Company News in Brief

Old Mutual expects drop in profit

Insurance group Old Mutual reported its adjusted headline earnings are expected to be in a range of a fall of 2% to a rise of 8% in its six months to end-June, which excludes hyperinflation-hit Zimbabwe. The group booked R3.16 billion of this profit measure, the group's preferred one, in the prior half-year, saying on Tuesday headline earnings, which includes a strong performance from Zimbabwe, is expected to rise in a range of 29% to 39%. The group reported strong operational performances in Old Mutual Insure, Old Mutual Corporate and Mass and Foundation Cluster, which was offset by lower life profits in Personal Finance, primarily driven by an increased number of large claims, and higher central costs compared to the prior period, "but in line with our expectations as we continue to invest in our future capabilities". Adjusted headline earnings saw a boost from increased shareholder investment returns as a result of improved performance in SA equities.

-FIN24-

JSE censures Caxton

The JSE has publicly censured paper and packaging group Caxton and ordered it to retract statements made in 2022 about its industry counterpart, Mpact. The JSE has concluded Caxton overstepped rules regarding disseminating information. Caxton held just over a third of Mpact as of the end of December and its biggest shareholder. But relations between the two have been troubled, and efforts to affect a takeover had been complicated by assertions from Caxton that Mpact could be withholding information in a competition matter. On 12 August 2022 and 6 October 2022, Caxton released two statements on the JSE's Stock Exchange News Service (SENS) in which it, among other things, that Mpact had failed to disclose adequate details of a pending cartel case and risks to the company, also maintaining that directors traded shares while in possession of this sensitive information. It also warned that Mpact was at risk of losing a major customer. The JSE said on Tuesday it had found Caxton to have breached its listing rules "for failing to observe the highest standards of care" in disseminating information and for "failing to promote investor confidence in standards of disclosure and corporate governance in the conduct of issuers' affairs and in the market as a whole." "Despite Caxton's status as a major shareholder of Mpact, there was no direct obligation in terms of the listings requirements or legal duty for Caxton to disclose such information," the statement read. Caxton on Tuesday released a SENS announcement retracting the statements but didn't offer further comment.

-FIN24-

Apple ordered to pay EU competition R257 billion

Apple on Tuesday lost its fight against an order by EU competition regulators to pay €13 billion (about R257 billion) in back taxes to Ireland as part of an EU crackdown against sweetheart deals between EU countries and multinationals. The European Commission issued the order in 2016, saying that the iPhone maker benefited from two Irish tax rulings for over two decades that artificially reduced its tax burden to as low as 0.005% in 2014. Apple had said the record EU tax order defied reality and common sense. Ireland, whose low tax rates helped it to attract Big Tech to set up their European headquarters, had also challenged the EU ruling. The Luxembourg-based Court of Justice of the European Union sided with EU antitrust chief Margrethe Vestager. "The Court of Justice gives final judgment in the matter and confirms the European Commission's 2016 decision: Ireland granted Apple unlawful aid which Ireland is required to recover," judges said.

-REUTERS-

Alphabet fined R48 billion

Alphabet's Google on Tuesday lost its fight against a €2.42 billion (R48 billion) fine levied by EU antitrust regulators seven years ago, one of a trio of hefty fines meted out to the company for various anti-competitive practices. The European Commission fined the world's most popular internet search engine in 2017 for using its own price comparison shopping service to gain an unfair advantage over smaller European rivals. A lower tribunal had endorsed the EU competition enforcer's decision in 2021, prompting Google to appeal to the Luxembourg-based Court of Justice of the European Union. CJEU judges noted that EU law does not sanction the existence of a dominant position, but its abusive exploitation. "In particular, the conduct of undertakings in a dominant position that has the effect of hindering competition on the merits and is thus likely to cause harm to individual undertakings and consumers is prohibited," they said. Google has racked up €8.25 billion in EU antitrust fines in the last decade. It has challenged two rulings involving its Android mobile operating system and AdSense advertising service and is now waiting for the judgments. It is also fighting EU antitrust charges issued last year that could force it to sell part of its lucrative adtech business after regulators accused it of favouring its own advertising services.

-REUTERS-