Major International Business Headlines Brief::: 18 May 2018

Fri May 18 10:10:12 CAT 2018

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Major International Business Headlines Brief::: 18 May 2018

 <http://www.mbca.co.zw/> 

*  Mauritius 2017 unemployment falls to lowest since 2008

*  Nigeria's parliament passes record 9.12 trln naira 2018 budget

*  Vitol, Glencore, Shell in running for Petrobras' Nigerian assets

*  S.Africa's Reserve Bank seen keeping rates at 6.50 pct next week

*  Morocco’s trade deficit rises 12 pct yr/yr in Jan-April

*  South African drugmaker Aspen secures 3.4 billion euro credit line

*  Investec sees steady earnings growth as it prepares for changing of the guard

*  China's Jinchuan Int'l to double African copper, cobalt output -exec

*  Uganda power distributor Umeme to spend $1.2 bln to expand grid

*  PayPal acquires Swedish payments firm iZettle

*  China drops sanctions probe into US sorghum imports

*  Iran nuclear deal: EU looks to avoid impact of US sanctions

*  CBS loses initial battle with shareholder

*  Ocado shares rise 44% on news of Kroger tech deal

*  Man Utd quarterly sales up by 8%

 <mailto:info at bulls.co.zw> 

Mauritius 2017 unemployment falls to lowest since 2008

PORT LOUIS (Reuters) - The unemployment rate in Mauritius fell to 7.1 percent last year from 7.3 percent in 2016, its lowest level since 2008, official data showed on Thursday.

Sugar workers prepare the land for sugar cane cultivation in Triolet, northern Mauritius in this undated photo. File.

Statistics Mauritius said the number of unemployed fell by 600 from 42,400 to 41,800. It said unemployment was now at its lowest since 2008 when the rate was at 7.2 percent.

The island’s workforce was estimated at 586,900, out of a population of 1.3 million, in 2017.

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Nigeria's parliament passes record 9.12 trln naira 2018 budget

ABUJA (Reuters) - Nigeria’s parliament passed a record 9.12 trillion naira ($29.8 billion) budget for 2018 on Wednesday aimed at boosting growth in west Africa’s biggest economy nine months before the country’s next presidential election.

Growth remains fragile after Africa’s top crude oil producer last year emerged from its first recession in 25 years. The recession was largely caused by low crude prices and militant attacks on energy facilities since oil sales make up two-thirds of government revenue.

The total sum laid out in the spending plan passed by the Senate is higher than the 8.6 trillion naira budget presented to parliament by President Muhammadu Buhari in November.

The budget was passed by the Senate, the upper chamber, and by lawmakers in the lower House of Representatives shortly afterwards. The budget still needs to be returned to Buhari to be signed into law.

“We must grow our economy away from oil. Hopefully, the current budget, when signed into law, should help us in this regard,” said Senate President Bukola Saraki.

Senate lawmakers said the increase from the plan presented by Buhari six months ago was due to the assumed oil price rising to $51 per barrel, up from $45 in Buhari’s earlier version.

The budget assumes crude oil production of 2.3 million barrels per day and an exchange rate of 305 naira per dollar. Brent crude stood at $78.43 per barrel by 1643 GMT.

“We still consider the oil price benchmark to be rather conservative given this year’s oil price outlook and would have preferred to see a steeper hike accompanied by lower borrowing,” said Olalekan Olabode, an economist at Lagos investment firm Vetiva Capital.

The budget proposes the use of 2.2 trillion naira to service debts and would operate a deficit of 1.73 percent of gross domestic product this year.

Delays in passing budgets, amid wrangling between the executive and legislature, are common in Nigeria and hindered the implementation of Buhari’s previous spending plans.

Buhari, who took office in 2015, plans to seek a second term in next February’s election. His handling the economy is likely to be a major campaign issue.

Budgets under Buhari, who took office in May 2015, have been Nigeria’s largest ever. But economists say implementation has been poor and failed to provide the type of capital expenditure needed to improve infrastructure.

“The implementation of fiscal policy is still weak and this year there is an additional risk of unproductive spending in the lead up to the election,” said Cobus de Hart, a senior economist at South Africa’s NKC African Economics.

