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Monday, March 2, 2009
Oilexco gets breather from Toronto Stock Exchange
Oilexco Inc, which received an extension on delisting of its shares by the Toronto Stock Exchange (TSX), said it was exploring several options for its shares to continue trading in Canada. The company said in a statement on late Monday that the TSX now agreed to delay the previously announced delisting date to Feb. 17, while Oilexco pursues listing on a different stock exchange in Canada. The Calgary, Alberta-based oil explorer on Feb. 5 had said it obtained bankruptcy protection under Canadian laws following its move in January to put its British assets under creditor protection. The company had said on Jan.7 that it placed its Oilexco North Sea Ltd unit under administration and continued to pursue the sale of the assets of the North Sea company. Several Canadian companies, including North America's biggest telephone equipment maker Nortel Networks Corp and Canadian locomotive builder Railpower Technologies Corp are on the verge of delisting from the Toronto Stock Exchange after seeking protection from creditors in a tumbling market. Oilexco's Canada-listed shares plunged more than 95 percent over the second half of last year as the company ran into funding troubles. The shares closed at 14.5 Canadian cents on Monday on the Toronto Stock Exchange.
Buffett says economy in shambles
Berkshire Hathaway Inc, Warren Buffett's insurance and investment company, barely broke even in the fourth quarter because of losses on derivatives contracts tied to the stock market.
Profit fell 96 percent, the fifth straight quarterly decline, and Berkshire's net worth tumbled $10.9 billion in the year's final three months. Net worth per share fell 9.6 percent in 2008, only the second decline since Buffett began running Berkshire in 1965. It fell 6.2 percent in 2001.
In his eagerly anticipated annual letter to Berkshire shareholders, Buffett also offered a gloomy economic outlook, saying "the economy will be in shambles throughout 2009 -- and for that matter, probably well beyond."
Still, despite what he called "paralyzing fear" resulting from the credit crisis and falling housing and stock prices, he remained optimistic about American resilience, and praised government efforts to avoid a "cataclysmic" breakdown in the financial system.
"Though the path has not been smooth, our economic system has worked extraordinarily well over time," he said. "It has unleashed human potential as no other system has, and it will continue to do so. America's best days lie ahead.
Berkshire generates about half its results from insurance, including auto insurer Geico Corp, but operates more than 70 businesses that offer such things as carpeting, ice cream, paint, real estate services and underwear.
Buffett is one of the world's most-admired investors, and Forbes magazine last year called him the second-richest American.
Quarterly net income for Omaha, Nebraska-based Berkshire sank to $117 million, or $76 per Class A share, from $2.95 billion, or $1,904, a year earlier. Revenue fell 12 percent to $24.59 billion.
Excluding $3.25 billion of investment losses, more than double the previous nine months combined, operating profit rose 43 percent to $3.37 billion, or $2,175 per Class A share, from $2.35 billion, or $1,518.
The amount in part reflected underwriting gains at Berkshire Hathaway Reinsurance Group, and investment gains and a termination fee related to an aborted effort to buy Constellation Energy Group Inc.
"They are doing better than many rivals in a very difficult investment and operating environment," said Bill Bergman, senior equity analyst at Morningstar Inc in Chicago. "We had a 5-star rating, the highest we have, on Berkshire, and after reading the letter I feel better than I did yesterday."
Buffett said insurance and utility results helped offset his mistakes, including a decision to buy shares of oil company ConocoPhillips when oil and gas prices were near their peak. He said his "terrible timing" cost Berkshire "several billion dollars." Buffett said he has also lost most of a $244 million investment in shares of two Irish banks.
Berkshire's book value, or assets minus liabilities, fell to $109.27 billion at year end from $120.16 billion at the end of September, and from $120.73 billion at the end of 2007.
DERIVATIVE LOSSES
Results were battered by $4.61 billion of pretax losses on about 251 derivative contracts largely tied to the longer-term performance of four stock market indexes and the credit quality of higher-risk "junk" bonds.
Profit fell 96 percent, the fifth straight quarterly decline, and Berkshire's net worth tumbled $10.9 billion in the year's final three months. Net worth per share fell 9.6 percent in 2008, only the second decline since Buffett began running Berkshire in 1965. It fell 6.2 percent in 2001.
