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DCC rejects a $6.66 billion offer to buy DCC, shares fall
Irish energy 'distributor DCC rejected a 4,95 billion-pound takeover offer from a consortium consisting of U.S. Investment firms KKR & Energy Capital Partners on?Thursday, claiming it undervalued its company. DCC shares, listed on the London Stock Exchange, fell 5% early in trading. Cash offer of 5,800 pence each share represents an 8% premium to DCC's closing price on Wednesday before the offer became public. KKR and?Energy?Capital partners did not respond immediately to requests for comments. According to British takeover regulations, the consortium has until June 10th to submit a firm offer or walk away. This is the latest attempt by private equity to acquire a UK listed company. Bidders are attracted by British or Irish companies' lower valuations. Beazley and Schroders?and Intertek are among the FTSE 100 companies that have received takeover bids in recent months. DCC distributes liquid gases, biofuels and renewable energy for businesses and households. It has simplified its operations in order to focus on the core energy business after divesting non-core assets such as healthcare and technology. RBC Capital Markets analysts stated in a note that they believe there is a high probability of a deal happening, but were unsure if it would be more than 10% above the current price. DCC shares fell?5.4% to 5,565 pence as of?0713 GMT. This valued the company at 4,75 billion pounds.
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Air France-KLM's jet fuel bill to rise by $2.4 billion by 2026
Air France-KLM said that it expects to see its fuel bill increase by 2.4 billion US dollars in this year due to the disruption of the energy markets caused by the Iran War. It also downgraded the outlook for its capacity. Jet fuel accounts for more than one-third of airline costs. EasyJet, TUI and other European airlines have revised their forecasts since the Middle Eastern conflict began at the end February. Jet fuel hedges that they have taken out to protect themselves from price increases are no longer able to keep them safe, given the size of the spikes. CEO SAYS WORST IMPACT ?HAS YET TO BE FELT Air France-KLM's Chief Executive Ben Smith stated in a statement that while fuel price increases have not yet been reflected in today's results, they will?have a significant impact on the next quarters. The company stated that its total fuel was expected to be $9.3 billion dollars in the coming year, and 1.1 billion dollars of this would be in the second quarter. The company's first-quarter losses were smaller than expected due to strong bookings made before the Iran War and the preference of passengers for European airlines. It has lowered its expectations of group capacity from 2025 to an increase in this year between 2% and 4%. It had previously anticipated an increase between 3% and 5%. Analysts say that the reduction in capacity was smaller than anticipated. Bernstein analyst Alex Irving stated in a report that it was a reflection of "a strong earnings environment?and high demand?for travel". Air France-KLM has reported a 27-million-euro operating loss for the first quarter, compared to a projected loss of 389-million-euro by LSEG's analysts. This represents a 301-million-euro improvement over the?last year. Fuel price increases have not yet affected first quarter results. The airline said that it saw an initial increase in demand after the war with Iran, as more passengers chose European airlines for flights to Asia. As the conflict continues, the airline said that it would increase its capacity for long-haul flights, but at a smaller rate, as many people are delaying bookings due to concerns about the financial risks of such trips.
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Rolls-Royce UK confident about outlook despite Middle East disruption
Rolls-Royce, a British 'engineering' company, said that it would abide by its guidance to increase profits at least 16% in this year and be able to mitigate the disruptions caused by the Middle East war. Rolls-Royce is the engine manufacturer for the Airbus A350 widebody jets and Boeing 787 widebody planes. This means that its airline customers were affected by the disruptions to air travel in the first weeks of the Iran War, which began in late February. The air travel industry has recovered somewhat since the conflict, but airlines that pay 'Rolls' for the hours of flight they use its engines continue to face higher fuel costs as a result. Rolls reported in its trading update of Thursday that Middle?Eastern carriers had recovered in terms of engine flying hours, with many engines returning to pre-conflict levels. Other regions also saw growth as carriers reallocated capacity. Tufan Erginbilgic, chief executive of the company, said in a statement that they hoped to 'fully mitigate' the financial impact. Rolls-Royce's power systems, which also run data centers, and its nuclear?power? and defence units are aiming for an operating profit of between 4 billion pound and 4.2 billion pound ($5.39-5.66 million) by 2026. $1 = 0.7427 pound (Reporting and editing by Paul Sandle).
