Bank Albilad 2020 net profit up 8% to $346.6m

Bank Albilad 2020 net profit up 8% to $346.6m
The profit rise was driven by an 8 percent increase in operating income. (Argaam)
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Updated 07 February 2021

Bank Albilad 2020 net profit up 8% to $346.6m

Bank Albilad 2020 net profit up 8% to $346.6m
  • Total operating expenses increased by 8 percent

Bank Albilad reported a net profit of SR 1.348 billion ($346.6 million) for 2020, up 8 percent, compared to SR 1.243 billion in the previous year.

The profit rise was driven by an 8 percent increase in operating income, due to higher net income from investment, financing activities and net exchange income.

However, (loss)/gain from investments, fee and commission income, other operating income, and dividend income decreased.

Total operating expenses increased by 8 percent, due to higher net impairment charge for expected credit losses, other general and administrative expenses, salaries and employee related benefits, and depreciation and amortization.

In Q4 2020, the bank reported a net profit of SR 377.8 million, an increase of 16 percent year-on-year (YoY).

The US has opened up its e-cigarette market – is Egypt next?

The US has opened up its e-cigarette market – is Egypt next?
Updated 14 sec ago

The US has opened up its e-cigarette market – is Egypt next?

The US has opened up its e-cigarette market – is Egypt next?

CAIRO: The US Food and Drug Administration finally approved the sale of three types of e-cigarettes last week, leaving business to ask what this means for the Egyptian market?

RJ Reynolds’ Vuse Solo e-cigarettes and two types of its tobacco-flavoured pods became the first-ever vapour products to win clearance from the US health watchdog.

The FDA decided after more than a year of tests that the benefit of the product to adults trying to quit smoking outweighs the risk of teenagers becoming hooked.

The regulator said the move was an “important step toward ensuring all new tobacco products undergo the FDA’s robust, scientific premarket evaluation”.

However, last Tuesday’s ruling came even as e-cigarettes have been widely available in the US for over a decade.

Yet this decision may pave the way to curb the widespread illegal trade in electronic smoking devices in Egypt.

The Egyptian Ministry of Health and Population recently warned against using e-cigarettes, saying that vaping contains nicotine and toxic substances that harm the smoker and those around them.

A ministry publication said that vaping can lead to chronic lung diseases, breathing problems and chest pain.

Western smoking products such as e-liquid pods carry a nicotine strength of 4.8%, roughly equivalent to a pack of cigarettes.

Nicotine is the chemical released when tobacco is smoked and is the addictive stimulant that gives users a rush. Vaping firms say their products provide smokers nicotine, with far fewer of the dangerous toxins contained in burning tobacco. 

Studies around the world are unclear on the health effects of e-cigarettes.

However, Fawzi Al-Hwaiti, a tobacco seller in central Cairo, is at the sharp end of the e-cigarette business in Egypt.

He stresses that only three types of vapes are authorized in Egypt, adding that he does not know whether the products he brings from dealers are legal or not. His prices range from EGP 600 to EGP 1,000.

Al-Hwaiti told Arab News: “It is not important that it be legal. The important thing is, it comes to me and I sell it and earn from it to support my family. I think it's legal because no one from the authorities has spoken to me before that.”

Some ordinary smokers hope that relaxation in the US will lead to a looser policy in Egypt.

The move by the FDA was welcomed by Engineer Islam Shawqi, a longtime smoker who decided to quit by taking up e-cigarettes.

He said: “I have smoked all my life, I have been a smoker for a long time, and I wanted to stop smoking. I resorted to smoking e-cigarettes, as I heard that they are less harmful.”

Shawqi believes that the approval of some types of vapes is the beginning of an opening up of trade in Egypt, that will help adult smokers like him.

However, the Egyptian Chambers of Commerce makes clear that the expansion of the e-cigarette market is in the hands of the government.

The business body said: "We have not received any notification, and I think that the Egyptian Ministry of Health must declare this matter first, before implementing it commercially.”

Robert Naous, Director of External Affairs, Middle East and North Africa, the leading e-cigarette maker Relx International expressed his happiness with lifting ban in Egypt, as he commented in a statement: “Lifting this ban in Egypt is a good and specific step in the right direction, which will greatly benefit the general investment environment in the country, by encouraging small and medium-sized companies and manufacturers to invest, opening new stores, and importing rechargeable vaping devices, thus creating new job opportunities. It is also certain that the state treasury will benefit by generating additional tax revenues in a sound manner, as it blocks the way for illegal merchants who evade import tax.”

