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Tag: Business

  • Asia markets rally as Trump delays China tariffs

    Asia markets rally as Trump delays China tariffs

    Shanghai led a rally across Asian markets Monday after Donald Trump said he would delay a hike in tariffs on Chinese goods citing “substantial progress” in trade talks and fuelling hopes of an end to their long-running stand-off. Optimism over the negotiations had already provided support to global equities, spurring a rally in January and February, but the president’s comments gave extra ammunition to investors to ramp up the buying.

    The news also fired currency markets with the yuan extending gains to a seven-month high, while other high-yielding, riskier units were also up against the dollar.

    Trump said on Twitter that the US “has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues”.

    He added: “As a result of these very productive talks, I will be delaying the US increase in tariffs now scheduled for March 1.”

    The president also said he planned to hold a summit with his Chinese counterpart Xi Jinping at his Mar-a-Lago estate in Florida to sign a deal.

    China’s Xinhua news agency added that the two sides had “made substantial progress on specific issues” including on transfer of technology, intellectual property and agriculture.

    ‘Sigh of relief’

    In morning trade, Shanghai jumped 2.8% and Hong Kong added 0.4% while Tokyo ended the morning 0.7% higher.

    Sydney and Singapore each put on 0.1%, while Seoul was flat, Taipei added 0.4% and Jakarta rose 0.3%.

    The gains in Asia followed another positive lead from Wall Street, where the Dow enjoyed its ninth straight weekly gain – the longest streak since May 1995.

    “This is a sigh of relief,“ said Ben Emons, managing director for global macro strategy at Medley Global Advisors. “Markets will still keep a level of caution, but this news is encouraging,“ he said.

    The upbeat sentiment lifted high-risk currencies, with the yuan hitting its highest level against the dollar since July, while South Korea’s won, the Australian dollar and the Indonesia rupiah were also well up.

    Forex traders will be closely watching speeches this week from top Federal Reserve officials – including chairman Jerome Powell’s appearance in front of lawmakers – hoping for clues about the bank’s monetary policy plans.

    Wall Street “will be looking for soothing comments about the future size of the balance sheet – the bigger the better – and insights into future rate hikes”, said Jeffrey Halley, senior market analyst at OANDA.

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  • Vietnamese airlines continue to be plagued by pilot shortage

    Vietnamese airlines continue to be plagued by pilot shortage

    With increasing demand for pilots as they expand, Vietnamese airlines have had to raise salaries, spend more on training and hire foreign pilots. Figures from the Civil Aviation Authority of Vietnam show that by 2020 Vietnam will need a total of 2,680 pilots for commercial flights, 1,320 more than now. Vietnam Airlines, the country’s flag carrier, needs to hire 193 more pilots to increase the number on its payroll to 1,293 pilots to meet demand in 2019, according to the carrier’s recent assessment report.

    The assessment forecast the demand to keep rising increasing to 1,340 by 2020 and 1,570 by 2025. This is a challenging number given the increasing shortage of pilots globally, according to industry insiders.

    According to a recent report from Boeing, the global aviation industry will need 790,000 new pilots by 2037, or double the current number, driven by an anticipated doubling of the commercial airplane fleet, record travel demand and tightening labor supply.

    Pilot training has always been extremely expensive, with stringent health and technical knowledge requirements, meaning that the number of pilots qualifying is always limited, according to industry insiders.

    A former Vietnam Airlines pilot revealed that because of the shortage, soon after he gave notice of termination he received many offers from airlines both domestic and foreign.

    He said many other pilots at Vietnam Airlines also constantly offered 15-25 percent higher salaries by head hunters.

    As a result the carrier has been focusing on hiring trainees. Duong Tri Thanh, its general director, said given the global shortage of pilots and carry out its expansion plans in time, Vietnam Airlines has been training internally and recruiting foreign pilots despite high costs.

    Similarly, Jetstar Pacific or Vietjet Air are facing difficulties filling their vacancies with pilots when trying to rapidly expand in South Korea, Japan, and other countries in Southeast Asia. Currently, the number of pilots at these firms is largely foreign due to limited domestic supply. Typically, at Jetstar Pacific, foreign pilots account for 80 percent of their fleet.

