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Oil giant Saudi Aramco: Company makes $700 million in profit every single day

Oil giant Saudi Aramco: Company makes $700 million in profit every single day

Oil giant Saudi Aramco made an astonishing $700 million in profit every single day, the biggest quarterly profit of any publicly listed company in history.

The Saudi Arabian petroleum and gas company reported an eye-watering $68 billion (US$48.4 billion) of profit in the second quarter of 2022.

Its earnings were boosted by surging demand as Covid-19 restrictions were dropped around the world — and pushed even higher by Russia’s invasion of Ukraine.

Net income leapt 90 per cent year-on-year for the world’s biggest oil producer, which clocked its second straight quarterly record after announcing $55.46 billion (US$39.5 billion) for Q1.

Aramco’s massive Q2 windfall was the biggest quarterly adjusted profit of any listed company worldwide, according to Bloomberg.

The state-owned Saudi firm heads a list of oil majors raking in massive sums after ExxonMobil, Chevron, Shell, TotalEnergies and Eni also revealed multi-billion-dollar profits in Q2.

US President Joe Biden blasted ExxonMobil earlier this year as inflation surged, stating it made “more money than God”.

And the future looks bright for Saudi Aramco.

“While global market volatility and economic uncertainty remain, events during the first half of this year support our view that ongoing investment in our industry is essential,” Aramco president and CEO Amin Nasser said.

“In fact, we expect oil demand to continue to grow for the rest of the decade,” he added.

Net income rose 22.7 per cent from Q1 in “strong market conditions”, Aramco said.

Half-year profits were $123.41 billion (US$87.9 billion), up from $66.27 billion (US$47.2 billion) for the same period of 2021.

Aramco will pay a $26.39 billion (US$18.8 billion) dividend in Q3, the same as it paid in Q2.

It “continues to work on increasing crude oil maximum sustainable capacity from 12 million barrels per day to 13 million by 2027”, its earnings announcement said.

The quarterly profits, the highest since Aramco’s record-breaking IPO in 2019, beat a company-compiled analyst forecast of $64.86 billion (US$46.2 billion).

Aramco shares closed down 0.9 per cent at 40.5 riyals ($15.16) on the Saudi stock exchange. They are up 25 per cent this year.

‘crown-jewel’

Aramco floated 1.7 per cent of its shares on the Saudi bourse in December 2019, generating $41.28 billion (US$29.4 billion) in the world’s biggest initial public offering.

The “crown jewel” and leading source of income for the conservative kingdom temporarily supplanted Apple as the world’s most valuable company in March. It now lies second in the list with a market valuation of $3.37 trillion (US$2.4 trillion).

Saudi Arabia has sought to open up and diversify its oil-reliant economy, especially since Mohammed bin Salman’s appointment as crown prince and de facto ruler in 2017.

Despite raising production, Aramco has pledged to reach “operational net zero (carbon) emissions” by 2050. Carbon pollution is tallied in the country that uses the fuel, not where it is produced.

Saudi GDP jumped nearly 12 per cent in Q2 on the back of high oil prices, the government announced last month.

Abu Dhabi-based energy expert Ibrahim Elghitany said the oil bonanza was a “golden opportunity” for the country.

“Saudi Arabia has recently achieved financial surpluses that it did not achieve during the last decade, which helps to provide financing for its development projects,” Elghitany told AFP.

Nasser said Aramco recovered quickly from a series of attacks by Yemen’s Huthi rebels on its facilities earlier this year, including a dramatic strike in Jeddah that sent smoke billowing during a Formula One practice session in March.

“We were able to restore our production in all these facilities immediately. In a few weeks, all facilities were working and producing at full capacity,” he told a media conference call.

Oil prices have dropped by $42 per barrel from a peak in June due to growing supplies, but remain close to $140 (US$100).

The OPEC group of oil-producing countries has been gradually raising production, despite pressure from Western leaders including US President Joe Biden — who visited Saudi Arabia last month — to pump more.

