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The Morning Ledger: Foreign Aluminum Producers Shake Off U.S. Tariffs |
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A worker stacks aluminum ingots at a smelter operated by Russia’s United Rusal, which the Trump administration targeted with trade sanctions last spring. PHOTO: BLOOMBERG NEWS
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Good day. European metal producers aren't feeling the negative impact of U.S. tariffs on imported aluminum yet, as they generally manage to pass on higher costs to their customers, reports The Wall Street Journal.
Following suit: Some producers, such as Alimex GmbH, a Germany-based maker of cast-aluminum products, are reporting rising U.S. sales. The reason, according to the company: Many of its U.S. rivals used the tariffs to raise prices, and non-U.S. companies have followed suit, sometimes more than offsetting the 10% duty set by the government.
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Pass it on: Constellium NV, a Dutch aluminum company with manufacturing sites mostly in Europe and North America, said its products remained attractive to U.S. customers despite higher prices. “We expect it to be net/net neutral as we substantially pass through duties to our customers,” said Constellium CEO Jean-Marc Germain.
Little boost to U.S. production: Profits for U.S. manufacturers have risen since the levies took effect in March. But high electricity costs make opening new lines or restarting mothballed smelters uneconomical, one of the reasons why the tariffs have failed to substantially boost U.S. production.
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Colgate-Palmolive Co., Hilton Holdings Inc., Moody's Corp. and Tenneco Inc. are among the companies slated to report earnings Friday.
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Trivago Seeks to Lower Ad Spending as Sales Drop |
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An employee takes photographs of Trivago GmbH signage during the company's initial public offering in New York in 2016. PHOTO: MICHAEL NAGLE/BLOOMBERG NEWS
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Hotel-search company Trivago NV is raising its profitability targets and reducing advertising spend in a bid to offset lower revenues from its main customers Booking Holdings Inc. and Expedia Group Inc.
Previously focused more on top-line growth, the Nasdaq-listed German company is now looking to optimize its spending to generate higher profits, Chief Financial Officer Axel Hefer said Thursday in an interview with CFO Journal.
“Every channel and every market has to deliver more of a contribution,” said Mr. Hefer, adding that management has embarked on a journey to change the company’s mindset.
As a result, Trivago’s return on advertising spend—the average yield generated from every euro invested—rose to 135.9% globally in the three months ended Sept. 30, up 25 percentage points from 110.9% in the prior year period. Mr. Hefer didn't provide more specifics on the company’s profitability targets.
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FASB Adds SOFR to List of Approved Rates For Hedge Accounting |
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The U.S. Federal Reserve in Washington, D.C. PHOTO: BRENDAN SMIALOWSKI/AGENCE FRANCE-PRESSE/GETTY IMAGES
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The Financial Accounting Standards Board on Thursday expanded the list of U.S. benchmark interest rates permitted in hedge accounting. The FASB added the overnight index swap rate based on the Secured Overnight Financing Rate to its list of eligible benchmark interest rates, reports CFO Journal's Tatyana Shumsky.
The move comes as global financial regulators are pushing for the transition away from the scandal-plagued London interbank offered rate, or Libor. The SOFR, a Treasury repurchase agreement financing rate, was identified as the preferred alternative to Libor.
The FASB said the accounting standards update will facilitate the Libor to SOFR transition and give adequate time for companies to prepare for changes to interest-rate hedging strategies.
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A Cartier watch on display in Geneva, Switzerland. PHOTO: FABRICE COFFRINI/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Cartier-parent Compagnie Financière Richemont SA and Alibaba Group Holding Ltd. will join forces to launch online platforms in China, in the latest effort by luxury retailers to tap into one of the world’s fastest-growing markets.
Third Point LLC sued Campbell Soup Co. and its board Thursday, alleging the food maker distributed misleading and incomplete information to win shareholders’ support in a heated proxy fight over control of the company.
Prospective lenders to Sears Holdings Corp. have so far rejected appeals to help fund a loan and stave off liquidation. Now the company is trying new tactics to attract financing, reports Bloomberg.
Google’s parent Alphabet Inc. reported surging profit on slightly slower growth in revenue, signaling uncertainty in its core business when it also is dealing with a rising backlash from regulators and turmoil in its own corporate culture.
Amazon.com Inc. continued its streak of profitability, topping $1 billion for the fourth straight quarter, but reported lackluster sales growth.
Whirlpool Corp. said it is raising prices again to stay ahead of material costs, as the appliance maker benefits from one set of tariffs and gets hit by another.
Royal Bank of Scotland PLC has set an extra £100 million ($128.1 million) aside to account for possible bad loans as a result of Brexit uncertainty, reports Reuters.
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The U.S. is set to renew sanctions on Iran, in a challenge for Iranian President Hassan Rouhani (center left), seen at a petrochemical complex in September. PHOTO: EPA-EFE
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The Trump administration, days before imposing sanctions aimed at the heart of Iran’s economy, is wrestling with a decision critical to its pressure campaign: How hard can it push European allies to cut off the country from the global banking system.
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China is cutting some of its oil trade with Iran after vowing for months to resist U.S. sanctions on the exports, providing Washington with an unexpected boost to its efforts to isolate the Islamic Republic.
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A top Chilean court decided not to hear a lawsuit that sought to block a Chinese lithium producer from acquiring a stake in its larger rival, clearing the way for the biggest-ever deal in an industry that supplies the burgeoning electric-vehicle market.
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Rising transportation costs is adding to inflationary pressures in supply chains. PHOTO: JUSTIN SULLIVAN/GETTY IMAGES
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Trucking companies are flexing their pricing power, pushing retailers and manufacturers to pay more to buy into a strong U.S. economy and adding to inflation pressures in supply chains.
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The U.S. is refusing to resume trade talks with China until Beijing comes up with a concrete proposal to address U.S. complaints about forced technology transfers and other economic issues, officials on both sides of the Pacific said.
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China and Japan agreed to cooperate on developing cities and other infrastructure in Asia, part of a rapprochement during the first formal visit by a Japanese leader to China in seven years.
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European Central Bank President Mario Draghi acknowledged Thursday that the eurozone economy has slowed, but said the bank will press ahead with plans to phase out easy-money policies this year.
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The U.S. is home to more dollar-based billionaires than any other country but China has cut into its lead, according to a new report card on the state of the megarich.
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Iconix Brand Group Inc., the New York brand management company, said Chief Financial Officer David Jones plans to resign to pursue another business opportunity, effective Friday.
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The company has launched a search for his successor and named Jeffrey Wood as interim CFO, effective Monday. Mr. Wood is currently treasurer and senior vice president of accounting and tax. He will receive a salary of $310,000 in connection with his interim role, and will be eligible for an aggregate target bonus of 65% of his interim base salary, the company said in a filing.
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Every weekend we select a handful of in-depth articles we think are worth a bit of your time, either because they peel back the layers on a compelling business story, or somehow make us look at business in a different light.
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Disruption is the primary challenge for most organizations, the response to which requires new strategy, new processes, and new behaviors. However, that often is easier said than done. Harvard Business Review explains why.
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Chinese retailers pay only about $1.40 to send a mug 8,000 miles to an American home because the Universal Postal Union classifies the world’s second-largest economy as a developing country. That could soon change, according to the Atlantic magazine.
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