    However, foreign pilots can be hard to come by since many other companies in Asia can offer them better remuneration and working conditions.

    An aviation expert said airlines need to combat the pilot shortage by investing in training facilities and recruitment programs and subsidizing training for pilot trainees.

    Vietnam’s aviation industry has been growing rapidly in recent years. There were 12.5 million air passengers last year, up 14.4 percent from 2017.

    The number of flights in the country grew by 16 percent on average between 2010 and 2017, according to official data.

    Vienam’s five airlines are Vietnam Airlines, its low-cost carrier Jetstar Pacific, budget airline Vietjet Aviation, Bamboo Airways and Vietnam Air Services Co.

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  • Foot Locker boosts capital expansion

    Foot Locker boosts capital expansion

    Foot Locker has announced a US$275 million capital expenditure program for this year, with Asia singled out as a target market. The investment is $75 million more than the US-headquartered sports-shoe and apparel retailer allowed for last year. “The capital spending planned for this year reflects increased investments in the company’s store fleet in all existing regions, including Asia, and in its digital initiatives,” the company said in a statement.

    “In addition, the company will continue to spend capital to build out its supply chain and other infrastructure capabilities.”

    Chairman and CEO Richard Johnson said Foot Locker sees “exciting opportunities” to invest in the business this year. The capital commitment followed decisions to launch a share buy-back program and to pay a dividend to shareholders.

    “Taken together, these actions demonstrate that our board is confident that Foot Locker can simultaneously deliver strong financial results, invest in the long-term growth of the business, and provide meaningful returns to our shareholders,” he said.

    Foot Locker currently operates 3221 stores in 27 countries in North America, Europe, Asia, Australia and New Zealand.

    In Singapore, Foot Locker opened three stores last year, in Jem Mall, Century Square and Suntec City.

  • Swire Properties’ community ambassadors visit Taikoo Dockyard retirees in HK

    Swire Properties’ community ambassadors visit Taikoo Dockyard retirees in HK

    Swire Properties’ Community Ambassador held a gathering with some 40 retirees of Taikoo Dockyard. It has been a tradition to organise such gatherings during Chinese New Year since 2015 to stay in touch with the old Swire staff and foster friendship across generations. Hosted by Mrs Elizabeth Kok, Director & Senior Advisor at Swire Properties, the old staff of the Swire group shared their fond memories of working in the Island East area, where the Swire group once operated the largest shipyard in Hong Kong for over a century.

    The sharing session was followed by a visit to the LEGO model of Taikoo Dockyard at Cityplaza, which reminisced about working lives in the area. While looking back to the good old days, the old staff are also amazed by the transformation of the area which is now developed into a blue-chip private housing estate and a major commercial area, against the backdrop of Hong Kong’s rapid development in the past decades.

    Many of the participants had spent their entire career life in Swire for more than 40 years. Mr Lam, aged over 90, was in charge of electric machine room of Taikoo Dockyard. Bringing along his old staff card to the gathering as a way to share his memory, he treasured the rare opportunity to gather with his former colleagues and the Community Ambassadors.

    Mrs Elizabeth Kok, Director & Senior Advisor at Swire Properties, welcomed the veterans in the gathering. She remarked that the event was so meaningful that it offered the old staff a chance to revisit their former workplace at Cityplaza.

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  • Vietjet to ink $13 billion Boeing deal during Trump-Kim summit

    Vietjet to ink $13 billion Boeing deal during Trump-Kim summit

    Vietnamese budget airline Vietjet will sign next week a deal to buy 100 narrow-body Boeing aircraft. The signing will take place on the sidelines of the upcoming Trump-Kim summit, sources said. The sources also said Vietjet will finalize next week a provisional deal agreed last year to buy 100 narrow-body Boeing 737 MAX jets worth almost $13 billion at list prices.

    The U.S. Federal Aviation Administration (FAA) last week gave Vietnam a Category 1 safety rating, allowing local airlines to operate direct flights to the U.S.

    Vietjet, along with other local airlines, had previously expressed interest in operating direct flights to the U.S.