Vitol, Glencore, Shell in running for Petrobras' Nigerian assets

LONDON (Reuters) - The world’s three largest oil traders are competing to buy the African arm of Brazil’s Petrobras that owns stakes in two major Nigerian offshore oil blocks, industry and banking sources with knowledge of the matter said, after submitting bids earlier this month.

Last November, state-controlled Petroleo Brasileiro SA, known as Petrobras, launched the sale of 100 percent of Petrobras Oil & Gas BV, or Petrobras Africa, as part of the heavily-indebted company’s plan to offload $21 billion in assets through 2018 as it also faces a massive corruption scandal.

Petrobras holds half the shares in the company while 40 percent are held by a subsidiary of Grupo BTG Pactual SA and 10 percent by Helios Investment Partners.

Bankers have previously estimated the value of the Petrobras venture to be about $2 billion.

The venture has stakes in two offshore blocks that contain two producing fields, the major Agbami field in OML 127, operated by a local Chevron affiliate and the Akpo field in OML 130 operated by Total SA.

The sale has attracted the top trading firms which are always on the hunt for long-term crude supplies. Mercuria and BP had also its potential.

In early May, three consortiums including the major trading companies submitted bids to buy Petrobras Africa.

Vitol bid together with the oil upstream subsidiary of U.S. private equity firm Warburg Pincus called Delonex and Canadian-listed Africa Energy Corp, an oil and gas exploration firm that is part of Sweden’s Lundin Group.

Glencore joined with Nigerian listed firm Seplat and French firm Maurel & Prom that is majority-owned by the Indonesian government. Indonesia’s state oil firm Pertamina also backs Maurel & Prom and owns a 20 percent stake in Seplat.

The third bidder was privately-held Famfa Oil together with Royal Dutch Shell.

Famfa Oil is one of the concessionaires in the operator of the Agbami oil field along with Chevron, Statoil and Petrobras. Chevron holds the majority stake.

Vitol, Glencore, Shell, Africa Energy declined to comment. Maurel, Famfa and Seplat did not respond for requests for comment.

Petrobras is expected to make a decision by the end of May. But the sources said that this could slide as there was a still a possibility that the bids might be split between the two oil block stakes.

Agbami produces about 240,000 barrels per day (bpd) while the Akpo field in OML 130 produces nearly 130,000 bpd with a second field Egina due to come onstream in the same block later this year.

S.Africa's Reserve Bank seen keeping rates at 6.50 pct next week

JOHANNESBURG (Reuters) - South Africa’s Reserve Bank will keep interest rates unchanged next week as an anticipated quicker rise in consumer prices over the coming months won’t drive inflation above target, a Reuters poll showed Wednesday.

All 25 economists surveyed in the past week predicted the central bank will hold rates at 6.50 percent at its May 24 meeting, which will follow last month’s losses by the rand and renewed weakness on Tuesday.

“They will probably hold steady, with the rand showing some vulnerability,” said Dennis Dykes, chief economist at Nedbank. “It illustrates the concerns that they have about the global situation.” However, he expected a reasonably neutral statement from Reserve Bank Governor Lesetja Kganyago.

The Bank cut its main interest rate to 6.50 percent in March, giving a boost to the economy, and is now expected to enter a prolonged period of inactivity, with no change forecast for the next 18 months at least.

“This current oil price is putting pressure on the inflation rate, especially if you consider the value-added tax (VAT) hike, we have seen the bottom or the best of inflation,” said Stanlib economist Kevin Lings.

In February the National Treasury announced a VAT increase for the first time in two decades, which could hurt consumer demand, to cap ballooning debt and close a large revenue shortfall.

“From here inflation will move higher, that obviously makes it more difficult to justify a rate cut,” Lings added.

Still, the rate of increase in consumer prices is not expected to breach the top-end of the Reserve Bank’s 3-6 percent target during the forecast horizon.

Emerging market currencies, including the rand, have been under pressure in the past month from a strong dollar bolstered by the Federal Reserve’s decision to raise U.S. rates in March and its apparent disposition to do so again.

In April a Reuters poll predicted the Fed would raise rates three more times this year. [ECILT/US]

Still the rand is expected to recoup some of its April losses against the dollar in the next 12 months - provided domestic economic growth improves. [ZAR/POLL]

Growth forecasts for South Africa have improved to 1.8 percent from 1.3 percent at the start of the year, even though mining and manufacturing shrank in March due to lingering policy uncertainty and lukewarm demand.

