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Enterprise Products' quarterly profit drops on lower margins, but buybacks to $5 billion are boosted
Enterprise Products Partners announced a lower-than expected quarterly core profit Wednesday as its liquids and natural gas businesses were weaker than expected. However, the company's petrochemicals business and refined products were stronger. Enterprise said that its board also increased the authorized size for its common unit purchase program from $2 billion to $5 billion, leaving $3.6 million in remaining capacity. The company described this authorization as "multi-year program" that offers an additional method to return capital to the investors. The company purchased 80 million dollars worth of units in the first quarter. UBS analyst Manav gupta called buyback update a "positive", but the "amount of the miss" could keep the stock at some pressure. In premarket trading, Enterprise shares were down 1.6% to $30.62. Enterprise has moved record volumes across its network. Natural gas pipeline throughput increased by 8% to 21.0 trillion British Thermal Units (Btus), and pipeline volumes equivalent rose 7% to 13.9 million barrels. These gains were offset with lower sales margins. LPG loading fees also decreased after contract renewals. LSEG data shows that adjusted earnings before interest taxes, depreciation, and amortization (EBITDA), was $2.41billion in the third quarter. This missed analysts' expectations of around $2.50billion. The company spent $2 billion on capex in the first quarter. This included $1.2 billion on growth projects, $583 millions for Occidental Petroleum’s gas gathering system and $198 in sustaining capital expenditures. The company now expects growth in 2025 to be at the upper end of its range of $4,000 billion-$4.5billion. Elvira Scotto, an analyst at RBC Capital Markets, said that Enterprise's "steady balance sheet and steady cash flow can handle planned capex expenditure". Reporting by Arunima and Katha in Bengaluru, editing by Krishna Chandra Eluri
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German court orders Afghan who killed toddler by knife attack to care
After he fatally knifed two people in an attack that shocked Germany nine months ago, the judge ordered that an Afghan national be sent to psychiatric treatment. The prosecution had claimed that Enamullah O., in accordance with German privacy laws was the man who killed a German and a 2-year-old when he attacked the kindergarten group of Aschaffenburg in western Germany in January. The man was diagnosed as having paranoid Schizophrenia. This hearing was not a criminal trial but a special procedure, because he was found to be not criminally liable due to his mental illness. The court confirmed that the decision was made to place him in psychiatric treatment. The attack occurred a month prior to Germany's Federal Election in February, and it contributed to the decision of now-Chancellor Friedrich Merz that stricter immigration policies and tighter border controls would be introduced. This was just one of many violent attacks that have raised fears about migration and fueled support for the far right Alternative for Germany (AfD), a party which has been topping polls. (Reporting and writing by Tilman Blsshofer; editing by Matthias Williams, Gareth Jones, and Madeline Chambers)
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Mercuria transports LME aluminum from Malaysia to New Orleans
Three sources with knowledge of the matter confirmed that Mercuria was shipping over 30,000 metric tonnes of aluminium to New Orleans from Port Klang, Malaysia. They added that the commodity trading company probably needed the metal because it had customers in the United States. Sources said that the metal was coming from London Metal Exchange-approved warehouses in Port Klang. Aluminium stocks, which stood at 268,325 tons on October 29, were down by 74,700 metric tons or 22 percent since September 22. . Industry sources claim that Mercuria's shipment to the United States of aluminium is part of an overall strategic push to industrial metals as the trader tries to diversify its business beyond the traditional energy sector. Mercuria announced its plans to remove large quantities of aluminum from LME's storage on September 16, 2009. Sources familiar with the situation said that Mercuria will send the aluminium taken from the LME warehouses at Port Klang, to the United States aboard a vessel called Astro Denebola. Mercuria, a Swiss company, declined to comment. Kpler data shows that the Astro Denebola, carrying 32,000 tonnes of aluminium, left Port Klang in October and is expected to arrive at New Orleans on Dec. 9. According to industry sources, the majority of the aluminium stored in the LME warehouses at Port Klang comes from India. Sources from the industry said that some of the metal in the warehouses at Port Klang Exchange was produced in Russia. Since the Russian invasion of Ukraine, in February 2022, Western consumers have shunned Russian aluminum. The U.S. imports large quantities of unwrought aluminum and alloys, more than 3.9 millions tons in the last year according to U.S. Government data. Aluminium is an important material in the construction, power and packaging industries. Industry sources claim that Mercuria holds more than 90% of LME aluminium warrants (title documents conferring ownership) since May. The premium on LME contracts with shorter maturities over those nearer to the LME is due to this holding, according the analysts. . The LME does NOT publish the names of companies that hold large amounts of metal warrants.
