2025-02-24 15:20
Feb 24 (Reuters) - Domino's Pizza (DPZ.O) , opens new tab on Monday missed estimates for quarterly same-store sales and said the consumer environment for fast food would remain pressured in 2025 as companies double down on their value meal offerings, taking its shares down 5%. Fast-food chains have been relying more on discounting in recent years - with Domino's introducing value offerings to drive demand in late 2023, a move that was mirrored later by burger giants McDonald's (MCD.N) , opens new tab and Burger King (YUM.N) , opens new tab as consumers started to balk at higher menu prices. Domino's would continue with its promotional efforts such as emergency pizza, as well as "boost weeks", which provided 50% off on online pizza orders in 2025, said CEO Russell Weiner on a post-earnings call. Domino's reported a quarterly same-store sales rise of 0.4% in the U.S., compared with analysts' average estimate of a 1.63% increase, according to data compiled by LSEG. "Going forward, we believe Domino's will continue to experience modest headwinds to traffic growth in the first half of 2025 as competition remains tough, weather, and other disruptions create volatility and consumers lean into value," said Jim Sanderson, analyst at NorthCoast Research. Still, Domino's international business saw some recovery after macroeconomic pressures had dented demand in some markets in Europe and Asia last year. Domino's exclusivity agreement with Uber Eats(UBER.N) , opens new tab for online orders has been extended until May, and Weiner said the company had also begun negotiations with additional delivery aggregator platforms, without naming any. Investors have been watching out for a potential deal with Doordash (DASH.O) , opens new tab for orders, which could provide the pizza chain with a larger customer base, RBC analyst Reich Logan had noted last week. The company's international same-store sales growth of 2.7% topped expectations of a 1.46% rise, while its earnings per share of $4.89 for the fourth quarter were in line with estimates. Sign up here. https://www.reuters.com/business/retail-consumer/dominos-pizza-misses-quarterly-same-store-sales-estimates-2025-02-24/
2025-02-24 13:10
NEW YORK, Feb 24 (Reuters) - Two U.S. Treasury market utilities are set to roll out new rules by the end of this year that will determine the amount of leverage hedge funds and other investors can deploy in trades, a step that could counterbalance rising transaction costs stemming from upcoming clearing requirements. The Depository Trust and Clearing Corporation (DTCC), a market infrastructure company, and futures exchange operator CME Group last year launched an enhanced cross-margining arrangement for clearing members that trade and clear both U.S. Treasury securities and CME Group interest rate futures. They plan to expand it to clearing members' clients by December, subject to regulatory approval, they said in a joint statement on Monday. It would become available as Treasury market participants prepare for new rules introduced by the Securities and Exchange Commission in 2023 aimed at reducing systemic risk in the $28.5 trillion Treasuries market by forcing more trades through clearing houses. "Aligning enhanced cross-margining for end-user customers with the regulatory timeline for expanded U.S. Treasury Clearing requirements encourages greater utilization of central clearing, therefore reducing systemic risk," the companies said. Clearing houses act as an intermediary between buyers and sellers, but they require traders to deposit collateral, called margin, to cover potential losses on their positions. With this arrangement the required collateral will be calculated across positions in both cash and futures, rather than determined on each market independent of the other. Under the proposal, the Fixed Income Clearing Corporation (FICC), a subsidiary of DTCC, will earmark cross-margin accounts, allowing all qualifying positions in the accounts to offset against eligible CME Group interest rate futures. CME Group will allow market participants to allocate futures to end-user cross-margin accounts throughout the day, making them available for offset within the cross-margin framework. "Customers that have material offsets in the exposure between their futures and their cash and repo positions ... can take advantage of that same type of portfolio margining and capital efficiency" available to clearing members of CME Group and the Government Securities Division of FICC, Laura Klimpel, head of Fixed Income and Financing Solutions at DTCC, said in an interview. The new central clearing rules are supposed to be implemented in phases by June 2026, but several Wall Street trade associations have recently asked the SEC to extend key deadlines by one year. Sign up here. https://www.reuters.com/markets/us/us-treasury-market-utilities-set-expand-cross-margining-this-year-2025-02-24/
