Nestlé delivers just enough to fend off Dan Loeb 14 Feb 2019 The Swiss consumer giant’s 2018 results show the Kit Kat maker is on track to meet its modest operating margin goal. That is the minimum to keep activist Third Point at bay. Speeding up disposals and aiming for more ambitious targets would be bolder – and achievable.
Spluttering SocGen undone by its own complacency 7 Feb 2018 France’s No.2 lender has reduced 2020 profit targets blaming low interest rates. That undercuts boss Frédéric Oudéa’s strategy based on revenue growing faster than expenses. Cuts to the misfiring investment bank will only go so far. A capital shortfall is now a bigger concern.
Julius Baer embarks on a more cautious era 4 Feb 2019 Newish chief Bernhard Hodler is cutting the Swiss wealth manager’s cost base after reporting weak 2018 results. It’s a shift from the expansion drive spearheaded by previous boss Boris Collardi. Shrinking margins and volatile transaction fees give Julius Baer little choice.
Downbeat Davos is still short on introspection 25 Jan 2019 Corporate and political leaders in the Swiss resort fretted about slowing economies, angry citizens, and clashes over technology. The gloom contrasted with last year’s misplaced optimism. Yet delegates remain bafflingly confident about their ability to predict what’s next.
China outlook from Davos goes a little off-piste 25 Jan 2019 A sharper slowdown is high on the list of worries at the economic retreat. George Soros warns a Cold War with the country could turn hot. For now, China’s growth is merely cooling and Beijing has ammunition left. Its Alpine promise of "modest prosperity" may be feasible.
Cost cuts can help UBS ride market ructions 22 Jan 2019 The Swiss bank reported a 2 percent increase in pre-tax profit despite a torrid end of 2018. The investment bank crashed to a quarterly pre-tax loss, while wealth management assets fell. The tougher environment puts more pressure on CEO Sergio Ermotti to hit his expense targets.
Context makes Santander’s Orcel fail even worse 18 Jan 2019 The Spanish bank expected UBS to honour a portion of its would-be CEO’s deferred pay. But recent executive moves at Deutsche Bank and Barclays saw new hires compensated in full. Andrea Orcel’s acceptance of a cut was a concession – making it all the odder Santander backed out.
Swiss $4 bln freight battle has questionable cargo 16 Jan 2019 Activist investor Cevian has helped solicit a bid for subscale freight group Panalpina. Would-be owner DSV could face competition from Switzerland’s Kuehne + Nagel, handing shareholders a sweeter price. It’s less clear that either will make a return from a much higher offer.
Yellow vests will hit Richemont rivals harder 11 Jan 2019 The Cartier owner said last year’s French protests were partly to blame for slowing organic growth. But Hermes and LVMH are more exposed to France, which brings in just 6 percent of Richemont’s revenue. Weakness in Hong Kong is a bigger worry for the $35 billion watchmaker.
Credit Suisse Mozambique mess is shameful at best 4 Jan 2019 Three of the Swiss lender’s former bankers have been arrested on charges of facilitating kickbacks on $2 bln of loans for the African country. Credit Suisse blames deceptive employees and says it has tightened controls. Even if the fallout ends there, it’s highly embarrassing.
Hitachi buys live wire in ABB power deal 17 Dec 2018 The Japanese conglomerate is paying a handsome $11 bln valuation for the lacklustre power grid unit of its Swiss rival. Activists there will be placated by the proceeds and a restructuring. Hitachi becomes an industry giant but finding other benefits, like synergies, will be tricky.
Plunging GAM shares belie elusive value 13 Dec 2018 With shares down 80 pct this year, the Swiss asset manager could be a takeover target. Cost savings alone are worth more than its market value. Yet uncertainty may lead clients to pull money, leaving a buyer with little. Fund group valuations are especially blurry in a panic.
Thiam’s bid to be boring rests on ditching traders 12 Dec 2018 The Credit Suisse boss plans to buy back shares worth 1.5 bln Swiss francs a year in 2019 and 2020. That should help the bank hit its 12 pct return target. Robust wealth management will offset lower trading revenue. The prospect of a 10 pct dividend yield also appeals.
Swiss spat offers Britain glimpse of Brexit future 7 Dec 2018 While UK politicians argue among themselves, the European Union is threatening to restrict share-trading with the Alpine nation over stalled treaty talks. It’s a stark reminder of the limits of sovereignty - and of the EU’s readiness to use regulation as a political weapon.
Albert Frere’s heirs can eliminate market discount 5 Dec 2018 The death of Belgium’s richest man casts a spotlight on GBL, the 13 bln euro group he co-founded. Despite past canny investments, it’s valued at a hefty discount to stakes in companies like Adidas and Pernod Ricard. Selling assets and beefing up private deals could change that.
Swiss have no easy way out of EU deadlock 3 Dec 2018 The government delayed by a week a decision on an EU treaty that would simplify a maze of bilateral deals. Accepting Brussels’ demands to further open up labour markets would risk defeat in a referendum. But failure to agree means putting barriers around the Swiss stock market.
Julius Baer slip heralds broader pain for peers 20 Nov 2018 Choppy markets and nervous clients hit the Swiss private bank’s margin in October, putting a key target at risk. The group’s push into the more volatile Asian market didn’t help. The weak update flashes a red light to rival wealth managers, like Credit Suisse.
Richemont’s Alibaba tie-up can’t come soon enough 9 Nov 2018 The luxury watchmaker’s sales growth is lower than where it was, and where rivals are. An obvious way to expand is to hike online sales. Teaming up with the Chinese digital giant would give Richemont a greater chance of parity with European luxury peers.
UBS’s Ermotti can afford a legal brawl or two 9 Nov 2018 The Swiss lender has refused a $2 bln U.S. settlement over missold securities, according to Reuters. Barclays, which spurned a similar deal, offers some hope of a lower eventual hit. With healthy capital, Ermotti has headroom to fight both this and a separate French tax battle.
Private equity could scratch Nestlé skin-care itch 6 Nov 2018 The KitKat maker is selling a unit specialising in psoriasis and acne treatments. Rival consumer groups may be put off by the business’s tricky mix of products and low margins. Private equity firms, already piling into the dermatology sector, would make a more logical owner.