    The carrier, the largest private airline in Vietnam, had also signed a deal to buy Boeing 737 MAX narrow-body jets when former U.S. President Barack Obama visited Hanoi in 2016.

    It also finalized a deal in November last year with Airbus for 50 A321neo jets during a visit to Hanoi by French Prime Minister Edouard Philippe.

    Vietjet currently operates 40 domestic routes and 66 international routes. It has 385 flights daily within Vietnam and to places such as Japan, Hong Kong, South Korea, Taiwan, Singapore, mainland China, Thailand, Myanmar and Malaysia.

  • Godiva sells Asia business to South Korea’s MBK for $1bn

    Godiva sells Asia business to South Korea’s MBK for $1bn

    Belgian chocolatier Godiva has sold select assets to MBK Partners as part of a global strategy to grow the business fivefold. Under the terms of the transaction, MBK will purchase the retail and distribution operations in four of Godiva’s more than 100 markets: Japan, South Korea, Australia and the future rights to develop New Zealand. The transaction, anticipated to close mid year, includes consumer packaged goods (CPG), digital commerce, travel retail (for Japan and South Korea) and more than 300 retail stores, as well as the Godiva production facility in Brussels that supplies product to these markets. All remaining 100-plus markets will continue to be owned and operated by Godiva.

    While the terms of the deal were not disclosed and completion is conditional on the necessary approvals, once settled Godiva Chocolatier will retain exclusive brand ownership in all global markets, granting a perpetual license to MBK Partners. Godiva will continue to source its products from the Belgian facility together with the production facility it owns in the US, and its affiliate facilities in Istanbul, Turkey.

    “Since 2008, we have been very pleased with the performance of Godiva, having nearly doubled its revenue and the number of stores operating globally, and we continue to see tremendous upside for this brand moving forward,” said Murat Ulker, chairman of Godiva’s owner Yildiz Holding.

    “Realising the potential ahead, together with Godiva leadership, we conducted a strategic review to explore new ways for generating the necessary cash flow to fuel the robust growth. This transaction is an ideal solution that provides the momentum to fuel expansion in other high potential areas of our portfolio.”

    “We believe this deal is a win-win for everyone,” added Godiva CEO Annie Young-Scrivner. “It gives us the financial flexibility we need to execute our fivefold growth strategy by accelerating efforts in new and existing markets and supporting the plan of opening of more than 2000 cafes globally, while preserving our Belgian legacy, quality, and craftsmanship that have helped to make our brand iconic.”

    Among Godiva’s various markets, Japan, South Korea, Australia and New Zealand collectively have some of the strongest brand equity and include more than 300 retail stores, making these regions the most compelling areas for monetisation. In Japan, Godiva has almost 90 per cent aided brand awareness and is the number one retail brand in the country, with the highest premium time spent in stores, according to 2017 research by the Nikkei Marketing Journal.

    At the same time, Yildiz sees significant unrealised opportunity for the brand that, when coupled with the infusion of capital, infrastructure and capabilities from MBK Partners, is expected to deliver a strong return on investment.

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  • Malaysia’s BLand earmarks RM1.05b property launches this year

    Malaysia’s BLand earmarks RM1.05b property launches this year

    Berjaya Land Bhd (BLand) plans to launch some RM1.05 billion worth of properties in 2019, mainly The Tropika in Bukit Jalil and Timur Bayu in Shah Alam, after a two-year hiatus. The group, via its subsidiary Berjaya Golf Resort Bhd, launched The Tropika over the weekend, a mixed development project with a gross development value (GDV) of RM720 million, comprising 868 residential units across four towers.

    BLand senior general manager of property marketing Tan Tee Ming expects The Tropika in Bukit Jalil to be the main revenue contributor for the group’s property segment this year.

    The Tropika is located on 6.5 acres of freehold land in Bukit Jalil. There are four different types of units, namely Type A, Type B, Type C and Type D measuring 732 sq ft, 974 sq ft, 1,318 sq ft and 1,251 sq ft respectively.

    Tan said units of the first tower is priced at RM725 psf and every subsequent tower will increase RM50 psf.

