COMPANY NEWS IN BRIEF
02 December 2020 | Business
Exxon Mobil Corp said it would write down the value of natural gas properties by US$17 billion to US$20 billion, its biggest ever impairment, and slash project spending next year to its lowest level in 15 years.
The oil major is reeling from the sharp decline in oil demand and prices from the Covid-19 pandemic and a series of bad bets on projects when prices were much higher. New cost cuts aim to protect a US$15 billion a year shareholder pay out that many analysts believe is unsustainable without higher prices.
The write down lays bare the size of the miscalculation that the company made in 2010 when it paid US$30 billion for US shale producer XTO Energy as natural gas prices went into a decade-long decline.
While smaller than the up to US$30 billion charge the company forecast a month ago, the quarterly charge to earnings reflects the company's recent reduction in its outlook for oil and gas prices.
Exxon will continue initiatives in offshore Brazil, Guyana, the Permian Basin shale field in the United States, and in performance chemicals despite plans to implement deeper spending cuts, it said. - Nampa/Reuters
Moderna files for vaccine authorization
Moderna Inc said it has applied for US emergency authorization for its Covid-19 vaccine after full results from a late-stage study showed it was 94.1% effective with no serious safety concerns.
The US Food and Drug Administration said an advisory committee would meet to discuss the request on Dec. 17, making Moderna's candidate the second highly effective vaccine likely to receive US regulatory backing and a potential roll out this year.
A shot developed by Pfizer Inc and BioNTech SE that was 95% effective in its pivotal trial is set to be reviewed by a panel of outside experts a week earlier. The FDA will decide on the emergency use authorizations (EUA)after the advisers make their recommendations.
Moderna, which also plans to seek European approval, reported that its vaccine's efficacy was consistent across age, race, ethnicity and gender demographics as well as having 100% success in preventing severe cases of the disease.
"We believe that we have a vaccine that is very highly efficacious. We now have the data to prove it," Moderna Chief Medical Officer Tal Zaks said. - Nampa/Reuters
Novavax expects delayed vaccine trial
Novavax Inc on Monday pushed back the start of a US-based, late-stage trial for its experimental Covid-19 vaccine for the second time and now expects it to begin in the coming weeks instead of November.
While the US trial has been hampered by issues in scaling up the vaccine's manufacturing, Novavax has a late-stage study underway in the UK which finished enrolment on Monday.
The US trial delay was not meaningful and it could provide more information into Novavax's "second-generation" vaccine that already lags behind larger rivals, said Cantor Fitzgerald analyst Charles Duncan.
Pfizer Inc and Moderna Inc are seeking US emergency use authorization for their experimental vaccines, but experts have said more than one vaccine would be needed to end the pandemic that has killed over 1.4 million people globally.
Novavax expects interim data from the UK trial in the first quarter of 2021, and could also pursue approval globally in the United States and UK after that initial data, Duncan added. - Nampa/Reuters
American Airlines began trial flights
American Airlines began trial flights from Miami to South America in mid-November to prepare for its role in transporting the Covid-19 vaccine, the US carrier said on Monday.
The flights simulate the conditions required for the vaccine to stress test the thermal packaging and operational handling process that will ensure it remains stable.
The trial flights come as airlines scramble to prepare ultra-cold shipping and storage facilities to transport Covid-19 vaccines developed by Pfizer and Moderna, whose doses require deep freezing and are likely to be among the first to be distributed.
The US carrier said it was working with cargo, pharmaceutical and federal partners to be ready to safely and quickly transport an approved vaccine.
Typically, airlines use containers with cooling materials such as dry ice to transport pharmaceutical products, but some don't have temperature controls, making products prone to unforeseen events such as flight delays. - Nampa/Reuters
JetBlue forecasts higher Q4 cash burn
JetBlue Airways Corp said on Monday it expects cash burn to rise to about US$8 million per day in the fourth quarter, citing recent booking trends and a delay in cash tax refunds.
A renewed surge in Covid-19 infections and travel curbs has further dimmed the financial outlook for the sector, which the International Air Transport Association (IATA) has predicted is set to lose US$87 billion this year.
US airlines received US$25 billion in federal aid to keep employees on payroll between March and September and have now asked for a second round of support.
"Booking trends remain volatile and the company continues to believe demand and revenue recovery will be non-linear through the fourth quarter and beyond," New York-based budget carrier JetBlue said.
It expects its fourth-quarter average daily cash burn to be between US$6 million and US$8 million, compared with its prior forecast of between US$4 million and US$US6 million. It also forecast a 70% slump in revenue, compared with its prior expectation of an about 65% fall. - Nampa/Reuters