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Government rejects proposals to tackle environmental impact of fast fashion

MarketLine

In June 2018 the Environmental Audit Committee (EAC) launched an inquiry into the sustainability of the fashion industry. The aim of this was to identify the ways in which the fashion industry can alter its practices to be both prosperous and sustainable. The report, published in February 2019, did just that. Had the proposals been accepted, the cost to the fashion industry would have probably been substantial due to the scale of environmental damage that has arisen from throwaway fashion. According to data submitted to the Environmental Audit Committee (EAC),… Read more

Alphabet X-Wing: Project Wing intensifies competition in a crowded drone delivery market

MarketLine

Project Wing aims to develop technology which makes the tracking and delivery of goods cheaper, faster and more sustainable than ever before. The project has developed an unmanned aerial vehicle with the ability to deliver packages to homes autonomously. This particular drone delivery service has a number of benefits associated with it in comparison alternative to traditional postal delivery. Transport times are quicker and are possible through bypassing traffic congestion reduces delivery times and helps reduce the volume of traffic on the roads. With less traffic and zero emissions, drone… Read more

Mini-BOTs: Italy’s idea to overcome debt might be proved more complex than it seems

MarketLine

The Italian government is considering of paying their tax cuts and aggressive spending by issuing mini-Bots. These would be small (euro) denomination, non-interest-bearing Treasury bills in the form of bearer securities that would be secured by tax revenues. Consumers would use mini-BOTs as a tax payment, provided they move beyond policy ideas into reality. Businesses or consumers could pay other businesses via transfers from account to account or hand to hand would not be subject of the EUR3,000 ($3,372) legal limit on cash payments within Italy, and last from the… Read more

Credit Agricole first quarter losses: Results fall below expectations

MarketLine

Crédit Agricole profits were below expectations in the first quarter, despite a better than forecast performance in its investment banking arm. The share value dropped as investors looked forward to a strategy update due in June. Citi Group claimed that the miss by Credit Agricole was mainly due to higher costs and higher taxes, with revenues broadly in-line and better provision in addition with a higher than expected contribution to the EU Single Resolution Fund during the quarter. Net income fell by 11% to EUR763m ($856m) missing analysts estimates alongside… Read more

Booz Allen Hamilton: FY2019 highlights strong growth, but with reason to worry about US government

MarketLine

Revenues for Q4 stood at $1.8bn, representing a 9.1% increase for the same period a year ago, while financial year end revenues reached $6.7bn – a huge 8.7% increase year-on-year. EBITDA for the year increased 15.4% to $675m, while net income was the company’s biggest mover compared to 2018, with a 34.2% increase to reach $395m. Booz Allen Hamilton is also wary of the company’s reputation being damaged by the US government. Reputation issues could be pointed towards President Trump and his potential to create public outcry for the company,… Read more

Boeing 737 MAX: Public action needed to rebuff long-term threats

MarketLine

Even before the deadly crashes, Boeing had already staked much on sales of the MAX. Created to catch-up with new offerings from Airbus, the 737 MAX was reportedly rushed into service. According to a ’60 Minutes’ investigation, development was carried out under demands from the higher management echelons that the new version of the plane be as close to the previous version as possible. So far only one airliner, Indonesian based Garuda, has cancelled an order. The company was scheduled to receive 49 more MAX aircraft, having already been delivered… Read more

Canopy Growth acquires This Works: Entry into skincare market will pay dividend

MarketLine

This Works was created in 2003 by Beauty Director of Vogue UK and International journalist Kathy Phillips, and has since established an international footprint and become a notable player within the health and beauty industry. The company is headquartered in London and develops products high-quality natural skincare and sleep solutions, which have garnered a loyal following over the years and propelled the company to success. Canopy Growth purchased This Works for £43m ($57.3m) in an all-cash transaction, highlighting the value it sees in the brand. This Works is an ingenious… Read more

