PRESS DIGEST-Australian Business News - May 12 05:27, Wednesday, 12 May 2004
(Compiled for Reuters by Media Monitors)
THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com.au)
Blood products group, CSL announced a A$100 million rationalisation program affecting jobs and plant in the United States, Germany and Austria. Analysts said the moves reflected the consolidation of an industry suffering from intense competition, price discounting and excess capacity. CSL production will be cut from 4.2 million litres to 3.1 million litres in an effort to realign supply and demand. Page 1.
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Glove and condom maker, Ansell , announced yesterday that it has appointed former Cadbury Schweppes executive, Douglas Tough, chief executive with effect from June 30. He will replace Harry Boon, who has spent three years establishing Ansell as a separate entity from the wreckage of former conglomerate, Pacific Dunlop. Tough will be based at Ansell's operational headquarters at New Jersey, in the United States. Page 14.
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Brewer Lion Nathan confirmed yesterday that it was in advanced negotiations on a joint venture with Dutch brewer, Heineken . The deal aims to use spare Lion Nathan capacity in Australia to brew and distribute Heineken beer under licence. At present, Heineken imports its beer from the parent company plant in the Netherlands. Heineken sold 12 million litres in Australia in 2003, generating A$47.5 million. Page 14.
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French stationery company, Lyreco, has made a takeover offer for Perth-based office supplies group, National 1, which is estimated to have between five per cent and 10 per cent of the local market. In a statement to the Australian Stock Exchange yesterday, National 1 chairman and managing director, Daniel Fogarty, welcomed the 14 cents a share offer from Lyreco, which is a family-owned company with operations in 18 countries. Page 14.
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Beverage maker, Coca-Cola Amatil , has appointed John Wartig, from Cadbury Schweppes , as its new chief financial officer. Wartig, an Australian, has been working overseas for Cadbury Schweppes for the past six years, most recently as senior vice-president of finance for the company's operations in the Americas. He replaces Mike Ihlein, who joined Brambles last month. Page 51.
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THE AUSTRALIAN (www.theaustralian.com.au)
Australian Chamber of Commerce and Industry chief executive, Peter Hendy, said last night that the Federal Budget was 'jam-packed with pre-election goodies,' but was nevertheless sound because it remained in surplus. UBS chief economist, Scott Haslem, said the Budget's net stimulus to the economy in 2004-05 would be approximately one per cent of gross domestic product, twice that of last year's Budget. Page 43.
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The Federal Budget expresses doubt about the sustainability of China's economic growth rate, but says its impact will see non-rural commodity exports grow by around nine per cent in 2004-05. The Budget papers say that further export growth is expected beyond 2004-05, but 'price growth will moderate as additional capacity comes on line.' The Budget says that increased capacity saw mining employment grow by 9.2 per cent in the year to the March quarter. Page 43.
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The Australian sharemarket will be boosted by superannuation measures in last night's Federal Budget, according to analysts. Treasurer, Peter Costello, announced the provision of A$2.1 billion over four years to increase the Government's co-contribution to superannuation for low-income earners. Mr Costello said the superannuation surcharge also would be reduced to 7.5 per cent by 2006-07, providing relief of A$610 million. Page 43.
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THE SYDNEY MORNING HERALD (www.smh.com.au)
The Business Council of Australia (BCA) last night welcomed the projected surplus of A$2.4 billion in the Federal Budget, but said it was concerned that the Budget was being 'underwritten' by burgeoning corporate taxes. The BCA said such a situation could not continue indefinitely without affecting Australia's international competitiveness. The council urged the Federal Government to reconsider the corporate tax rate of 30 per cent. Page 21.
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Last night's Federal Budget confirms an immediate increase to 150 per cent in the tax deductibility of oil exploration expenditure in designated remote offshore areas. The cost to revenue of the measure is estimated at A$17 million over the next four years. The Budget papers say that Australia has 40 offshore basins that show promise of becoming new oil provinces, but half are unexplored because of high cost and risk. Page 21.
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The shareholder class action against poker machine company, Aristocrat Leisure , was transferred yesterday from the Victorian Supreme Court to the Federal Court in New South Wales (NSW). Counsel for the shareholders also applied to the NSW Supreme Court for access to evidence in the case in which Aristocrat's former chief executive, Des Randall, is suing the company for alleged breach of contract. Page 23.
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Blood products manufacturer, CSL, yesterday announced the closure of 35 plasma centres across the United States, reducing the volume collected by one million litres. The company described the move as part of the 'extraordinarily complex integration' of its recent A$1 billion Aventis Behring acquisition. CSL managing director, Brian McNamee, reiterated his forecast that cost savings from the integration would eventually exceed A$500 million. Page 23.
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Net inflows to retail investment funds fell by eight per cent to A$2.2 billion in the March quarter, according to statistics released yesterday by Assirt Research. However, the increased value of shares held by the funds meant that their total assets increased by 3.2 per cent to A$277 billion. Assirt's figures show that the funds missing out on new inflows were those dealing in cash and equities, both local and overseas. Page 23.
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THE AGE (www.theage.com.au)
The superannuation industry has welcomed changes, announced in yesterday's Federal Budget, that are expected to see money flood into superannuation funds. According to Budget papers, the two main changes will cost the Federal Government A$2.7 billion over four years. Three-quarters of the total will be spent on helping low and middle-income earners increase their superannuation. Page B1.
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Revenue projections in the Federal Budget papers assume that Australian company profits will rise by 9.25 per cent next financial year, increasing the corporate tax take by 5.6 per cent to A$39.4 billion. Tax receipts from superannuation are estimated to increase by 25 per cent this financial year to A$4.51 billion, and by a further 22 per cent in 2004-05, to A$5.52 billion. Page B1.
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Clothing retailer, Just Group, confirmed it would buy back 203.7 million shares so that major shareholder, Catalyst Investment Managers, can sell out of its holding. The Catalyst buyback was outlined in the Just Group prospectus and approved by shareholders in March. The company agreed to pay the issue price of A$2.10 a share in the buyback, though the shares have yet to trade at that level. They closed three cents higher yesterday at A$1.94. Page B2.
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Woodside Petroleum announced a promising oil strike in a new exploration well in the Exmouth sub-basin, in Western Australia. Woodside said that analysis was continuing to determine whether the discovery was commercial, but preliminary interpretation indicated a 24-metre gas column and a 13-metre oil column. The find is within the WA-255-P joint venture with BHP-Billiton. Page B2. --
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