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Finance News - part 10

US Retail Stocks in Decline

US Retail Stocks in Decline

FINANCE

  • Poor results and low forecasts for OfficeMax, Liz Claiborne and Urban Outfitters drag US retail stocks down
  • Walmart reports 0.6% increase in shares

Retail stocks in the United States fell on Thursday following poor results and forecasts from big names such as OfficeMax, Urban Outfitters and label Liz Claiborne, according to analysts at FactSet Research.

Office supplies giant OfficeMax reported lower than expected first quarter profits of 13 cents a share, well short of the estimated 27 cents. Share prices plummeted 12% as a result.

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European Carmakers Boosted by Strong Q1 Profits

European Carmakers Boosted by Strong Q1 Profits

FINANCE

  • Volkswagen reports profit of $2.5 billion in Q1, three times higher than 2010
  • Fiat acquires additional 16% stake in Chrysler, narrows in on top automakers
  • Volvo, Peugeot-Citroen cut back production due to limited parts from Japan

European automakers bounced back strongly in the first quarter of 2011, as Volkswagen continued on from last year’s strong performance and Fiat closed in on the world’s top carmakers.

Europe’s largest carmaker Volkswagen posted first quarter profits of $2.5 billion, three times higher than the same time last year. It sold an unprecedented two million cars, another milestone for the German group, after its record profits of $9.8 billion in 2010.

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Hyundai Seals $557 Million JV in China

Hyundai Seals $557 Million JV in China

FINANCE

  • Hyundai signs $557 million joint venture deal with Sichuan Nanjun Automobile Group
  • JV aims to produce 160,000 vehicles annually by 2013
  • Chinese commercial car market to hit 5.2 million units by 2015

Hyundai has reached an agreement over terms for a $557 million joint venture with China’s Sichuan Nanjun Automobile Group. The venture will be an equal share partnership between the South Korean and Chinese carmakers that aim to manufacture 160,000 vehicles per year by 2013.

The operation will be based in Ziyun in China’s southwest province of Sichuan and will get underway in late 2011. Talks began earlier last year with Hyundai agreeing to an initial proposal for the joint venture in October.

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Amazon Sales Soar in North America

Amazon Sales Soar in North America

FINANCE

  • Q1 sales for Amazon’s North American sites increased nearly 45% to $5.47 billion
  • Amazon international site sales top $4.39 billion
  • However, global net income fell to $201 million in Q1, down 33% on last year

The world’s largest online retailer Amazon.com announced that sales from its North American sites jumped nearly 45% to $5.47 billion in the first quarter of 2011, with global sales totaling $9.86 billion.

The US and Canada saw the strongest growth of all Amazon sites, with electronic goods and merchandise sales totaling $3.3 billion, a 63% increase compared to the same period last year. Media sales, particularly books and DVDs, increased by 18% to $1.89 billion.

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Nokia Signs Smartphone Deal with Microsoft as Market Share Falls

Nokia Signs Smartphone Deal with Microsoft as Market Share Falls

FINANCE

  • Nokia signs smartphone partnership deal with Microsoft; plans to scrap Symbian OS platform
  • Nokia Q1 2011 profits fall 1.4% to $503 million – much better than expected; its global market share drops to 29%
  • Apple posts record unit sales of 18.6 million iPhones and $11.9 billion in profit for Q1

Finnish mobile phone company Nokia is connecting with Microsoft in a partnership that is expected to boost its diminishing market share.

The deal between the smartphone and software giants comes as Nokia posted a 1.4% fall in profit to $503 million for the first quarter of 2011. The figures were better than expected though, with initial forecasts predicting much lower earnings, or even a loss in Q1.

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Apple Profits Soar as iPhone Sales Hit Record High

Apple Profits Soar as iPhone Sales Hit Record High

FINANCE

  • Apple’s net profit almost doubles to just under $6 billion
  • Revenue jumps 83% to $24.7 billion
  • iPhone sales hit record high of 18.65 million units, accounting for almost $12 billion in revenue

Profits for US tech giant Apple have exceeded expectations, boosted by an unprecedented number of iPhone sales.

Apple reported net profit of just under $6 billion in its fiscal second quarter, which almost doubles the figure from last year. Revenue was up 83% totaling $24.7 billion, nearly $1.30 billion more than highest expectations, according to business intelligence group Thomson Reuters.

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Walmart Goes Social with $300 Million Kosmix Purchase

Walmart Goes Social with $300 Million Kosmix Purchase

FINANCE

  • Walmart buys social media company Kosmix for $300 million to create @WalmartLabs
  • New group will create technologies for social and mobile commerce to support Walmart’s global multi-channel strategy
  • Acquisition predicted to force competitors to invest in social media strategies

Walmart has acquired social media company Kosmix for the sum of $300 million in a bid to create a mobile and social shopping experience to draw in new customers.

California-based Kosmix built a social media platform that helps filter online updates by topic. It drives TweetBeat, a real-time live events filter, and medical search engine RightHealth, providing users with detailed and personalized information.

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Zacharon Seals $210 Million Deal with Pfizer to Develop Orphan Disease Drugs

Zacharon Seals $210 Million Deal with Pfizer to Develop Orphan Disease Drugs

FINANCE

  • Zacharon will provide Pfizer with access to its drug identification technology
  • Deal represents major validation for small biotech Zacharon; underscores Big Pharma’s interest in orphan diseases
  • Orphan diseases affect over 620 million people around the world

Zacharon Pharmaceuticals has announced a $210 million deal with drug powerhouse Pfizer to develop treatments for orphan diseases.

The small San Diego-based biotechnology firm will provide Pfizer with access to its drug identification technology to target treatments for rare diseases, including lysosomal storage disorders. These conditions can cause progressive deterioration in physical and mental state, and can also lead to early death.

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The New Face of Irish Banking

The New Face of Irish Banking

FINANCE

  • €70 billion bill for Irish banking sector bailout
  • Irish Life & Permanent will sell life insurance arm to raise €4 billion
  • Only Bank of Ireland and Allied Irish Banks to remain in 2015

The price tag of rescuing Ireland’s battered banking sector is barely conceivable: €70 billion ($99 billion). That is not far off the €70 billion that Britain spent bailing out its own banks. But in the Republic of only 4.4 million people, the burden will be significantly heavier.

Late last month, the Central Bank of Ireland said four banks required a further cash injection of €24 billion, as revealed in a capital and liquidity stress test. These tests, a condition of the €85 billion EU-International Monetary Fund (IMF) bailout loan, are designed to determine if Irish banks could withstand another severe crisis over the next three years.

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Kraft Foods Management Shake-Up

Kraft Foods Management Shake-Up

FINANCE

  • Dr. Peter B. Henry appointed to Board of Directors; David Brearton appointed CFO
  • CEO Irene Rosenfeld’s compensation was cut 27% in 2010 to total over $19 million
  • Kraft reported 2010 net revenue growth of 27% to $49.2 billion

Today global food giant Kraft Foods Inc. added to its Board of Directors Dr. Peter B. Henry, 41, who is Dean of the New York University Stern School of Business and a recognized international economist. The company also confirmed that current directors Frank G. Zarb and Deborah C. Wright will not stand for re-election.

Kraft previously announced on March 14 that current Executive Vice President of Operations David Brearton, 50, will replace Executive Vice President and Chief Financial Officer Timothy McLevish, 55, after Kraft files its first quarter financial statements this year. McLevish will leave the company mid-2011.

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