Latest News
-
Vulcan misses its quarterly estimate as adverse weather dampens the construction
Vulcan Materials reported second-quarter revenue, profit and earnings below Wall Street expectations on Thursday as weather disruptions caused construction to slow down and reduced demand for construction materials. The demand for construction materials has been hit by persistent inflation which has driven up the operational costs of corporations. Construction spending was also affected by higher borrowing costs. Tom Hill, CEO of the company, said that despite weather challenges our pricing discipline and cost performance led to an increase of 13% in aggregates gross profit per ton. The company reported $2.10billion in revenue for the three months ended June 30. This is up 4.4% compared to a year ago. According to LSEG data, analysts had on average expected $2.19billion. Vulcan Materials, based in Birmingham, Alabama, sells crushed stone, sand and gravel and supplies asphalt to six states, including Texas and California. The company also produces ready-mixed cement in California, Maryland and Virginia. Materials are delivered by barge, rail, truck and ship. Vulcan's adjusted profit per share was $2.45. Analysts had predicted a profit per share of $2.54 on average. CEO Hill said that "our execution in the first six months of the year, along with the acceleration of new highway construction in our markets, supports our outlook for the full-year to deliver $2.35-2.55 billion in Adjusted EBITDA", he added. Reporting by Abhinav Paramar in Bengaluru, Editing by Maju Sam
-
Howmet raises 2025 forecast on robust aerospace demand
Howmet Aerospace increased its full-year revenue and profit forecast on Thursday. It attributed the increase in jet production to the strong demand for fasteners, engine components and other parts. In premarket trading, shares of the aerospace company, which counts Airbus as a customer, rose 3.5%. Howmet, for example, has benefited from the increased production of planes due to the growing demand for air travel. Howmet CEO John Plant stated in a press release that "we acknowledge positive signs regarding narrow-body construction rate increases, especially on the Boeing 737 MAX". Boeing delivered 206 of its 737 MAX jets in the first half, compared to 135 the previous year. Airline delays due to supply-chain bottlenecks have also caused airlines to extend the life of older aircraft. This has led to a spike in aftermarket part orders. The aerospace supply chain has been put under pressure by President Donald Trump’s tariffs, which include levies against trading partners and broad tariffs on steel and aluminum. Howmet, a Pennsylvania-based company, has announced that it will pass on the inflated costs of tariffs through increased prices to its customers. It anticipates revenue in 2025 to range between $8.08 and $8.18 Billion, as opposed to its previous forecast of $7.88 and $8.18 Billion. Howmet has also increased its adjusted profit forecast for 2025 to between $3.56 to $3.64 per shared, up from its previous range of $3.36-4.44. The second-quarter revenue grew 9.2%, to $2.05billion. This was driven by a 8% rise in sales of commercial aerospace. The company's adjusted earnings per share were 91 cents, up from 67cents a year earlier. (Reporting by Utkarsh Shetti in Bengaluru; Editing by Shilpi Majumdar)
-
EU energy policy caught between US gas and Chinese green technology: Bousso
Since the Russian gas phaseout, EU dependence on US LNG has increased. China dominates the EU's renewable energies supply chain EU-US trade deal sets unrealistic energy target Ron Bousso LONDON, 31 July - The European Union’s extravagant pledge to purchase $750 billion in U.S. Energy by 2028 could increase the bloc’s already excessive dependence on American Gas, at the same time that it is becoming increasingly dependent on Chinese technology for its energy transition. Under the new trade agreement with Washington, the EU has committed that it will increase its purchases of U.S. natural gas, coal and oil from $75 billion in 2020 to $250 billion annually over the next three. Eurostat data shows that the U.S. will account for 50% of EU's imports of liquefied gas in 2024. It also accounts for 17% of imports of oil and 35% of imports of coal. The U.S. exports the most LNG in the world, and this fuel is super-chilled. The promised purchases are not only unlikely, but also downright unrealistic, due to the huge volumes involved, and the fact the EU's energy trade is determined primarily by the market, not centralized buying. The greater concern is that increased purchases will increase Europe's dependence on U.S. power at a time when it is already precarious. DEPENDENCE RISKY Europe is heavily dependent on LNG imports due to its drastic reduction in Russian pipeline gas purchases after Moscow's invasion into Ukraine in 2022. Before that, Russia was responsible for over 40% of European gas purchases. Brussels has a plan to phase out all Russian energy imports in 2027. This ambitious but achievable goal will increase the demand for LNG from the U.S. It is less risky to rely on an ally who is democratic and Western than to bind oneself with a power that is authoritarian, but there are still risks. One of the reasons is that the Trump administration's erratic policies and bullying behavior may cause European leaders to question the sustainability of any U.S. agreement. Moreover, a large portion of LNG is produced along the U.S. Gulf Coast which is at risk from extreme weather events like hurricanes, heatwaves and floods. These disasters can lead to severe and abrupt supply disruptions. The price of natural gas in the United States could also rise dramatically over the next few years, as the domestic demand increases, especially given the massive power requirements for artificial intelligence. The U.S. Energy Information Administration predicts that Henry Hub gas will double in price between 2024-2026, to $4.40 for every million British Thermal Units. These price increases could make American LNG less competitive against other sources. CHINESE WALL Energy crisis following the invasion of Ukraine by Russia taught Europe two hard lessons. Don't be too reliant on a single energy provider, and reduce your reliance on fossil energy, especially with Europe's inadequate and declining domestic production. In order to address this concern, the bloc has increased investments in technologies such as renewables, nuclear, and battery storage. According to a report released by the International Energy Agency, European investments in clean energy are expected to double in size from 10 years ago to $494 billion by 2025. Solar and wind power generated around 20% of the total energy consumed in the region and half of its electricity last year. However, the rapid growth of renewables is not without its own risks. The green energy supply chain, which is dominated by Chinese tech, has its own dependence issues. Solar energy is Europe's fastest-growing renewable source. Around 80% of solar photovoltaic panel production in the EU comes from China. It does this at a very low cost which has hindered Europe's attempts to expand its domestic manufacturing. China is the dominant producer of raw materials such as cobalt, nickel and lithium that are essential to storage batteries and wind turbines. No Good Choices Diversifying EU sources of renewable technologies and essential minerals is crucial for the bloc’s energy security. However, this will take many years to achieve. Theoretically, cooperating on this front with the U.S. could be beneficial. However, not if Washington takes advantage of its dominant position in order to extract more concessions from Europe while offering little else. The EU is caught in the middle of two geopolitical forces. The European Union's double concerns about fossil fuels and its increasing dependency on U.S. gas, as well as the over-reliance on China in terms of renewable energy, may eventually cause European leaders to turn back to fossil fuels, if they are worried about rising energy costs. The pace and success of EU energy policies will be determined by the balance between energy security and political reality in the next few years. If the terms of the U.S. recent trade deal is any indication, then the EU's energy policies are not off to a good start. You like this column? Check out Open Interest, your essential source for global commentary on financial markets. ROI provides data-driven, thought-provoking analysis. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X.
-
Safran shares rise as French jet engine maker raises outlook
Safran, the French aerospace company, raised its annual forecasts on Thursday after reporting higher-than expected first-half profit. Its shares rose more than 4% thanks to a brisk demand of spare parts for jet engine. Safran, who together with GE Aerospace produce engines for Airbus medium-haul aircraft and Boeing long-haul jets reported higher maintenance profits, and its cabin interiors business, which had been struggling, saw further progress in the black. After certain adjustments, the company's closely-watched recurring operating income increased 27% to 2,51 billion euros ($2,87 billion) as revenues rose 13% to 14,77 billion euros. According to a consensus compiled by the company, analysts expected an average operating profit of 2,39 billion euros for the first half of 2014 on revenues of 14,74 billion euros. Safran has raised its forecast for the full year of the same profit measure from 4.8 to 4.9 billion euros to a range between 5.0 and 5.1 billion euro. This is an increase over a previously stated range. It forecast revenue growth of the low teens instead of 10%. Analysts at Bernstein said that Safran's aftermarket indicators, which are used to determine how much money engine manufacturers make during their regular visits to engine shops, exceeded expectations. Analysts say that the growing demand for air travel and the shortage of planes caused by a lack of deliveries from aircraft manufacturers have forced airlines into flying planes longer. This has led to extra maintenance. Safran shares rose 3.9% at midday. Shares of UK engine manufacturer Rolls-Royce rose also After improvements in its large wide-body engines led to strong first-half performance, it raised targets. ENGINE AGREEMENT Airbus, a jet maker that has been firing at engine manufacturers for delays in delivering new engines into jet factories because parts are diverted to repair shops to keep existing aircraft flying. Airbus and CFM have been strained by the tug-of-war between airplane hangars and aircraft factories over parts, while Pratt & Whitney, a rival engine manufacturer is gaining ground. Also under scrutiny Safran CEO Olivier Andries admitted that CFM was behind on deliveries to Airbus, partly due to a French strike. But he told reporters that the plans to catch up were "challenging, but totally achievable". He confirmed that CFM and Airbus had reached an agreement on the number of engines to be delivered in the remainder of the year, as the planemaker strives towards its delivery target. Airbus CEO Guillaume Faury On Wednesday The engine makers have agreed to help meet its delivery targets. Safran announced separately plans to build a carbon brakes plant in France, near Lyon. This follows a competition with Quebec and Oregon State, U.S.A. for the new major site. Safran, which was founded 20 years ago by the merger of Snecma, a state-owned engine manufacturer, and Sagem Electronics (now part of Sagem), acquired the Collins Aerospace actuation and control business for $1.8 billion last week. The company also sold a small U.S. operation to comply with the demands of regulators for the Collins acquisition. Safran estimated that the combined transactions will add between 600 and 700 millions of euros to the group's revenues for the remainder of the year.
