PRESS DIGEST-Australian Business News - Nov 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)
Department store retailer Myer (MYR.AX) yesterday released sales figures for the October quarter, with sales growing by 5.2 percent to A$717.1 million. According to analysts, Myer's less expensive product range helped the company's sales growth, which outstripped that of rival David Jones. However, both companies' inclusion of sales from recently refurbished stores in like-for-like sales figures has been criticised as confusing by investors and analysts. Page 43.
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Construction group Leighton Holdings (LEI.AX) yesterday held its annual general meeting in Sydney, with chief executive Wal King reporting a 25 percent increase in net profit for the September quarter, to A$130.9 million. Mr King, who has been criticised recently for receiving A$12.6 million in remuneration last year, said the company had a record A$38.2 billion in orders as of September. Page 43.
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Power generation company Energy Developments yesterday held its annual meeting in Brisbane, with shareholders protesting against the company's executive salaries. Energy Developments' remuneration report was rejected by 60.3 percent of votes, including those of New Zealand infrastructure group Infratil, which owns 32 percent of the company. Managing director Greg Pritchard last year earned A$1.47 million, a 62 percent increase from the previous year. Page 43.
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Mining company Xstrata's (XTA.L) A$120 million lawsuit against steel maker BlueScope Steel, for allegedly rejecting contracted coal shipments last year, is unlikely to be a precursor to widespread legal action, according to legal commentators. Rick Malone, a partner at Johnson Winter and Slattery, said the case involving Xstrata and BlueScope (BSL.AX) is unusual as the contract was coming to an end at the time. However, the case may lead to the re-examination of contracts within the industry. Page 45.
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THE AUSTRALIAN (www.theaustralian.news.com.au)
Wal King, the chief executive of construction company Leighton Group, yesterday criticised the practice of recruiting chief executives from the United States to head Australian companies. Mr King said 'You name me one American chief executive that's stayed in Australia? I think all they have done is ratchet up the salaries for guys like me.' Mr King has come under criticism after being paid A$12.5 million last year. Page 21.
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News Corporation (NWSA.O) chairman and chief executive Rupert Murdoch yesterday acknowledged that the media sector and the wider global economy are improving, but warned, 'I prefer to remain conservative in treating this recovery as still a little fragile.' Mr Murdoch made the comments at the release of News Corporation's first-quarter results, recording a better than expected 11 percent increase in net profit. Page 21.
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The Foreign Investment Review Board (FIRB) this week approved A$285.8 million of Chinese investment in Australia's resources sector, with six separate deals being approved over the past three weeks. The approvals come after comments from the board's executive director, Patrick Colmer, provoked confusion over the FIRB's attitude to foreign investment in the sector. Page 22.
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Brian Johnson, a banking analyst from broking firm CLSA, yesterday criticised the campaign by Australian banks against reforms proposed by the Australian Prudential Regulation Authority. Mr Johnson said that despite claims that Australian banks were unaffected by the financial crisis, they 'only survived given unprecedented action by the central bank and the government.' Page 23.
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THE SYDNEY MORNING HERALD (www.smh.com.au)
The parliamentary inquiry into the collapse of financial planning network Storm Financial has uncovered regulatory confusion over who is responsible for contacting customers regarding calls on margin loans. Storm executives have denied that they had a responsibility to pass on margin calls received from lenders. Macquarie Bank and Commonwealth Bank of Australia have also denied that they should be held responsible for the margin calls not being passed on to clients by Storm. Page 1.
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The chief executive of oil refining company Caltex (CTX.AX), Julian Segal, yesterday outlined the company's plans for responding to climate-change policies. Mr Segal acknowledged that Caltex's traditional oil refining business is likely to become less relevant, and said cleaner fuels will become more important. Mr Segal said Caltex saw the development of biofuels as a possible growth area for the company. Page 4.
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Transport logistics company Brambles' (BXB.AX) new chief executive, Tom Gorman, yesterday announced the appointment of Greg Hayes as the company's new chief financial officer. Analysts say that the appointment is likely to be the first of a number of changes within the company's management team over coming months. Mr Gorman commenced his new role at the start of this month. Page 5.
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The Australian Securities and Investments Commission is to undertake a review of the fees and legal expenses incurred by the court-appointed special liquidator to telecommunications company One.Tel, Paul Weston. The move follows a meeting of the company's creditors in August, which saw Mr Weston clash with creditors. Mr Weston has spent A$9.5 million since his appointment in 2003. Page 6.
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THE AGE (www.theage.com.au)
Toll-road operator Transurban has rejected a A$6.7 billion takeover offer from two Canadian retirement savings funds, however, analysts say a deal may still occur if the proposal is improved. The funds, Canada Pension Plan Investment Board and Ontario Teachers Pension Plan, are thought to have approached the board of Transurban yesterday in a bid to reopen talks. Page B1.
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Carrier Qantas Airways (QAN.AX) has told staff that the company's sponsorship department has been closed, and 'delivery of Qantas sponsorships has been outsourced to an external agency.' The airline is one of Australia's largest corporate sponsors, and the decision will see all future deals managed through an agency, believed to be M&C Saatchi (SAA.L). A review of all sponsorship deals is also taking place. Page B2.
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A single former partner of accounting firm Arthur Anderson is delaying the settlement of a A$500 million damages claim to creditors of collapsed insurance group HIH. The unnamed partner is the only one of 117 partners at the firm in 1998 who is not yet prepared to sign off on the settlement, and has been granted until December 20 to seek independent opinion on the proposed deal. Page B3.
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Federal Innovation Minister Kim Carr will today release a report on Australia's manufacturing sector which has found that poor management is hampering the A$100 billion sector and causing it to fall behind the manufacturing sectors of other economies. 'The fact is our major competitors are better at the management of manufacturing firms than we are, and government is very keen to work with industry to improve this,' Senator Carr will tell the Melbourne Institute today. Page B5.
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