Tesla hits record profit despite parts shortage, ship delays

Tesla hits record profit despite parts shortage, ship delays
Updated 19 min 55 sec ago

Tesla hits record profit despite parts shortage, ship delays

Tesla hits record profit despite parts shortage, ship delays

DETROIT: Record electric vehicle sales last summer amid a shortage of computer chips and other materials propelled Tesla Inc. to the biggest quarterly net earnings in its history.
The company said Wednesday that it made $1.62 billion in the third quarter, beating the old record of $1.14 billion set in the second quarter of this year. The profit was nearly five times larger than the $331 million Tesla made in the same quarter a year ago.
Revenue of $13.76 billion from July through September also set a record, but it fell short of Wall Street expectations of just over $14 billion, according to FactSet.
Excluding special items such as stock-based compensation, Palo Alto, California-based Tesla made $1.86 per share, beating analyst estimates of $1.62. CEO Elon Musk has said he's moving the headquarters to Austin, Texas, the dateline of Wednesday's earnings release.
Some of the quarterly profit, though, came from selling regulatory credits to other automakers. Tesla made $279 million on credits during the quarter.
"A variety of challenges, including semiconductor shortages, congestion at ports and rolling blackouts, have been impacting our ability to keep factories running at full speed," the company said in a statement to shareholders.
Earlier this month Tesla said it delivered a record 241,300 electric vehicles in the third quarter even as it wrestled with the shortages that have hit the entire auto industry. Most automakers reported sales declines in the U.S. last quarter due to chip and other shortages, including General Motors and Ford.
Previously, Musk has said Tesla kept its manufacturing lines running largely by finding chips from alternate suppliers and then scrambling to rewrite some of the software in its cars to ensure all the technology remained compatible.
Third-quarter sales rose 72% over the 140,000 deliveries Tesla made for the same period a year ago.
So far this year, Tesla has sold around 627,300 vehicles. That puts it on pace to soundly beat last year’s total of 499,550.
While sales grew in the third quarter, the average sales price fell 6% because Tesla is selling more less-expensive Models 3 and Y and fewer pricier Models S and X.
Tesla also took an impairment charge of $51 million due to a decline in value of its Bitcoin holdings.
Musk didn't appear on this quarter's conference call with with analysts and investors. He said previously that he would show up only when he had something important to say.
That left Chief Financial Officer Zachary Kirkhorn and Vice President of Vehicle Engineering Lars Moravy to answer questions.
Kirkhorn said the company was able to hit an operating margin — how much it makes pretax after variable production costs — of just under 15%.
But Kirkhorn said Tesla may face some difficulties in the future that could threaten that margin, including rising commodity prices and labor shortages. Tesla's biggest cost exposure is for nickel, which goes into battery cells, and aluminum, which the company uses for other nonbattery components, he said. Tesla also will face inefficiencies as it starts production at new factories in Texas and Germany next year, he said.
The company already is seeing commodity cost increases, which have resulted in price hikes, Kirkhorn said. Next year it's possible that Tesla will see more. "It's difficult to say precisely, but the volatility and the increases are just so substantial," he said.
Tesla executives also made their first public comment on multiple investigations of the company by U.S. safety regulators. Moravy said Tesla is cooperating as much as possible.
The National Highway Traffic Safety Administration has opened an investigation into why Tesla's Autopilot driver-assist system keeps running into parked emergency vehicles. Of the dozen crashes that are part of the probe, 17 people were injured and one was killed.
The safety agency also is questioning why Tesla didn't recall vehicles with Autopilot when it did an over-the internet software update so they better recognize firetrucks and police cars in low light. NHTSA said the update addressed a safety defect.
Kirkhorn said safety is important to Tesla as the auto industry transitions from traditional cars to being more software-oriented. “Regulatory bodies, and understandably so, are interested in understanding how to regulate in this environment, and NHTSA is no exception,” he said. “Were excited to partner and we'll work collaboratively with all the different regulatory bodies.”
Tesla hasn’t always cooperated with the safety agency, though. In January, Tesla resisted a request from NHTSA to recall about 135,000 vehicles because their touch screens could go dark. The agency said the screens were a safety defect because backup cameras and windshield defroster controls could be disabled.
A month later, after NHTSA started the process toward holding a public hearing and taking Tesla to court, the company agreed to the recall.
In its shareholder statement, Tesla also said that construction of its new factory near Austin is progressing as planned and it’s preparing equipment and “fabricating our first pre-production vehicles.”
The factory, which is centrally located versus Tesla’s other assembly plant in Fremont, California, will send Model Y small SUVs and new Cybertruck pickups to East Coast population centers.
Tesla said it expects to expand its factory capacity quickly, and over a “multi-year horizon” it expects sales to grow an average of 50% annually.
Shares of Tesla Inc. fell 1.6% to $851.80 in after-hours trading Wednesday.

