Industry News

June 28, 2012 The Age Grocery wholesaler Metcash said it would raise $325 million with the funds to be used to expand in automotive parts and to purchase the rest of hardware group Mitre 10. The company also revealed a full-year profit of $90 million, less than the $135.9 million expected by analysts according to Bloomberg. The annual result was also down 63 per cent on a year earlier, with the company blaming the cost of restructuring its operations and the acquisition of Franklins for the drop. Metcash shares are in a trading halt and last changed hands at $3.74. The company said the price of the new shares would hinge on demand. The Australian Financial Review earlier reported the price would be in the range of $3.46-$3.56, implying a discount of as much as 7.5 per cent on its last price. Metcash will pay a final dividend of 16.5…

June 29, 2012 The Age GROCERY wholesaler Metcash ticked all the wrong boxes yesterday. It delivered a full-year profit that was below expectations, it announced plans to buy a non-core business and it decided to raise capital in a shabby equities market. To make matters worse, Metcash is also feeling the increased financial heat from legacy deals – having to write off loans and investments in supermarket retail joint ventures. This is a company in the middle of an exercise in reinvention. But it’s a process that is being undertaken in a very difficult environment. In the midst of all this the company’s chief executive, Andrew Reitzer, needs to explain why his $215 million acquisition of Franklins is taking longer than expected to gain traction and reap the promised returns. Investors would be justified in questioning whether Metcash overpaid for what is essentially an investment in creating a monopoly in…

Jane Harper Herald Sun June 29, 2012 GROCERY wholesaler Metcash is seeking an immense cash injection to bankroll an acquisition spree following a dramatic slide in profitability. The group, which supplies groceries to IGA supermarkets, will raise up to $375 million by issuing new shares. It will use funds to buy out hardware store Mitre 10 and fund other acquisitions. It comes after restructuring costs sent the group’s full-year profit plummeting 63 per cent. Metcash chief executive Andrew Reitzer said the new acquisitions played to the company’s strengths. He rejected suggestions from retail analysts that Metcash was diversifying to prop up its food and grocery business, which recorded sales growth of just 2 per cent amid a testing environment. “There’s nothing wrong with the IGA business,” Mr Reitzer said. “Our supermarket business would be the envy of many companies around the world.” He said the sustained price war between Coles…

CSNNews DALLAS — Nobody wants to receive a ticket from a police officer. However, 7-Eleven Inc. is making sure there is one exception to that rule. For the 18th time, the convenience store chain will launch its Operation Chill community relations program this summer. As part of Operation Chill, 7-Eleven will hand out approximately 1 million coupons to law enforcement agencies nationwide. The coupons entitle the bearer to receive a free Slurpee. Hence, more than 600 law enforcement agencies will “ticket” youngsters who are caught in random acts of kindness, good deeds or positive community activities with the free Slurpee coupons redeemable at participating 7-Eleven stores. “Uniformed police officers can be intimidating to many kids,” Mark Stinde, 7-Eleven’s vice president of asset protection, said in a company news release. “Recognizing good behavior helps build positive relationships between local law enforcement agencies and young people and encourages good behavior with a…

Eli Greenblat June 29, 2012 The Age Struggling upmarket department store David Jones has received an unsolicited takeover approach from a British company, which could potentially value the retailer at more than $1.4 billion and spark a consolidation of the underperforming Australian retail sector. David Jones told the Australian Securities Exchange this morning it had received an unsolicited letter from a non-incorporated UK entity indicating its interest in making an offer for the retailer. It is believed that David Jones chief executive Paul Zahra is currently overseas in Europe on business. In a brief statement to the market, David Jones said the approach was made by a non-incorporated UK entity about which ”no usual public information is available’’. “The directors do not believe they currently have relevant information to enable them to qualify or value the approach but should this change will advise the market accordingly,’’ David Jones said in…

July 2, 2012 The Age Four in 10 businesses in key sectors have warned of immediate price hikes under the carbon tax. FOUR in 10 Australian businesses in the key sectors of manufacturing, services and construction plan to hike their prices immediately in response to the carbon tax, a survey has found. As the Gillard government began the tough job of selling its carbon tax, a survey by the Australian Industry Group concluded that price rises would be widespread, although ”considerable confusion” remained about the scheme. The survey of Ai Group members found that 40 per cent of manufacturing businesses, 40 per cent of services businesses and 44 per cent of construction businesses planned to increase at least some of their prices from yesterday. Also from yesterday, nearly 300 big carbon emitters – mostly power generators and mining companies but also many local councils – began paying the $23-a-tonne carbon…