2025-02-24 12:59
CEO says Azul well positioned to focus on operations, after market disuptions and debt restructuring in 2024 Azul posts slightly higher-than-expected core earnings for Q4 Azul sees EBITDA of about 7.4 billion reais this year, implying 22% increase from last year SAO PAULO, Feb 24 (Reuters) - Brazilian airline Azul (AZUL.N) , opens new tab expects to go "back to basics" and be able to focus more on its operations this year, Chief Executive John Rodgerson said, after a challenging 2024 marked by some market disruptions and a major debt restructuring. "I am excited about 2025. It can't be worse than 2024," he told Reuters in an interview as the carrier reported on Monday fourth-quarter core earnings slightly above market expectations, with full-year figures matching its previously released outlook. Azul in 2024 struggled with supply chain issues delaying aircraft deliveries, floods that kept the key Porto Alegre airport closed for months, a weaker Brazilian real, and balance sheet pressures leading to debt deals with lessors. The carrier recently concluded the major restructuring that included the termination of almost $1.6 billion in debt from its balance sheet, while also raising $525 million in fresh money. "We are well positioned as we have concluded all our renegotiation, so now we can focus a lot more on operations. I would say go back to basics and deliver the Azul product the market knows," Rodgerson said. "We did not do our best last year because we had to survive. Now that we are alive, time to go back to what we used to be." Azul expects to deliver earnings before interest, taxes, depreciation and amortization (EBITDA) of around 7.4 billion reais ($1.29 billion) this year, implying growth of around 22% when compared to 2024. In the fourth quarter, core earnings reached 1.95 billion reais, up 33% year-on-year, helped by higher passenger traffic and load factor. Rodgerson highlighted unit revenue was roughly flat on a yearly basis despite increased capacity. Net revenue rose 10.2% in the fourth quarter to 5.54 billion reais. Analysts polled by LSEG expected EBITDA to come in at 1.91 billion reais, while revenue was forecast to hit 5.62 billion. "Azul's problem was never its operations, but its balance sheet," the CEO said, noting that as part of its restructuring lessors agreed to a debt-for-equity swap. "Despite everything, we delivered what we promised the market." Azul is now eyeing a potential business combination with rival Gol (GOLL4.SA) , opens new tab that would create a dominant carrier in Latin America's No. 1 economy, holding roughly 60% of the domestic market. ($1 = 5.7300 reais) Sign up here. https://www.reuters.com/business/aerospace-defense/brazilian-airline-azuls-core-earnings-up-33-q4-2025-02-24/
2025-02-24 12:27
TSX ends up 0.02% at 25,151.26 Consumer staples sector adds 2.1% Energy falls 0.9% BMO, Scotiabank report on Tuesday Feb 24 (Reuters) - Canada's main stock index ended nearly unchanged on Monday as investors awaited quarterly earnings reports from the nations major banks, with gains for consumer-related shares offsetting declines for energy. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) , opens new tab ended up 4.23 points, or 0.02%, at 25,151.26, after posting on Friday its biggest decline in two months and its lowest closing level in five weeks. Canada's big six banks are expected to build more credit loss provisions as they brace for uncertainty surrounding the U.S. tariff threat, analysts said, potentially weighing on first quarter earnings and beyond. The banks report later this week, starting with Bank of Montreal (BMO.TO) , opens new tab and Bank of Nova Scotia (BNS.TO) , opens new tab on Tuesday. "It's very hard to say what the real objective of the new U.S. administration is, whether it is really just something that can be addressed from increasing border security," said Angelo Kourkafas, an investment strategist at Edward Jones Investments. The heavily weighed financials sector was barely changed but the consumer staples sector climbed 2.1%, with shares of food retail Metro Inc (MRU.TO) , opens new tab adding 3.1%. Consumer discretionary advanced 1.7% and the materials group, which includes fertilizer companies and metal mining shares, was up 0.7% as the price of gold rose. Shares of Equinox Gold Corp (EQX.TO) , opens new tab edged 0.1% higher after the company on Sunday said it would acquire all the outstanding shares of Calibre Mining (CXB.TO) , opens new tab in an all-stock deal. Calibre Mining Corp (CXB.TO) , opens new tab shares ended 3.9% lower. The price of oil settled 0.4% higher at $70.70 a barrel as investors awaited clarity on talks to end the war in Ukraine. Still, energy was a drag, falling 0.9%. Industrials and technology both lost 0.5%. Sign up here. https://www.reuters.com/markets/tsx-futures-rise-higher-gold-prices-2025-02-24/
