Sabtu, 03 Agustus 2019

Berkshire Hathaway profit falls as insurance underwriting declines - Yahoo Finance

Buffett, chairman and CEO of Berkshire Hathaway, takes his seat to speak at the Fortune's Most Powerful Women's Summit in Washington

By Jonathan Stempel

(Reuters) - Berkshire Hathaway Inc <BRKa.N> on Saturday said its quarterly operating profit fell more than analysts expected, as weaker results from insurance underwriting and a slowing economy weighed on the conglomerate run by billionaire Warren Buffett.

The auto insurer Geico suffered larger accident gains, while cargo volumes for consumer and agricultural products declined at the BNSF railroad. Earnings barely budged in Berkshire's manufacturing and its service and retailing lines of business.

Second-quarter operating profit declined 11% to $6.14 billion, or roughly $3,757 per Class A share, from $6.89 billion, or roughly $4,190 per Class A share, a year earlier.

Analysts on average expected operating profit of $3,851.28 per share, according to Refinitiv IBES.

Berkshire also said quarterly net income rose 17% to $14.07 billion, or $8,608 per Class A share, from $12.01 billion, or $7,301 per Class A share, a year earlier, reflecting higher unrealized gains on Berkshire's investments.

A U.S. accounting rule requires Berkshire to report such gains with earnings. That rule adds volatility to Berkshire's net results, and Buffett says it can mislead investors.

The U.S. economy's annualized growth rate slowed to 2.1% in the second quarter from 3.1% in the first quarter, as an acceleration in consumer spending was partially offset by declining exports, manufacturing and business investment, reflecting the U.S.-China trade war.

Berkshire ended June with $122.4 billion of cash and equivalents, though it spent $2.1 billion in the quarter to repurchase its own stock.

The cash hoard reflects Buffett's 3-1/2-year drought in finding major acquisitions. He committed $10 billion in April to help Occidental Petroleum Corp <OXY.N> buy rival Anardako Petroleum Corp <APC.N>.

Berkshire operates more than 90 businesses that also include Dairy Queen ice cream, Fruit of the Loom underwear, and its namesake energy company and real estate brokerage.


(Reporting by Jonathan Stempel in New York; Editing by Hugh Lawson)

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2019-08-03 12:21:00Z
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Heathrow flights cancelled as support staff strike looms - BBC News

Heathrow Airport is to cancel 177 flights on Monday and Tuesday after a union vote rejected a pay offer.

Around 4,000 Unite members including engineers, firefighters and security staff voted on the airport's revised deal, with 88% opting to strike.

If the walk-outs go ahead, Unite says, almost 2,500 staff will miss work.

Heathrow is yet to announce which flights will be cancelled, and said passengers should check with their airlines to see if they were affected.

Affected passengers might be offered other flights or refunds by their airline, it added.

Heathrow said the flight cancellations, which affect 91 airlines including British Airways, were a pre-emptive measure in case a solution was not found.

Talks between union leaders and Heathrow management at the conciliation service Acas, aimed at averting the strike action, lasted until late on Friday and resumed on Saturday.

The airport, which advised passengers to check its website for updates, said its contingency plans would keep Heathrow open and safe on both strike days, albeit with some disruption.

Passengers still scheduled to fly on Monday and Tuesday have been warned to arrive at least three hours ahead of long-haul departures and two hours ahead of short-haul departures, because it may take longer to get through security.

'Growing anger'

A Heathrow spokeswoman said: "I can confirm that we are working with our airline partners to consolidate and reduce the number of flights operating during the strike period.

"We have proactively cancelled 177 flights departing Heathrow across Monday and Tuesday.

"Passengers on these flights will have either been rebooked onto alternative services or provided a refund."

Unite regional co-ordinating officer Wayne King said: "This latest vote for strike action points to growing anger among the airport's workers in a whole range of vital jobs which are essential to the smooth and safe running of Heathrow.

"Airport bosses need to heed this latest strike vote and the overwhelming rejection by our members of the revised pay offer which offers little over and above the original offer of £3.75 extra a day for many workers."

