Tuesday, 1 May 2012

Dell sees brisk sales of new ultrabooks

 Dell Inc's new ultra-thin laptop computer meant to rival Apple Inc's popular MacBook Air is doing much better than the company expected.

Sales of the XPS 13 ultrabook, which hit store shelves on Feb. 28, are now more than double the company's internal forecast, driven by strong demand from both consumers and big corporations, Dell said. 

"With this product, we went aggressive with the forecast," Dell product marketing director Alison Gardner said. "Since we started shipping it to customers, XPS 13 has exceeded our expectations."

Almost half of the sales of the XPS 13, which starts at $999, were to corporations, she added.

Dell's so-called enterprise business has doubled in the past five to six years and now represents half of the company's profit.

While Gardner declined to reveal the exact number of units sold so far or the internal forecast, she said Dell is seeing a lot of sales momentum for the super-thin category of laptops.

PC manufacturers plunged into ultrabooks - a super-thin category of laptops that chipmaker Intel Corp helped create - to attract consumers increasingly captivated by Apple's iPad, MacBook Air and other mobile devices.

Some analysts have said the high price of the laptops, driven up by expensive components such as solid-state drives, may impede sales and force Intel to sacrifice profit margins on its processors to help make them affordable.

Intel, which dubbed them ultrabooks, is providing support by kicking off its biggest marketing push since 2003.

The chip maker's "A New Era in Computing" campaign, which began in April, includes TV and print advertising along with a push in social media.

Clunky laptops are increasingly under threat as tablets grow more powerful and are used for multiple functions, from Web surfing to sophisticated graphics and video manipulation.

Round Rock, Texas-based Dell - which has been waging an uphill battle to diversify its revenue base from PCs to become a larger player in the data center equipment market and IT services - also plans to launch its first consumer tablet computer in late 2012.

Manufacturing sector expands slightly in April supported by bulging order books: HSBC PMI data

 The pace of growth in country's factory sector inched up in April, supported by bulging order books, but slower output growth and increasing price pressures dampened sentiment, a business survey showed on Wednesday. 

The HSBC India Manufacturing Purchasing Managers' Index (PMI), compiled by Markit, rose to 54.9 in April from 54.7 in March. 

The index has remained above the 50-mark that divides growth from contraction for more than three years. 

"Activity in the manufacturing sector expanded at a slightly faster pace in April. While output growth moderated ... new orders continued to pour in, including for exports," said Leif Eskesen, chief economist for India & ASEAN at HSBC. 

The new orders sub-index rose to 61.1 in April after falling to 58.1 in March, buoyed by strong exports, but while remaining solidly above 50 the factory output index fell for the third straight month. 

However, actual industrial output data is painting a bleaker picture with India posting sluggish factory production growth of 4.1 percent in February from a year ago, way below the 6.6 percent expected by analysts.

That does not bode well for Asia's third largest economy as factory output accounts for roughly 15 percent of gross domestic product (GDP). 

Last month economists cut their GDP forecasts for the fifth straight quarterly Reuters poll and now expect growth to average 7.1 percent in the fiscal year to March 2013. 

The government is more optimistic, expecting the economy to grow 7.6 percent in the same period, but even that is still a far cry from the near double-digit rates seen before the onset of the global financial crisis in 2008. 

The Indian economy has been throttled in recent years by a combination of high inflation, tight monetary policy, weak global economic conditions and the lax implementation of fiscal policies and reforms. 

The PMI survey showed the costs of raw materials grew at their fastest pace since August, and firms hiked their prices at the quickest rate in a year. 

Fears of adding to inflationary pressures that have plagued the economy might prevent the RBI from cutting interest rates aggressively to stimulate growth. 

The Reserve Bank of India cut the repo rate by a greater than expected 50 basis points last month to boost the flagging economy, but warned that it had little room to manoeuvre as inflation was likely to remain elevated. 

"Inflation accelerated with both output and input prices rising faster," said Eskesen. "This suggests that upside risks to inflation remain and that the RBI's rate cut could turn out to have been premature and too aggressive

Bharti Airtel Q4 net falls 28% to Rs 1006 crore, capex outlook between $3-3.2 billion

NEW DELHI: Bharti Airtel, India's biggest mobile phone carrier by subscribers, reported its ninth straight quarterly profit decline as intense price competition and losses on foreign exchange eroded earnings. 

Consolidated net profit fell to Rs 1,006 crore ($190.89 million) in the fourth quarter ended March from Rs 1401 crore a year earlier, Bharti said on Wednesday. The company said that the net income was impacted by higher costs on account of 3G license fee amortisation ( Rs 106 crore), 3G interest costs (Rs 84 crore), forexfluctuation losses (Rs 132 crore) and tax provisions (Rs 198 crore). 