2025-02-24 12:22
LONDON, Feb 24 (Reuters) - Bank of England Monetary Policy Committee member Swati Dhingra has been reappointed to her role as an external member of the central bank's rate-setting body for a second three-year term, the British government said on Monday. Dhingra joined the MPC in August 2022 and will now hold the post until August 8, 2028. The Indian-born economist has been the most consistent voter for looser monetary policy at the BoE. Earlier this month she voted for a half-point cut in interest rates to 4.25% rather than the quarter-point cut backed by the majority. Policy minutes from the BoE showed the vote for a bigger rate reduction reflected concerns about a "subdued outlook for demand" that was likely to bear down on inflation over the medium term, despite an "expected near-term uptick in regulated prices". Dhingra is also an associate professor at the London School of Economics where she specialises in trade policy. External members of the BoE's MPC can serve a maximum of two terms, subject to the approval of the finance minister. Sign up here. https://www.reuters.com/world/uk/bank-englands-dhingra-reappointed-monetary-policy-committee-2025-02-24/
2025-02-24 11:59
BP under pressure to boost returns from Elliott Investment Management Changes to be announced on capital markets day investor update BP's shares have underperformed rivals Feb 24 (Reuters) - BP's chief executive will scrap a target to increase renewable generation 20-fold by 2030, returning the focus to fossil fuels, as part of a strategy shift announced on Wednesday to tackle investor concerns over earnings, two sources told Reuters. BP's shares have underperformed rivals in recent years and the oil major has already dropped its target to cut oil and gas output by 2030, Reuters reported in October. On Wednesday, when BP holds a capital markets day, CEO Murray Auchincloss will tell investors the company is abandoning its target to grow renewable generation capacity 20-fold between 2019 and 2030 to 50 gigawatts , opens new tab, two sources close to the matter said. The plan to drop the target has not been previously reported. BP declined to comment. Its earnings reports show the company has 8.2 GW of renewable generation capacity, and that for 2019, BP's net wind generation capacity reached 926 megawatts. It did not give a figure on total renewable capacity for that year. The sources said BP will also ditch a target to reach core earnings (EBITDA) of $49 billion this year and instead set an annual percentage growth target, the sources said. They declined to be named because they were not authorised to speak publicly on the strategy change. While BP has said in a call with analysts it could drop the targets, it has yet to formally announce any decision. BP failed to reach its 2024 EBITDA target of 40.9 billion. The company will also make public plans to divest assets and cut other low-carbon investments to reduce debt and boost returns, the sources said. The capital markets day was originally scheduled for February 11 in New York, but was changed to to Wednesday in London because Auchincloss had to undergo a medical procedure. SECTOR-WIDE SHIFT Across the energy sector, major companies that shifted their portfolios in response to the need to lower carbon emissions and curb climate change have returned the focus to oil and gas, where returns have become easier as fossil fuel prices have rebounded from pandemic lows. The investor environment has also been transformed by the re-election of U.S. President Donald Trump, a climate sceptic and advocate of fossil fuels. Pressure has become intense on BP after activist investor Elliott Investment Management built up a nearly 5% stake. Elliott, known for pushing changes at companies such as Honeywell (HON.O) , opens new tab and Southwest Airlines (LUV.N) , opens new tab, is demanding an overhaul, including tighter cost discipline at BP. A separate source familiar with the matter told Reuters Elliott wanted BP to scale down its green energy spending and sell assets such as wind and solar. BP would also benefit from selling its Castrol lubricants and its network of service stations to unlock value and boost share buybacks, added the source, who also asked not to be named. Under Auchincloss’ predecessor, Bernard Looney, BP pledged in 2020 to cut oil and gas output by 40% while rapidly growing renewables by 2030. BP lowered the reduction target to 25% in 2023. Since taking office, Auchincloss has slowed investments in renewables and announced plans to cut costs and reduce staff by 5%. BP could on Wednesday announce cuts to its annual low-carbon capex by $2-$3 billion, analysts at Bank of America said. BP's 2024 capital spending was $16.24 billion. Sign up here. https://www.reuters.com/business/energy/bp-ditch-renewables-goals-return-focus-fossil-fuels-2025-02-24/
