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PRESS DIGEST-Australian Business News - Jun 14

Source: Reuters - Thu, 13 Jun 2013 21:02 GMT
Author: Reuters
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Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy.

THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)

Australia may miss out on Asia's booming demand for food unless there are advances in productivity and infrastructure for the agriculture sector, said Andrew Crane, chief executive of CBH Group, Australia's second largest exporter of wheat. Exports from Russia, India and eastern Europe have increased, now constituting around 30 percent of international trade, explained Dr Crane. Page 13.

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Influential media entrepreneur Harold Mitchell is expected to announce in early July his retirement from executive chairmanship of Aegis Media Pacific, which paid A$363 million for his Mitchell Communications Group three years ago. Japanese advertising company Dentsu acquired Aegis for A$4.94 billion in March. Page 13.

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There is no indication that Newcrest Mining is likely to sell its 33 percent stake in Evolution Mining, said Evolution executive chairman Jake Klein yesterday. The statement followed speculation that Newcrest would divest assets after announcing its gearing could reach double its target level because of A$6 billion in write downs. Page 15.

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Capital expenditure for Rio Tinto's Simandou iron ore project in south-eastern Guinea has risen to between A$16 billion and A$20 billion, up from A$9 billion in 2011 and the expected start of production had slipped from 2015, said Guinea mines minister Mohamed Lamine Fofana. Rio was currently working to finalise the project's investment framework with the International Finance Corporation, the Aluminium Corporation of China Limited and the Guinea government, responded a Rio spokesman on Thursday. Page 15.

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The Federal parliamentary committee about to recommend abandoning the controversial reach rule, which would then allow a television licence holder to broadcast to over 75 percent of the Australian population, needs more time to determine legally enforceable safeguards for regional programs. The committee is requesting consent from both houses of parliament to present its report on Monday June 24 instead of the Monday before. Page 15.

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Coca-Cola Amatil (CCA) chief executive Terry Davis stated his business was fortunate that over half its product supply involves customers outside the supermarket chains. Due to price competition between the supermarkets and their lower volumes, CCA predicts a drop of between 8 and 9 percent in earnings before interest and tax for the first half of this year. Page 16.

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Suncorp Group has announced its A$1.6 billion portfolio of bad corporate and property loans has been sold to investment bank Goldman Sachs, who offered an average of A60 cents in the dollar. The sale will yield an after-tax loss for the second half of 2012-13 of between A$470 million and A$490 million for the bancassurer. Page 17.

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Westpac Banking Corporation has repurchased US$3.75 billion government-guaranteed United States senior medium-term notes with expiry dates of July 2014 and September 2014, taking its 2012-13 buyback of government-guaranteed bonds to A$7.3 billion. The transaction indicated that funding conditions had improved while credit growth remained soft, commented Mark Bayliss, a credit strategist with independent corporate adviser Aquasia. Page 17.

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THE AUSTRALIAN (www.theaustralian.news.com.au)

Gold miner Alacer has cited the reduced gold price, high labour and equipment costs and the impact of the carbon tax on fuel in its decision to place its two Kalgoorlie mines on the market. Justifying claims by industry observers that the gold mining industry has been shaken by the fall in gold prices, Canadian miner Barrick is also selling three goldmines in Western Australia. Page 17.

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Although Lisa Ho is attempting to buy back her self-named fashion business, it is thought administrators are close to brokering a deal with The Apparel Group. Retailer Myer had earlier been interested but a deal could not be reached. Lisa Ho Designs and Lisa Ho Retail were placed into voluntary administration with debts over A$11 million on 8 May. Page 17.

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Mortgage group RHG shareholders have expressed concerns over former director Trevor Loewensohn and non-bank lender Resimac's A$130 million unsolicited takeover proposal having not received any information from RHG's board since the offer was made three weeks ago. At least one shareholder asked the Australian Securities and Investments Commission to investigate. The board has said it would provide an update "at the appropriate time". Page 17.

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Perth based engineering group Clough yesterday upgraded its profit outlook and anticipates earnings before interest and tax of A$90 million in financial 2013. The decision to prepare for "leaner conditions" since early 2012 had paid off, said Clough chief executive Kevin Gallagher, as numerous iron ore and coal focused service companies warn of lower then expected profits. Page 18.

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Woolworths spin-off SCA Property Group purchased six neighbourhood shopping centres in Victoria and one in Queensland for A$135.8 million, including some tenanted by chain stores of competitor Wesfarmers. SCA is set to raise A$110 million through a A$90 million institutional placement and existing debt facilities. Page 19.

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News Limited chief executive Kim Williams told staff that Herald Sun editor-in-chief Phil Gardner has had a "fine" 28-year career with the company after announcing Monday will be Mr Gardner's last day. Competitor Fairfax also announced outgoings yesterday with general manager of food and wine Lisa Hudson and general manager of travel Lauren Quaintance leaving immediately. Page 19.

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National Broadband Network (NBN) telecommunications contractor Syntheo's future is under a cloud as 50 percent owner Service Stream has entered a trading halt to investigate performance issues. According to sources, Service Stream is increasingly keen to quit the NBN since it took over Syntheo's financial responsibilities earlier this year. Page 19.

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The Australian Stockbrokers' Foundation awards took place at Star Casino last night, raising funds for many charities including Lifestart and Sydney Children's Hospital Randwick. Morgan Stanley staffer Peter Richardson won Australia's best stockbroker, UBS took the Best Dealing Desk award from record breaking Goldman Sachs and the tongue-in-cheek "best operator award" went to ABN Amro Clearing for its FKP share-trading fiasco. Page 19.

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THE SYDNEY MORNING HERALD (www.smh.com.au)

A July interest rate cut from the Reserve Bank of Australia has become less likely after a surprise fall in the May unemployment rate was posted at 5.5 percent, seasonally adjusted. However, Citi chief economist Paul Brennan said the new data continues to show a softening labour market. In May, 5300 full-time jobs were lost but 6400 part-time jobs were created. Page 25.

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Australia's six biggest auditors have agreed to implement action plans to improve the quality of audits following an inspection report by the Australian Securities and Investments Commission. KPMG, Ernst & Young, PricewaterhouseCoopers, Grant Thornton, Deloitte Touche Tohmatsu and BDO will focus on enhancing the "level of professional scepticism" and "appropriateness of audit evidence", but will not consider rotating auditors among companies. Page 25.

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THE AGE (www.theage.com.au)

The Productivity Commission has found Australia's productivity progress is weak and likely to worsen. The multifactor productivity fell by an average of 1.1 percent each year in the four years since 2006. Mining and utilities productivity performance declined in 2011-12 by 10.5 percent and 5.4 percent respectively. Page 25.

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The latest Westpac Lost Super Report highlights the increasing growth of lost superannuation, which has risen from A$17.4 billion last year to A$18.1 billion this year. The report estimates half of the population with superannuation funds have probably lost some superannuation. Also, a third of Australians have more then one superannuation account. Page 27.

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