Quickbites — BHP to record bad results

December 14: Broken Hill Proprietary Co Ltd., Australia's market leader, is set to record another disappointing profit this week when it re...

December 14: Broken Hill Proprietary Co Ltd., Australia’s market leader, is set to record another disappointing profit this week when it releases its half-yearly results, analysts said. With lower copper and commodity prices biting, analysts expect the resource giant’s earnings to be no more than A$560 million. That figure compares with earnings of A$683 million in the corresponding half last year. "Intuitively I think they will be struggling to match the last one, not a lot has gone in their favour," one funds manager said.

Most analysts expect the copper division will continue making losses in the second quarter and many are also predicting trouble in both the minerals and steel divisions. The only bright spot for the company will be its petroleum division, but one broker said its earnings would only hold up because of the slide in the Australian dollar. Much of the copper division’s weakness would come from matters beyond BHP’s control such as weaker copper prices and its drought-halted Ok Tedi mine in Papua New Guinea. But the drop would also highlight that costs at some of its North American mines were still too high.

Mitsui Gas gets Vietnam licence

Mitsui Co. of Japan and the Thai subsidiary of Unique Gas have received a licence to increase their Vietnam investment to $22.5 million to produce lubricants and solvents, a company official said. The licence allows Unique Gas and Petrochemicals Vietnam (UGPV) to quadruple its current investment of $5.02 million and expand its oil downstream activities in its facilities in Dong Nai province, about 40 kilometres (25 miles) outside Ho Chi Minh City. UPGV deputy general director Toshiaki Isshiki told AFP on Saturday the company is forging ahead with expansion plans despite the slowdown in the Vietnamese economy.

Story continues below this ad

UPGV expects to complete construction on the new facilities for lubricants and solvents at its existing site by early 1999. The group faces fierce competition from other petrochemical giants, including Total of France, Shell International as well as local companies Saigon Petrol and Petrolimex.

Fuji Bank to cut 500 more jobs

Japan’s Fuji Bank Ltd. under pressure from bad loans is to increase staff cuts from 1,500 to 2,000 by March 1999 as part of a restructuring, a newspaper said. After the cuts the major commercial bank will have 13,700 employees, compared with 15,168 last March, the Mainichi Shimbun said.

The bank also plans to sell stocks worth 500 billion yen ($3.8 billion) to raise its capital adequacy ratio from 8.6 per cent as of the end of September to a round 10 per cent by March 1999.

Fuji Bank, a major creditor of failed Yamaichi Securities Co. Ltd., rejected the brokerage’s request for additional loans, which triggered Yamaichi’s collapse in November. Fuji Bank said in mid-November that its parent pre-tax profit plunged 75.6 per cent from a year earlier to 14 billion yen in the six months to September on the write-off of bad debts. Fuji Bank forecast for the year to March 1998 a parent pre-tax loss of 450 billion yen on operating income of 2,600 billion yen, with a net loss of 440 billion yen.