    “There are two market segments that we want to cater for in The Tropika. We thought of the buyers in mind and the first segment is young families. We also want to focus on investors. We know that there will be a rental market for the apartments that we build here,” Tan told the media.

    The Tropika is within close proximity to SJKC Lai Meng, International Medical University and Asia Pacific University, as well as the Bukit Jalil Complex, the Bukit Jalil Recreational Park and the Bukit Jalil Gold & Country Resort.

    Surrounding the four residential towers of The Tropika is a 2.9-acre deck equipped with 68 types of facilities.

    The commercial space of the project features a 23,695 sq ft grocer along with a two-storey dual frontage office lots ranging from 3,316 sq ft to 3,814 sq ft and retail space ranging from 752 sq ft to 1,677 sq ft.

    Completion of the commercial component will take two years while the residential towers will take four years.

    Tan said BLand is also planning to develop the 12-acre land next to The Tropika, where the Berjaya Property Gallery sits on, into a 1,500-unit residential project with managed healthcare.

    Meanwhile, he said the Timur Bayu development in Shah Alam has a GDV of RM330 million, consisting of high-rise and low-rise residential units. It is expected to launch the project in the third quarter this year.

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  • Korean Air plans to make 16 trillion won in sales by 2023

    Korean Air plans to make 16 trillion won in sales by 2023

    Korean Air unveiled its mid-term business strategy Tuesday, saying it aims to record 16.2 trillion won ($14.4 billion) in sales by 2023. The goal comes as the airline’s March shareholders’ meeting draws near. Korean Air Chairman Cho Yang-ho’s term at the country’s largest airline ends this year and shareholders will vote on his re-election. To achieve the sales target, it needs to grow by an average 5.1 percent every year. Last year, the airline inked 12.7 trillion won in sales.

    Its operating profit target for 2023 is 1.7 trillion won, about 2.5 times more than last year’s 692.4 billion won.

    The company said it will work to raise the profitability of its business to reach a 10.6 percent profit to sales ratio. Last year, the ratio stood at 5.5 percent. Along with improved profits, the company plans to lower its debt ratio to below 400 percent from last year’s 699 percent.

    To expand sales, Korea’s largest full-service carrier plans to expand routes connecting America and Asia through a joint venture inked with U.S. airline Delta Air Lines last year. The partnership enables the two companies to share revenue, costs, flights and sales networks with antitrust immunity on their trans-Pacific operations.

    The airline also plans to open up new flight routes headed to Europe and Southeast Asia, both growing as popular travel destinations.

    As for its cargo business, the airline plans to bolster its business with emerging markets like Vietnam, India and Central and South America.

    In the aerospace business, the company said it will develop new technologies to build parts for passenger aircraft and start mass producing unmanned aerial vehicles to secure future growth engines.

    This year, Korean Air proposed a target of 13.2 trillion won in revenue and 1 trillion won in operating profits.

  • Warm weather blamed for worsening Bossini International loss

    Warm weather blamed for worsening Bossini International loss

    An unseasonably warm winter and weak consumer sentiment in core markets has been blamed for a more than doubling of losses for Bossini International in the six months to December. The casual-fashion retailer reported a 10 per cent decline in group revenue to HK$875 million (US$111.5 million) and a 5 per cent drop in same-store sales for the period. Gross profit fell 11 per cent and the loss attributable to shareholders ballooned from $12 million in the same period a year earlier to $26 million (US$3.3 million).

    Operating profit in the key Hong Kong and Macau market, where Bossini has 39 stores, improved, despite a 5 per cent decline in same-store sales.

    In Singapore, sales plummeted 23 per cent due to store closures. Same-store sales there fell by 6 per cent, in Taiwan by 7 per cent and in Mainland China by 3 per cent. Group-wide same-store sales fell by 5 per cent, worse than the 2 per cent of the December 2017 half.

    As at the end of last year, Bossini International had a total net retail floor area for directly managed stores of 362,000sqft, about 4000sqft less than a year earlier, across 295 stores, (11 more than a year earlier). It opened 114 franchised stores in markets outside Hong Kong and Macau, taking the total franchised network to 768.