In his eagerly anticipated annual letter to Berkshire shareholders, Buffett also offered a gloomy economic outlook, saying "the economy will be in shambles throughout 2009 -- and for that matter, probably well beyond."
Still, despite what he called "paralyzing fear" resulting from the credit crisis and falling housing and stock prices, he remained optimistic about American resilience, and praised government efforts to avoid a "cataclysmic" breakdown in the financial system.
"Though the path has not been smooth, our economic system has worked extraordinarily well over time," he said. "It has unleashed human potential as no other system has, and it will continue to do so. America's best days lie ahead.
Berkshire generates about half its results from insurance, including auto insurer Geico Corp, but operates more than 70 businesses that offer such things as carpeting, ice cream, paint, real estate services and underwear.
Buffett is one of the world's most-admired investors, and Forbes magazine last year called him the second-richest American.
Quarterly net income for Omaha, Nebraska-based Berkshire sank to $117 million, or $76 per Class A share, from $2.95 billion, or $1,904, a year earlier. Revenue fell 12 percent to $24.59 billion.
Excluding $3.25 billion of investment losses, more than double the previous nine months combined, operating profit rose 43 percent to $3.37 billion, or $2,175 per Class A share, from $2.35 billion, or $1,518.
The amount in part reflected underwriting gains at Berkshire Hathaway Reinsurance Group, and investment gains and a termination fee related to an aborted effort to buy Constellation Energy Group Inc.
"They are doing better than many rivals in a very difficult investment and operating environment," said Bill Bergman, senior equity analyst at Morningstar Inc in Chicago. "We had a 5-star rating, the highest we have, on Berkshire, and after reading the letter I feel better than I did yesterday."
Buffett said insurance and utility results helped offset his mistakes, including a decision to buy shares of oil company ConocoPhillips when oil and gas prices were near their peak. He said his "terrible timing" cost Berkshire "several billion dollars." Buffett said he has also lost most of a $244 million investment in shares of two Irish banks.
Berkshire's book value, or assets minus liabilities, fell to $109.27 billion at year end from $120.16 billion at the end of September, and from $120.73 billion at the end of 2007.
DERIVATIVE LOSSES
Results were battered by $4.61 billion of pretax losses on about 251 derivative contracts largely tied to the longer-term performance of four stock market indexes and the credit quality of higher-risk "junk" bonds.
17. National Stock Exchange, Vestar Capital Partners
VESTAR CAPITAL PARTNERS
Vestar Capital Partners appointed Peter Baumgartner as managing director of Vestar Resources, the firm's team of seasoned professionals who serve as advisors for the private equity firm's portfolio company management teams.
Most recently, Baumgartner was a partner and managing director at Mercer/Oliver Wyman.
NATIONAL STOCK EXCHANGE
National Stock Exchange appointed Sarah Heffron, executive director at J.P. Morgan, as a director on the National Stock Exchange Inc board and on its parent company, NSX Holdings Inc.
FEDERAL AGRICULTURAL MORTGAGE CORP (AGM.N)
Farmer Mac appointed Michael Gerber as acting president and chief executive officer, succeeding Henry Edelman, effective immediately. Gerber will continue to serve as chief executive of Farm Credit of Western New York, an association in the Farm Credit System.
EVERCORE PARTNERS INC (EVR.N)
The U.S. merger advisory firm hired Ray Newton III as senior managing director in its private equity group, Evercore Capital Partners. Newton was previously with Perseus LLC. His appointment is effective Oct. 1 and he will be based in New York.
BANK OF NEW YORK MELLON CORP (BK.N)
The financial services company hired Simon Putt, previously with Fidelity International, as director, head of UK Institutional Client Relationship Management. Putt will be based in London.
CAPITAL & REGIONAL PLC (CAL.L)
The British property fund manager promoted Charles Staveley to group finance director effective Oct. 1. He was deputy finance director with the company earlier.
Vestar Capital Partners appointed Peter Baumgartner as managing director of Vestar Resources, the firm's team of seasoned professionals who serve as advisors for the private equity firm's portfolio company management teams.
