Welcome to Talking Business, a podcast produced in Melbourne Australia. The podcast is available on the Acast app, the Apple Podcast store or wherever you go to get your podcasts. Or you can get it at the Business Acumen website at www.businessacumen.biz.

I am Leon Gettler. My job is to review and monitor the week’s news in business, finance, and economics. I bring it all to you, every week.


This is episode number five in our series for 2019 and today’s date is Friday, March 1

 Listen to the full podcast here: 

First I talk to I talk to Luke Annear about his business iAuditor the world’s most powerful checklist and inspection app. He’ll talk about  Spotlight – a real time incident report app and how his apps are changing the way businesses deal with risk and ohs. He’ll talk about how he built his $400 million business and how he got New York investment firm, Tiger Global to invest in his company.

And then I talk to Indeed economist Callum Pickering about Australia’s latest unemployment and wages figures.

But first, let’s talk to Luke Annear.

The Securities Exchange Commission says Tesla Chief Executive Elon Musk violated an agreement that settled fraud charges with the SEC by tweeting material information about his electric car company without prior review and should be held in contempt/  The potential repercussions are big: It’s possible that Musk could be unseated as CEO and banned from serving as an officer of a publicly traded company.

Musk, who has repeatedly expressed his distaste and disrespect for the SEC, tweeted last week that Tesla would produce 500,000 cars this year. In doing so, he violated a deal requiring pre-approval for tweets containing information material to Tesla or its shareholders, the SEC said in its court filing.

President Donald Trump said he’ll extend a deadline to raise tariffs on Chinese goods until he can meet Chinese President Xi Jinping after the two sides made “substantial progress” in the latest round of trade talks that wrapped up Sunday in Washington. “The U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues,” Trump said in a Twitter posting on Sunday evening. “As a result of these very productive talks, I will be delaying the U.S. increase in tariffs now scheduled for March 1.” If the sides make further headway in negotiations, Trump said he and Xi planned to meet at his Mar-a-Lago resort in Florida to conclude an agreement, though he didn’t offer any details on the timing of the meeting or how long he expects the tariff extension to last.

The European Union is considering telling Theresa May that if she can’t get her Brexit deal through Parliament and wants to delay the departure date, the country will have to stay in the bloc until 2021. Bloomberg reports that senior EU figures and several governments back an extension of as much as 21 months beyond the scheduled March 29 exit day. The idea will enrage pro-Brexit lawmakers in May’s party, who will probably see it as a tactic to get them to back May’s deal.  Officials on both sides now expect some kind of extension as a way of avoiding a no-deal scenario that businesses consider catastrophic. The idea of a short three-month postponement has long been floated. But EU officials now say three months wouldn’t be enough to break the deadlock — that would only work if the deal had been ratified by Parliament and more time was needed just to pass outstanding legislation. This coincides with Theresa May bowing to overwhelming pressure to reduce the risk of a disorderly departure from the European Union, accepting that Parliament should have the chance to delay Britain’s exit if it rejects her withdrawal plans next month. Mrs. May’s concession, in the face of an internal rebellion, was the latest in a long line of retreats as she has struggled to cajole her fractious party into supporting a revised version of the deal on withdrawal, or Brexit, that lawmakers threw out by a massive margin last month.

Australia’s housing market continues to trend downwards with Australian Bureau of Statistics figures showing construction work done slipped 3.1 per cent in the December quarter, coming in 2.1 per cent lower than it was a year ago.

The weekly ANZ-Roy Morgan consumer confidence rating fell by 1.0 per cent to 114.1 points after rising 1.0 per cent in the prior week.

And don’t hold your breath for a big pay rise, after the International Monetary Fund projected that incomes adjusted for inflation would average just 0.3 per cent through to 2024, which is well below the average of 1.8 per cent annual growth experienced since the 1960s. This comes after the Reserve Bank of Australia governor Philip Lowe said that low wages were a bigger economic risk than falling house prices.

 Bill Shorten is set to hit banks and financial institutions with a new levy for a $640 million fund to support victims of misconduct as Labor sharpens its attacks on poor corporate behaviour ahead of the expected May federal election.  The opposition announced a “banking fairness fund” to be imposed in addition to the Coalition’s banking levy and be paid by financial institutions among Australia’s top 100 listed companies, with the amount they pay linked to their market capitalisation. The pre-election pledge would raise $160m in new taxes a year for four years, hitting not only the big four banks — Commonwealth, NAB, Westpac and ANZ — but also Suncorp Group, Bank of Queensland, and the Bendigo and Adelaide banks. ­Financial institutions AMP and Macquarie Group would also pay. Half the money from the bank tax would be used to double the number of taxpayer-funded ­financial counsellors, from 500 to 1000, giving free advice and ­advocacy to an extra 125,000 ­people a year. The Federal Opposition argues it is the best way to respond to the findings of the banking royal commission, promoting and funding new services in the financial sector. The nation’s big banks have already been hit with a tax on their operations, announced under former prime minister Malcolm Turnbull.

Prime Minister Scott Morrison has launched a pre-election climate change policy, pledging $2 billion for projects to bring down Australia’s emissions. The Climate Solutions Fund is an extension of former prime minister Tony Abbott’s Emissions Reduction Fund. The program includes funds for land revegetation, reducing bushfire risk and replacing refrigeration systems. Senior Liberals had flagged the need for new climate policies ahead of the expected election in May.

