Company news in brief
14 September 2020 | Business
Oil and gas producer Kosmos Energy said last week it agreed to sell certain exploration assets in Africa and South America to a unit of Royal Dutch Shell for up to US$200 million.
Shell will acquire the company’s participating interest in blocks offshore São Tomé and Príncipe, Suriname, Namibia and South Africa, Kosmos said in a statement.
Kosmos said it plans to use up to one-third of the initial sale proceeds of US$100 million to test two high-quality infrastructure-led exploration prospects in the Gulf of Mexico.
Dallas, Texas-based Kosmos said it expects to realise about US$125 million in total savings across capital expenditures over the next two years after the sale. – Nampa/Reuters
Rio Tinto exits reverberates across boardrooms
The departure of Rio Tinto chief executive Jean-Sebastien Jacques (photo) over the destruction of ancient Aboriginal heritage sites in Australia has put mining executives globally on notice of ignoring cultural and social issues at your peril.
Jacques and two deputies resigned on Friday after weeks of shareholder pressure over what was seen as the miner's inadequate initial response to the destruction of the rockshelters - a board-led inquiry found no single individual was at fault and reprimanded the three senior executives by trimming bonus payments.
"For the CEO and a couple of senior management to go over an ESG issue, it's just going to reverberate through board rooms throughout the resource sector," said Ben Cleary, a partner at Tribeca Investment Partners.
Rio chairman Simon Thompson said on Friday that what happened at the site had been wrong and that the company was "determined to ensure that the destruction of a heritage site of such exceptional archaeological and cultural significance never occurs again".
Rio's detonations, which allowed it to access higher grade iron ore, came amid a wider movement in Australia focused on the treatment of Aboriginal groups, who fall behind the general population on markers ranging from child mortality to literacy. – Nampa/Reuters
Harmony Gold expects full year loss
South Africa's Harmony Gold Mining said on Thursday it expects to report a loss for the full year as a R1.7 billion derivative loss hits profits though revenue increased on a higher gold price.
The gold miner expects headline loss per share (HEPS) for the year ended June 30, to be between 139 and 169 cents, compared to earnings of 204 cents per share reported in the year-ago period.
Harmony said it recorded derivative losses of close to R1.7 billion compared to gains of R484 million a year ago, driven by a weaker South African rand-US dollar exchange rate and the strengthening of commodity prices during the year.
The company said it had also recorded a loss of about R919 million on its dollar-denominated debt compared to a loss of R78 million a year earlier.
A surge in the gold price, however, contributed to an increase in revenue to R29.2 billion from R26.9 billion. – Nampa/Reuters
SAA needs state cash this week
South African Airways needs short-term funding from the government by the end of next week for the state carrier's business rescue process to continue, its administrators said on Thursday.
"It is prudent to advise affected persons of the company's dire financial position," they said in a statement. "The existing funds which are available for operational expenditure ... are near depletion."
The administrators plan to scale back the fleet and cut jobs but at least R10 billion in new funds is needed.
The government has yet to clarify where it will find the money but said in a statement on Thursday that a decision on the sources of funding would be announced "soon".
The administrators said the government had so far advanced R9.3 billion to pay various lenders, but that the remaining portion of short-term funding had yet to materialise. – Nampa/Reuters
Lufthansa's Swiss unit could cut 15% of jobs
Lufthansa's Swiss unit could cut up to 15% of its 9 500 jobs if it cannot agree salary cuts with staff as it seeks to meet strict savings targets in the wake of the coronavirus crisis, Swiss weekly Sonntagszeitung said yesterday.
"It is our target to get through the crisis with as many employees as possible," the paper quoted a spokesman for Swiss as saying. "We have to cut costs by around 20%. We are not only focusing on personnel costs, but on every unit of the company."
There has been a first round of negotiations on temporary adjustments to working conditions and an overhaul of the benefits plan, a spokesman for Swiss union VPOD which represents ground staff told Reuters.
"Swiss has declared that it must achieve 15% cost savings. How this will be achieved is not yet clear," he said.
Swiss parent Lufthansa has pledged a restructure ranging from thousands of job cuts to asset sales, as it seeks to repay a 9 billion euro (US$11 billion) state bailout and navigate deepening losses in the face of the pandemic. – Nampa/Reuters