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Air France-KLM revised capacity outlook due to geopolitical uncertainties
Air France-KLM reported a smaller loss in the first quarter than expected on Thursday, but it downgraded the outlook for its capacity on the basis that geopolitical uncertainties are linked to the U.S./Israeli war against Iran and the rising costs of jet fuel. EasyJet, TUI and other European airlines have revised their forecasts due to the shrinking jet fuel hedges. The airlines expect to feel the effects of the Strait of Hormuz closure more intensely in the next few months. Ben Smith, Air France-KLM's Chief Executive said that fuel price increases have not yet been reflected in today's results. However, they are expected to affect the next quarters. The company stated that its group capacity is now expected to increase by 2% - 4% in this year compared to 2025. Previously, it had expected a 3%-5% increase. It said that it expected a 2.80 billion euro (2.40 billion dollar) increase in fuel costs in 2026, compared to 2025. Air France-KLM has reported a loss of 27 millions euros ($31.55m) in the first quarter, compared to a?loss projected by LSEG of 389million euros ($454.51m). This represents a 301 million euro improvement compared to last year. Fuel price increases have not yet affected the first-quarter results. The company said that it had seen an initial surge in bookings for long-haul flights after the Iran 'war broke out, as travellers were choosing European airlines to fly to Asia. However, the expansion of its long-haul flight capacity would be more modest, as people are putting off travel plans and bookings closer to their travel dates, due to financial concerns. ($1 = 0.8559 euro) (Reporting and editing by Edmund Klamann; Joanna Plucinska)
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Russian drones struck Ukraine's Odesa over night, injuring 18, officials claim
Officials said that Russian drones had attacked Odesa, Ukraine's south city, overnight, for the second time in a week. They injured at least 18 people, and damaged residential buildings. Serhiylysak, head of local military administration, stated that the strikes caused the most damage in the central Prymorskyi District, where residential buildings with five stories and high-rises were damaged. Lysak, the head of the local military administration, said that large fires were started in upper floors as well as on a rooftop. These have since been put out. The number of injured is still subject to change, according to emergency services. Odesa is a major Black Sea Port and a focal point for Ukrainian exports. It has been repeatedly targeted by Russian attacks over the past four years of Russia's conflict. In a?attack that occurred on Monday, 14 people were injured. Ukraine's air force said that Russia launched 206 drones and one ballistic missile at the country between 6 pm (1500 GMT) Wednesday, 172 of which were neutralized or downed. It added that one missile and 32 drones were fired at 22 different locations. Lysak stated that a 17-year old boy was one of the injured, and two others were in serious condition?in intensive care. He also reported that an administrative building, a shopping center, and a hotel had been damaged. He posted pictures of a fire that was raging inside a building, with its upper floor being damaged. Flames and heavy smoke were also seen billowing out from the high-rise. He added that dozens of 'buses and vehicles have been damaged or destroyed at various parking areas. He said that in another district, there were strikes at warehouses, infrastructure buildings, and garage cooperatives. (Reporting and editing by Anna Pruchnicka.
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DHL's operating profit increases thanks to cost and capacity management
DHL, the German logistics giant, reported on Thursday a higher than expected 'first-quarter operating profits', helped by structural cost reductions, capacity management and yield measures. Tobias Meyer, CEO of the company, said that despite closed airspace and blocked sea routes, they kept cargo moving. The company's?quarterly profit before interest and tax was 1.48 billion euros ($1.73billion), exceeding analysts' expectations by 1.38 billion, according to a consensus provided by the company. The?quarterly operating margin increased to 7.3%, up from 6.6% in the same quarter?last. Meyer stated that "after the first three month, we are on track to reach our full-year goals." In March 2025 the company announced its biggest cost-cutting program in two decades, as a way to protect its margins during a period when shipping and logistics firms are facing trade disruptions. Analysts were expecting European logistics companies to see their first-quarter earnings benefit from higher freight costs - and supply chain complexity - resulting from the U.S./Israeli war against Iran. DHL was seen as one of the key beneficiaries due to a'spillover' effect from air to sea freight.