Biden’s trip was seen as a climb-down after he previously promised to make Saudi Arabia a “pariah” over the killing of Washington Post columnist Jamal Khashoggi by Saudi agents in Turkey in 2018.

British Prime Minister Boris Johnson has also visited Saudi Arabia since the Russian invasion in February.

High oil prices are contributing to the inflationary pain suffered by consumers worldwide.

– with Andrew Backhouse, AFP

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How much time you should allow to make a connecting flight

How much time you should allow to make a connecting flight

Ever been on a delayed flight with a tight connection coming up and wondering if you’re going to make it? It’s stress you don’t need. Right now, when flight delays are all too common, it’s bringing more stress to more travelers.

In a sign of the times, Qantas has just raised its connection times for passengers transferring from a domestic to an international flight. Instead of 60 minutes, the airline will soon have a minimum connection time (MCT) of 90 minutes. The move comes as Qantas struggles with baggage handling delays caused by staff shortages. It’s taking longer to transfer checked luggage between aircraft, but another reason is the ongoing problems with flight delays. Qantas has just posted the worst on-time performance of any carrier in June 2022, with almost half its flights delayed or cancelled, and therefore more time is required between flights.

Minimum connection time

If your journey involves a connection you might be tempted to catch an earlier flight to allow for delays, but how much time should you allow? The answer is the MCT, the least amount of time required for you to get from your arriving flight to your next flight at the transfer point, and for your airline to do the same.

As a rule of thumb, the MCT is 60 minutes between domestic flights, 90 minutes between international flights, but it’s not the same for all airports and in all situations. For example if you arrive on an international flight at Sydney Airport and you’re transferring to a domestic flight, you need to get to the domestic terminal which is several kilometers away. As well as the journey time, you might have to wait up to 30 minutes for the T-Bus service which connects the terminals. That’s on top of the time it takes to collect your baggage and pass through immigration and customs, then check in for your next flight. Even 90 minutes might be cutting it fine. An MCT of 2½ hours is more realistic. By contrast, once you’ve collected your luggage and cleared immigration and customs, transferring between domestic and international flights at Melbourne Airport requires only a short walk. Any change of aircraft that involves domestic-to-international or vice versa requires an MCT of at least two hours. When things are likely to go wrong, such as the baggage handling problems currently experienced at many Australian airports, add another 30 minutes.

However things can get even more complicated. When you take a flight with a stop somewhere in between, you’re usually traveling on a single ticket with the same Passenger Name Record (PNR) for the entire journey. In most cases, it’s the responsibility of the airline you’re booking with or your travel agent to make sure your MCT is sufficient. If you don’t make that connecting flight through no fault of your own, it’s up to the airline to make things right and get you to your final destination as quickly as possible. That applies even if your journey involves different airlines, provided you’re traveling on a single ticket.

But that might not be the case. Say for example you’ve booked a cheap flight to Singapore then made another booking on a different airline to Paris. That’s a split ticket, one flight ticket for each sector. Assuming you have checked baggage you’re going to need to retrieve it in the baggage claim area at Singapore’s Changi Airport and check it in for your next flight. Even though you’re not going outside the terminal, that means passing through Singapore immigration, collecting your bag and going through customs before you can head for departures and check yourself and your baggage in for your Paris flight. Afterwards you’ll need to get through immigration and security before heading to your departure gate, and that’s going to take some time. Exactly how long depends on several variables – the queues at immigration, how long it takes for your checked luggage to arrive, the time it takes to check back in – but anything less than three hours could mean you miss your Paris flight.

If you’re traveling on a split ticket and you don’t make your connecting flight, you’re then regarded as a ‘no-show’ and subject to whatever penalties your airline applies. It could be the total loss of whatever you’ve paid, even if you’ve missed that connecting flight through no fault of your own, for example if your first flight is late in arriving at the transit stop. Worse still, missing one sector of a flight ticket means that all subsequent sectors on the same booking are automatically cancelled. If after Paris you were booked to fly to Athens on the same booking, that booking no longer exists.