Meanwhile, talks aimed at averting a separate strike by British Airways pilots are to continue next week.

Leaders of the British Airline Pilots Association (Balpa) met the company last week to try to resolve the dispute over pay.

The union would have to give two weeks' notice of any industrial action.

Can I claim compensation if my flight has been cancelled?

If your flight out of Heathrow has been cancelled, you should contact your airline to see what you are entitled to in terms of a refund or compensation.

However, if your flight has been cancelled due to airport (rather than airline) staff striking, it is unlikely you will be able to claim compensation as this would be considered "extraordinary circumstances" outside of the airline's control, the Civil Aviation Authority said.

The CAA added that the airport is not obliged to pay compensation directly to passengers, and whether the airport gives its customers (the airlines) compensation is a commercial issue between the two parties.

If your flight has been cancelled because airline staff are striking, the CAA said, then this would be considered within the airline's control, and therefore you have a legal right to either:

  • A full refund, and this includes flights in the same journey that might be from a different airline (for example, an onward or return flight)
  • A replacement flight to get to your destination
  • Or, if you are part way through your journey and don't want a replacement flight, you are entitled to a flight back to the airport you originally departed from

If the cancellation delays you by two hours or more, you are also legally entitled to compensation and help with any costs you may incur as a result of the delay.

Are you due to fly on Monday or Tuesday? Has your flight been affected? Get in touch by emailing haveyoursay@bbc.co.uk

Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways:

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https://www.bbc.com/news/business-49212984

2019-08-03 10:19:54Z
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Heathrow flights cancelled as support staff strike looms - BBC News

Heathrow Airport is to cancel 177 flights on Monday and Tuesday after a union vote rejected a pay offer.

Around 4,000 Unite members including engineers, firefighters and security staff voted on the airport's revised deal, with 88% opting to strike.

If the walk-outs go ahead, Unite says, almost 2,500 staff will miss work.

Heathrow is yet to announce which flights will be cancelled, and said passengers should check with their airlines to see if they were affected.

Affected passengers might be offered other flights or refunds by their airline, it added.

Heathrow said the flight cancellations, which affect 91 airlines including British Airways, were a pre-emptive measure in case a solution was not found.

Talks between union leaders and Heathrow management at the conciliation service Acas, aimed at averting the strike action, lasted until late on Friday and resumed on Saturday.

The airport, which advised passengers to check its website for updates, said its contingency plans would keep Heathrow open and safe on both strike days, albeit with some disruption.

Passengers still scheduled to fly on Monday and Tuesday have been warned to arrive at least three hours ahead of long-haul departures and two hours ahead of short-haul departures, because it may take longer to get through security.

'Growing anger'

A Heathrow spokeswoman said: "I can confirm that we are working with our airline partners to consolidate and reduce the number of flights operating during the strike period.

"We have proactively cancelled 177 flights departing Heathrow across Monday and Tuesday.

"Passengers on these flights will have either been rebooked onto alternative services or provided a refund."

Unite regional co-ordinating officer Wayne King said: "This latest vote for strike action points to growing anger among the airport's workers in a whole range of vital jobs which are essential to the smooth and safe running of Heathrow.

"Airport bosses need to heed this latest strike vote and the overwhelming rejection by our members of the revised pay offer which offers little over and above the original offer of £3.75 extra a day for many workers."

Meanwhile, talks aimed at averting a separate strike by British Airways pilots are to continue next week.

Leaders of the British Airline Pilots Association (Balpa) met the company last week to try to resolve the dispute over pay.

The union would have to give two weeks' notice of any industrial action.

Can I claim compensation if my flight has been cancelled?

If your flight out of Heathrow has been cancelled, you should contact your airline to see what you are entitled to in terms of a refund or compensation.

However, if your flight has been cancelled due to airport (rather than airline) staff striking, it is unlikely you will be able to claim compensation as this would be considered "extraordinary circumstances" outside of the airline's control, the Civil Aviation Authority said.