Growth for next year is expected to hit 2 percent.

Morocco’s trade deficit rises 12 pct yr/yr in Jan-April

RABAT (Reuters) - Morocco’s trade deficit grew 12 percent to 66.105 billion dirhams ($7.01 billion) in the first four months of 2018 compared with same period a year earlier, the foreign exchange regulator said on Wednesday.

The gap widened from 59.010 billion dirhams in January-April last year, as imports rose 9.2 percent to 158.817 billion. That outstripped a 7.2 percent increase in total exports to 92.712 billion dirhams from 86.485 billion, the data showed.

There was a 13.5 percent increase in equipment imports to 39.715 billion dirhams, a 10 percent increase in finished consumer goods to 35.581 billion, a 9.5 percent rise in energy products to 24.788 billion and a 3.8 percent increase in food imports to 17.402 billion.

The automotive sector topped Morocco’s exports with a rise of 19.1 percent to 23.905 billion dirhams, while exports of phosphates and derivatives fell 4.5 percent to stand at 13.552 billion.

Tourism receipts grew 18.1 percent to 21.095 billion dirhams from 17.858 billion last year, while remittances from Moroccans living abroad posted a 13 percent increase to 21.010 billion.

Foreign direct investments dropped 17.1 percent to 6.765 billion dirhams, down from 8.162 billion in first four months of last year.

South African drugmaker Aspen secures 3.4 billion euro credit line

JOHANNESBURG (Reuters) - Aspen Pharmacare, Africa’s biggest generic drugmaker, said on Thursday it had secured a 3.4 billion euro ($4 billion) credit facility for refinancing debt at three of its subsidiaries.

Aspen, which has operations in 50 countries, said the facilities were 70 percent oversubscribed and would be used for Aspen Finance, Pharmacare Limited t/a Aspen Pharmacare and Aspen Asia Pacific. It did not provide further details.

The drugmaker has been expanding rapidly outside its home base of South Africa, where a heavily regulated pharmaceuticals market has put a cap on growth.

Aspen, which in March reported a 26 percent rise in first-half earnings helped by its therapeutic focused brands, said it had secured the revolving credit facility from 28 banks internationally. It is structured across the euro, the South African rand and the Australian dollar with tenors of two to four years and a one-year extension option.

The firm makes branded and generic pharmaceutical products, as well as infant nutritional and consumer healthcare products.

($1 = 0.8480 euros)

Investec sees steady earnings growth as it prepares for changing of the guard

JOHANNESBURG (Reuters) - Anglo-South African investment bank and asset manager Investec Plc reported an increase in operating profit on Thursday, with funds managed by its asset management business topping 100 billion British pounds ($135 billion) for the first time.

The 5.6 percent rise in operating profit for the year ended in March indicates stability as Investec heads for a changing of the guard this year with co-founder Stephen Koseff set to step down as CEO in October and two other founding members of the business - Bernard Kantor and Glynn Burger - also due to retire.

Analysts do not expect any big strategy shift for the group, which reported ongoing operating profit of 701 million pounds ($949 million) for the full-year ended March 31, up from 663.7 million pounds a year earlier.

“Operating performance during the year was underpinned by sound growth in loans and funds under management and a solid recurring income base, despite a challenging backdrop in South Africa and the UK,” Koseff said in a statement.

Adjusted earnings per share before goodwill, acquired intangibles and non-operating items jumped 13.3 percent to 61.3 pence, the company said in a statement.

The board proposed a final dividend of 13.5 pence per ordinary share, equating to a full year dividend of 24 pence, up from 23 pence last year.

Uncertainty about the terms of Britain’s departure from the European Union and political uncertainty in South Africa continued to affect corporate and consumer confidence in those two markets during the period under review, Investec said.

The group’s wealth & investment and asset management businesses generated substantial net inflows taking fund management’s assets under management above 100 billion pounds, Koseff said.

Shares in Johannesburg-listed Investec were up 1 percent at 95.99 rand by 0704 GMT, while in London the group’s shares were flat.

Chairman Fani Titi and Hendrik du Toit - head of Investec’s asset management business - have been picked as the group’s new joint chief executives and will formally take charge in October.