See also: Eight Australian airport lounges you can enter without flying business class

See also: Everything you need to know about coping with the current travel chaos

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ASX opens higher as Wall St rallies, JB Hi-Fi hikes dividend, Carsales profit jumps

JB HI-FI

Australian shares have started the day higher, tracking gains on Wall Street.

The ASX 200 was up 35 points, or 0.5 per cent, to 7,067, at 10:16am AEST.

At the same time, the Australian dollar was flat, at 71.17 US cents.

Shares of JB Hi-Fi rose 0.2 per cent, to $45.61, after the electronics retailer reported a 7.7 per cent jump in annual earnings, to $544.9 million, as higher store traffic driven by the easing of COVID-19 restrictions complemented continued growth in online you go out.

The company was one of the beneficiaries of the pandemic as work-from-home mandates meant higher demand for electronics.

With easing of COVID-19 restrictions, the company was able to reopen all of its stores in the latter half of the financial year, while online sales over the year registered a 52.8 per cent jump.

This helped it increase the company’s full-year dividend payout to $3.16 a share, up from $2.87 in the prior financial year.

The company noted that the cost of doing business in Australia was higher, in-line with higher inflation in the country, while reporting higher sales in Australia and its The Good Guys brand for July.

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What can you buy for Australia’s median house price?

What can you buy for Australia's median house price?

Cobden Hayson Drummoyne selling agent Chad Egan said apartments in the block can sell for well above $1 million.

“Wolseley Street is a popular street and this is a 1970s red brick apartment, so the demographic will be young couples and investors,” Egan said.

Though Sydney’s property market is facing headwinds as interest rates rise, and the rising cost of living hits home buyers’ budgets, Egan said properties priced between $950,000 and $1.1 million were still seeing good interest from buyers.

In Melbourne, buyers can find a house on land closer to the city, if they are prepared to do a renovation.

A three-bedroom Victorian home at 118 Farrell Street in Port Melbourne is listed for $1.05 million to $1.15 million but needs renovating.

Chisholm & Gamon Property Port Melbourne associate director Jon Kett said the vendors had owned the property since 2010 as an investment.

“This home is ready to renovate,” Kett said. “It’s going to need a little bit of work to bring it up to modern standards.”

Buyers looking to get into the market with a budget of $1 million or just above could expect to buy a property that needed work, especially in areas closer to the city such as Port Melbourne, he said.

“Most people looking around the $1 million mark are looking to buy and add value [by renovating],” Kett said.

Better bang for buck is on offer further afield, such as this house in Dingley Village about 23 kilometers southeast of the CBD.

A modern five-bedroom family home at 27 Village Drive has been advertised for between $995,000 and $1.04 million. The house features an outdoor entertaining area and a heated, in-ground pool.

Brisbane buyers can find a house close to the city center in the low seven figures if they are open to giving their new home a facelift.

This three-bedroom ‘pink palace’ at 34 Michael Street, Bulimba, features street art by the current owner and is listed for offers over $975,000.

Just 4 kilometers from Brisbane’s CBD, it includes a pink facade and illustrations ranging from a bird to a Day of the Dead, Mexican folk-art inspired piece.

Inside, the home has a brightly decorated kitchen, but also needs some TLC.

Ray White Bulimba selling agent William Low said buyers were still interested despite the renovation work required.

“People are fearful of inflation and interest rates, so it is getting a little bit harder to sell properties that need renovation, but we’re expecting this one to sell by the end of the week,” Low said.

Just three kilometers from Adelaide’s CBD, another fixer-upper is for sale. Built in 1918, the property at 27 Cambridge Street, North Adelaide, is listed for sale with a $975,000 to $1.05 million price tag.

The semi-detached home has a “rare” backyard for that part of the city, and a car park.