Luckin Coffee could displace Starbucks in China

MarketLine

Chinese coffee start-up company Luckin Coffee has demonstrated strong potential in the Chinese coffee market. In just two years of existence the company has expanded prolifically and now threatens Starbucks, the leading coffee house chain operating in China. Luckin has made its intentions clear with the aim of become the nation’s leading specialist coffee provider by continuing an aggressive expansion strategy. The company has already achieved in two years what Starbucks has taken 19 years to complete in China. This has raised concern for Starbucks, which has begun taking action… Read more

Beyond Meat: Vegan burgers are going public

MarketLine

Beyond Meat raised the price range for its shares before floating on the stock market, valuing the plant-based meat producer at almost $1.5bn. The American company, which counts the actor and ecologist Leonardo DiCaprio its investors, will now offer their shares at a price of $23 to $25. The decision to increase the price from the original price range of $19 to $21 indicates strong demand for shares. But Beyond Meat has made big losses and does not know when it will make a profit. Financial results for 2018 reveals… Read more

The Body Shop: Plans to expand in the growing Indian cosmetics market

MarketLine

The Body Shop is a manufacturer and retailer of personal care and cosmetics products. The company classifies its offerings under seven product categories: face care, body care, hair care, make-up, fragrances and gifts. The Body Shop operations spread globally with a presence in over 65 countries and employs 22,000 people. Prior to being acquired by Natura, The Body shop’s sales were declining in the UK, reflecting the UK high street malaise. Results for 2016 show total sales were EUR920.8m ($1.1bn), down from EUR967.2m ($1.14bn) in 2015. Moreover, competition from an… Read more

CMA blocks Asda Sainsbury’s merger: Ending merger will stifle competition and dissuade future investment

MarketLine

On Wednesday, April 25th 2019 the Competition and Market Authority announced that the proposed merger deal between leading supermarket food retailers, Sainsbury’s and Walmart-owned Asda, would not go ahead. Despite being expected, the decision has shook investors; Sainsbury’s share price fell to a near three-year low on the day of the announcement. It leaves Sainsbury’s CEO Mike Coupe in the unenviable position of having to come up with a strategy for the future of the company as a solo act, a situation made tougher having already invested so much into… Read more

Robinhood: Fintech start-up and zero-fee trading app applies for traditional banking service charter

MarketLine

The company has stated “This is a first step towards being granted a national bank charter which would allow Robinhood to offer traditional banking products and services,” a strategy that will please users and potential investors. The move will mean if the charter is approved, the company will be able to offer a full-service bank product alongside its no-fee trading platform. The application will without doubt be supported by the company’s upcoming IPO, said to be worth $5.6bn. The US-based company raised $363m in its latest Series D round of… Read more

CMA blocks Asda Sainsbury’s merger: Ending merger will stifle competition and dissuade future investment

MarketLine

On Wednesday, April 25th 2019 the Competition and Market Authority announced that the proposed merger deal between leading supermarket food retailers, Sainsbury’s and Walmart-owned Asda, would not go ahead. Despite being expected, the decision has shook investors; Sainsbury’s share price fell to a near three-year low on the day of the announcement. It leaves Sainsbury’s CEO Mike Coupe in the unenviable position of having to come up with a strategy for the future of the company as a solo act, a situation made tougher having already invested so much into… Read more

Debenhams: The latest victim of the UK high street

MarketLine

Even though Debenhams has announced store closures under a proposed CVA, the retailer is far from being alone in experiencing high-street woes. Numerous retailers, including House of Fraser, New Look, Next, Arcadia, and Marks & Spencer have been facing increasing financial difficulty on the UK high-street, while others, such as Toys R Us, have exited the market altogether. Debenhams’ difficulties are the result of an often seen tale of too many stores, too much debt, and a failure to keep up with consumer trends. On top of the problems that… Read more

Chevron buys Anadarko: $33bn purchase is big move into US shale

MarketLine

For now the purchase of Anadarko Petroleum Corporation – a company that in 2018 registered $13bn in revenue but which consistently lost billions of dollars each year before turning a profit in 2018 – remains the largest of its type and places Chevron level with ExxonMobil and Royal Dutch Shell in terms of production. Last year the newly combined company would have generated greater revenues than ExxonMobil. Investing so heavily reveals the degree of confidence big oil players have in shale gas extraction. The scale of operations such companies will… Read more

