08 April 2021 | Business

BP hits US$35 bln net debt target

Energy group BP said on Tuesday it expects to have hit its $35 billion net debt target in the first quarter of this year, sooner than expected and paving the way for it to deliver on its promise of buying back shares.

"This is a result of earlier than anticipated delivery of disposal proceeds combined with very strong business performance during the first quarter," Chief Executive Bernard Looney said in a statement.

Shares in the London-based company, which had previously expected to reach the net debt target in around the fourth quarter of 2021 or the first quarter of 2022, rose as much as 3% to 299 pence in early trade on news it would reach the target sooner.

BP plunged to a US$5.7 billion loss last year and had a debt pile of $39 billion at the end of 2020. It had expected that debt level to rise in the first half of 2021 due to several payments due. However, in the first quarter it generated around US$4.7 billion from sale proceeds.

As part of Looney's plan to shift the focus of the oil major to low carbon energy investments, BP aims to sell US$25 billion of assets by 2025.- Nampa/Reuters

Vitol suffers fall in revenue

Global energy trader Vitol suffered an US$85 billion fall in revenue last year, but its profits were boosted as trading plays offset the impact of the Covid-19 pandemic on oil demand and prices.

Many traders benefited in 2020 from extreme oil price volatility and storage opportunities. In April last year, US light sweet crude went negative for the first time and benchmark Brent futures touched two-decade lows before rebounding.

In a statement on Tuesday, Vitol said its revenue dropped to US$140 billion last year from US$225 billion in 2019. The Swiss firm does not disclose its net profit. Bloomberg quoted sources last month saying Vitol made a record net profit of about US$3 billion last year.

Traded oil volumes fell to 7.1 million barrels per day (bpd), compared with 8 million bpd in 2019, as oil demand contracted during coronavirus lockdowns.

Rival Trafigura said its oil and metals trading divisions had record profits in its financial year ending September 2020 while Glencore's trading division had its best year since 2008.- Nampa/Reuters

United Airlines to increase women pilots

United Airlines said on Tuesday it wants women and people of black colour to make up at least half of the 5 000 pilots it plans to train this decade at its new flight school, a push to diversify a career traditionally dominated by white men.

The announcement comes as US airlines resume pilot hiring halted last year during the pandemic and as they find themselves in the crosshairs of politically charged issues involving race.

"We want to make sure that we are tapping into a big deep talent pool and not limiting ourselves to just one section of the pond," Chief Communications Officer Josh Earnest said on a Zoom call with journalists.

Chicago-based United joined Delta Air Lines and American Airlines on Monday in speaking out against voting restrictions following recent legislation in states like Georgia that activist groups say unfairly target Black and other racial minority voters.

United is the only major US airline to own a flight school, the United Aviate Academy, which it bought last year just before vanishing demand because of the pandemic forced the industry to scale back its operations. - Nampa/Reuters

Genworth terminates US$2.7 bln buyout deal

Genworth Financial Inc has terminated a US$2.7 billion buyout agreement with investment firm China Oceanwide Holdings Group Co, the US insurer said on Tuesday.

Originally proposed in October 2016, the merger was stalled for years over concerns about Chinese access to sensitive data of US citizens. Shares of Genworth fell more than 6% in extended trading.

"Greater clarity about Genworth's future is needed now in order for the company to execute its plans to maximize shareholder value," Genworth's non-executive chairman James Riepe said, explaining the rationale behind the move.

Genworth said its revised plans include a potential partial IPO of its US mortgage insurance business.

The insurer said it will continue to explore partnerships with China Oceanwide to bring long-term care insurance products to the Chinese market. - Nampa/Reuters

Qatar Airways calls for borders to reopen

Qatar Airways called for countries to safely reopen borders on Tuesday, with its chief executive warning that more airlines would need state aid this year to avoid going bust.

Akbar al-Baker said that Qatar Airways, one of the Gulf's biggest carriers, would emerge from the coronavirus crisis as a top global airline.

The state-owned airline received a 7.3 billion-riyal (US$1.95 billion) equity injection last year from the Qatar government to see it through the travel slump.

Airlines around the world are desperate for income but uncertainty over how long some borders will stay closed is making people reluctant to plan or book holidays, leaving many planes grounded or flying near empty.

"We need to get borders safely reopened so people will fly again and with airlines expected to bleed cash at least until the fourth quarter of 2021 there is no time to lose," Baker told an online event.

Baker said he agreed with industry forecasts that passenger demand would not return to pre-pandemic 2019 levels until 2024, a year later than many had initially thought. - Nampa/Reuters

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