The CAA added that the airport is not obliged to pay compensation directly to passengers, and whether the airport gives its customers (the airlines) compensation is a commercial issue between the two parties.

If your flight has been cancelled because airline staff are striking, the CAA said, then this would be considered within the airline's control, and therefore you have a legal right to either:

  • A full refund, and this includes flights in the same journey that might be from a different airline (for example, an onward or return flight)
  • A replacement flight to get to your destination
  • Or, if you are part way through your journey and don't want a replacement flight, you are entitled to a flight back to the airport you originally departed from

If the cancellation delays you by two hours or more, you are also legally entitled to compensation and help with any costs you may incur as a result of the delay.

Are you due to fly on Monday or Tuesday? Has your flight been affected? Get in touch by emailing haveyoursay@bbc.co.uk

Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways:

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https://www.bbc.com/news/business-49212984

2019-08-03 07:38:50Z
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Jumat, 02 Agustus 2019

Gas Glut Weighs on Oil Giants - The Wall Street Journal

Natural-gas prices have fallen due to concerns about a glut, driven by booming production in the Permian Basin. Natural-gas flare near Pecos, Texas. Photo: James Durbin for The Wall Street Journal 
By
Bradley Olson

The world’s largest oil companies are feeling the financial pressure of a global decline in natural-gas prices.

Exxon Mobil Corp. XOM -1.28% second-quarter profits fell 21% as diminished returns for gas and petrochemicals offset production growth in America’s hottest oilfield, the Permian Basin of Texas and New Mexico.

Chevron Corp. CVX -0.42% ’s net income rose 26% to $4.3 billion due in part to its receipt of a breakup fee from a scuttled deal to buy Anadarko Petroleum Corp. APC -0.77% , but the company saw the prices it fetches for its U.S. natural gas fall by more than half.

Exxon’s lower returns Friday mirrored similar results earlier this week from European counterparts, including Royal Dutch Shell PLC. Profits from the company’s global natural-gas segment fell by about half to $1.34 billion, as prices declined abroad due to abundant new supply from projects around the world. Shell said its quarterly profit fell by half to about $3 billion.

Natural-gas prices have been falling due to concerns about a glut of the cleaner-burning fuel, driven in part by booming production in the Permian Basin and new export projects ranging from the Texas Gulf Coast to Papua New Guinea. The abundance of the fuel has pushed down prices for liquefied natural gas, as more companies seek to sell cargoes around the world.

Oil prices also continue to be volatile due to demand and geopolitical worries. The U.S. benchmark for crude fell 7.9% to $53.95 a barrel Thursday, but was bouncing back somewhat Friday morning, up 3%.

Exxon, one of the largest natural-gas producers in the U.S., warned on July 1 that second-quarter profits would fall by as much as $600 million due to price declines. Shale companies also have suffered due to the price decrease.

Shares in Whiting Petroleum Corp. plunged 39% on Thursday after the company disclosed a production slowdown. It said it took in just 47 cents per thousand cubic feet of gas during the second quarter, down 64% from the same period last year. Whiting had to throttle its production growth as North Dakota limited how much natural-gas companies can burn off, a process known as flaring.

“Infrastructure constraints were more severe than anticipated and we did not have enough cushion for associated operating delays,” Chief Executive Brad Holly told investors. The company said this week that it was slashing its workforce by 33%, joining other shale companies such as Pioneer Natural Resources Co. PXD 0.67% in paring back to limit costs.

Other shale companies are experiencing operations-related problems. Concho Resources Inc. shares fell 22% Thursday after it disclosed disappointing output from wells it had drilled too close together, a growing problem in the shale-drilling sector.

Related Video

The U.S. has more than doubled its crude output over the last decade. Much of the growth is due to the Permian Basin of West Texas and New Mexico. WSJ traces the hotspot of North America’s crude oil boom, with a look at challenges that producers in the region face.