Revolut: the Uber of financial services

MarketLine

Traditional banks have long been at an advantage when it comes to customer data due to having access to vast amounts of information that financial technology (fintech) competitors cannot obtain. However, this situation has been changing recently, especially in Europe. New European legislation that was introduced in 2018 called Payment Services Directive (PSD2), and it has put traditional banking products and services under a threat from a new type of digital-first startups. A handful of them have already seen a big growth in users and have broken even operationally. What… Read more

McDonald’s: Tech-heavy strategy at the forefront of driving growth

MarketLine

McDonald’s recently announced its purchase of tech start-up Dynamic Yield Ltd for a price tag of $300m, making it the company’s biggest deal in decades. The fast food giant isn’t best known for embarking on M&A activity, but it has been investing heavily in more recent years in a bid to bring technology to its services, indicating that tech lies at the forefront of the McDonald’s future. McDonald’s recent acquisitions are the latest in a string of digital investments which have taken place over the last few years, which have… Read more

The Entertainer continues expansion with ELC acquisition: Retailer bucking the high street trend

MarketLine

The UK high street has seen a number of casualties in recent times, with many retailers collapsing and others significantly scaling down operations. In the toys & games market, Toys ‘R’ Us has been the stand out casualty with the retailer closing all of its stores in the UK during 2018 following bankruptcy. Prior to this, Toys ‘R’ Us had been the leading toy retailer in the UK for most of its history after entering in 1985. The Entertainer seized this opportunity, making 2018 the year for expansion. The retailer… Read more

Primark: Fashion giant continues to break the rules of retail

MarketLine

Associated British Foods, the parent company of Primark, announced in late February that it expects profits will be “well ahead” of last year despite a drop in underlying sales in its stores. The company also managed to perform well in 2018, despite the retail environment being particularly tough, with revenues reaching £7.4bn ($9.8bn), 6% ahead of last year at constant currency rates. Primark believes future growth prospects lies in further expanding its store portfolio and has ambitious plans to open more stores in the coming year, including 19 across, France,… Read more

AstraZeneca agrees $6.9bn deal with Daiichi Sankyo: UK drug maker could dominate the future breast cancer therapy market

MarketLine

The joint development and commercialization of a new breast cancer therapy indicated for the treatment of HER-2 positive breast cancer has the potential to help the AstraZeneca in its quest for a larger oncology market share. If approved, it will join Lynparza (olaparib) – a PARP inhibitor marketed by AstraZeneca for the treatment of HER negative breast cancer. The addition of a new breast cancer therapy to the AstraZeneca product portfolio will almost certainly increase the company’s market share. Roche currently dominates the treatment of HER-2 positive breast cancer with… Read more

Micro-transactions dominating the gaming industry: Gambling becoming a major issue

MarketLine

Micro-transactions have dominated the gaming industry in recent years, largely due to their ability to generate an income for games developers throughout the life-span of a game, rather than being dependent on the one-off payment at the point of sale. This new model facilitated revenues to sharply increase and has begun a new wave of ‘free-to-play’ games, whereby developers make profits based upon the additional features players can purchase within the game. From a business perspective in-game purchases have been a tremendous success; some companies have doubled their profits. However,… Read more

Saudi Aramco financials released: Despite huge net profit, financials reveal fundamental problems

MarketLine

For the first time in over four decades of operation state-owned oil major Saudi Aramco released financials, revealing the firm to have produced the highest net profit of any company in the world. Despite the attractiveness of headline figures, the financial condition of the firm falls far short of the $2tn valuation the government declared when launching an IPO was first mentioned publically. Evidence on which that valuation could be supported is lacking, exacerbating the economic problems the state has experienced of late, thus revealing the need for diversification. In… Read more