It’s not the only historic home for sale, with a 1910-built property at 83 Carlton Street, New Town, about 4 kilometers from central Hobart, advertised for offers over $1,045 million.

The home includes some of its original stained-glass charm, has four bedrooms, and comes with stunning views.

Some of the best views at this price point are 5 kilometers from Perth’s CBD in Crawley.

There, buyers can find a modern three-bedroom apartment at 9W/4 Crawley Avenue which has views of the Swan River from one side, and Kings Park Botanic Garden on the other.

The apartment is listed with a price guide of $969,000 and for that money, buyers will get a renovated pad with separate laundry and a study.

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Wall Street rally sets up the ASX for strong open

Wall Street rally sets up the ASX for strong open

The S&P 500 rose 72.88 points to 4,280.15, while the Dow gained 424.38 points to 33,761.05. The Nasdaq added 267.27 points to 13,047.19.

Wall Street surged higher to close the week.

Wall Street surged higher to close the week. Credit:AP

Small-company stocks also made strong gains in a sign that investors are confident about the economy. The Russell 2000 rose 41.36 points to 2,016.62.

The central bank has been raising interest rates in the hopes of slowing the economy and cooling the hottest inflation in four decades, but investors are worried that it could hit the brakes too aggressively and steer the economy into a recession.

On Friday, a survey by the University of Michigan showed that consumer sentiment is stronger than economists expected. Still, inflation remains painfully high. That means the Fed is likely to remain on course with its rate hikes until it is certain that prices have peaked and are easing.

The Fed’s last two increases were by 0.75 percentage points. Traders now see about a 60 per cent chance that the central bank will raise overnight interest rates by half a percentage point at its next meeting.

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The yield on the 10-year Treasury fell to 2.84 per cent from 2.88 per cent late on Thursday. It remains below the two-year yield. That’s an unusual investment of the expectation that borrowing money for a longer period should cost more than a shorter period. When investors demand a higher return for a short term like the 2-years than a longer one like 10 years, it’s viewed by some investors as a reliable signal of a pending recession. The economy has already contracted for two consecutive quarters.

withAP

The Market Recap newsletter is a wrap of the day’s trading. Get it each weandkday afternoon.

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Australia’s top economists on how to fix high inflation

Australia's top economists on how to fix high inflation

Australia’s top economists are divided on how to tackle ballooning inflation of 6.1% that’s forecast to climb to a three-decade high of 7.75% by the end of the year.

Three of the 48 leading economists surveyed by the Economic Society of Australia and The Conversation say Australia should be able to tolerate an inflation rate of 8% or higher.

Seven expect inflation to fall back to an acceptable level without the need for any further action other than Reserve Bank adjustments to interest rates.

That view was slow weight by news from the United States last week that annual inflation slid from 9.1% to 8.5% in July, after inflation of zero over the month.

Asked how high an inflation rate Australia should be prepared to tolerate, most nominated a rate at the top of or above the Reserve Bank’s 2-3% target band.

Twelve nominated a rate well above the target band.

Ten said the step-up in inflation was primarily caused by events overseas not within Australia’s power to control.

The polled economists are recognized as leaders in their fields, including economic modeling and public policy. Among them are former Reserve Bank, Treasury and OECD officials, and a former member of the Reserve Bank board.

Made with Flourish

Beyond rate rises, what could be done?

There are three kinds of actions governments can take to bring consumer price inflation down

  • actions that suppress consumer spending (“demand”)

  • actions that increase the supply of goods and services (“supply”)

  • actions that directly restrain prices

Invited to choose from a menu of options, and add options to the menu, the panel placed slightly greater weight on measures to restrain demand than measures to boost supply, and greater weight on both than measures to directly restrain prices.

The most popular measure, backed by 37% of those surveyed, was winding back government spending. Almost as popular, backed by 33%, was a super-profits tax on fossil fuel producers, with the proceeds used to reduce cost of services.

