February 9, 2017

Corporate reporting season calendar with earnings results

The mid-financial year corporate reporting season runs through February, with a handful of companies reporting in March.

The calendar gives you the expected dates that companies will report - this can change at short notice - along with a consensus analyst forecast of their net profit after tax, excluding significant one-off items.

IMF: Australian economy faces 'significant risks' from housing market, China slowdown

The International Monetary Fund cautioned that Australia still faces "significant risks and uncertainties" and has warned about the country's housing market and the slowdown in Australia's main trading partners, including China.

In a consultation paper, the IMF said the balance of risks to the growth outlook has improved, but significant risks and uncertainties still remain.

For 2017, the IMF expects real GDP growth to come in at 2.6 per cent, edging slightly higher to 3 per cent in 2018 and 2019, before dipping back to 2.9 per cent in 2020 and the subsequent years after.

"With inflation below target, still elevated underemployment, and remaining economic slack, the monetary policy stance should remain accommodative," the paper concluded.

The Reserve Bank kept interest rates on hold, as widely expected, at its first policy meeting for 2017 earlier this week.

While the cash rate remains at an historic low of 1.5 per cent, some analysts anticipate the central bank will hike rates in the second half of this year.

Meanwhile, the IMF forecast the unemployment rate to gradually fall over the next five years, from 5.7 per cent in 2017 to 5.1 per cent in 2022.

More support needed for transition from mining

The IMF noted that support is needed for a transition to non-mining growth, and also warned that a rise in protectionist policies in the global economy could pose a risk for the country.

The IMF said it saw scope for an increase in infrastructure investment, and supported the Federal Government's plans to balance its budget over the next four years.

The IMF's director said authorities, including the Australian Prudential Regulation Authority (APRA), should remain vigilant and increase the resilience of Australia's financial system to any shocks, including further strengthening how much capital banks hold.

"Financial regulatory authorities would need to stand ready to intensify targeted prudential matters, if lending or housing price growth were to reaccelerate," the IMF warned.

House prices in Sydney have surged by more than 70 per cent over the past five years and, in a speech given last night, Reserve Bank governor Phillip Lowe said housing affordability is an "increasingly important issue", while also backing the Government's campaign to lower the corporate tax rate.

Meanwhile, Treasurer Scott Morrison told reporters today at a press conference changes to tax laws are critical to Australia's competitiveness.

"I think his [RBA governor Philip Lowe] clear articulation of the challenges that are in front of the Australian economy ... I think set out clearly for Parliament as they consider not only the enterprise tax plan, but also the measures to fix the budget and make sure we meet the projection of a balance in 2021," Mr Morrison said.

"Cutting taxes for business supports wages, supports jobs, supports growth."

News Corp posts second quarter loss citing Australian newspaper impairments

Rupert Murdoch's __news Corporation has posted a second quarter loss citing impairments in its Australian newspaper business as a key factor.

The struggling empire reported a loss from continuing operations of $US219 million ($287 million) compared to a profit of $US106 million in the prior year.

News Corporation chief executive Robert Thomson said the results were hurt by a continuing decline in advertising income and "an impairment of the print-related fixed assets of our Australian newspaper business".

Mr Thomson said the loss included $US537 million of non-cash impairments and write down and a one-time gain from the sale of News Corporation's real estate business in Europe.

The News Corp head also launched an attack on providers of "fake news" and the "murky world of digital advertising".

"We are in an era where integrity is priceless. Yet digital distributors have long been a platform for the fake, the faux and the fallacious," Mr Thomson said.

Mr Thomson predicted there would be an "awakening and surely a reckoning" in the advertising market.

"Advertisers want reassurance that their products are displayed in suitable surroundings. Some of the world's best known, most prestigious brands are inadvertently funding extremists and hardcore pornographers."

Mr Thomson did not specify which brands he meant.

Headwinds in print ads

Mr Thomson pointed to "continued headwinds in print advertising" but that the losses were offset by a strong performance in the digital real estate division and "meaningful revenues" at News Corp's publishing arm Harper Collins.