Cannabis market: Aurora Cannabis leading the market

MarketLine

Quite a few countries before Canada had legalized recreational marijuana use, or enacted laws partially allowing it. However, none of those countries created a legal market for marijuana. For a market to emerge it has to be backed by serious economic and political power; Canada is just such a country. On October 17th 2018 the Canadian parliament approved the Cannabis Act, giving the green light for using and growing marijuana and initiating the process for a market to emerge. The creation of companies specializing in producing marijuana for recreational purposes… Read more

Estonia: Only 1.3m people, but 4 unicorn start-ups

MarketLine

The former Soviet-controlled nation of Estonia, home to just 1.3m people, is one of the most tech-savvy countries in the world. It holds the world record for the number of startups in the country per capita, has one of the world’s fastest broadband speeds, and its education system teaches every child how to code. It is also leading in the development of online governance infrastructure – participating in elections by internet voting takes just 90 seconds. Its highly flexible, transparent, and hassle-free infrastructure makes it a great place for business… Read more

Argentine agricultural exports: Tax on exports not helping to initiate economic recovery

MarketLine

Even during numerous economic crises during the early 2000s Argentina routinely registered a trade surplus, but that is no longer the case. To combat biting economic conditions the government has imposed austerity alongside a plethora of policies which include higher taxation on exports. The decision to tax exports at a higher rate to lower the deficit is therefore flawed. Instead of agriculture being helped to improve the economy, higher export taxation makes key Argentine products more expensive in an industry which is notoriously price sensitive. Instead of targeting the agricultural… Read more

Vale disaster: Mining giant will survive, but repercussions will be severe

MarketLine

The collapse led to the flooding of the town of Brumadinho with 12 million cubic meters of mining waste, wreaking havoc across the landscape. This has not only caused a huge environmental disaster but also led to the deaths of an estimated 169 – a figure which is expected to rise. While Vale is a metal and mining and logistics company, it derives the bulk of its revenue from the ferrous minerals segment, which accounted for 74% of total revenue in FY2017. Vale expects that the anticipated decline in output… Read more

Weight Watchers: A poorly timed rebranding has crushed investor expectations and collapsed the share price

MarketLine

On February 26th 2019, dieting and weight-loss company Weight Watchers released its annual report for 2018. The share price settled in the week following the announcement, but not before the company suffered the second-largest share price drop in its history, dropping nearly 35% overnight. While the financial performance was remarkable – revenues and operating incomes grew more than $200m and $100m respectively – investors were primarily interested in what is perhaps Weight Watchers’ most important metric: its number of end of period subscribers. Historically Weight Watchers has found subscribers following… Read more

Nigerian e-commerce market will lead economic growth: However companies are struggling in the current market environment

MarketLine

Nigeria is seen by many investors as a gateway to the African market: the country has the highest GDP in Africa. Investment has enabled the country to develop its digital market; improving internet services and accessibility has created opportunities for digital businesses. E-commerce has become one of the most lucrative online markets in Nigeria; the rate of internet usage and purchases has continuously increased over the years. The rising amount of online retail purchases has resulted in the e-commerce market in Nigeria reaching a value of $13bn within just ten… Read more

Amazon Prime Dominating: revenue streams key to success

MarketLine

Amazon has become a phenomenon in the retail industry. Through the use of Prime, originally just a subscription to fast delivery at a fixed rate, has become a method to foster customer loyalty in an otherwise ruthless sector. Through continually pushing to add more value towards the mere $119 a year subscription, Amazon founder and CEO Jeff Bezos has smashed through analysts’ forecasts, reaching an astonishing 100 million subscribers to the service. The two-day delivery feature Amazon has so boasted proudly about for many years now continues to be a… Read more

Kraft Heinz Company: What has caused this food giant’s share price to nosedive?

MarketLine

Kraft Heinz Company is a global food producing giant capable of strengthening its position as the fifth largest food producer in the world, but an overvalued 2015 merger has harmed the immediate outlook for the company. Charges as a result of the goodwill and intangible assets in its latest results capped off a terrible 2018 for the company, in which attributed to a common shareholder loss of $12.6bn and diluted loss per share of $10.34 – representing a huge write-down in a sector that seldom sees figures of that magnitude… Read more