The revenue grew at 11.6% for the full year in India & South Africa, mainly contributed by stability in pricing accompanied by growth in customer numbers. Africa, after adjusting for the number of days in Q1 FY11, grew by 18.8% in $ terms, on the back of network expansion and growing customer base. 

The consolidated EBITDA margins for the full year dropped to 33.2% versus 33.7% in the previous year, but Africa improved to 26.5% versus 21.9% in FY11. 

The consolidated net income for the year declined to Rs 4,259 crore versus Rs 6,047 crore, impacted by higher costs on account of 3G license fee amortisation (Rs 593 crore), 3G interest costs (Rs 421 crore), forex fluctuation losses (Rs 422 crore) and tax provisions (Rs 481 crore). 

Bharti Airtel expects consolidated capital expenditure of between $3 billion and $3.2 billion in the fiscal year that started in April, an executive said on Wednesday. 

The capex outlook excludes any potential payment for spectrum, said Sarvjit Singh Dhillon, group chief financial officer at the mobile operator's parent Bharti Enterprises. 

Commenting on the results Sunil Bharti Mittal, Chairman & Managing Director, Bharti Airtel said that he was pleased the year ended with the company's customer base crossing 250 million across twenty countries, the twentieth country being Rwanda. 

"Our launch of 4G LTE, the first in India, is testimony to our commitment to the broadband agenda," he said. 

Stating that the entire industry looks to the government for a fair, transparent and sustainable telecom regime, Mittal said, "The recent regulatory developments in India will have significant implications on the future of telephony and broadband, as well as India's global competitiveness." 

STOCKS NEWS SINGAPORE-Shares rise by midday, DBS gains

Singapore shares rose by midday on Wednesday, after China's manufacturing sector showed fresh signs of bottoming out in April and strong U.S. factory activity data raised hopes that the global economy was still on track for a recovery.
The benchmark Straits Times Index (STI) rose 0.52 percent to 2,994.00, holding above key resistance at the 50-day moving average around 2,986.
"The markets have been holding up today. China's HSBC PMI came in slightly better than the last number we saw," said Ng Kian Teck, lead analyst at SIAS Research.

