PRESS DIGEST-Australian Business News - March 6
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)
-- Food manufacturer Goodman Fielder (GFF.AX) has rejected analyst concerns that it is at risk of breaching its banking covenants. 'Any suggestion that we are under pressure on our covenants is just plain wrong,' chief executive Peter Margin told investors yesterday. Goodman's market value has fallen by over A$400 million in the past week. Analysts say the recent share price fall is due to concerns over the company's ability to achieve its full-year guidance, as well as possible asset write-downs. Page 45.
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Utility infrastructure owner Hastings Diversified Utilities Fund (HDF.AX) yesterday reduced its annual dividend by more than half to A12 cents a share, down from the previous year's A28.5 cents. Hastings also announced it would inject A$20 million of debt into its British water utility, South-East Water, raising concerns about how the fund will service a $110 million convertible debt from mid-2010. Hastings said an 'orderly asset divestment process' would allow the fund to realise value for investors. Page 45.
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Diversified regional business group Ruralco Holdings (RHL.AX) yesterday said it expects net profit for its first-half, which ends March 31, to fall by 45 percent to 55 percent compared to the previous year's result of A$10.6 million. Managing director John Maher would not comment on a possible dividend cut, saying the board had not yet made a decision on the issue. Mr Maher said the group had been most affected by the downturn in its real estate arm, and that the company has started a cost and capital management program. Page 46.
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Federal Communications Minister Stephen Conroy yesterday restated the Government's commitment to the construction of its national broadband network, and is expected to announce the winner of the tender for the A$10 billion-plus project later this month. Senator Conroy said the current financial crisis made investment in broadband an even higher priority for the Government. Communications company Telstra this week questioned the ability of bidders to raise funding for the project. Page 47.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
-- Representatives from Australia's major banks and associations representing the financial services industry yesterday met with Federal Superannuation and Corporate Law Minister Nick Sherry to discuss regulation of credit agencies. Following the roundtable discussion, the Australian Bankers Association said that there is now 'a real commitment to improve the accountability and transparency of the ratings agencies.' Prime Minister Kevin Rudd recently criticised rating agencies for their role in the financial crisis. Page 17.
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West Australian (WA) company Perdaman Chemicals and Fertiliser has received approval from the WA Government to construct a A$3.5 billion urea fertiliser plant in the town of Collie, south of Perth. Perdaman chairman Vikas Rambal said the plant, which aims to produce 2 million tonnes of urea a year by 2013, would generate around A$850 million a year, as well as creating 1500 jobs during the project's construction, with up to 250 staff required for the plant's ongoing operation. Page 17.
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Tom Albanese, the chief executive of mining company Rio Tinto (RIO.AX), this week said that British investors in the company are becoming increasingly positive about the proposed US$19.5 billion deal with Chinese aluminium company Chinalco. Rio is listed on both the London and Australian markets, with 78 percent of stock listed in London. Despite growing acceptance of the value of the proposed deal, analysts say many investors remain opposed in principle to providing Chinalco the sole opportunity of increasing its stake. Page 17. Continued...