Exxon, boosted by its drilling operations in the Permian, said production rose about 7% from a year ago. But earnings fell 21% to $3.13 billion, or 73 cents a share. That beat analyst expectations, although they would have missed without a one-time tax benefit of about $500 million that stemmed from from a tax-rate change in the Canadian province of Alberta.

The spot U.S. benchmark price for natural gas fell by about 10% in the three months ended in June to an average of $2.51 per million British thermal units, according to FactSet. The price has continued to fall through July even as a U.S. heat wave led to a surge in demand at power plants. In some regions, such as in West Texas, natural gas has even sold for a negative value, meaning producers had to pay pipeline companies to process and ship the commodity.

U.S. gas production rose to a record of more than 37 trillion cubic feet last year, up 44% from a decade earlier.

At Exxon, revenue dropped 6% to $69.09 billion, above the consensus forecast of $63.6 billion. Capital and exploration expenditures were up 22% to $8.08 billion, due in part to a ramp-up in spending and activity in the Permian Basin.

Exxon had previously said earnings would fall in the second-quarter due to lower prices and more maintenance expenses. Some analysts said the results were even more underwhelming in light of previous disclosures.

“They missed already lowered expectations across all segments,” said Jennifer Rowland, an analyst at Edward Jones.

Exxon executives noted that prices and margins for three of its four main businesses were near 10-year lows, but the company continues to have the financial ability to invest in new projects.

“We’re in a unique position versus the rest of industry,” Exxon Senior Vice President Neil Chapman said. “We have the financial capacity to maintain our plans.”

Chevron’s production rose 9% to more than 3 million barrels of oil and gas a day, a record driven by activity in the Permian Basin and the San Ramon, Calif., company’s Wheatstone natural-gas export project in Australia.

Sales fell 10% to $36 billion, and capital spending in the first six months of the year rose 9% to $10 billion.

Read more

Exxon shares were down about 1.5% in Friday morning trading. They were down 9.3% in the last 12 months.

Chevron shares slipped about 1.4% Friday morning. The company’s stock price has fallen about 2.7% in the last year.

—Aisha Al-Muslim and Rebecca Elliott contributed to this article.

Write to Bradley Olson at Bradley.Olson@wsj.com

Copyright ©2019 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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2019-08-02 15:50:00Z
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Dow drops 300 points as trade war escalates - CNN

Stocks are bracing for a dramatic finish this week, after President Donald Trump announced new tariffs on Chinese imports Thursday.
Starting September 1, $300 billion worth of goods from China, including toys and iPhones, will be hit with a 10% tariff. That's on top of the existing 25% tariff on $250 billion worth of imports.
US stocks and global markets are flashing red in response.
The Dow (INDU) shed 305 points late in the morning on Friday. The S&P 500 (SPX) and the Nasdaq Composite (COMP) slid 1.2% and 1.8% respectively.
The S&P and Nasdaq are on track for its worst week since December. For the Dow, it is shaping up to be the worst week since late May, according to Refinitiv.
The July jobs report did little to change the narrative. The US economy added 164,000 jobs in July, in line with the Refinitiv consensus estimate. The unemployment rate was unchanged at 3.7%.
More drama on the trade front adds to the odds that the Federal Reserve will make a deeper interest rate cut in September, according to Goldman Sachs economists led by Jan Hatzius. That said, with one month left until the new tariffs are implemented and on-going talks with Beijing, there is a chance they will never actually come into effect.
The Goldman economists anticipate the new tariffs will shave up to 0.2 percentage points off of US GDP growth. That will rise to a 0.5- to 0.6-percentage point cut if the tariffs rise to 25%, they said.
The risk of US tariffs on European auto imports has risen with Thursday's tariff announcement, they said.
It has been a volatile week for stocks.
On Wednesday, the Fed cut rates by a quarter percentage point, as widely anticipated. But comments from Fed Chairman Jerome Powell that the cut wasn't ushering in an extended period of loser monetary policy disappointed markets. Stocks sold off.
On Thursday, equities recovered and the weakest ISM manufacturing survey in three years added to the narrative that the US economy will need another boost after this week's rate cut.
Then Trump announced the new tariffs, and stocks dropped sharply. The Dow swung 600 points over the course of the day, the biggest one-day point move since January.