-
Air France-KLM withdraws from the process to purchase stake in Spain's Air Europa
A spokesperson for the Franco Dutch airline group announced on Thursday that Air France-KLM had pulled out of the deal to purchase a stake in the privately owned Spanish airline Air Europa. The spokesperson for Air France-KLM said that Globalia, the company that controls Air Europa and is controlled by Air France, could not come to an agreement. Globalia's spokesperson did not respond immediately to a comment request. German Lufthansa, Turkish Airlines and IAG-owned British Airways have made bids to Globalia for a 20% stake in Spanish airline IAG. Air Europa, a Spanish airline that connects Madrid to large Spanish cities throughout Europe and Latin America and flies across Spain, is looking to raise money to pay back a loan from the government granted during pandemic. Airlines are under increasing pressure to consolidate their operations in Europe so that they can better compete against major global competitors from the United States or the Middle East. Many airlines are looking to expand on popular routes in Southern Europe. (Reporting and editing by Inti landauro, Bernadettebaum and Joanna Plucinska)
-
Sources say that India's GMR Airports has finalized details for its largest bond issue
Three sources familiar with the development said that GMR Airports in India has finalised terms for what will be its largest corporate debt offering. The company aims to raise over 60 billion rupees (685.13 millions dollars). The second largest airport operator in the country will raise 18 billion rupies through 18-month bonds. The issue will be primarily placed with mutual fund. The sale of bonds for three years will raise an additional 42 billion rupees, and large foreign lenders are expected to absorb the supply. Sources said that the company would pay a coupon of 10.50% annually on both maturities and the fundraising was expected to be complete in the next couple of days. The sources all requested anonymity, as the discussions are private. GMR Airports didn't respond to an email asking for comment. Crisil has rated the bonds of this company A+. The company manages several airports, including those in Delhi, Hyderabad and Bangalore. $1 = 87.5740 Indian Rupees (Reporting and editing by Dharamraj Dhutia, Khushi malhotra)
-
Heathrow airport in London is hit with more flight cancellations following an air traffic failure
On Thursday, at least 16 flights were cancelled to and from London Heathrow Airport. This was a day following widespread disruptions caused by technical issues with Britain's air-traffic control system. National Air Traffic Services, which controls air traffic for planes in UK airspace as well as the eastern part North Atlantic, announced on Wednesday that its systems are fully operational and capacity has returned to normal following the switch to a backup system. Cirium, an aviation analytics company, reported that the second NATS outage in two years also affected Gatwick Airport, near London, Edinburgh Airport, Scotland, and other locations. As of 1830 GMT, Wednesday, there were 122 cancellations. Heidi Alexander, Transport Minister, said that she would be meeting with NATS Chief Executive Martin Rolfe to "understand what happened and prevent a reoccurrence". Alexander, a social media user on X, wrote that NATS works closely with airports and airlines to clear up the backlog. Heathrow’s website indicated that 16 flights were cancelled Thursday, including those to and from New York, Berlin and Toronto, as well as departures. In March, the airport, Britain's biggest and Europe's busiest was also affected by an electrical fire in a sub-station, which left thousands of passengers stranded. Neal McMahon, Ryanair's Chief Operating Officer, called for NATS' Rolfe resigning. He said that no lessons were learned since the August 20, 2023 disruption brought about by a malfunction in the automatic processing flight plans. NATS did not respond immediately to an inquiry about McMahon’s remarks, despite apologising to those who were affected by the incident on Wednesday. (Reporting and editing by William Schomberg, Catarina demony)
-
Air France-KLM and Lufthansa defy worries about a trade war with Q2 growth
