalisation in the banking sector.
----------
Uber Technologies late Wednesday reported a fall in annual revenue as the coronavirus pandemic hit demand for the ride-hailing firm's services, though its food delivery unit continued to perform well. For the fourth quarter to December 31, revenue was down at USD3.17 billion from USD3.75 billion the same period the year before, while its net loss narrowed to USD962 million from USD1.09 billion. The San Francisco, California-based firm posted a fourth-quarter loss per share of USD0.54, narrowed from a loss per share of USD0.64 the prior year. More positively, Delivery revenue, from its Uber Eats business, surged to USD1.36 billion in 2020 from USD418 million in 2019.
----------
MARKETS
----------
European markets were mixed Thursday after key Asian markets closed for holidays. Frankfurt's blue-chip index was outperforming peers, led by athletic apparel maker Adidas, up 3.4%. In London, Shell A shares were down 2.1%, with analysts commenting that its plans to reduce emission were not ambitious enough. Wall Street was pointed higher. Chris Beauchamp, chief market analyst at IG, said a "more positive atmosphere" was prevailing in global markets after US Federal Reserve Chair Jerome Powell calmed nerves about the direction of monetary policy.
----------
CAC 40: down 0.1% at 5,664.02
DAX 30: up 0.6% at 14,012.12
FTSE 100: up 2.70 points at 6,527.06
----------
DJIA: called up 0.2%
Nasdaq Composite: called up 0.5%
S&P 500: called up 0.3%
----------
S&P/ASX 200: closed down 0.1% at 6,850.10
Hang Seng: closed up 0.5% at 30,173.57 in half-day session
Nikkei 225: Tokyo market closed for National Foundation Day
----------
EUR: soft at USD1.2128 (USD1.2135)
GBP: soft at USD1.3828 (USD1.3845)
USD: unchanged at JPY104.67 (JPY104.66)
GOLD: up at USD1,842.63 per ounce (USD1,837.45)
OIL (Brent): down at USD61.02 a barrel (USD61.40)
(currency and commodities changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
The US economy is a long way from a strong job market and the experience of past recessions shows it could take years to recover, Fed Chair Powell said Wednesday. In addition to mass vaccinations to halt the Covid-19 health crisis, it will take a full suite of government policies to repair the damage done by the pandemic to the US labour market, he said in a speech. "Despite the surprising speed of recovery early on, we are still very far from a strong labour market whose benefits are broadly shared," Powell told the Economic Club of New York. He again noted the true jobless rate is about 10%, far above the official 6.7% rate in January, after adding in people who have given up looking for a job and workers who were laid off but misclassified as employed. The damage is not equally shared and has eroded gains from the decade-long recovery that preceded the pandemic and finally extended to minorities, especially African Americans, he said.
----------
Bank of England Governor Andrew Bailey on Wednesday pressed the EU to agree a post-Brexit financial services deal by next month for the sake of pandemic recovery on both sides of the Channel. The costs of the City of London's lack of access since Brexit were laid bare in new data showing Amsterdam last month overtook London as Europe's top share trading hub. Rebutting some of the demands made by Brussels in return for the City to regain access to EU states, Bailey said Britain had no intention of creating "a low-regulation, high-risk, anything-goes financial centre and system". "We have an opportunity to move forward and rebuild our economies, post-Covid, supported by our financial systems. Now is not the time to have a regional argument," the UK central banker said in a speech. Euronext Amsterdam together with two other Dutch share markets last month displaced London's historic role as the main equities hub for Europe, the Financial Times reported. An average of EUR9.2 billion in shares were traded each day on the Amsterdam markets in January, more than four times their December figure and higher than London's EUR8.6 billion, the FT said.
----------
A recently signed free trade deal between Singapore and Britain entered into force on Thursday, the city-state's Trade & Industry Ministry said. The agreement, which has been "provisionally applied" since January 1, "will deepen the strong economic relations both countries share," according to Singapore's Trade Minister Chan Chun Sing. The deal, the first between Britain and one of the 10 members of the Association of Southeast Asian Nations, will "strengthen our roles as business hubs in our respective regions," Chan's ministry said on Wednesday. The ministry said that the bilateral deal means British and Singaporean businesses "will enjoy the same benefits" as under an older EU-Singapore trade agreement.
----------
The Biden administration is backing away from Donald Trump's attempt to ban TikTok, asking a court to postpone a legal dispute over the proposed move as it reviews national security threats posed by Chinese technology companies. A court filing on Wednesday said the US Commerce Department was reviewing whether former president Trump's claims about TikTok's threat to national security justified the attempts to ban it from smartphone app stores and deny it vital technical services. Separately, the Biden administration has "indefinitely" shelved a proposed US takeover of TikTok, according to a Wall Street Journal report. Last year, the Trump administration brokered a deal that would have had US corporations Oracle and Walmart take a large stake in the Chinese-owned app on national-security grounds. The unusual arrangement stemmed from a Trump executive order that aimed to ban TikTok in the US unless it accepted a greater degree of American control.
----------
Biden pressed Chinese leader Xi Jinping over human rights in Hong Kong and Xinjiang late Wednesday in their first call since the new US president took office on January 20, according to the White House. Setting the stage for what could extend the contentious relationship between the two superpowers, Biden offered Xi his "greetings and wellwishes" for the Chinese people on the occasion of the Lunar New Year celebrations, the White House said in a statement. But, laying his own groundwork for Washington-Beijing ties after four tumultuous years under predecessor Donald Trump, Biden immediately challenged his counterpart over China's projection of power in the Indo-Pacific region, the crackdown on pro-democracy activists in Hong Kong and the oppressive treatment of millions of Muslim Uighurs in the Xinjiang region. In the call Biden told Xi that his priorities were to protect the American people's security, prosperity, health and way of life, and to preserve "a free and open Indo-Pacific," the White House said in a statement on the call.
----------
The US Senate reconvened on Wednesday for the second day of the impeachment trial of former president Donald Trump. Democratic impeachment managers and Trump's legal team have each been allotted 16 hours to make their opening arguments. House Democrats spoke throughout the day on Wednesday, laying out their case for impeachment. Congressman Jamie Raskin of Maryland kicked off the day with an earnest speech arguing that Trump had abdicated his duty as commander-in-chief. "The evidence will show you that ex-president Trump was no innocent bystander," Raskin said. On Tuesday, both sides argued over whether it is constitutional to impeach a former president after he leaves office. Following a day of impassioned arguments, the senate voted 56-44 to proceed with the impeachment trial, with only six Republicans joining Democrats.
----------
Copyright 2021 Alliance News Limited. All Rights Reserved.