($1 = 0.7401 pounds)

China's Jinchuan Int'l to double African copper, cobalt output -exec

HONG KONG (Reuters) - China’s Jinchuan Group International Resources plans to double its African copper and cobalt production in the next two to three years, its chief executive officer said on Thursday.

The company currently produces around 50,000 tonnes of copper and 5,000 tonnes of cobalt a year, Gao Tianpeng said at the LME Asia Week conference in Hong Kong.

“In the next to two three years we will double our capacity,” he said.

Miners are boosting copper and cobalt production to meet demand from an expected boom in electric vehicles.

Jinchuan’s mining unit, Metorex Group, is headquartered in South Africa and controls the Ruashi Mine in the Democratic Republic of Congo that produces copper and cobalt and in Zambia, the Chibuluma South copper mine.

Metorex produced 42,512 tonnes of copper last year, steady from the year before, and 4,638 tonnes of cobalt, up from 3,391 tonnes in 2016.

Uganda power distributor Umeme to spend $1.2 bln to expand grid

KAMPALA (Reuters) - Ugandan power distributor Umeme Ltd plans to spend $1.2 billion in the next seven years to revamp and expand the grid and has hired an adviser to explore options for raising the money, the company’s chief executive said on Wednesday.

The investments will be used to prepare for an expected rise in power expected to come online by 2020, CEO Selestino Babungi told Reuters in an interview.

The East African country is developing two new hydropower plants on the Nile - Karuma and Isimba - and when completed, they are expected to add a combined 780 megawatts (MW) of power to the grid.

When the two China-financed and constructed plants come online, they will roughly double the country’s existing generation capacity which currently stands at about 700 MW.

“We need to invest in new infrastructure to uptake the new generation: extending lines, building new substations, connecting more customers,” Babungi said.

Uganda’s energy market is largely seen as underexploited and holding significant potential for growth.

The grid reaches just 23 percent of the country’s 40 million people and power consumption, according Umeme, stands at 85 kilowatt hours per capita annually.

That’s below the average per capita consumption rate of 150 kilowatt hours for sub-Saharan Africa, excluding South Africa, according to a 2015 report by consultancy McKinsey.

Babungi said economic activities toward beginning crude oil production and an industrialisation drive by the government of President Yoweri Museveni was expected to expand consumption by 8 percent annually over the next five years.

Uganda discovered crude reserves estimated at 6.5 billion barrels in 2006 and has targeted production in 2020.

“We see better prospects ...with all these oil activities-the pipeline, the refinery, activities are starting to pick up. We believe this will have spill over effects on the electricity sector,” he said.

Last year Uganda signed a deal with neighbouring Tanzania to develop a crude export pipeline from oilfields in landlocked Uganda’s west to Tanzania’s Indian Ocean port of Tanga.

At 1,445 km, it will be the world’s longest electrically heated pipeline.

Last year Umeme, Uganda’s sole electricity distributor, saw its pre-tax profit plunge 77 percent, hammered by debt servicing costs.

Babungi said he was “expecting 2018 to be better” citing brighter economic growth forecasts by the central bank.

Uganda’s state-controlled pensions fund NSSF is Umeme’s largest single shareholder. South African funds including Allan Gray, Kimberlite Frontier Africa Master Fund and Investec Asset Management Africa Fund also owning major stakes.

PayPal acquires Swedish payments firm iZettle

PayPal has bought iZettle, a Swedish mobile payments company that sells a card-reader aimed at small businesses, for $2.2bn (£1.6bn).

The move boosts PayPal's in-store presence at a time when competition in the online payments sector is increasing.

The takeover comes less than three weeks after iZettle said it would list shares in Stockholm.

At the time the firm said the listing would help it raise money and expand.

When complete, the acquisition of iZettle will mean PayPal has an in-store presence in 11 markets in Europe and Latin America.

PayPal president Dan Schulman said: "This combination brings together iZettle's in-store expertise, recognised brand and digital marketing strength with PayPal's global scale, mobile and online payments leadership, and trusted brand reputation."

Founded in Stockholm in 2010, iZettle started out selling credit and debit card readers that could be plugged into smart phones and tablets.