Made with Flourish

Another tax measure – increased income taxes with the proceeds used to reduce cost of services – was backed by 17%. Two of those surveyed wanted to abandon the legislated Stage 3 tax cuts for higher earners due to take effect in 2024.

But several of those who advocated winding back government spending or increasing tax did so without enthusiasm, believing that while the government should be prepared to assist the Reserve Bank in suppressing consumer demand, suppressing demand wouldn’t tackle the main reasons prices were climbing.

The risks of doing too much

The Australian National University’s Robert Breunig said much of the inflationary pressure had come from things such as oil prices that were beyond the power of Australians to influence, making it “important not to overreact”.

Melbourne University banking specialist Kevin Davis said what appeared to be high inflation might actually mainly be a series of short-term supply-induced price rises, making it hard to see how choking demand could do much good.

Australia’s current ultra-low unemployment rate was an achievement that should be celebrated, rather than put at risk without a good reason.

If high inflation did stay for a while and spread to wages, a welcome side effect would be more affordable housing.


Read more: Why does the RBA keep hiking rates? It’s scared it can’t contain inflation

Curtin University macroeconomist Harry Bloch made the point that while measures to suppress demand in Europe and the United States would indeed have an impact on global energy and food prices, that wasn’t true of measures to suppress demand in Australia, which is too small to influence global prices.

Consulting economist Rana Roy disagreed, saying the fact that high inflation wasn’t primarily caused by excess demand was no reason not to treat it by containing demand. Whatever the cause, containing demand would contain inflation.

Mala Raghavan from the University of Tasmania and Leonora Risse from RMIT University suggested winding back or delaying spending in two areas where it was clear the government was contributing to domestically-driven higher prices: subsidies for, and spending on, construction and infrastructure.

Withholding gas, boosting immigration

The most popular ideas for boosting the supply of goods and services to take pressure off inflation were reserving a portion of Australian gas and other commodities for domestic use, and boosting immigration, supported by 33% and 29% of the economists surveyed.

Made with Flourish

Reserving a portion of Australian east coast gas for use in Australia would help decouple Australia’s east coast gas prices from sky-high international prices as has happened in Western Australia, which reserves 15% of its gas for domestic use.

Boosting immigration would take pressure off costs by easing labor shortages.

Federation University’s Margaret McKenzie suggested investigating blockages in supply chains and offering diplomatic and industry support to bust them.

Subsidizing childcare, subsidizing fuel

The most popular idea for directly restraining prices was increased subsidies for childcare, supported by 25% of the economists surveyed, several of whom suggested it could also increase the supply of workers who had previously been prevented from working by unaffordable childcare.

Made with Flourish

Other ideas that would directly restrain some prices included pushing for below-inflation wage rises in the Fair Work Commission and extending the six-month cut in fuel excise due to expire in September.


Read more: Inflation hasn’t been higher for 32 years. What now?

Former Reserve Bank board member Warwick McKibbin warned against pursuing low inflation for its own sake, saying when the economy was weak or in recession a high rate of inflation could be more easily justified than at other times.

He said the Reserve Bank should stop targeting inflation and instead target the rate of growth in national spending, an idea he will be putting to the independent review of its operations.

Detailed responses:

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Why Cheerios are better than coffee for breakfast, new study claims

Researchers from the US have created the Food Compass, which, they say, is the most comprehensive system ever devised to assess the nutrition content of what we eat

When it comes to eating healthily, it seems there’s a new piece of advice every week.

Take eggs. Once demonized for being high in cholesterol, they gained hero status when protein-rich diets became the holy grail for weight loss. No wonder we’re so confused.

But a new study could be the definitive guide that we’ve all been looking for.

Researchers from the US have created the Food Compass, which, they say, is the most comprehensive system ever devised to assess the nutrition content of what we eat. The team in Boston spent three years looking at more than 8,000 foods and drinks, from melon to a McDonald’s, and used cutting-edge science to rank them according to 54 different attributes.