Oil at $85 as solid U.S. demand underpins sentiment

Oil at $85 as solid U.S. demand underpins sentiment
Updated 28 min 19 sec ago

Oil at $85 as solid U.S. demand underpins sentiment

Oil at $85 as solid U.S. demand underpins sentiment

TOKYO: Oil prices were mixed on Thursday, paring earlier gains, as some investors scooped up profits from the recent rally while solid demand in the United States and a switch to fuel oil from coal and gas amid surging prices underpinned market sentiment.
Brent crude futures fell 11 cents, or 0.1%, to $85.71 a barrel at 0355 GMT, reversing earlier gains that took the benchmark to the highest since October 2018. It rose 0.9% the previous day.
U.S. West Texas Intermediate (WTI) crude futures for December rose 5 cents, or 0.1%, to $83.47 a barrel. November WTI crude, which expired on Wednesday, settled up 91 cents, or 1.1%, after touching the highest since October 2014 earlier in the session.
"We saw some correction with Brent, but overall sentiment remained bullish as there have been no large increases in output by the United States or OPEC," said Satoru Yoshida, a commodity analyst with Rakuten Securities.
"Brent could reach $90 a barrel later this year as tightness in global oil markets will likely continue as U.S. decarbonisation efforts will cap output increases while demand will increase as more power companies switch fuel from coal and gas," he said.
Crude prices have risen as supply has tightened, with the Organization of the Petroleum Exporting Countries (OPEC) maintaining a slow increase in supply rather than intervening to add more barrels to the market.
Oil refiners are ramping up output to meet a synchronised uptick in demand across Asia, Europe and the United States, but plant maintenance and high natural gas prices are expected to constrain supply in the fourth quarter.
Oil markets hit multi-year highs earlier in the week also supported by a global coal and gas crunch, which has driven a switch to diesel and fuel oil for power generation.
Strong demand in the United States was confirmed by the latest weekly data.
U.S. crude stocks fell by 431,000 barrels in the week to Oct. 15 to 426.5 million barrels, compared with analysts' expectations in a Reuters poll for a 1.9 million-barrel rise, the U.S. Energy Information Administration (EIA) said on Wednesday. EIA/S
U.S. stocks at the Cushing, Oklahoma delivery hub hit their lowest level since October 2018, pointing to tightness in the market that may take some time to alleviate.
U.S. gasoline stocks fell by a more-than-expected 5.4 million barrels to 217.7 million barrels, the lowest since November 2019, the EIA said, while distillate stocks fell to levels not seen since April 2020.
"Crude oil inventories at Cushing have been drawing dramatically, supporting WTI flat price and structure, with the backwardation on the prompt end of the WTI curve strengthening above 50 cents," Citi Research said in a note, noting the trend comes despite the autumn maintenance season.
In a sign of market tightness, WTI futures contracts are currently in steep backwardation , where later-dated contracts trade are at a lower price than the current contract. Normally later months trade at a higher price, reflecting the costs of storing oil.
The steep backwardation encourages companies to sell oil immediately rather than keep it in storage.

Saudi Arabia doesn't want oil prices to cripple global economy, finance minister tells CNBC

Saudi Arabia doesn't want oil prices to cripple global economy, finance minister tells CNBC
Updated 49 min 43 sec ago

Saudi Arabia doesn't want oil prices to cripple global economy, finance minister tells CNBC

Saudi Arabia doesn't want oil prices to cripple global economy, finance minister tells CNBC

RIYADH: Saudi Arabia doesn't want high oil prices that will cripple global economy recovery, but the Kingdom has no say on what prices are as they are determined by the market, finance minister Mohammed Al Jadaan told CNBC in an interview.

"I think we need to see a price that is good for investors, good for producers so that they can continue investing because the world needs the energy, and does not actually impact negatively the world's recovery particularly in a time like this," he told the American TV channel.

PayPal in $45bn bid for Pinterest: Reuters

PayPal in $45bn bid for Pinterest: Reuters
Updated 20 October 2021

PayPal in $45bn bid for Pinterest: Reuters

PayPal in $45bn bid for Pinterest: Reuters

NEW YORK: PayPal Holdings Inc. has offered to buy digital pinboard site Pinterest Inc. for $45 billion, people familiar with the matter said on Wednesday, a combination that could herald more tie-ups between financial technology and social media companies in e-commerce.

The deal talks come as internet shoppers increasingly buy items they see on social media, often following “influencers” on platforms such as Instagram and TikTok. Buying Pinterest would allow PayPal to capture more of that e-commerce growth and diversify its income though advertising revenue.

PayPal has offered $70 per share, mostly in stock, for Pinterest, one of the sources said. 

The online payments provider hopes to successfully negotiate and announce a deal by the time it reports quarterly earnings on Nov. 8, the source added.

The sources cautioned that no deal was certain and terms could change. They asked not to be identified because the matter is confidential.

PayPal and Pinterest did not respond to requests for comment. Bloomberg News first reported on the PayPal-Pinterest talks on Wednesday.

PayPal’s offer represents a 26 percent premium to Pinterest’s closing price of $55.58 on Tuesday. PayPal’s shares fell over 4 percent on the news, while Pinterest rose more than 14 percent to $63.51.