The impact of the swing away from print advertising is underscored in the transition to digital advertising which now accounts for 27 per cent from __news and information services revenue.

One of Rupert Murdoch's premier print assets, the Wall Street Journal, now has 2.1 million paid subscribers with more than 50 per cent in digital.

"Audiences crave integrity, which is why is why so many of our mastheads have reported strong growth," Mr Thomson said.

However, revenues in cable networks fell by 2 per cent or $US2 million compared to the prior year because of lower affiliate advertising after losing rights to the Rugby World Cup.

News Corporation also reported a changing in the carrying value of its Australian cable television operation Foxtel, where net income decreased from $US52 million to $US24 million.

The media company is blaming a change in the value of Foxtel's investment in Ten Network and losses associated with its streaming service Presto, which was recently closed.

Revenue in the Murdoch family controlled company fell by 2.1 per cent to a market value of $US2.12 billion.

Follow Peter Ryan on Twitter and on his Main Street blog.

Author Andrew Bragg says Australia needs to fight back against trade protectionism

As Donald Trump's protectionist policies continue to ratchet up global nerves, the Australian Government is being urged to seek trade deals that don't rely on the United States.

Andrew Bragg, the director of policy and research at the Liberal Party-aligned Menzies Research Centre, says Australia needs to fight back against protectionism and find other trade deals to counter Mr Trump's isolationist stance.

Without having more "irons in the fire" to replace the doomed Trans-Pacific Partnership (TPP), Mr Bragg warns Australia could find itself an orphan in global trade, especially after the US sparks a trade war with China.

"I don't think we need to take dictation from Trump, certainly not on matters of great important like trade," Mr Bragg told The World Today.

"We need to have our fingers in many pies and irons in the fire. We can't afford to be flatfooted.

"We've been here before in the 1970s when the UK joined the European Common Market and our agricultural market was smashed."

Mr Bragg put his concerns into a book, Fit For Service, which will be launched by the Prime Minister in Canberra on Wednesday.

The book argues that while succumbing to creeping protectionism is not the answer, Australia needs to embrace opportunities and trade deals where farmers, winemakers, financial services and business can benefit.

Mr Bragg said Australia needed to pursue independent trade policies that act an an "insurance policy" against US isolationism.

"We can't afford to wait for instructions from Washington. It's incumbent on all of us to nourish trade trade just as big business did in the 1950s when Menzies open trade to Japan and the business community supported Bob Hawke in tearing down the tariff walls," Mr Bragg said.

But Mr Bragg added that Mr Trump could surprise the pessimists and emulate the anti-communist Richard Nixon who opened relations with China during his presidency.

Mr Bragg said there was a chance Mr Trump might go beyond the rhetoric and pull off a trade deal with China.

"That's eminently possible that Trump will reprise Richard Nixon and seek a free trade deal with Beijing and that's why we need to keep working within our region on deals like the TPP," he said.

Fit For Service includes the views of Prime Minister Malcolm Turnbull and advice from his predecessors Tony Abbott and John Howard, who have differing thoughts on the extent of Mr Trump's protectionist stance.

You can follow Peter Ryan on Twitter and on his Main Street blog.

Australia's jobs market highly gender-segregated, little change over past 20 years

Donald Trump's rise to power in the United States has politicians across the Western world scrambling to win back the "angry white male voter".

In Australia, there are vows to put "Australians first" and revive the manufacturing sector.

But some economists and employment experts are warning against mythologising industries such as car making in favour of other growing sectors that are facing looming skills shortages, such as health and aged care.

Figures from the Workplace Gender Equality Agency (WGEA) show Australia's jobs market is highly gender-segregated, and the situation has barely changed in the past 20 years.

Just one-in-ten nurses in Australia are male.

The problems are so entrenched a Senate inquiry into gender segregation in the workplace was called late last year, and is expected to report around the end of March.

