05/11/2025

BIZ & FINANCE WEDNESDAY | NOV 5, 2025

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BP Q3 beats expectations, helped by refining margins

LONDON: Oil major BP reported a smaller-than-expected fall in third quarter underlying profit yesterday as higher refining margins partly offset the impact of lower crude prices. The company said it made an underlying replacement cost profit, or adjusted net income, of US$2.21 billion (RM9.27 billion), compared with the average estimate of US$2.02 billion in a company-provided poll of analysts and US$2.27 billion a year ago. BP kept the pace of its quarterly share buyback programme at US$750 million through the third quarter. Chief executive Murray Auchin closs said he expected completed or announced asset sale agreements would reach around US$5 billion this year. BP’s European rivals Shell and TotalEnergies also posted third quarter profit falls last month, dragged down by lower oil prices, though Shell beat expectations helped by better trading results in its huge gas division and Total benefited from higher refining margins. Average Brent crude prices during the quarter declined 13% from the same period last year. There was no update on the closely watched sale process for BP’s Castrol lubricants unit, which is the centrepiece of its US$20 billion disposal programme. BP’s customers and products division, boosted by higher refining margins, reported profit before interest and tax of US$1.61 billion, slightly above analysts’ forecast of US$1.59 billion and outperformed last year’s US$381 million. BP’s operating cash flow in the quarter was US$7.8 billion, above last

The partnership marks a strategic shift for Starbucks after more than 26 years in China, combining the global coffee chain’s brand recognition with Boyu’s local market expertise to expand into smaller cities and new regions. China represents Starbucks’s second biggest market globally, though the company has faced increasing competition from local coffee chains like Luckin coffee that has won over customers with lower prices. o Smaller-than expected drop in profit to US$2.21b, asset sales to reach around US$5b for 2025 year’s US$6.8 billion. As previously guided, net debt was steady at around US$26 billion compared with the previous quarter. Separately, in Riyadh, oil giant Saudi Aramco reported a 2.3% drop in third quarter profit yesterday as a slump in prices continued to hit revenues. The fall in net income to US$26.94 billion from US$27.56 billion in 2024 marks the 11th consecutive quarterly drop for Aramco, one of the world’s biggest companies by market capi talisation. “The decrease was mainly driven by lower revenue and other income related to sales, partially offset by lower operating costs,” Aramco said in a statement to the Saudi stock exchange. Crude prices have been pinched global bank, with a balance sheet about double the size of the economy – should capitalise its foreign subsidiaries by 100% rather than 60% currently, to cover potential losses abroad. Reuters reported in July a review by UBS looking at contingency planning has concluded that London is one of the best options for an alternative location should the bank try and move. Kelleher said Switzerland is going the other way compared with the U.S. which has effective regulation to let economies grow, criticising regulators for excessive restrictions in the banking sector that were pushing products into the shadow banking sector. “We are beginning to see huge rating agency arbitrage in the insurance business,“ Kelleher said, referring to the US insurance market, warning those were what went wrong in the 2007 subprime crisis. – Reuters

People walk past a logo of BP during the annual energy industry event Abu Dhabi International Petroleum Exhibition and Conference in Abu Dhabi, United Arab Emirates, on Monday. – REUTERSPIC

in recent months by a cloudy outlook for demand owing to global eco nomic uncertainty linked to tariffs and recession worries. But geopolitical issues – including

new US sanctions targeting Russian energy companies – have helped keep oil prices from sliding more significantly. The results also come just days

after the eight key members of the Opec+ alliance, including Saudi Arabia and Russia, announced the latest hike in oil production. – Reuters, AFP

Starbucks to sell controlling stake in China business to Boyu Capital NEW YORK: Starbucks announced on Monday it will sell a controlling stake in its Chinese retail operations to investment firm Boyu Capital in a deal valuing the business at around US$4 billion (RM16.8 billion). Starbucks reported last week that its latest quarterly same-store sales in China rose by 2%, fuelled by an increase in traffic, but added that average spending per ticket had dropped. expertise will help accelerate our growth in China, especially as we expand into smaller cities and new regions,” said Starbucks CEO Brian Niccol.