    Hong Kong challenge

    Bossini chairman Man Kuen Bess Tsin said the significant decline in retail sales growth in Hong Kong since July and the negative impact of the devaluation of the Renminbi had impacted on the company’s sales in its home market, which accounts for 66 per cent of group revenue.

    “The Hong Kong retail market presented a cautious optimism if not a mixed picture. Strong inbound tourism, especially from Mainland China, was recorded in Hong Kong. Nevertheless, the consumption per capita started to drop in the third quarter, despite the annually increasing numbers of tourist arrivals in Hong Kong.”

    The group’s total net retail floor area in Hong Kong and Macau reduced from 125,800sqft to 121,600sqft, a decrease of 3 per cent, while sales per square foot slipped 5 per cent to $7200 (from $7600). Operating profit in Hong Kong and Macau was $17 million, up from $12 million for an operating margin of 3 per cent (compared with 2 per cent a year earlier).

    Mainland China revenue decreased 2 per cent.

    Bossini Singapore posted an operating loss of 5 million, 20 per cent more than the comparable period and the operating margin was negative 9 per cent.

    Cautious outlook

    Tsin said Bossini International management is “cautiously optimistic” about the year ahead.

    “However, in face of the complex and volatile global economy and geopolitics, the outlook is full of uncertainties. As an open economy, Hong Kong is particularly vulnerable to the impact of the global situation. At the same time, the local economy and consumption structure are also gradually changing.

    Challenges and opportunities coexist. The group is fundamentally strong with a healthy financial position, which is capable of facing the potential challenges.”

    Tsin said the export franchising business is a main focus of the group.

    “We will further expand and optimise the distribution network, leveraging the economy of scale in market reach and profitability.”

    The company will focus on introducing more new products and designs, with a focus on functionality at the core of its product strategy. Alongside the young adult segment, the company will develop more childrenswear lines to broaden its customer base and it will strengthen supply chain management to improve operational efficiencies.

  • India’s yogi to open clothing stores

    India’s yogi to open clothing stores

    Indian yoga guru Baba Ramdev is making moves into fashion through his firm Patanjali. The brand plans to launch 100 exclusive clothing stores with e-commerce support across India by next year. It is also seeking to open small venues in metropolitan areas. Twenty stores are expected to be operational by the end of this year in cities such as Jaipur, Agra, Patna and Nasik.

    A recent ad campaign for the Baba Ramdev brand sought to “create a movement towards embracing and embodying Indian fashion,” according to a report.

    The firm’s flagship in New Delhi sells around 3000 items under three distinct sub-brands, which will be made available on Amazon, Flipkart and Paytm under the new expansion drive.

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  • SK Telecom to launch data analyzer with Microsoft

    SK Telecom to launch data analyzer with Microsoft

    Korea’s No. 1 mobile carrier SK Telecom said Wednesday it will collaborate with U.S. software giant Microsoft for big data solutions to expand its presence in the global market. SK Telecom said it signed a development and global business cooperation agreement with Microsoft in Silicon Valley to step up development and global marketing in big data analysis.

    Under the partnership, SKT will launch its real-time big data analyzer, Metatron, on Microsoft’s public cloud platform Azure.

    Metatron provides quick and easy data analysis, which also includes data collection, storage and visualization processes. Azure is the world’s second-largest public cloud provider, used in 140 nations across the globe.

    The two companies agreed to launch the big-data-based asset performance-management service for the commercial market in July.

    “The partnership is expected to set the ground for Metatron’s footprint in the global market,” Choi Yong-jin, SKT’s data labs director, said in a release.

    Already well-established in its domestic market, SK Telecom has focused on leveraging its mobile network technology expertise and increasing revenue in content, software and security.

    During MWC Barcelona, set to open next Monday, the company plans to demonstrate its 5G technology, including quantum-safe cryptography solutions and mobile edge computing.

    Quantum-safe technology encrypts transmitted data using special quantum keys, which prevents interception or theft.

    Edge-computing systems process data locally, in nearby data centers or on devices, which eases the strain on networks and improves data reply times.