It has more recently expanded with an e-commerce platform which tracks items such as sales and inventory for its customers.

The Swede leading the way to a cashless society

US-based Paypal was formerly part of eBay, but is now a standalone digital and mobile payments company. It claimed more than 200 million active customer accounts at the end of last year.

It owns the peer-to-peer payments company Venmo, which is popular in the US, and last year acquired Swift Financial, which makes business loans.

The firm said last month that it was considering additional acquisitions.

It is facing increased competition as more companies, including Apple and major banks, improve their digital offerings.

The tie-up with iZettle will increase PayPal's capacity with firms with physical retail operations.--BBC

China drops sanctions probe into US sorghum imports

China says it is dropping an anti-dumping probe into sorghum imports from the US, as the two sides discuss ways of easing trade tensions.

In April, Beijing introduced a high tariff on the imports as part of a tit-for-tat trade spat between with the US.

But China's commerce ministry has now said the measures affect consumers and are not in the public interest.

The US is the world's leading producer of sorghum, and is the largest supplier of the grain to China.

Sorghum is a grain used primarily to feed livestock, but it is also used to create ethanol, or drinking alcohol.

China said a final ruling on whether to continue April's 178.6% tariffs would be made after a further investigation.

Olive branch

Under his "America First" slogan, US President Donald Trump promised to counter what he describes as unfair global trade practices that put the US economy at a disadvantage.

China and the US have imposed - or threatened to impose - tariffs on various goods, in what observers warn could escalate into a larger trade war.

A delegation headed by China's Vice-Premier Liu He is currently in the US for trade talks and dropping the sorghum probe might be an olive branch for the negotiations.

Reality Check: Are we on the brink of a trade war?

Why a US-China trade war could hurt Asia

China opens car market after US tensions

Should the West suspect Chinese tech?

Earlier this year, the US announced it would impose import taxes on aluminium - including but not exclusively those from China.

Beijing has since responded with retaliatory tariffs of its own against the US on a range of goods, including pork and wine.

The US also claims that China has unfair intellectual property practices, such as those that have allegedly pressurised US companies into sharing technology with Chinese firms when doing business in the country.

Beijing, meanwhile, continues to claim that the US is dumping other products at cheaper-than-market prices into China, which is hurting Chinese farmers and manufacturers.--BBC

Iran nuclear deal: EU looks to avoid impact of US sanctions

The EU is to begin reviving legislation that will allow European companies to continue doing business with Iran, despite US sanctions.

The so-called "blocking statute" was introduced in 1996 to circumvent US sanctions on Cuba but was never used.

On Friday, the EU will begin redrafting and preparing the legislation so it applies to the latest Iran sanctions.

It will prohibit European companies from complying with the penalties and permit compensation for affected firms.

Washington is re-imposing strict sanctions on Iran, which were lifted under a 2015 international deal to control the country's nuclear ambitions.

The impact of Iran sanctions

Winners and losers as Trump quits Iran deal

The EU's billion-dollar deals at risk

Jean-Claude Juncker, the president of the European Commission, said the statute was being introduced to protect European firms.

"It's the duty of the EU to protect European business and that applies in particular to small and medium-sized enterprises," he told a news conference following a summit of EU leaders in Bulgaria on Thursday.

He added that the legislation was designed to deal with "extra-territorial" sanctions when they have an impact on the EU.

Why is the US imposing sanctions on Iran?

President Donald Trump pulled the US out of the Iran nuclear deal earlier this month and pledged to ramp up pressure on the country.

The agreement was signed by six world powers, alongside Iran, to curbed Iranian nuclear activities in return for the lifting of UN, US and EU sanctions.

But Mr Trump has denounced the "horrible" deal, and now Washington is re-imposing the strict sanctions.

Last week, the US sanctioned six people and three companies it said had ties to Iran's elite military force.

US individuals and entities are barred from doing business with them following the move.

The US position is at odds with that of France, Germany and the UK, which say they are committed to the agreement and to expanding trade with Iran.

What do the sanctions mean for Europe?

European businesses are worried that their ties with the US could be damaged if they continue doing Iranian deals.

Some of Europe's biggest firms had rushed to do business with Iran after the nuclear deal took effect.