European airlines Lufthansa, Air France-KLM and United Airlines reported higher profits in the second quarter on Thursday. This was despite concerns that U.S. tariffs and economic uncertainty could affect transatlantic travel. The transatlantic routes are the most profitable for airlines. In recent years, British Airways owner IAG has benefited from this as European competitors have struggled. Delta was among the U.S. carriers that abandoned their full-year forecasts in spring due to a weakening of travel demand. This followed President Donald Trump’s tariffs, which shook consumer and business confidence. However, European airlines are bucking this trend. Lufthansa reported on Thursday that demand for its premium products in the United States was strong, despite the weakening dollar. Air France-KLM also highlighted the strength of their premium offerings. Lufthansa announced a 27% increase year-on-year in its second quarter operating profit, which reached 871 million euro ($995 millions), exceeding the analysts' average estimate of 805million euros. In a press release, Carsten Spohr, Chief Executive Officer of the company said: "Despite the fact that the second quarter saw a return to geopolitical crisis and economic uncertainty, we confirm today our positive outlook for this year." CONTRAST WITH THE UNITED STATES Bookings for U.S. Airlines have improved since late June, after a sharp decline in March and April following Trump's trade war. Although demand has stabilised, airline executives claim that it is still below the estimates made at the beginning of the year. The spending of price-sensitive travelers is also down, despite the uncertainty surrounding the U.S. economic situation and rising costs. Europeans are often known to be more price sensitive than Americans and have less spending power. The wealthy Americans who are visiting Europe this summer are not poor. Delta and United Airlines have performed better despite the fact that domestic U.S. travel is struggling, affecting budget airlines. FIXING WEAKNESSES, NEW STRENGTHS In a client note, Bernstein analyst Alex Irving stated that the investment in Italy's ITA Airways contributed a "surprisingly large" profit to group's bottom-line. Since the pandemic, Lufthansa struggled to cope with increasing labour costs and a slowdown in traffic from Asia. The airline issued two profit warnings. The company stated that the decision to focus on Italy as a cost-savings measure was paying off. Rome is much cheaper to maintain than German base. Air France-KLM’s operating profit for the second quarter rose to 736 millions euros, up from 513million euros a year ago. This is in line with analysts' expectations. Air France has been able to capitalize on the strong demand for flights to Paris, and its appeal as a luxury French airline. KLM has had ongoing problems at Schiphol Airport near Amsterdam.
Old Dominion misses quarterly estimates as freight slump drags on
Old Dominion Freight Line's revenue and profit for the second quarter fell below Wall Street expectations on Wednesday as its freight services continued to be muted in a macroeconomic environment that was tough.
In afternoon trading, shares of Thomasville-based LTL carrier, which serves companies in retail, manufacturing and automotive sectors as well as healthcare, fell by about 9%.
Trucking rates in the U.S. have been pushed lower by persistent overcapacity and low freight volumes.
Old Dominion is still managing to operate in a challenging operating environment, which has lasted longer than expected. CEO Marty Freeman added that the "challenging" economy continues to impact demand for services.
The company's revenue for the third quarter fell by 6.1% compared to last year, to $1.41 billion. Profit per share also dropped by 14%, to $1.27.
According to LSEG data, analysts had on average expected revenue of 1.42 billion dollars and a profit per share of $1.29.
The company said that the decline in revenue was primarily due to lower shipment volumes and lighter weights, despite higher freight prices.
In a press release, CEO Marty Freeman stated that the decrease in revenue has had a deleveraging impact on many of our operational expenses.
Operating ratios, which are a key measure of operating expenses as a percent of revenue for a company, have increased to 74.6%, up from 71.9% one year ago. However, they improved since the first quarter. A higher ratio indicates a rise in costs and lower profitability.
Daniel Imbro, Stephens analyst, said that the company has continued to control its costs during this recession. This is especially true given June's softer top-line figures. (Reporting and editing by Pooja Deai, Maju Samuel and Abhinav Paramar in Bengaluru)
(source: Reuters)