Most recently, Baumgartner was a partner and managing director at Mercer/Oliver Wyman.
NATIONAL STOCK EXCHANGE
National Stock Exchange appointed Sarah Heffron, executive director at J.P. Morgan, as a director on the National Stock Exchange Inc board and on its parent company, NSX Holdings Inc.
FEDERAL AGRICULTURAL MORTGAGE CORP (AGM.N)
Farmer Mac appointed Michael Gerber as acting president and chief executive officer, succeeding Henry Edelman, effective immediately. Gerber will continue to serve as chief executive of Farm Credit of Western New York, an association in the Farm Credit System.
EVERCORE PARTNERS INC (EVR.N)
The U.S. merger advisory firm hired Ray Newton III as senior managing director in its private equity group, Evercore Capital Partners. Newton was previously with Perseus LLC. His appointment is effective Oct. 1 and he will be based in New York.
BANK OF NEW YORK MELLON CORP (BK.N)
The financial services company hired Simon Putt, previously with Fidelity International, as director, head of UK Institutional Client Relationship Management. Putt will be based in London.
CAPITAL & REGIONAL PLC (CAL.L)
The British property fund manager promoted Charles Staveley to group finance director effective Oct. 1. He was deputy finance director with the company earlier.
16. Zimbabwe stock exchange restarts, trades in dollars
Zimbabwe's stock exchange restarted after a three-month halt on Thursday and trades were in U.S. dollars for the first time, a move the new government hopes will help attract investment and revive the economy.
The ZSE, along with property, had been viewed by investors in Zimbabwe as one of the few relatively safe havens in an economy ravaged by the world's highest inflation rate.
Trading stopped in November during a central bank crackdown on banks and stockbrokers accused of allowing traders to use fraudulent cheques to purchase shares.
The ZSE asked the government for permission to trade in foreign currency when it restarted given the collapse of the Zimbabwe dollar, a request the central bank approved earlier this month.
Trading got off to a slow start on Thursday with very few buyers. There was applause when shares in manufacturing firm Apex (APEX.ZI) traded hands, making it the first successful foreign currency-denominated deal.
Long-time rivals President Robert Mugabe and MDC leader Morgan Tsvangirai last week formed a unity government after months of wrangling and have pledged to make reviving the economy a top priority.
Renaissance Capital said it favours Zimbabwean stocks.
"While the key risks remain, namely political risk and a still deteriorating macroeconomic environment, we believe valuations have fallen to more attractive levels," it said in a research note.
Washington Mehlomakhulu, an equities analyst with Highveld Financial Services in Harare, said investors whose funds were tied up in stocks were likely to welcome the news, but that dollarisation of the market would present challenges.
"There might not be enough liquidity to fund transactions, especially from local buyers, and there are restrictions on foreign investors who might have the interest and the money," he said.
"We actually expect a huge sell-off from locals once the market is back running. Many wanted trading to resume so they could sell shares and get a bit of financial relief." (Nelson Banya; +263 912 782 287)
The ZSE, along with property, had been viewed by investors in Zimbabwe as one of the few relatively safe havens in an economy ravaged by the world's highest inflation rate.
Trading stopped in November during a central bank crackdown on banks and stockbrokers accused of allowing traders to use fraudulent cheques to purchase shares.
The ZSE asked the government for permission to trade in foreign currency when it restarted given the collapse of the Zimbabwe dollar, a request the central bank approved earlier this month.
Trading got off to a slow start on Thursday with very few buyers. There was applause when shares in manufacturing firm Apex (APEX.ZI) traded hands, making it the first successful foreign currency-denominated deal.
Long-time rivals President Robert Mugabe and MDC leader Morgan Tsvangirai last week formed a unity government after months of wrangling and have pledged to make reviving the economy a top priority.
Renaissance Capital said it favours Zimbabwean stocks.
"While the key risks remain, namely political risk and a still deteriorating macroeconomic environment, we believe valuations have fallen to more attractive levels," it said in a research note.
Washington Mehlomakhulu, an equities analyst with Highveld Financial Services in Harare, said investors whose funds were tied up in stocks were likely to welcome the news, but that dollarisation of the market would present challenges.