Starbucks has been credited with creating the market for coffee in China after entering in 1999. But its market share there has tumbled to 14% last year from 34% in 2019, according to data from Euromonitor International. Starbucks is expected to focus on its traditional strength of being the coffee chain where people want to meet and spend time, with analysts saying it would be a mistake for Starbucks to enter into an aggressive price war with Luckin. – AFP, Reuters

The companies said they aim to grow the store count to as many as 20,000 locations over time, with the business continuing to be head quartered in Shanghai. The deal is expected to close in the second quarter of fiscal year 2026, pending regulatory approvals.

Under the agreement, Boyu will hold up to 60% of a new joint venture operating 8,000 Starbucks stores across China, while the Seattle-based company retains a 40% stake and continues to own the brand and intellectual property.

The company said it expects the total value of its China retail business to exceed US$13 billion, including proceeds from the sale, its retained interest, and future licensing fees over the next decade. “Boyu’s deep local knowledge and

UBS chairman: Switzerland having ‘identity crisis’ over role in banking

Beijing supports renminbi stocks trading counter to boost access to Hong Kong equities

HONG KONG: UBS chairman Colm Kelleher said yesterday Switzerland is having an“identity crisis”about its role in the world of banking. Kelleher, speaking at a global financial leaders’ investment summit here, said the European country where UBS is headquartered faces competition in the global wealth management market from centres such as Hong Kong and Singapore for the first time. Switzerland’s pharmaceutical industry is also being hollowed out as a result of the tariff talks, he said. “Switzerland ia facing a crossroads here because it’s facing some major challenges,” Kelleher said. His remarks came as the Swiss bank has been examining moving its headquarters from the country since the government proposed new capital rules. The Swiss government proposed reform measures in June that envisage UBS – as Switzerland’s sole remaining

HONG KONG: China will support the inclusion of a renminbi counter under a stock connect scheme that would for the first time allow mainland investors to trade Hong Kong-listed stocks in yuan, the latest policy effort to strengthen ties between the two markets and boost the currency’s international status. China Securities Regulatory Com mission vice-chairman Li Ming said yesterday mainland authorities were keen to expand the current range of offshore renminbi initiatives. He told the Global Financial Leaders’Investment Summit here the regulator supports mainland in vestors to trade on a renminbi stock transaction counter – launched in 2023 to investors in Hong Kong – via the mainland-Hong Kong stock connect programme linking the two markets. “We will support the futures

market in Hong Kong enrich the management tools for offshore renminbi initiatives, and help Hong Kong to continuously foster its position as an international financial market,” Li said. An expansion of the policy would allow investors greater access to companies such as e-commerce giant Alibaba, while deepening offshore yuan liquidity in the financial hub. The Hong Kong Monetary Authority’s summit, now in its fourth year, has brought together leading Chinese regulators, policy makers and global banking bosses. Earlier, People’s Bank of China (PBOC) deputy governor Lu Lei said China’s central bank would “appro priately calibrate the strength and pace of policy support, ensure the implementation and execution of various monetary policy tools, and fully unleash the effects of these

policies”. The PBOC last cut interest rates and banks’ reserve requirement ratio in May, in an effort to soften the economic damage caused by a trade war with the United States. Analysts remain divided on whether the PBOC will take further easing measures such as cutting rates by year-end. Chinese Vice Premier He Lifeng said yesterday he hopes Hong Kong will strengthen cooperation with mainland China’s economic and financial sectors which would allow the city to enhance its status as a global financial centre. “I hope Hong Kong can grasp the opportunities and proactively deepen its connection with the country’s development plans and enhance economic and financial cooperation with the mainland,” He said. – Reuters