In 2017, EU exports to Iran (goods and services) totalled €10.8bn (£9.5bn; $12.9bn), and imports from Iran to the bloc were worth €10.1bn. The value of imports was nearly double the 2016 figure.

Now, there are fears that billions of dollars' worth of trade and thousands of jobs could be jeopardised.

Some of the biggest deals that are at risk include:

French energy giant Total's deal, worth up to $5bn, signed to help Iran develop the world's largest gas field. Total now plans to unwind those operations by November unless the US grants it a waiver

Norwegian firm Saga Energy's$3bn deal to build solar power plants

An Airbus deal to sell 100 jets to IranAir--BBC

CBS loses initial battle with shareholder

US media company CBS has lost an initial court battle amid a dispute with one of its biggest shareholders over control of the firm.

A Delaware judge on Thursday lifted a temporary restraining order against the investor, National Amusements, which is owned by the Redstone family and has been pushing CBS to merge with Viacom.

The ruling is expected to prevent CBS from taking steps to reduce National Amusements' voting power.

CBS said it would continue to fight.

It said: "The ruling clearly recognises that we may bring further legal action to challenge any actions by [National Amusements] that we consider to be unlawful, and we will do so."

CBS sues key investor over Viacom merger

Viacom boss Philippe Dauman resigns following $72m settlement

And following the court's decision on Thursday, CBS went ahead with a board meeting at which it backed plans to reduce National Amusements' voting power.

The board voted to approve a special dividend that would cut the Redstone family's stake to about 20% from about 79%.

However, CBS said its decision was "subject to Delaware Court Approval".

'Significant threat'

Tensions between the two sides were triggered by Shari Redstone's efforts to merge CBS with Viacom, another National Amusements company.

Earlier this week, CBS said the proposal was not in the firm's interest.

It also announced plans to consider reducing National Amusement's voting power by issuing a special dividend at the board meeting on Thursday.

The firm argued that Ms Redstone's interference in the merger process and other actions posed "significant threat of irreparable and irreversible harm" to CBS.

CBS had sought a temporary restraining order against National Amusements ahead of the meeting, arguing that Ms Redstone would block the plan to reduce her voting power by changing the board or its bylaws.

However, Delaware Chancery Court Chancellor Andre Bouchard said "a truly extraordinary set of circumstances would be necessary to grant such a request".

"I am not convinced that the harm plaintiffs fear would be irreparable," he wrote.

"To the contrary, the court has extensive power to provide redress if Ms Redstone takes action(s) inconsistent with the fiduciary obligations owed by a controlling stockholder."

'Unprecedented motion'

National Amusements, which operates cinemas in the US, UK and Latin America, controls about 80% of the voting power at both CBS and Viacom through a dual share class structure. The firm's ownership stake is lower.

After CBS filed the lawsuit, National Amusements moved to amend the board's bylaws, requiring a supermajority for certain measures.

National Amusements said the judge's decision was "a vindication of National Amusements' right to protect its interests."

It said: "We are pleased by the court's decision to deny CBS and its special committee's unprecedented motion to try to deprive a shareholder of its fundamental voting rights."

Viacom and CBS were previously part of the same company, but Sumner Redstone, Shari's father, separated the two firms in 2005.

CBS subsidiaries include its flagship television network, television studios and the Simon & Schuster publishing firm.

Viacom includes Paramount, as well as media brands such as Nickelodeon,--BBC

Ocado shares rise 44% on news of Kroger tech deal

Shares in online grocer Ocado have surged by 44% after it struck a deal with US retail giant Kroger.

Ocado's technology will be used in the US exclusively by Kroger, which is one of the world's biggest grocery chains with annual sales of $122bn (£90bn).

Under the terms of the deal, Kroger will also take a 5% stake in Ocado.

The agreement is the latest in a series of deals that Ocado has struck with retailers to share its technology that automates online grocery orders,

The Kroger deal is the fourth agreement Ocado has reached in six months, and marks its first foray into the US.

Shares in Ocado started the day worth 552p, rose at one point to 995p, and ended the day worth 797p.

The Ocado robot swarms that pack your shopping

James Lockyer, analyst at Peel Hunt, says that one of the reasons that Ocado's deal with Kroger is so "transformational" is because of the sheer number of robotic warehouses that British company could build for its new US customer.

