FOOD
Danone sees lower margin
Danone SA has forecast a lower margin, and more acquisitions and divestments as new chief executive officer Antoine de Saint-Affrique seeks to turn around the world’s largest yogurt maker, which has been stagnating for about a decade. De Saint-Affrique plans to boost investment in key brands to spur growth, which would weigh on profitability this year, the Paris-based company said yesterday. The company said that recurring operating margin would be above 12 percent this year, implying it would reach the lowest level in more than a decade. Sales are predicted to grow 3 to 5 percent on a like-for-like basis through 2024.
TOYS
Lego sales soar 27%
Lego Group’s sales jumped 27 percent last year driven by new store openings in China and customers flocking back to its reopened shops, the toymaker said yesterday. The family-owned company said it had outpaced the toy industry in all major markets during the year, when sales of its colorful plastic bricks totaled 55.3 billion Danish kroner (US$8.08 billion). Net income rose to a record 13.3 billion kroner from 9.9 billion kroner in 2020. It opened 165 new Lego stores last year, most of them in China, bringing the total number of Lego-branded stores to 832 worldwide. However, Lego expects the growth rate to fall back to a single-digit percentage this year.
TELECOMS
Orange, Masmovil in talks
Orange SA and Masmovil Ibercom SA have entered exclusive merger talks in an attempt to consolidate the Spanish telecom market, in a deal that would give the combined company a total enterprise valuation of 19.6 billion euros (US$21.3 billion). The new company would take the form of a 50-50 joint venture, jointly controlled by Orange and Masmovil, a statement said yesterday. Masmovil carries a debt of about 6 billion euros, a spokesperson said, which would imply a cash payment being made to Orange to balance the merger.
FOOD
Greggs issues profit warning
British baker and fast food chain Greggs yesterday said that the surging cost of raw materials, energy and employee wages would limit any material profit growth this year after it reported record annual profit last year. Greggs, best known for its sausage rolls, steak bakes, vegan snacks and sweet treats, said cost pressures were more significant than it had initially expected. The company made a pretax profit of ￡145.6 million (US$190.8 million) in the year to Jan. 1, versus a loss of ￡13.7 million in 2020. Total sales were ￡1.23 billion, up 5.3 percent on 2019, before the COVID-19 pandemic impacted trading.
BANKING
Canadian CEO pay rises
Pay for the leaders of Canada’s five largest banks rose an average of 28 percent as the lenders’ earnings increased and shares gained. Total direct compensation for the chief executive officers climbed to a combined C$51.3 million (US$40.0 million) for fiscal 2021, which ended on Oct. 31 last year. The bump tops the 18 percent average increase in variable pay that the banks paid to their employees last year — and the 6.3 percent gain in total compensation per employee over the period. Royal Bank of Canada chief executive Dave McKay had the largest pay package at C$15.5 million.
Semiconductor business between Taiwan and the US is a “win-win” model for both sides given the high level of complementarity, the government said yesterday responding to tariff threats from US President Donald Trump. Home to the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), Taiwan is a key link in the global technology supply chain for companies such as Apple Inc and Nvidia Corp. Trump said on Monday he plans to impose tariffs on imported chips, pharmaceuticals and steel in an effort to get the producers to make them in the US. “Taiwan and the US semiconductor and other technology industries
A start-up in Mexico is trying to help get a handle on one coastal city’s plastic waste problem by converting it into gasoline, diesel and other fuels. With less than 10 percent of the world’s plastics being recycled, Petgas’ idea is that rather than letting discarded plastic become waste, it can become productive again as fuel. Petgas developed a machine in the port city of Boca del Rio that uses pyrolysis, a thermodynamic process that heats plastics in the absence of oxygen, breaking it down to produce gasoline, diesel, kerosene, paraffin and coke. Petgas chief technology officer Carlos Parraguirre Diaz said that in
CHIP WAR: Tariffs on Taiwanese chips would prompt companies to move their factories, but not necessarily to the US, unleashing a ‘global cross-sector tariff war’ US President Donald Trump would “shoot himself in the foot” if he follows through on his recent pledge to impose higher tariffs on Taiwanese and other foreign semiconductors entering the US, analysts said. Trump’s plans to raise tariffs on chips manufactured in Taiwan to as high as 100 percent would backfire, macroeconomist Henry Wu (吳嘉隆) said. He would “shoot himself in the foot,” Wu said on Saturday, as such economic measures would lead Taiwanese chip suppliers to pass on additional costs to their US clients and consumers, and ultimately cause another wave of inflation. Trump has claimed that Taiwan took up to
SMALL AND EFFICIENT: The Chinese AI app’s initial success has spurred worries in the US that its tech giants’ massive AI spending needs re-evaluation, a market strategist said Chinese artificial intelligence (AI) start-up DeepSeek’s (深度求索) eponymous AI assistant rocketed to the top of Apple Inc’s iPhone download charts, stirring doubts in Silicon Valley about the strength of the US’ technological dominance. The app’s underlying AI model is widely seen as competitive with OpenAI and Meta Platforms Inc’s latest. Its claim that it cost much less to train and develop triggered share moves across Asia’s supply chain. Chinese tech firms linked to DeepSeek, such as Iflytek Co (科大訊飛), surged yesterday, while chipmaking tool makers like Advantest Corp slumped on the potential threat to demand for Nvidia Corp’s AI accelerators. US stock
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