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Fuel costs and China's top airline's Q1 profits cloud the outlook
China's top three state-owned carriers returned to profitability in the first quarter. This was due to the robust demand for travel during the Lunar New Year and the recovery of global travel. However, the outlook has been overshadowed by higher fuel prices because of the war in Iran. China Southern Airlines, based in Guangzhou, reported a net loss of 747 millions yuan for the same period of last year. Air China, the country's flagship carrier, posted a net profit of 1.71 billion Yuan compared to a loss last year of 2.04 billion Yuan. Shanghai-headquartered China Eastern Airlines reported a net profit of 1.63 billion yuan, versus a year-earlier loss of 995 million yuan. China Southern, Air China, and?China Eastern all saw their Hong Kong shares drop by as much as 2,7%, 2,9%, and 2.3%, respectively. China Southern and its subsidiary Xiamen Airlines signed agreements with Airbus on Wednesday to buy 102 and 35 A320neo aircraft respectively. Catalogue prices for the 137 planes are around $21.4 billion. Deliveries will be made in phases between 2028 and 2032. China Eastern announced a deal last month with Airbus for the purchase of 101 A320neos in a deal valued at $15.8billion. The three airlines said that a renewed focus of the international market is a key growth driver, as they are operating'some flight routes via Russia which bypass the Middle East. Air China's international passenger traffic increased by 28% in March. China Southern also saw a rise of 23%, and China Eastern experienced a rise of 22%. Bank of America recently released a report predicting that Chinese airline capacity will grow by 13% annually in summer 2026. This would bring it to 91% of the levels of 2019. Europe and Australasia are expected to be the main growth corridors. China-North America routes are still lagging behind, with capacity for China-U.S.A. and China Canada at only 29% and 40% respectively of the 2019 levels. HSBC analysts have warned that in a recent report, the Big 3 are "adversely positioned compared to peers due to a structurally price-sensitive travel cohort" in China. They also added that "rising costs of fuel weigh more on Big 3 profits as they struggle pass costs on without losing customers." The global airline industry was expecting record profits in 2026 of $41 billion, but the doubled price of jet fuel has now put this at risk. Jet fuel prices are 'nearly twice as high, outpacing an increase of?roughly 65 percent in crude oil prices. Major mainland Chinese airlines have increased domestic fuel surcharges by six times. The major airlines have increased the surcharges for domestic flights to 60 yuan (8.80 dollars) for flights less than 800 kilometers and 120 yuan (120 dollars) if they exceed 800 kilometers, up from 10 and 20 yuan respectively. Willie Walsh of the International Air Transport Association warned on Tuesday that the jet-fuel crisis could first hit Asia as a shortage in the summer peak season in the northern hemisphere becomes a growing worry. The impact on routes has been rapid. Flight Master data shows that several?Southeast Asia route were cancelled between April 1, 2012 and?12. These include Xian - Phuket, Chongqing - Phuket and Hohhot - Bangkok. On Oceania, the cancellation rates were 83.3% for Guangzhou to Darwin, 57.1% for Hangzhou to Auckland and 50% for Wuhan to Sydney. Li Hanming is an independent expert in China's aviation sector. He said that these routes were no longer viable commercially due to higher oil prices. Li added that "carriers cannot really raise their fares, either," because it would dampen the demand. Reporting by Sophie Yu and Julie Zhu in Beijing, and Donny and Donny in Hong Kong. Editing by Raju Gopikrishnan.
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Sources say that Apollo, Blackstone, and KKR are competing for Shell's stake in LNG Canada.
Three people with knowledge of the situation said that Apollo Global Management is in a fierce battle to buy a large stake from Shell's energy?major, LNG Canada. Three of the largest asset managers in the world, the 'trio', remain as bidders for the Shell auction, which attracted interest from large money managers, infrastructure investors, and other major companies. Several people have said that the deal could be worth more than $10 billion or even $15 billion. The bidding process is confidential, so everyone who spoke to asked that their names not be used. Shell, who announced on Monday a $16.4billion deal to purchase Canadian natural gas producer ARC Resources, will be able to sell a large portion of its 40% stake in LNG Canada. This sale is also an opportunity for Shell to attract new capital into the LNG Canada export project, ahead of any expansion. LNG Canada is the first major North American liquefied gas facility with direct access into the Pacific Ocean. This allows it to ship directly to Asia, its largest market, where the super-cooled fuel can be sold. Shell will sell the exposure to the first and second phases to one bidder rather than splitting it up, as was originally reported in January. People said that Shell or any of Apollo, Blackstone or KKR might win the final battle, or Shell may retain some or even all of its stake. Shell declined to make any comment. Shell declined to comment. Apollo, Blackstone, and KKR all declined to comment. Insurers Money Shell is the biggest backer of LNG Canada. Other owners of LNG Canada include Japan's Mitsubishi Corp., Malaysia's Petronas and?MidOcean. This joint venture between investment firm EIG, and Saudi Aramco. LNG Canada's appeal has only grown in recent weeks as North American energy assets are benefiting from the free movement of oil and gas due to Middle Eastern energy supply being throttled by the U.S. Iran war. Some people have said that all three asset managers - Apollo Athene's, Blackstone Credit & Insurance's and KKR Global Atlantic's - are using capital from their respective insurance businesses to boost 'their bids. In recent years, money managers have increased their use insurance assets as low-cost sources of funding for other strategic areas in their business. These investments are best made with infrastructure assets, which are low-risk and have a long lifespan. Blackstone, as an example, used its insurance division last year to support a joint venture that included EQT. EQT owns a large number of stakes in the U.S. natural gas producer.
Gulf crisis affects Australian and New Zealand companies, from airlines to banks
The U.S. and Israel war on Iran is causing financial stress for companies in Australia and New Zealand. Higher fuel prices are stoking inflation, reducing consumer and business confidence and weighing on corporate earnings.
Below are some of the companies from Australia and New Zealand who have reported an impact on their business due to the Middle East conflict.