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https://www.cnn.com/2019/08/02/investing/dow-stock-market-today/index.html

2019-08-02 15:01:00Z
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Wall Street drops to one-month low on trade, growth fears - Investing.com

© Reuters. Traders work on the floor at the NYSE in New York © Reuters. Traders work on the floor at the NYSE in New York

By Amy Caren Daniel

(Reuters) - Wall Street's main indexes sank to one-month lows on Friday after a sharp escalation in U.S.-China trade tensions and tepid job growth in July reinforced fears of a global economic slowdown.

The Labor Department said nonfarm payrolls increased by 164,000 jobs last month and the economy created 41,000 fewer jobs in May and June than previously reported. However, July's numbers were in line with economists' expectations.

"Job numbers were not too far from expected. It shows the trend is slowing down. It's consistent with another rate cut either in September or October," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

"The bigger issue for the Fed policy outlook is tariffs because that implies you will see higher costs for finished goods rather than intermediate goods that we have been importing from China."

The jobs report comes a day after President Donald Trump threatened to slap a 10% tariff on $300 billion of Chinese imports from next month, sending global markets tumbling overnight and investors fleeing to safe-haven U.S. Treasuries and the Japanese yen.

China on Friday said it would not be blackmailed and warned of retaliation.

Technology companies, which get a sizeable portion of their revenue from China, were the hardest hit, down 1.34%, weighed by iPhone maker Apple Inc (NASDAQ:) and chipmakers.

The Philadelphia Semiconductor index slipped 1.06%, while shares of Apple fell 1.5%.

Boeing (NYSE:) Co, the single largest U.S. exporter to China, fell 0.8% and Caterpillar Inc (NYSE:) declined 0.6%.

The sudden escalation in trade rhetoric follows the Federal Reserve on Wednesday playing down expectations of further aggressive monetary policy actions after cutting interest rates for the first time in a decade.

Hopes that the Fed would be more accommodative to counter the impact of the bruising trade war had helped Wall Street's main indexes hit record highs last month.

Fed funds futures implied traders were positioned for a 100% chance the central bank would reduce its target range on interest rates by a quarter point in September, CME Group's FedWatch program showed. [MMT/]

At 9:46 a.m. ET, the was down 128.15 points, or 0.48%, at 26,455.27, the was down 16.70 points, or 0.57%, at 2,936.86. The was down 68.59 points, or 0.85%, at 8,042.53.

The defensive utilities sector rose 0.3%, while a surge in oil prices helped the energy sector eke out small gains. [O/R]

The second-quarter earnings season is in full swing, with 74.4% of the 355 S&P 500 companies that have reported so far beating profit estimates, according to Refinitiv data.

NetApp Inc (NASDAQ:) slumped 20.7% after the data storage equipment maker lowered its forecast for the first quarter and 2020, blaming a weakening macro environment.

Declining issues outnumbered advancers for a 2.24-to-1 ratio on the NYSE and for a 2.25-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and four new lows, while the Nasdaq recorded seven new highs and 76 new lows.

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https://www.investing.com/news/stock-market-news/trump-tariff-threat-hits-wall-street-for-second-day-1943938

2019-08-02 14:51:00Z
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Wall St. drops at open on Trump's tariff threat, slow job growth - Investing.com

(Reuters) - U.S. stock indexes fell at open on Friday, weighed by tariff-sensitive technology stocks following a sharp escalation in U.S.-China trade tensions, while a tepid domestic jobs growth in July reinforced fears of an economic slowdown.

The fell 54.76 points, or 0.21%, at the open to 26,528.66. The S&P 500 opened lower by 9.66 points, or 0.33%, at 2,943.90. The dropped 54.70 points, or 0.67%, to 8,056.42 at the opening bell.

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2019-08-02 13:41:00Z
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