However, he said he expects the STI to remain rangebound ahead of U.S. non-farm payrolls data due on Friday.
Shares of DBS Group Holdings Ltd climbed as much as 1.5 percent to a five-week high, as investors warmed to the stock following its stronger-than-expected quarterly earnings last week.
Upcoming Indonesian rules that may jeopardise DBS Group's $7.3 billion bid to take over Bank Danamon also helped sentiment as it lessened the risk of DBS becoming bogged down in a drawn-out, messy acquisition and consolidation process.
DBS rose to an intraday high of S$14.17, a level not seen since the announcement of the Danamon deal last month caused the shares to plunge.
"The Danamon deal is still subjective. The market seems to be taking the probability that it may not go through in a positive way," said Ng.
U.S. factory activity grew in April at the strongest rate in 10 months, with the Institute for Supply Management's index rising to 54.8 from 53.4 in March, easing worries the economy had lost momentum at the start of the second quarter.
The HSBC China Purchasing Managers' Index, which is geared towards smaller firms, improved to 49.3 in April from 48.3 in March.
1303 (0403 GMT)
(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com; Editing by Chris Gallagher)
11:57 STOCKS NEWS SINGAPORE-Sakari shares up as cost reductions expected
Shares in Sakari Resources Ltd gained on Wednesday as the Indonesian coal miner is expected to reduce costs at a key mine this year, shrugging off poor first quarter results.
Sakari stock rose 3 percent to S$2.03, bringing its gains so far this year to around 10 percent, with OCBC Investment Research maintaining its buy rating on the miner despite reducing its target price to S$2.29 from S$2.76.
Sakari's Jembayan mine in Kalimantan, Indonesia, had been hit by bad weather and management brought forward the opening of two new pits there, driving up cash costs to $67.5 per tonne in the first quarter.
But OCBC said in a report that Sakari believes operations at Jembayan are set to return to normal over the year.
"(Sakari) remains confident that it can achieve a cash cost of low- to mid-US$60/tonne this year," OCBC analysts wrote.
OCBC cut its 2012 earnings estimate for Sakari by 41 percent after the miner posted a net profit of $14.5 million for its first quarter, 65 percent lower than a year ago due to lower coal production and higher fuel costs.
1027 (0227 GMT)
(Reporting by Leonard How in Singapore; leonard.how@thomsonreuters.com)
10:24 STOCKS NEWS SINGAPORE-OCBC Investment cuts CapitaLand target price
OCBC Investment Research has cut its target price for property developer CapitaLand Ltd to S$3.21 from S$3.40 and kept its buy rating, citing lower average selling prices for its residential developments.
CapitaLand shares fell 0.3 percent to S$2.93, but have gained 33 percent since the start of the year.
CapitaLand, Southeast Asia's largest property developer, on Monday reported a 31 percent climb in first-quarter net profit to S$133.2 million ($107.8 million), helped by higher operating income and larger portfolio gains.
Poor sales from its residential units in China continued to weigh on CapitaLand's overall sales in the first quarter, OCBC said. The company sold only 189 units in China in January-March.
However, broking house Maybank Kim Eng said in a report that CapitaLand may benefit from some policy loosening in tier 2 and 3 cities in China, and raised its target price to S$4.00 from S$3.96.
A loosening could help developers maintain strong contracted sales momentum into the middle of the year, and sales could recover strongly in May, said Kim Eng, which kept its buy rating.
For related story click
1011 (0211 GMT)
(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com)
09:55 STOCKS NEWS SINGAPORE-SMRT falls as brokers cut ratings
Shares of train operator SMRT Corp Ltd SMRT.SI fell as much as 3 percent to a 29-month low, after it posted a sharp fall in quarterly earnings and reduced its final dividend, prompting several brokers to cut their ratings on the stock.
SMRT reported on Monday a 59 percent drop in fourth quarter net profit to S$13.9 million ($11.2 million), and declared a reduced final dividend of 5.70 Singapore cents compared with 6.75 cents a year ago.
SMRT shares fell 1.8 percent to S$1.65 with more than 1.1 million shares changing hands in early trade, compared to its average daily volume of 3.2 million shares over the last five sessions.
CIMB Research cut its target price for SMRT to S$1.50 from S$1.55 and maintained its underperform rating, citing higher operating expenses and a cut in dividend.
"Plagued by margin erosion and cash flow strains, we see no reason to own this stock. Further, dividend yields are no longer attractive," said CIMB in a report.
The broker added that SMRT's plans for asset renewal will result in higher capital expenditure, while mandates for more stringent repairs and maintenance will elevate its cost structure permanently, eating into profits.
JPMorgan downgraded SMRT to neutral from overweight and cut its target price to S$1.60 from S$2.00.
OCBC Investment Research also downgraded SMRT to hold from buy and lowered its target price to S$1.71 from S$2.04, citing weaker-than-expected earnings for 2012.
It estimated that SMRT's capital expenditure in 2013 will rise to S$500 million due to higher expenses needed for upgrading its assets.
For related statement click
0942 (0142 GMT)
(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com)
8:44 STOCKS NEWS SINGAPORE-Index futures rise
Singapore index futures climbed 0.12 percent, indicating a positive start of the benchmark Straits Times Index .
Asian shares edged higher and the dollar recovered against the yen on Wednesday after strong U.S. factory activity data eased concerns about a loss of momentum in the world's biggest economy.

BSkyB hopes results can outshine hacking headlines

Probes into phone hacking and the legacy of a failed bid by Rupert Murdoch to seize full control look likely to overshadow a resilient set of results from satellite broadcaster BSKyB on Wednesday.
BSkyB, already 39 percent-owned by Murdoch's News Corp, was dragged firmly into the centre of the hacking storm engulfing Murdoch's British newspaper business when its Sky News channel admitted last month that it hacked into emails on two occasions.