Air New Zealand, New Zealand's flag carrier, announced that it would be raising fares in response to the volatility of jet fuel prices in early March. It was one of the first airlines to do so.
The airline announced on April 7 that it would cut?flights throughout May and June. This will affect around 4% flights and 1% total passengers.
Auckland International Airport, New Zealand: Flights from Auckland to the Middle East have been disrupted.
In March, the number of passengers on Middle Eastern routes dropped by 81% and seat capacity fell by 73% compared to a year earlier, according to airport operator.
New Zealand-based a2 Milk has cut its profit forecast for fiscal 2026 as higher freight costs and supply chain disruptions due to conflict have affected the availability of the China-label infant formula product on its largest market.
Cleanaway Waste Management: The company has slashed the full-year forecast for operating earnings by approximately A$20,000,000 ($14.17million), due largely to higher costs, reduced activity, and differences in timing of cost recovery.
Cochlear, an Australian manufacturer of hearing implants, has lowered its profit forecast for 2026 due to weaker trading on developed markets. The company cited slower "surgical volumes", fewer referrals for hearing aids, and a softer consumer mood. The company stated that the Middle East War has increased risks for order cancellations, delays in delivery, and a higher exposure to receivables. This, combined with worsening margins and restructuring costs, have led to a reduction of its 2026 profit forecast.
Fletcher Building, New Zealand: Fletcher Building, New Zealand, said that it is indirectly exposed to the Middle East conflict through supply chains, freight lines, energy costs and the wider economic impact of construction demand in Australasia.
Construction materials manufacturer expects to increase prices in all divisions as a result of passing on costs to its customers. Plastics, where the company claims immediate exposure is present, will be subject to price increases of up to 36%. Other divisions are expected to see a 1%-5% increase.
Fonterra New Zealand, a dairy producer, said the conflict could impact its supply chain and increase its inventory and costs in second half of year. It also contributed to volatility in global commodities prices.
National Australia Bank: National Australia Bank said it expected to incur credit impairment costs of A$706 (504.44 millions) during the first half fiscal 2026.
NAB stated that the volatility of interest rates in the second quarter, the weaker New Zealand Dollar and the increase in provisioning would result in a reduction of the group's?common equity tier 1 capital rate by approximately 20 basis points on March 31.
The company also plans to apply a discount of 1.5% to its dividend reinvestment program for the first half to raise A$1.8 billion and help strengthen its balance sheet.
Orora Packaging Company: Orora has lowered its earnings forecasts for its French division Saverglass, and cancelled the share buyback program. The company cited the impact of war.
Due to the closing of shipping routes, the company also stopped bottle production in its glass production plant at Ras al-Khaimah (United Arab Emirates).
Qantas Airways: Qantas Airways is Australia's national carrier. It has raised its fuel costs outlook for the second part of the year up to A$800m and announced that it will not be starting its planned A$150m share buyback, citing the sharply higher jet fuel prices.
Qantas has increased fares to offset the rising cost of its flights and is shifting them towards stronger routes, such as Paris and Rome?where demand is strong, and cut domestic capacity by approximately 5 percentage points during the June quarter.
Qube Holdings : Qube anticipates that the Middle East conflict will have an impact on its EBITA of between A$10 and A$20 million in fiscal 2026.
The logistics company said, however, that recent events could encourage an acceleration of investment in new projects involving alternative energy, which could prove beneficial for the firm.
Virgin Australia: Virgin Australia expects fuel costs to increase by around A$30 to A$40 Million ($21.39 to $28.52 millions) in the second half fiscal 2026.
In mid-March, the airlines announced that they were adjusting their fares due to the rising costs in the aviation industry.
Westpac: Westpac, Australia's no. Westpac, Australia's no.
Westpac's net margin for its Treasury and Markets division has been weakened due to interest rate volatility related to the conflict. A weaker outlook is already leading to higher credit provisioning.
Westpac's provisioning of?potentially bad debt? is at its highest level since the COVID-19 Pandemic.
Woolworths Woolworths is the largest Australian supermarket. It said that the Middle East conflict had created uncertainty for both customers and suppliers. This has exacerbated the already severe cost of living pressures.
Fuel price pressures, customer retention investments and fuel price increases will all affect the firm's forecasted growth in domestic food segment earnings for fiscal 2026.
Woolworths has also announced that it will freeze the prices of 300 household staples from May 1 for three months. This is due to cost pressures imposed by Australian suppliers, which are driving up prices across all supermarkets.
Worley: Worley estimates that the negative impact of the Middle East conflict will be between A$30 and A$40 millions on its underlying EBITA in fiscal 2026.
The Australian engineering company warned that it would not be able to grow its underlying EBITA by more than 5% in fiscal 2026 but aimed to increase revenue by more than 5% in fiscal 2025.
(source: Reuters)