WGEA director Libby Lyons said around 80 per cent of employees in health care and social assistance are female, and the gender divide appears to be deepening.

"Nearly 90 per cent of graduates entering that industry are women," Ms Lyons observed.

"So that would suggest to me that gender segregation is actually getting worse, that we are not encouraging young women to look to industries other health care and social assistance, and vice versa, we are not encouraging men to look at the more female-dominated industries - that are growth areas."

Andrew Jamieson worked in human resources in the mining and manufacturing sectors before joining aged care provider Benetas in Melbourne, where he is now Learning and Organisational Development Manager.

Mr Jamieson said the number of workers in the sector must be tripled over the next 20 years to meet the demands of an ageing population, and that means making aged care more appealing to all workers, especially men.

"We need a more diverse workforce, and men play an important role in that, especially if we're going to really meet the needs of our clients," he said.

While he was happy to move into the aged care sector, his decision was met with some surprise.

"There's a lot of deeply held assumptions about the roles of men and women, and that was my personal experience as well with how I saw my role in my family and work," he said.

"There were people who were surprised that I was moving into an environment that had a lot of nurses and women in other roles, and they were wondering why I would be doing that."

One well-known barrier to encouraging men into traditionally female jobs is concern about poor pay and conditions.

But over time, pay often rises in female dominated industries when more men start working in them, Ms Lyons said.

John Walsh, an early childhood educator at SDN Children's Services in Sydney, said he has been offered plenty of opportunities to further develop his skills since he joined the industry two-and-a-half years ago, and his gender has not been an issue.

Mr Walsh is the only male educator at his child care centre, and said his colleagues appreciate the different points of view he brings to the team, as well as the opportunity to give the children a male role model.

He has not received much overtly negative feedback on his decision to pursue a career in childcare, but some of the comments clearly reflect assumptions about the kind of work a man should be doing.

"I didn't feel there were any direct questions [about it], but there are times where people ask if I'll become a primary school teacher or a high school teacher, or 'do you want to own a centre?'" he said.

"I do have goals, but for the moment I just enjoy spending time with the children and working in the classroom and feel that I can learn a lot more by doing that."

Male proportion of workforce falls to 53.6pc

Since the global financial crisis, the male proportion of the workforce has fallen from just under 55 per cent in 2008, to 53.6 per cent last year, as jobs in industries like manufacturing disappear.

Independent economist Saul Eslake has warned of the risks of mythologising manufacturing in public debate as being somehow more noble than other types of work.

Mr Eslake said it is much harder to encourage displaced workers from sectors in structural decline to move into the services sectors that are creating jobs, if they are seen as women's work.

"Historically, manufacturing has been seen as providing long-term, stable jobs paying high wages to male bread winners, and the fact that our society has changed in many ways from that is unsettling for many people and I can understand that," Mr Eslake said.

"But the idea that you can somehow recreate patterns of employment based on how they were in the 1950s or 1960s would be very difficult to accomplish in practice, and couldn't be accomplished without considerable cost to the large majority of Australian consumers."

Director of the Centre for Future Work at the Australia Institute, Jim Stanford, said Australia's deindustrialisation has been deeper and more rapid than in other comparable economies.

"Since 2008, manufacturing has lost about 200,000 jobs, and in fact as a share of total employment Australia's manufacturing sector is now about the smallest of any industrialised country, even smaller than places like Luxembourg or Switzerland, which is surprising," Mr Stanford said.

Dr Stanford said the latest figures show that since the financial crisis, the proportion of men working in health care, aged care and social assistance has gone up.

But it is still very low, around 20 per cent.

Despite the current boom in services jobs, and predictions of future jobs growth, he said not enough jobs are being created in any industry to employ everyone who wants a job.

"In all of Australia last year there was only 90,000 new jobs created, all of them were part-time, and that falls far short of the growth in our working age population of about 300,000 a year," he said.

"So there's no lack of will among Australian workers who've been displaced from one job to do whatever they can to find a new job."