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Gazprom lowers its investment for 2026 to 1.1 trillion Russian roubles compared with 2025
Gazprom, the Russian gas giant, announced on Thursday that its management board approved an investment program for 2026 in the amount of 1.1 trillion Russian roubles (approximately $13.53 billion), which is almost a third less than a revised figure of 1.615 trillion Russian roubles set for 2025. Gazprom did not include the Power of Siberia 2 pipeline from China to the list of priority projects for next year. The company announced last month that it had signed an agreement for the construction of a pipeline which would allow the delivery of 50 billion cubic meters of additional gas to China each year via the Mongolian gas fields in the Arctic. The price of the gas that will be supplied through the new pipeline, which is a key factor in determining the costs of the construction of the pipeline and the way those costs are shared between the parties involved, has yet to be decided. Gazprom announced on Thursday that the funding for next year will focus on developing gas-producing centres in Russia's eastern region and Arctic Yamal Peninsula, as well supplying gas to homes and expanding the Power of Siberia 1 pipeline to China. Gazprom has agreed with China to increase annual gas supplies through the pipeline from the planned capacity of about 38 bcm by an additional 6 bcm. This is the only existing pipeline between the two countries.
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ExPro reports that Ukraine will resume its gas imports via Transbalkan routes in November.
ExPro, a consultancy firm, said that Ukraine will resume imports of gas via the Transbalkan pipe in November after a dramatic increase in Russian attacks against the country's energy and gas infrastructure. In October, Russia intensified its strikes against Ukraine's gas industry. This resulted in Kyiv losing 55% of their own production of gas and forcing them to import an extra 4 billion cubic meters of gas to keep cities warm this winter. ExPro reported that Greek DEPA Commercial and D.Trading, a subsidiary to Ukraine's largest energy company DTEK, as well as Swiss Axpo Trading have booked capacities for the import of gas from Greece into Ukraine in a daily quantity of 0.6 millions cubic meters. Transbalkan, the route that links Greece's LNG Terminals with Ukraine, has not been used since September and October. It was only operational in July and August. Ukraine imports approximately 24 million cubic meters (mcms) of gas per day, including over 10 mcms from Poland, around 10 mcms from Hungary, and more than four mcms from Slovakia. Transbalkan pipeline is not in demand because of the high costs of transiting gas through the Ukraine and the four countries. ExPro reported that tariff reductions made by Moldovan and Romanian operators in November had helped to fill bookings. (Reporting and editing by Emelia Sithole Matarise; Reporting by Pavel Polityuk)
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Howmet Aerospace raises its annual forecast due to strong demand for jets
Howmet Aerospace raised its revenue and profit estimates on Thursday as the manufacturer of castings, fasteners and other components expects to see a rise in demand due to increased production of commercial aircraft. Suppliers like Howmet have benefited from the influx of Airbus and Boeing aircraft orders, thanks to a resilient demand for air travel. As aircraft manufacturers struggle to meet demand due to production and supply-chain challenges, the company also sees an increase in demand for spare parts by airlines that are flying older jets longer. Howmet expects to reach $9 billion in revenue by 2026. This represents a 10% growth year-over-year. Howmet CEO John Plant stated that "turning to 2026 the air traffic continues growing and the backlog for commercial aircraft extends throughout the decade." This will provide both solid demand for commercial aerospace original equipment and growing demand for engines spares. Boeing, the top customer, received approval earlier this month to increase monthly production of its best-selling 737 MAX jets to 42 a week, up from 37. Plant, a key customer of Airbus, said that the best-selling A320 does not yet have a build rate. This was stated in the earnings call for July. The aircraft parts manufacturer expects revenue in 2025 to range between $8.18 and $8.2 Billion, up from an earlier forecast that was $8.08-$8.18 Billion. The company also increased its profit forecast to between $3.66 and $3.68 a share. This compares to the previous range of $3.56 to $3.64. Howmet has said that it will pass on to its customers the inflated costs associated with manufacturing materials such as aluminum and steel to help cushion any tariff impact. The company's adjusted third-quarter profit was 95 cents, exceeding Wall Street's expectations of 91 cents. The quarter's revenue was also higher than the analysts' expectations of $2.04billion. (Reporting by Allison Lampert, Montreal; Nandan Mandayam, Bengaluru. Editing by Vijay Kishore).
