PRESS DIGEST-Australian Business News - Oct 27
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)
Bunnings' managing director John Gillam says the Wesfarmers-owned (WES.AX) hardware group's property pipeline remains strong for construction of new sites. Mr Gillam says he is not worried about rival US-based retailer Costco entering the Australian market. Supermarket Woolworths (WOW.AX) is planning to compete with Bunnings via its A$88 million purchase of Danks (DKS.AX). In cooperation with US-based home improvement group Lowe's (LOW.N), the supermarket giant is hoping to open 150 big-box hardware stores in the next five years. Page 16.
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Steel makers BlueScope (BSL.AX) and OneSteel (OST.AX) are likely to make an announcement about their manufacturing plans in November. BlueScope chief executive officer Paul O'Malley says there will be a minor loss for the first half of next year, but UBS analyst Mark Busutil says that production rates are above market expectations, and guidance could bring a 'positive surprise'. Deutsche Bank analyst Emily Behncke says BlueScope's downstream coating operations are currently running at 90 percent. Page 16.
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Online holiday bookings business Wotif.com (WTF.AX) has performed strongly, despite the global recession, and intends to revamp its flight bookings engine on Lastminute.com and travel.com.au before the end of 2009. Wotif managing director Robbie Cooke says the Australian economy's 'robustness', and the strong Australian dollar, seems promising. The company sold a record 6.3 million room nights in the 2009 financial year, representing an increase of 1.4 million when compared with the previous period. Page 18.
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Aircraft maker Boeing (BA.N) will meet with Australian carriers Qantas Airways (QAN.AX) and Virgin Blue (VBA.AX) this week to discuss orders and repair issues. The move comes after extensive delays to its 787 Dreamliner plane. Boeing says that airlines in Australia, New Zealand and the South Pacific islands will need 670 new aircrafts in the next two decades. 'Oceania air travel growth is expected to be above 5 percent, compared to a world average growth of 4.9 percent,' says Boeing Commercial Airplanes marketing vice-president Randy Tinseth. Page 18.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
Department store retailer Myer has received a flood of applications for its due initial public offering (IPO). The IPO is worth over A$1 billion with retail investors due to represent around 50 percent of the register. The appeal of the float makes Myer one of the biggest offerings since the Telstra T1 tranche back in 1997. If successful, the Myer float would give the market a boost. A final price will be determined by Thursday, following an institutional bookbuild. Page 19.
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Miner Highlands Pacific (HIG.AX) reported yesterday that it was exploring an area near the Ok Tedi mine in Papua New Guinea. The area contains copper and gold resources. BHP Billiton (BHP.AX)(BLT.L) abandoned Ok Tedi in February 2002 due to environmental concerns. Highlands owns 8.56 percent of the A$1.5 billion Ramu Nickel mine currently being built in Madang province. Yesterday, the miner announced that it would accelerate development of the Nong River exploration area, about 20 kilometres northeast of Ok Tedi. Page 20.
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UBS analysts have reported that the imminent listing of department store Myer could be a risk for investors. In a report sent to UBS clients, analysts Ben Gilbert and Paul Wong noted that Myer should be priced at a discount compared with upmarket rival David Jones (DJS.AX). The analysts are concerned that once the company moves to the next phase it will have to deliver growth, which will be underpinned by the opening of 15 stores over the next five years. Analysts claim the share price should be discounted to A$4.35. Page 20. Continued...