The channel said it had acted in the public interest but has been reprimanded for breaking the law by Judge Brian Leveson, who is leading an inquiry into press standards that is rocking the British establishment by delving into ties between journalists, politicians and police officers.
Shares in BSkyB had been riding at their highest level in almost 10 years until revelations in July 2011 that an investigator for Murdoch's now defunct News of the World newspaper had hacked into the voicemail messages of murdered school girl Milly Dowler.
Murdoch's son, James, was chairman of BSkyB when the scandal first broke and its shares have subsequently lost almost 20 percent of their value, despite continued growth of the business and moves to placate disgruntled shareholders.
BSkyB last year announced it would hand 1 billion pounds back to shareholders via a buyback and James Murdoch, once tipped as heir apparent to his father's media empire, last month quit his chairmanship.
The damage to BSkyB's shares was all the greater because the scandal derailed moves by the Murdochs to take full control of a company that is much more profitable than their newspapers.
Father and son were hauled before Leveson's inquiry just last week to give three days of evidence, and James' departure as chairman of the broadcaster was widely seen as a damage-limitation measure ahead of this week's publication of a damning report by members of parliament.
On Tuesday, lawmakers found Rupert Murdoch unfit to run a major international company and accused News Corp of showing "wilful blindness" about the scale of hacking at the News of the World tabloid.
Despite all the negative headlines, analysts expect the company to report higher third quarter earnings at 0700 a.m. British time on Wednesday.
Operating profit in the first nine months of its business year is expected to be 14 percent higher than a year earlier at 902 million pounds on the back of a 5 percent rise in revenue to just under 5.1 billion pounds.
"We expect BSkyB to deliver reassuring results over the coming quarters, with scope for further cash returns," UBS analyst Polo Tang wrote in a note to clients.
Tang has a "neutral" rating on BSkyB shares pending an auction of English Premier League soccer broadcast rights where competition is expected to be fierce, driving up prices.
Reuters reported last week that BSkyB, which has built its British pay-TV business on the back of soccer rights, could face a costly challenge from Qatari group Al Jazeera when the rights are renewed this summer.
The most closely watched number on Wednesday is expected to be subscriber figures. These are likely to show that BSkyB added a total of 71,000 new customers in the third quarter to the end of March, according to the average of seven forecasts compiled by the company.

Car bomb kills 6 after Obama leaves Afghan capital

At least six people were killed in a suicide car bomb attack in the Afghan capital on Wednesday, officials said, hours after U.S. President Barack Obama left Kabul following an unannounced visit during which he signed a strategic partnership agreement.

The Taliban, ousted by U.S.-backed Afghan forces for harbouring bin Laden and other militants, quickly claimed responsibility for what it said was a suicide car bomb attack.
Wednesday's attack was the latest in a recent surge of violence after the Taliban announced they had begun their usual "spring offensive", and that they had suspended tentative steps towards peace talks with the United States.
Kabul police chief Ayoub Salangi said six people, a Gurkha guard and five passers-by, were killed in the Kabul attack.
Salangi told Reuters a car bomb exploded on Jalalabad road, the main road out of the capital heading east, where several U.S. military bases and compounds housing Westerners are located.
He said one of those compounds, known as "Green Village", was the target. A plume of black smoke was seen rising from inside the area.
Reuters witnesses heard a second blast in the same area about 90 minutes after the first explosion.
The Interior Ministry earlier said at least two people had been killed , and another police official said an exchange of gunfire followed the first blast.
Afghan media said heavy casualties were feared.
Taliban spokesman Zabihullah Mujahid said: "One of our mujahideen detonated his car in front of a military base."
"Other mujahideen are inside the base fighting. There are very heavy casualties for the enemy," Mujahid told Reuters by telephone from an undisclosed location.
The Taliban often exaggerate accounts of attacks involving foreign troops or Afghan government targets.
A spokesman from NATO headquarters in the country said the coalition was aware of several explosions.
Obama marked the anniversary of bin Laden' s death with a speedy trip to Afghanistan, signing the strategic pact with Karzai and delivering an election-year message to Americans that the increasingly unpopular war is winding down.
Most foreign combat troops are due to leave Afghanistan by the end of 2014 under a plan to hand security responsibility to Afghan forces.
Obama left the country about three hours before the explosion, after making a televised address to Americans from Bagram Air Base north of the capital.
A U.S. embassy warning system urged staff to stay away from windows and take cover after the explosion. The embassy is in the main diplomatic area in the centre of the city.
Insurgents staged coordinated attacks in Kabul last month, paralyzing Kabul's centre and diplomatic area for 18 hours.
The Taliban claimed responsibility for those attacks, but U.S. and Afghan officials blamed the militant, al Qaeda-linked Haqqani network.

MPs say Rupert Murdoch unfit to run company

Rupert Murdoch is not fit to run a major international company, MPs said on Tuesday, finding him ultimately responsible for the illegal phone hacking that has corroded his global media empire and damaged the political establishment.