Under its agreements with Group Casino of France and Canada's Sobeys it will build one automated warehouse for each, under the deal with Kroger Ocado will build between three and 20.

Ocado and Kroger are already looking to identify the first three sites for automated warehouse facilities in the US, and are aiming for up to 20 sites over the first three years of the agreement.

As the deal with Kroger is exclusive, Ocado said it would now end talks with other US-based retailers.

In the past few months, Ocado has struck a deal to share its technology with with ICA Group in Sweden. It also operates the online business of the UK's fourth largest supermarket, Morrisons.

'Ocado is making great strides in the global grocery market," said Laith Khalaf, senior analyst at Hargreaves Lansdown.

"The company is known in the UK as an online supermarket, but that's just the tip of the iceberg, as Ocado is primarily a technology and logistics firm with the potential to license out its services to grocers around the world.

"Indeed there seems to be a bit of a queue forming, made up of those who want to play catch-up in the digital retailing age, and consequently Ocado now has a foothold in the hugely important US market, as well as the UK, France and Canada."

Long road to profit

Ocado was set up in 2000 by former Goldman Sachs bankers Tim Steiner, Jonathan Faiman and Jason Gissing - though Mr Steiner and Mr Faiman had known each other since nursery school in North London.

The company's launch was helped by Waitrose, the upmarket supermarket group, which injected £46m to help build Ocado's distribution base in Hertfordshire.

In return, Waitrose supplied Ocado and took a 40% in the fledgling business.

For years Ocado was criticised for not making a profit and when it first sold shares on the stock exchange in 2010 it had to cut the offer price.

Also, for a long time, there were questions about how Ocado could expand its business given its contractual ties to Waitrose.

It eventually signed a £216m deal with Morrisons in 2013 to operate a new online grocery service for the supermarket group.

As of 2018, Mr Steiner is the only member of the founding trio to remain at Ocado, where he is chief executive.

Mr Gissing retired in 2014, while Mr Faiman departed in 2009 and has since entered the oil industry by investing in and becoming chairman of exploration group Neos.--BBC

Man Utd quarterly sales up by 8%

Manchester United has seen its third quarter revenues rise by 8.1% to £137.5m, from £127.2m a year before.

The Old Trafford club, which plays against Chelsea in the FA Cup final on Saturday, also recorded a small profit for the quarter of £100,000.

Despite defeat by Spain's Sevilla in the Champions League the club has stuck to its revenue targets for the current year, of £575m to £585m.

The club finished second in the Premier League behind rivals Manchester City.

Ed Woodward, executive vice chairman, said: "As another season nears its close, we have achieved our highest number of points and finish since 2012-13 and we look forward to another trip to Wembley.

"We anticipate another successful summer tour in the United States in preparation for the 2018-19 season."

Broadcast revenues were up 26.4% at £39.7m. Commercial revenues were slightly higher, and matchday income was 6% higher at £31.1m.

New deals

Four sponsorship deals were signed during the three months to April including new deals with Chinese insurance firm PingAn and sports nutrition firm Science in Sport.

A deal with South Korean pharmaceuticals company Cho-A-Pharm was renewed, and one with Chinese mattress maker Mlily was extended.

However, total sponsorship revenues for the quarter were down by 0.2% to £41.7m compared with a year before.

Wages for the quarter were £75.1m, an increase of £8.6 million, or 12.9%, "primarily due to player salary uplifts related to participation in the Uefa Champions League".

But other operating expenses for the quarter were £26.3m, a decrease of £4.4m, or 14.3%, reflecting lower home domestic cup gate share costs, reduced travel costs and a reduction in foreign exchange losses.

Net debt at the end of March stood at £301.3m, a decrease of 17.7% over the year.--BBC

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Workers’ Day

01/05/2018

Africa Day

25/05/2018

Zimbabwe

Heroes’ Day

Zimbabwe

13/08/2018

Zimbabwe

Defence Forces Day

Zimbabwe

14/08/2018

 <mailto:info at bulls.co.zw> 

DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has been compiled from sources believed to be reliable, but no representation or warranty is made or guarantee given as to its accuracy or completeness. All opinions expressed and recommendations made are subject to change without notice. Securities or financial instruments mentioned herein may not be suitable for all investors. Securities of emerging and mid-size growth companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

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