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  • Emart24 ups the booze to capture solo drinker market

    Emart24 ups the booze to capture solo drinker market

    Convenience store chain Emart24 will expand its alcohol selection tenfold at around 500 branches this year, the brand said Wednesday. The products will be offered using the shop-in-shop model with 120 products, including wine, whiskey and micro-beers, displayed in a dedicated corner. Three to six racks will be added at each outlet to hold the products.

    The company explained the efforts are motivated by the rise of solo drinkers, those who enjoy a few drinks after work as opposed to drinking in larger groups.

    The reduction of the workweek to 52 hours and changing lifestyles, which prioritize work-life balance, have further driven up the number of solo drinkers. Before the announcement, the convenience store tested the shop-in-shop model at 19 branches for two months from November. Sales of wine, craft beer and whiskey increased 20-fold. Overall sales at these 19 branches doubled.

    Emart24 said it plans to expand the shop-in-shop concept to products other than alcohol in the future. It is considering fresh food and imported snacks.

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  • King Power duty free monopoly ending soon

    King Power duty free monopoly ending soon

    Thailand’s much-maligned airport duty-free monopoly appears set to be nearing an end. For years, major Thai retailers have complained that incumbent operator King Power has controlled the retail offer – and prices – at Thailand’s largest airports, especially Suvarnabhumi outside Bangkok. Frequent travellers often comment that airport ‘duty-free’ prices are higher than at other airports in the region, including Singapore and Hong Kong.

    On Wednesday, state-owned Airports of Thailand (AOT) approved guidelines for concessions for duty-free and commercial activities at its airports, the first step in opening up retail spaces to other companies.

    According to Reuters, AOT will offer three retail licences at an upcoming auction, clearing the way for Thai retail giants Central Group and The Mall Group, along with South Korea’s Hotel Shilla, to enter the fray.

    King Power’s current licence ends next year.

    AOT says contracts will cover duty-free retail, commercial businesses such as food and beverage outlets and pick-up counters for shoppers who buy goods in town and collect them at the airport after clearing customs and immigration.

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  • Hyundai Motor raided as defect cover-up investigated

    Hyundai Motor raided as defect cover-up investigated

    Prosecutors raided the main office of Hyundai Motor and its smaller affiliate Kia Motors on Wednesday as part of a probe into allegations that the company tried to conceal defects in some of its vehicle lineups. The Seoul Central District Prosecutors’ Office sent its investigators to search the quality division at the headquarters of the automaker to collect evidence.

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  • Rising active customer count gives Vipshop good impact

    Rising active customer count gives Vipshop good impact

    Chinese online discounter VIPShop is reaping the benefits of a 13 per cent increase in active customers last quarter to 32.4 million – well ahead of the 5 per cent full-year improvement. Its annual results released overnight showed net revenue soared 15.9 per cent last year to RMB84.5 billion (US$12.3 billion) and net income attributable to shareholders rose 9.2 per cent to RMB2.1 billion ($309.6 million). VIPShop says its Gross Merchandise Volume (GMV) for the full year rose 21 per cent to RMB131.0 billion.

    “We are pleased to have finished the fourth quarter of 2018 with solid operational results,” said chairman and CEO Eric Shen.

    “Going forward, we will continue to strengthen our core capabilities, aiming to bring highly desirable selections of products to our valued customers on a daily basis, which will drive our long-term growth and profitability.”

    CFO Donghao Yang said the fourth quarter saw “a healthy sequential recovery” of VIPShop’s bottom-line, which was mostly attributable to a focus on the highly profitable apparel category.

    “During this quarter, we began to shift some low-margin categories from our first-party business into the marketplace platform, reducing their drag on our bottom-line while still delivering a solid GMV growth of 15 per cent year over year. We remain focused on stabilising our margins, aiming to drive enhanced shareholder return in the long run.”

    During the fourth quarter of last year, VIPShop added about 86,000sqm of warehousing space, taking its capacity to 3 million sqm.

    For the first quarter of the new year, the company expects net revenue to grow by up to 5 per cent, to between RMB19.9 billion and RMB20.9 billion.