"There might not be enough liquidity to fund transactions, especially from local buyers, and there are restrictions on foreign investors who might have the interest and the money," he said.
"We actually expect a huge sell-off from locals once the market is back running. Many wanted trading to resume so they could sell shares and get a bit of financial relief." (Nelson Banya; +263 912 782 287)
Pakistan stock exchange postpones floor removal
KARACHI, Oct 26 (Reuters) - Directors of Pakistan's main stock exchangedecided on Sunday to postpone the removal of a floor that has been propping upits index since August, an exchange official said.
The Karachi Stock Exchange imposed the floor at 9,144 points on Aug. 28,after a 36 percent fall from the beginning of the year on political uncertaintyand a sagging economy. The exchange board said on Oct. 14 the floor would beremoved on Oct. 27.
No date has been fixed for the removal of the floor.
The exchange's managing director told a news conference the floor wouldnot be removed until a support fund was in place.
"It is in our collective interest to return to our normal tradingparameters," said managing director Adnan Afridi adding that stabilisationmeasures had to be in place when the floor was removed.
The floor has stifled trade and the index ended flat at 9,182.88 pointson Friday.
The stock market regulator said on Wednesday it had approved a 20 billionrupee ($247 million) fund being set up by the government to support share priceswhen the floor was removed.
Afridi said the fund had been approved but authorities were working outits mechanics.
The fund would invest in nine state-owned entities, an exchange officialsaid on Friday, adding that a special session would be held on Saturday toenable the fund to buy stocks 12.5 percent lower than current prices.
But authorities postponed the special session on Saturday because of whatan SEC official described as some differences between the brokers and exchangeofficials.
Earlier on Sunday, the exchange directors held a meeting with the primeminister's top adviser on economic affairs, Shaukat Tarin.
Tarin has said he wanted to see the floor removed, but he told DawnTelevision earlier on Sunday, if the support fund was not in place, then apostponement of the floor's removal was an option for exchange directors.
The fund will invest in nine state-owned companies: Oil and GasDevelopment Co Ltd, Pakistan Petroleum Ltd , National Bank of Pakistan, PakistanState Oil , Sui Southern Gas Co Ltd, Sui Northen Gas Co Ltd, Kot Addu Power CoLtd, Pakistan Telecommunication Co Ltd and Habib Bank Ltd.
The Karachi Stock Exchange imposed the floor at 9,144 points on Aug. 28,after a 36 percent fall from the beginning of the year on political uncertaintyand a sagging economy. The exchange board said on Oct. 14 the floor would beremoved on Oct. 27.
No date has been fixed for the removal of the floor.
The exchange's managing director told a news conference the floor wouldnot be removed until a support fund was in place.
"It is in our collective interest to return to our normal tradingparameters," said managing director Adnan Afridi adding that stabilisationmeasures had to be in place when the floor was removed.
The floor has stifled trade and the index ended flat at 9,182.88 pointson Friday.
The stock market regulator said on Wednesday it had approved a 20 billionrupee ($247 million) fund being set up by the government to support share priceswhen the floor was removed.
Afridi said the fund had been approved but authorities were working outits mechanics.
The fund would invest in nine state-owned entities, an exchange officialsaid on Friday, adding that a special session would be held on Saturday toenable the fund to buy stocks 12.5 percent lower than current prices.
But authorities postponed the special session on Saturday because of whatan SEC official described as some differences between the brokers and exchangeofficials.
Earlier on Sunday, the exchange directors held a meeting with the primeminister's top adviser on economic affairs, Shaukat Tarin.
Tarin has said he wanted to see the floor removed, but he told DawnTelevision earlier on Sunday, if the support fund was not in place, then apostponement of the floor's removal was an option for exchange directors.
The fund will invest in nine state-owned companies: Oil and GasDevelopment Co Ltd, Pakistan Petroleum Ltd , National Bank of Pakistan, PakistanState Oil , Sui Southern Gas Co Ltd, Sui Northen Gas Co Ltd, Kot Addu Power CoLtd, Pakistan Telecommunication Co Ltd and Habib Bank Ltd.
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