2025-01-29 19:47

Jan 29 (Reuters) - U.S. railroad operator Norfolk Southern (NSC.N) , opens new tab on Wednesday posted a quarterly profit that beat analysts' estimates, helped by cost cuts implemented to improve margins and better-than-expected insurance recoveries related to a costly derailment. Shares of the company were up 4% in early morning trading. Norfolk had taken a hit of about $1.4 billion in last two years due to a derailment in Eastern Ohio in 2023 that released over 1 million gallons of hazardous materials and pollutants near the state's border. Norfolk implemented voluntary and involuntary job cuts last year that helped offset some of that impact. Insurance recoveries related to the accident exceeded expenses by $43 million in the fourth quarter, Norfolk added. Excluding fuel surcharges, the company reported operating revenue of $2.81 billion for the quarter ended Dec. 31, up 2% from a year earlier. It reported an adjusted operating ratio of 64.9%, representing a 390-basis-point improvement from a year ago. The ratio is a keenly watched metric that indicates operating expenses as a percentage of revenue. A higher operating ratio reflects an increase in costs, suggesting lower profitability. Norfolk reported an adjusted profit of $3.04 per share for the reported quarter, above analysts' estimates of $2.95 per share, according to data compiled by LSEG. Total revenue fell 2% to $3.02 billion. Analysts, on average, expected revenue of $3.02 billion. (This story has been corrected to fix revenue figure to $3.02 billion from $3 billion in paragraph 8, and to add the dropped words 'excluding fuel surcharges' in paragraph 5 and 'adjusted' in paragraph 7) Sign up here. https://www.reuters.com/business/autos-transportation/norfolk-southern-beats-profit-estimates-helped-by-cost-cuts-insurance-recovery-2025-01-29/

2025-01-29 19:34

Jan 29 (Reuters) - Grains trader Archer-Daniels-Midland (ADM.N) , opens new tab on Wednesday named Carrie Nichol as its chief accounting officer, effective March 1, 2025, as the company continues to grapple with accounting irregularities. Nichol previously headed accounting operations at global trading house and ADM competitor, Cargill. She will succeed ADM's corporate controller Molly Fruit, who will be transitioning into another role. The appointment follows a period of financial challenges for ADM during which the company has been forced to revise its financial statements for multiple fiscal years, including 2023 and the first two quarters of 2024. The company has had to correct financial data for each year from 2018 to 2023, after an internal investigation found some sales between business units within the company were not recorded properly. ADM is set to report its financial statements for the fourth quarter of 2024 next week on February 4. Sign up here. https://www.reuters.com/markets/commodities/adm-taps-industry-veteran-lead-accounting-amid-irregularities-2025-01-29/

2025-01-29 19:31

IEA criticized for focus on clean energy policy Report claims IEA's assumptions on oil demand are flawed IEA defends its projections, calls report error-filled WASHINGTON, Jan 29 (Reuters) - The International Energy Agency's former oil industry and market chief criticized the agency's focus on the global energy transition in a report released on Wednesday, and said the IEA should concentrate on oil and gas supplies. The IEA is under fire from the administration of President Donald Trump for a shift in recent years toward a focus on clean energy policy. A senior member of Trump's Republican party and other oil industry representatives were present at a Washington event to mark the report's release. The Paris-based IEA has provided research and data to industrialized governments for more than half a century to guide policy on energy security, supply and investment. As member countries rapidly build renewable energy supplies and seek input on policies for the shift toward a low-carbon economy, the IEA has shifted with them. That has drawn criticism from the oil industry, Republicans and Trump and his team, who are refocusing U.S. energy policy on increasing oil and gas output and say that the previous administration's focus on renewables is driving up energy costs. Trump's campaign last year identified the IEA's climate focus as an issue he could address as president. Trump has leverage over the IEA because the U.S. provides a quarter of its funding. The IEA has also angered other global oil producer countries including Saudi Arabia. The report published on Wednesday, titled Energy Delusions, was written by the IEA's former head of oil industry and markets, Neil Atkinson, and Mark Mills, director of think tank the National Center for Energy Analytics. The authors launched the report on Capitol Hill on Wednesday alongside Wyoming Republican Senator John Barrasso and Alan Armstrong, CEO of pipeline firm Williams and current president of the National Petroleum Council. The authors said the report was aimed at influencing the new administration. The report identifies 23 assumptions made by the agency that led to what it calls a flawed conclusion that global oil output would peak by 2030, and that no new oil and gas investment was needed. The report says the IEA underestimates growth in emerging economies as well as in plastic and petrochemicals markets, and overestimates the pace of electric vehicle adoption. "The promotional aspirations and flawed assumptions underlying IEA's peak-demand scenarios have serious implications, given the obvious global economic and security considerations in planning for and delivering reliable, affordable energy supplies," the report said. The IEA said the report was "full of rudimentary errors" and "fundamental misrepresentations about both energy systems in general and IEA modelling in particular", in a statement issued on Wednesday. The agency said it welcomes ideas for improving its analysis. "The report also incorrectly suggests the IEA’s oil demand projections are an outlier – in reality, the projections are well aligned with comparable scenarios of other organisations, including major oil companies," the agency said in a statement. Barrasso, who led a Congressional report criticizing the IEA for its green focus, declined to respond when asked whether he thought IEA chief Fatih Birol should be replaced, but said the agency risks losing its relevance. "They are going to get ignored because they are basing their proposals on aspirations that are never going to happen and the world is seeing that and elections are rejecting what they want," he said on the sidelines of the event. Sign up here. https://www.reuters.com/business/energy/new-report-aims-turn-iea-away-energy-transition-focus-2025-01-29/