They gave each food a score between 1 and 100 — the higher the score, the healthier the food. Foods scoring between 100 and 70 are encouraged, those between 69 and 31 should be eaten only in moderation, while anything under 30 is bad news.

Researchers from the US have created the Food Compass, which, they say, is the most comprehensive system ever devised to assess the nutrition content of what we eat

Researchers from the US have created the Food Compass, which, they say, is the most comprehensive system ever devised to assess the nutrition content of what we eat

Some of the highest scoring foods will come as little surprise. Legumes, nuts and seeds (average score 78.6), fruits (73.9) and vegetables (69.1) all do well. Savory snacks and desserts (average score 16.4) are on the no-go list.

But there are some surprises. Sweet potato crisps get a score of 69, the same as bulgur wheat, usually considered a healthy grain. The vitamins and minerals in both are comparable. But break it down further, and other factors emerge.

Sweet potatoes have more vitamin A and potassium, and are low in sodium.

Bulgur wheat does have more protein and fiber than sweet potatoes, but it also has more starch (a bad thing) and fewer healthy fats.

And those of you who have ditched cereal in favor of eggs for breakfast might be surprised to find that Cheerios (95) and Shredded Wheat (83) are not only top scorers in the grain category, but score more highly than a boiled egg (51 ).

‘Cereals aren’t inherently bad. In fact, if they have a high whole grain content then they will get a good score for that, and if they don’t have added sugar, they won’t lose any points,’ explains Professor Jeffrey Blumberg, one of the co- authors of the study.

Coffee addict? Curiously, an espresso (55) isn't the best choice, according to the Food Compass

Coffee addict? Curiously, an espresso (55) isn’t the best choice, according to the Food Compass

What’s more, although eggs are a great source of protein, they may not contain as many nutrients as, say, a cereal that’s been fortified with vitamins and minerals, hence the lower score.

Fancy super-charging your diet? Here’s what to choose—with their Food Compass ratings in brackets.

FOLLOW THE FOOD COMPASS

Highest scoring foods – 100/100

  • avocado
  • Raw or lightly cooked broccoli
  • celery juice
  • raw salmon
  • Watercress
  • red kidney beans
  • cherries

Lowest scoring foods – 1/100

  • fizzy drinks
  • white pitta bread
  • boiled sweets
  • Frankfurters
  • biscuits
  • fudge
  • instant soups

BREAKFAST

For juice, opt for celery (100), which contains a range of vitamins and minerals including potassium, magnesium and calcium, or tomato (100), which is a great source of the antioxidant lycopene.

Coffee addict? Curiously, an espresso (55) isn’t the best choice. The healthier option is a skimmed milk cappuccino (73), which has some protein and, unlike the full-fat version (58), not too many saturated fats.

As for cereals, Special K might seem a good option, but with a score of 18, it’s on a par with Cornflakes (19) and not much better than Frosties (15).

Eggs alone, boiled or poached, score only 51. But make an omelette and you can push that up or down, depending on what you put in it. A ham and cheese omelette cooked in butter drags the score down to 15, but with an egg-white omelette with vegetables, you’ll hit 59. If toast is your thing, ditch jam on white (1) for reduced-fat peanut butter on whole wheat (63).

LUNCH

Unadulterated sashimi (thinly sliced ​​seafood) is a good choice (100), while a sushi-style California roll (1) has almost no health benefits thanks to its starchy rice, sugary vinegar and processed crab sticks.

White rice noodles (17) might look healthy but they’re almost empty calories. But if you go for wholegrain spaghetti (70) you get a lot more fiber, plus iron and potassium. Add a tomato-based sauce, with seafood and vegetables, and you’ll score 78.

