COMPANY NEWS IN BRIEF
COMPANY NEWS IN BRIEF

COMPANY NEWS IN BRIEF

Phillepus Uusiku
Deliveroo orders more than doubled in Q1

Food delivery company Deliveroo said its orders more than doubled in the quarter to end-March in its first trading update since its highly-anticipated listing in London last month flopped.

Growth accelerated for the fourth consecutive quarter, the company said, with group orders up 114% year-on-year to 71 million and gross transaction value (GTV) up 130% year-on-year to 1.65 billion pounds (US$2.27 billion).

Chief Executive Will Shu said demand was strong in both UK and Ireland and its international markets, driven by record new customer growth and sustained demand from existing customers.

"This is our fourth consecutive quarter of accelerating growth, but we are mindful of the uncertain impact of the lifting of Covid-19 restrictions," he said yesterday.

"So, while we are confident that our value proposition will continue to attract consumers, restaurants, grocers and riders throughout 2021, we are taking a prudent approach to our full year guidance."

The company said it was maintaining its guidance for full-year GTV growth of between 30% to 40% and gross profit margins of 7.5-8.0%. - Nampa/Reuters

Qantas boosts domestic capacity outlook

Qantas Airways Ltd boosted its capacity outlook for the domestic market, forecasting it would reach 90% of pre-pandemic levels during the current quarter and even more in the next financial year as travel demand improves.

"We're now seeing really positive signs of sustained recovery," Qantas Chief Executive Alan Joyce said in a statement.

"This is the longest run of relative stability we've had with domestic borders for over a year and it's reflected in the strong travel demand we saw over Easter and the forward bookings that are flowing in each week from all parts of the market."

Rival Virgin Australia said earlier that 10 leased Boeing Co 737 planes would return to its fleet as part of plans that would see it reach more than 80% of pre-pandemic domestic capacity by mid-June.

Qantas had previously forecast it would reach 80% of pre-pandemic levels in the quarter ending June 30, allowing it to stop burning cash. -Nampa/Reuters

American Airlines sees bookings rebounding

American Airlines said on Wednesday it expects to fly more than 90% of its domestic seat capacity in the summer of 2021, compared with the same period in 2019, due to a strong rebound in bookings.

The US airline also expects to utilize 80% of its international seat capacity this summer, compared with 2019 levels.

Air travel has been impacted by travel restrictions around the world due to the Covid-19 pandemic, however, rising vaccination rates are widely expected to aid bookings later this year.

American said it plans to operate more than 150 new routes this summer, as people increasingly travel for leisure.

"Today, customers are telling us they're eager to get back to travel," said Brian Znotins, American's vice president of network planning, in a statement. - Nampa/Reuters

DNB in US$1.3 bln deal to buy Sbanken

Norway's largest bank DNB has agreed to buy smaller competitor Sbanken in a deal worth 11.1 billion Norwegian crowns (US$1.32 billion), the companies said yesterday.

DNB will offer 103.85 crowns per share for Sbanken, a 29.8% premium over Wednesday's closing price.

"The board of directors is of the opinion that the offer reflects the strong financial and strategic value of the Sbanken group and implies an attractive valuation for shareholders," said Sbanken Chairman Niklas Midby.

"We believe that Sbanken and DNB as a combined entity will be strongly positioned to compete with the global technology leaders."

Sbanken was established in 2000 as the first pure-play digital bank in Norway and was listed on the Oslo Stock Exchange in 2015.- Nampa/Reuters

Dell spins off VMware stake

Dell Technologies Inc said on Wednesday it would spin off its 81% stake in cloud computing software maker VMware, in a move that will help the PC maker reduce its debt.

VMware will distribute a special cash dividend of between US$11.5 billion and US$12 billion to all its shareholders, including Dell, which will receive between US$9.3 billion and US$9.7 billion, in the transaction that is expected to be tax-free.

The spinoff, first proposed in a filing last July, will help Dell lower its long-term debt of US$41.62 billion, much of which was taken on during its 2016 acquisition of data management firm EMC.

VMware is currently Dell's best-performing unit and has benefited from companies looking to cut costs and move to the cloud, a shift that has been accelerated by the Covid-19 pandemic.

VMware interim Chief Executive Officer Zane Rowe told Reuters in an interview that VMware will use between US$2.5 billion and US$3 billion of cash from its balance sheet to pay the dividend and fund the rest with debt.

Rowe said VMware expects to have an investment-grade credit rating after the transaction.- Nampa/Reuters

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