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Malaysia's Capital A "ordeal" to unify AirAsia's seven airlines is nearing its end
Capital A, a Malaysian company, said that it had met all the conditions for selling its AirAsia business to AirAsia X (its medium-haul low cost sister company) by December. This will unite seven airlines under a common banner. Capital A announced that all key conditions for disposal have been met. This includes consent letters from creditor, approval by the Thailand Stock Exchange, and commitments made to raise new equity. AirAsia, founded in 2001 with just two aircraft, has grown to be one of Asia's leading budget airlines. Capital A, which was severely affected by the pandemic travel restrictions, has been classified as PN17 by Malaysia's Stock Exchange. The company will exit this status by the end if the year after the deal. Over the past year, we've overcome every obstacle and approval to close these deals. "We are now at the end of what seemed like an endless ordeal," Tony Fernandes said in a press release. AirAsia Group will be the name of the unified group. Capital A will focus on travel and digital operations. By December, the parties expect to have completed other procedural requirements like Capital A's reduction in capital and distribution of its shares and AirAsia X listing. Capital A divested its aviation unit last April, when AirAsia Group acquired AirAsia Bhd, without having to pay a purchase cost, since Capital A transferred its outstanding debts to the airline operator. The company has reported a record loss for the full year 2020 of 5.1 billion Ringgit. ($1.21 billion). In fiscal year 2024, the company reported a loss in 475 million Ringgit.
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Vietnamese airline Vietjet orders 100 Airbus jets, 40 Rolls-Royce engines
Vietjet, a Vietnamese airline, has agreed to order 100 Airbus planes worth billions of dollars. The companies announced this in a statement released on Thursday. Vietjet has also ordered 40 Rolls-Royce engine as part of its expansion plans. To Lam, the top leader of Vietnam, visited Britain in order to strengthen ties between London and Vietnam. According to a joint statement, the airline has placed orders for 100 Airbus A321neo aircraft, following an non-binding Memorandum of Understanding signed with Airbus in June. Vietjet, in an internal document, said that the deal, which was valued at $25 billion but did not specify if it included additional planes, engines, or services, was not disclosed. The budget airline is involved in a dispute with the London High Court regarding a payment due for four leased aircraft. It also confirmed an agreement to purchase 40 Trent 7000 engine for 20 Airbus A330neo planes. The Vietjet contract showed that the deal had a value of $3.8 billion. This was a value which hadn't been disclosed before. Rolls-Royce announced the agreement back in June but refused to comment on its value. Reporting by Phuong nghuyen, writing by Francesco Guarascio, editing by Gareth Jones & Tomaszjanowski
LME to implement permanent restrictions on large-position holders
The London Metal Exchange said Thursday that it intends to set permanent rules imposing restrictions on members who have large positions in contracts near them due to low inventory levels.
Hong Kong Exchanges and Clearing Ltd., the world's largest and oldest market for industrial metals which is owned, placed temporary restrictions on June following a spike in premiums for copper contracts near by.
LME stated that these measures were implemented in response to a low-stock situation combined with large positions in nearby dates. This had led the LME Special Committee to instruct market participants to reduce their large on-exchange position.
Recent premiums on zinc near you have reached record levels, after inventories fell by around 85% this year.
Maintain orderly markets
The LME stated that it believes that a permanent rule, which applies to all market participants who have significant positions on nearby prompt dates, is the best way to maintain orderly market conditions.
In June, the LME announced that it had taken steps to prevent the emergence of a "corner" or "undesirable condition" on the market.
In a Thursday statement, the LME stated that the restriction required holders of long positions greater than total stock levels to loan back to the market with a zero-premium.
It added that the new rule expands restrictions on positions closer to delivery known as "tom next" positions.
Zinc, the premium on the cash contract for the three-month forward
The LME announced that a consultation period would run until 21 November. (Reporting and editing by Bernadettebaum and Alexander Smith; Eric Onstad)
(source: Reuters)