Sandwiches aren’t a great choice, regardless of filling. Even a vegetable submarine sandwich with fat-free spread only gets 14, while roast beef gets 11. If you must grab a sarnie, go for grilled chicken on a wholewheat roll with lettuce and tomato (68). Sadly, but predictably, cakes (1) and cookies (4) aren’t advised.

dinner

You won’t be surprised to learn that a McDonald’s cheeseburger (8) isn’t massively nutritious. Ditch the meat and starchy carbs in favor of seafood — it’s high in protein, low in saturated fats, and packed with vitamins and minerals.

Try mussels in a tomato-based sauce (95), or a tuna salad made with light mayo (73). For top marks, go for a seafood salad with lettuce, tomato, carrots and other vegetables. The bad news is you need to hold the dressing to get a perfect 100.

If you can forgo meat, a curry isn’t a bad option. Vegetable curry scores 90, beef curry just 51.

Finally, while an ice cream sundae, with chocolate sauce and whipped cream, scores 10, you can still get a chocolatey fix — chocolate frozen yogurt made with skimmed milk scores a pretty impressive 81.

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Tattarang launches $250 million biotechnology fund, Tenmile

Tattarang launches $250 million biotechnology fund, Tenmile

Billionaire Andrew “Twiggy” Forrest is on the hunt for Australia’s next biotech household name with the launch of a $250 million venture capital fund for healthcare investments.

The fund, called Tenmile, will be backed by Tattarang, the private investment group co-owned by Forrest and his wife Nicola. It will be one of the few Australian investment vehicles purely focused on backing health technology companies.

Chief executive of Tenmile portfolio company Carina Biotech, Dr Deborah Rathjen, with Dr Steve Burnell.

Chief executive of Tenmile portfolio company Carina Biotech, Dr Deborah Rathjen, with Dr Steve Burnell.

Tenmile’s executive chair Dr Steve Burnell said while COVID-19 has proven to be a significant tailwind for the biotech sector, Australian companies still needed access to more private capital beyond initial grant funding.

“Australia could be the sort of health technology superpower, in a way…the foundations have been laid. We really think the missing ingredient is capital to help these companies reach ‘exit velocity’, as I say,” he told The Sydney Morning Herald and The Age.

The pandemic has shone a light on the global value of healthcare companies, though valuations have slid and share prices have taken a hit amid this year’s global market selloff. The ASX health care index is down by 7 per cent over the past year, with even giants like CSL and ResMed declining over the past 12 months.

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Burnell said there is still plenty of cutting-edge research that needs funding to produce long-term value beyond the pandemic. Tenmile is willing to be patient with its holdings, looking at investment horizons from a couple of years to a decade.

“The point is we’re not driven to push companies towards premature IPOs or some sort of exit,” Burnell said.

The fund’s maiden investments are focused on relatively new therapeutic areas, including personalized cancer treatments and the use of psychedelics and medicinal cannabinoids.

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Mattress company Koala cuts 30 Australian jobs over economic uncertainty

Mattress company Koala cuts 30 Australian jobs over economic uncertainty

Popular Aussie bedding and homewares company, Koala, has laid off 30 local staff due to unstable economic conditions.

The company shot up in popularity, particularly during the 2020 and 2021 lockdown periods, due to its competitive pricing, being all online and offering four hour delivery to metro areas.

However, just like many other companies, supply chain issues, inflation and surging interest rates have all taken their toll.

A Koala spokeswoman told The Sydney Morning Herald and The Age that uncertain economic conditions had resulted in 30 Australian staff members being made redundant last week.

Describing the former staff as “amazingly talented”, she said the company was supporting them with an outplacement service and professional connections.

According to the company’s website, Koala has “more than 200” employees.

The company also confirmed it had consolidated its offices in the inner-city Sydney suburb of Alexandria after previously also having employees located in the CBD.

News.com.au has contacted Koala for comment.

But it isn’t just the Australian staff that have been impacted, with 10 roles also being made redundant in South Korea following an expansion to the region last year.

The spokeswoman again told the publications “economic uncertainty” was behind the move, along with the need to “reduce our start-up cost in the market”.