2025-01-29 18:42

Canadian dollar weakens 0.2% against the greenback Trades in a range of 1.4393 to 1.4471 Bank of Canada cuts by 25 basis points Canada-US 2-year spread widens to 141 basis points TORONTO, Jan 29 (Reuters) - The Canadian dollar weakened against the greenback on Wednesday as the Bank of Canada cut interest rates to support the economy ahead of expected U.S. trade tariffs, helping to widen the gap between Canadian and U.S. bond yields. The loonie was trading 0.2% lower at 1.4420 per U.S. dollar, or 69.35 U.S. cents, after trading in a range of 1.4393 to 1.4471. The BoC reduced its key policy rate by 25 basis points to 3%, cut growth forecasts and warned Canadians that a tariff war triggered by the United States could cause major economic damage. "The market is still looking for more rate cuts from the Bank of Canada," said Amo Sahota, director at Klarity FX in San Francisco. "If we do get a hit from tariffs that obviously would put downward pressure on growth." Investors see a 41% chance the BoC will cut again in March and are pricing in roughly 40 basis points of further easing in total by the end of 2025. The Canadian 2-year yield eased 4.1 basis points to 2.801%. It was trading 5.6 basis points further below the equivalent U.S. rate to a gap of roughly 141 basis points. That was the largest gap since October 1997. U.S. Commerce secretary nominee Howard Lutnick said that Canada and Mexico can avoid looming U.S. tariffs if they act swiftly to close their borders to fentanyl. The U.S. dollar was firmer against a basket of major currencies after the Federal Reserve left interest rates unchanged as widely expected but gave scant clues about further reductions in borrowing costs this year. The price of oil, one of Canada's major exports, settled 1.6% lower at $72.62 a barrel after U.S. crude stockpiles rose more than expected last week. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-dips-boc-rate-cut-adds-interest-rate-divergence-2025-01-29/

2025-01-29 17:10

LONDON, Jan 29 (Reuters) - Bank of England Governor Andrew Bailey said he was optimistic that tougher global bank capital rules would ultimately come into force despite uncertainty over whether Donald Trump's administration will implement the so-called Basel 3.1 regime. Bailey told the British parliament's cross-party Treasury Committee that although the Basel rules were controversial in the United States, banks appreciated they offered the potential of a level playing field for international competition. "I remain optimistic that ... we'll get agreement on it and that we'll get through this. To be fair to the new U.S. administration, we have to give them time to get into place," he said. The Basel 3.1 reforms are intended to be the final version of international rule changes agreed by central bankers and regulators from 28 jurisdictions to make the banking system safer in the wake of the 2008 global financial crisis. But the reforms have faced fierce opposition from U.S. banks, as they often require lenders to hold more capital - reducing the risk that taxpayers will have to foot the bill for future losses but lowering profits for shareholders. Analysts have said the rules could be watered down or even scrapped under Trump's new administration. The BoE said earlier this month it would delay implementing the standards in Britain by a year until January 2027 to get clarity on Trump's plans, prompting the European Union to also weigh its options. "We do need an agreement on Basel going forward. We have delayed that because of the uncertainty from the U.S. angle because there's a competition issue," Bailey said. Sign up here. https://www.reuters.com/business/finance/boes-bailey-says-bank-rules-were-delayed-because-us-competition-2025-01-29/

2025-01-29 16:21

Jan 29 (Reuters) - General Dynamics (GD.N) , opens new tab beat expectations for fourth-quarter results on Wednesday, as strength in the company's defense businesses offset persistent supply issues holding back jet deliveries. The Russia-Ukraine war and the escalation of conflicts in the Middle East fueled demand for weapons and military vehicles during the quarter. The company's three defense segments - combat systems, marine and technologies - posted revenue growth of 1.3%, 16.2% and 2.8%, respectively. Revenue in the aerospace unit, which makes Gulfstream business jets, jumped 36.4%, even though supply of jet engines has been held up by longer certification times, keeping General Dynamics from completing deliveries on schedule. The company delivered 136 aircraft during the year, lower than its revised October estimate of 150 aircraft. Its book-to-bill ratio of 0.9-to-1 for the quarter suggests billing was slightly higher than new orders received. General Dynamics shares were down 3% in morning trading. It now expects the Federal Aviation Administration to certify the G800 jet in the first half of 2025, and sees total Gulfstream deliveries of around 150 aircraft for the year. Investors are concerned government defense budgets could face cuts under the newly formed Department of Government Efficiency (DOGE) headed by billionaire Elon Musk. Some analysts, however, have said Trump's comments on acquiring Greenland and taking over the Panama Canal should support the case for increased spending. "With respect to the DOGE, I think any actions that improve the efficiency and cost structure of organizations is a good thing and we would embrace that," said CEO Phebe Novakovic during the quarterly earnings call. The Virginia-based company reported a 14% rise in quarterly profit to $4.15 per share, compared with analysts' estimates of $4.05, according to data compiled by LSEG. Total quarterly revenue rose 14.3% to $13.34 billion, compared with estimates of $12.77 billion. For 2025, General Dynamics forecast a total revenue of $50.3 billion, compared with 2024 revenue of $47.7 billion. It sees 2025 company-wide profit of $14.80 per share, compared with $13.63 per share reported in 2024. Sign up here. https://www.reuters.com/business/aerospace-defense/general-dynamics-quarterly-profit-rises-steady-defense-demand-2025-01-29/