But it split along party lines, with members from Prime Minister David Cameron's Conservative Party voting against the report, saying they did not agree with its view that the Australian-born Murdoch was not fit to run a major company.
Cameron is facing criticism ahead of local elections this week that he was too close to the media tycoon, who won government approval to take over British pay-TV operator BSkyB, before dropping the bid when the scandal broke.
The report said there had been huge failures in corporate governance which raised questions about the competence of Rupert's 39-year-old son, James.
"News International and its parent News Corporation exhibited wilful blindness, for which the companies' directors -including Rupert Murdoch and James Murdoch - should ultimately take responsibility," it said.
"We conclude, therefore, that Rupert Murdoch is not a fit person to exercise the stewardship of a major international company."
Murdoch said the report had made difficult reading. "But we have done the most difficult part, which has been to take a long, hard and honest look at our past mistakes."
"There is no easy way around this, but I am proud to say that we have been working hard to put things right," he said in an email to staff.
In an echo of previous attempts to contain the scandal to a single "rogue" reporter involved in phone-hacking, Murdoch said only a single incident of wrongdoing - an email hacking case at the Times of London - had been found at his British broadsheets.
He said the company's Management and Standards Committee, which was set up to help police and lawyers investigate hacking and bribery by journalists, had now concluded its investigations into those newspapers and the Sun, where several reporters have been arrested on suspicion of bribery.
News Corp homed in on the split between the Conservatives and opposition Labour party members in the committee, saying its factual record was followed by "some commentary that we, and indeed several members of the committee, consider unjustified and highly partisan".
British media regulator Ofcom is investigating whether BSkyB -- 39 percent owned by News Corp - is a "fit and proper" owner of a broadcast licence, which entails an examination of the company's officers and shareholders.
A top 10 investor in BSkyB, who declined to be named, noted the political row over the 'not fit' wording, which was clearly aimed at influencing the Ofcom decision.
Asked if the report would have any bearing on his stake, he said: "Not just yet but if it means he (Murdoch) has to sell eventually, then that might be quite interesting."
The scandal has already forced James Murdoch to sever almost all his ties with Britain, stepping down as chairman of BSkyB, although he still holds a directorship of the company.
"The suggestion that Rupert Murdoch is not fit to lead a major international company is an astonishing conclusion," commentator Roy Greenslade, who worked under Murdoch at the Sun and Sunday Times, told Reuters.
The revelations of widespread phone hacking for newspaper stories last summer wiped almost 20 percent off News Corp's value in one month and has reduced James Murdoch's chances of taking over his father's $50 billion media empire, which includes the Wall Street Journal, 20th Century Fox and pay-TV operations.
Shareholders of News Corp could use the report as an excuse to demand better corporate governance, but the Murdoch family controls around 40 percent of voting stock so Rupert is unlikely to come under any real pressure to change his leadership style.
"There are some large investors who like the assets but don't like how they're run," said David Joyce, an analyst at Miller Tabak, adding the report could be positive if it forced News Corp to improve its corporate governance.
The report could also do damage in the U.S. where a Washington DC-based lobby group has already called for the News Corp's 27 Fox broadcast licenses to be revoked by the U.S. Federal Communications Commission.
Citizens for Responsibility and Ethics in Washington (CREW) said it had sent a letter to FCC chair Julius Genachowski which says broadcast frequencies may be used by only people of good character who will serve the public interest.
It also sent letters to the House and Senate Commerce Committees asking for hearings into whether Rupert and James Murdoch meet the FCC's character standards.
FCC spokespeople were not immediately available to comment.
The final version of the report was backed mainly by Labour members but also a member of the Liberal Democrats, junior partners in the governing coalition, in a blow to the Conservatives.
"None of us were able to support the report and we all voted against it," Conservative lawmaker Louise Mensch said, referring to her party members. "It will be correctly seen as a partisan report and we've lost a very great deal of its credibility."
Mensch said she would have supported the report if the reference to Rupert Murdoch being unfit to run a major international company had been removed.
"These people corrupted our country," Tom Watson, a Labour lawmaker and one of Murdoch's harshest critics on the committee said, referring to a police inquiry that has led to the arrests of journalists as well as police officers suspected of taking bribes.
The report said News Corp executives had shown contempt for the parliamentary system, singling out ex-News International chief Les Hinton, the paper's former top lawyer Tom Crone and the tabloid's last editor Colin Myler for having misled them.
James has also apologised for failing to get to the bottom of the scandal but said he was kept in the dark by staff at the paper. The committee said it did not have enough evidence to judge, but said Murdoch should have asked more questions.
"Their instinct throughout, until it was too late, was to cover up," the report said.
Yacktman Asset Management, a large shareholder in News Corp, said the British report did not change their view on the stock, while Barry Diller, who helped Murdoch build the Fox TV and studio business, said he was "more fit, morally and otherwise, to lead an organization than the majority of those that do".
BSkyB shares finished up 1.9 percent, slightly outperforming a 1.3 percent rise on the broad FTSE100 index.
The lower house of parliament will meet at a later date to debate the report and vote on whether to accept the findings.