“For the near term, our operations in Korea continue as we explore more efficient ways to serve the market,” she said.

The Sydney Morning Herald and The Age also cited claims from multiple industry sources that Koala had explored the possibility of listing on the Australian stockmarket, before abandoning the plan amid the recent the recent technology downturn.

The spokeswoman for the company strongly denied these claims.

“Like any private company with proven success as a market leader in our categories and markets, we are fortunate enough to receive countless inbound introductions from potential investors,” she said.

“They see the opportunity for Koala to continue to disrupt the global furniture market.”

She did not offer specific figures, but said Koala’s margins were double those of some of its competitors, adding that the decision to offer furniture and other homewares has led to “incredible growth” in non-mattress sales.

“We will continue to invest in our operations across Australia and Asia,” the spokeswoman said.

In October 2020, Koala copped significant backlash after announcing it would cease manufacturing its mattresses domestically and make them in China instead.

Staunch supporter of Australian-made products, Harvey Norman executive chairman Gerry Harvey, previously slammed Koala’s move, saying the name of the company implies the product is made domestically.

“Anyone selling imported mattresses are doing it because they can make more money,” Mr Harvey said.

“The marketing is dishonest… they are pretending they are Australian.”

The retail giant’s co-founder said overseas imports made it harder for local companies to compete in bedding and furniture.

Mr Harvey said his store predominantly sold made-in-Australia bedding, supporting local companies such as Sealy, SleepMaker and AH Beard.

When it was established in 2015, Koala marketed itself as a retailer of Australian-made furniture with a strong focus on sustainability.

However, most of its manufacturing has now moved to China and Europe, with the company deregistering itself in 2019 from using the Australian Made trademark.

“The decision to cease production of mattresses in Australia will provide significant innovation and quality improvements to help drive our continued growth across Asia-Pacific,” a company spokeswoman said at the time.

Koala said the move offshore would mean it would have greater influence in cultivating “sustainable behaviours” in its manufacturing and supply chain.

“We are always in search of the best manufacturers, suppliers, and makers around the world who meet or exceed our environmental and sustainability standards and conduct assessments to support this,” a spokeswoman said.

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5 things to watch on the ASX 200 on Monday 15 August 2022

5 things to watch on the ASX 200 on Monday 15 August 2022

A happy male investor turns around on his chair to look at a friend while a laptop runs on his desk showing share price movements

Image source: Getty Images

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week in a disappointing fashion. The benchmark index fell 0.5% to 7,032.5 points.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX 200 expected to return

The Australian share market looks set to rebound on Monday following a very strong night on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 39 points or 0.55% this morning. On Wall Street, the Dow Jones was up 1.3%, the S&P 500 climbed 1.7%, and the NASDAQ jumped 2.1%.

Oil prices fall

energy producers Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) could start the week in the red after oil prices tumbled on Friday. According to Bloomberg, the WTI crude oil price dropped 2.4% to US$92.09 a barrel and the Brent crude oil price fell 1.45% to US$98.15 a barrel. Oil prices came under pressure on speculation that US Gulf supply disruption will ease.

Westpac Q3 update

the Westpac Banking Corp. (ASX: WBC) share price will be one to watch on Monday when the banking giant releases its third quarter update. The market is likely to be looking for an update on how Australia’s oldest bank’s cost cutting program is progressing and how its margins have fared since rates started to rise.

Gold price rises

gold miners Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could have a decent start to the week after the gold price pushed higher on Friday night. According to CNBC, the spot gold price was up 0.45% to US$1,815.50 an ounce. The precious metal recorded its fourth straight weekly gain after the US dollar softened.

Bendigo and Adelaide Bank results

Westpac isn’t the only bank releasing an update today. Bendigo and Adelaide Bank Ltd (ASX: BEN) shares will be on watch when the regional bank releases its full year results. According to a note out of Goldman Sachs, its analysts expect the bank to report a cash profit of $502 million and pay a full year dividend of 123 cents per share.