A massive expansion of the Snowy Hydro scheme has been officially approved in a bid to force energy prices down and make power more reliable. Early works on the pumped hydro-electricity project can now begin, with Prime Minister Scott Morrison visiting Tumut in southern NSW to announce the approval. Pumped hydro works by using cheap electricity – usually at night – to pump water back up a hill and into the dam, where it is stored until energy demands start to peak during the day. Snowy Hydro’s board approved the final investment on December 12, and the government is satisfied the project stacks up. Taxpayers will chip in $1.38 billion, with Snowy Hydro to fund the rest. When completed, the new project will increase generation capacity by 2000 megawatts and provide 175 hours of energy storage – enough to power 500,000 homes during peak times. It will create up to 2400 jobs in construction and support up to 5000 direct and indirect jobs across the Snowy Mountains region. The Snowy 2.0 proposal was one of former Prime Minister Malcolm Turnbull’s pet projects before he was dumped by his party for pushing for action on climate change.

It’s been a tough two weeks for Australia’s coal industry First there was a court ruling blocking a new mine on climate change grounds, then one of the world’s largest producers Glencore Plc capped output growth, and finally, China was seen to be slowing down Australian imports. Of all the shocks to hit the industry, it was perhaps Justice Brian Preston’s ruling in a Sydney court room on Feb. 8 that has the farthest-reaching consequences. Gloucester Resources’ Rocky Hill coal mine proposal had already been rejected by the New South Wales government due to its potential adverse impact on the local environment and community, but Preston went a step further in throwing out Gloucester’s appeal, saying it would add to greenhouse gas emissions at a time when rapid and deep cuts were needed.  Coal may also be an unwitting victim of trade tensions between Australia and China with the Asian nation jamming up imports of coal from Australia, with at least one major port suspending customs clearance. The developments are symptoms of the fuel’s decline and likely signal headwinds for the industry in Australia, the world’s second-biggest supplier of coal used for power generation and steel making, where the government estimates some A$70 billion of new projects are in the pipeline

Bega Cheese is closing its cheddar and mozzarella cheese manufacturing facility in Coburg with immediate effect, with redundancies to follow. The dairy and spreads manufacturer did not say how many jobs at the Melbourne facility could go. Some staff will be offered employment at other Bega sites, but there will be redundancies.

National Australia Bank, which was singled out for criticism by the royal commission, leading to the resignation of its chairman and CEO, has signaled it will shed up to 180 jobs as part of an overhaul of its branches. The restructure aims to better align rosters with customer banking habits, with advisory roles to be targeted. Employees have already been notified of the changes that will see fewer staff at branches. No branches will be closed as a result of the move.

Telstra is unlikely to charge customers more to use its 5G network than it’s now charging for the 4G network, chief executive Andy Penn said. Speaking at MWC, the world’s largest mobile telecommunications conference in Barcelona, Mr Penn said that while Telstra would formally announce the price of the high-speed 5G network when phones and modems were available that could use the network, the core connectivity plans probably wouldn’t be “differentially priced” compared to the pricing of Telstra’s current connectivity plans.

Logistics group Brambles has sold its IFCO reusable plastic containers business for US$2.51 billion ($3.52 billion) and will return a large chunk of the proceeds to shareholders. Private equity firm Triton and Luxinva, a subsidiary of the Abu Dhabi Investment Authority, will acquire the business. IFCO, which Brambles bought in 2010 for $US1.25 billion, is based in Germany and operates a pool of more than 300 million reusable plastic containers and tubs used to transport fresh fruit and vegetables, meat and fish to thousands of retailers across Europe, the United States and Asia. The company said it would return as much as US$1.95 billion of the proceeds to shareholders. This will be made up of a pro-rata return of cash of about US$300 million, and on-market share buyback of up to US$1.65 billion.

Canadian fertiliser maker Nutrien Ltd is in talks for a potential deal involving Australian rural services firm Ruralco .  Ruralco has a market value of $321.5 million. Nutrien was created when Potash Corporation and Agrium merged in 2017. If it proceeds – beyond an agreement between both boards the deal would still require shareholder support and Foreign Investment Review Board and Australian Competition and Consumer Commission approval – the deal would combine two of the big three rural service providers in Australia. Ruralco has a network of 50 specialist majority-owned rural supply, finance, insurance, grain and water service businesses in all states and the Northern Territory, with brands including CRT, Rodwells, Roberts Ltd, Primaries, BGA Agriservices, Grant Daniel & Long, Territory Rural and live exporter Frontier International. It is understood that Ruralco has agreed to the $460 million deal and has gone into a trading halt. The deal will see Ruralco’s shareholders being offered about $4.40 a share, more than a 40 per cent premium to their last closing price.

Coal and gas power generator Alinta Energy will build a $400 million mega wind farm in the mid-west of Western Australia by the middle of next year in its first direct commitment to building a renewable energy generation on either side of the country. The 214-megawatt Yandin windfarm is to be built and maintained by global wind technology company Vestas at a site about 175 kilometres north of Perth.

TPG Telecom will write down the value of its abandoned mobile network by $228 million following its decision to cancel construction because of the government’s ban on Huawei providing equipment for 5G networks. Huawei is TPG’s main mobile equipment vendor, and the $6.15 billion telco last month said the ban left it no choice but to stop building its 4G network. It said this meant it could not upgrade the network to 5G,

Amazon Australia has announced it will transition workers at its fulfilment centres to permanent jobs over the next year. It says it will create 500 new permanent roles at its warehouses following criticisms of its work practices and total reliance on casual workers.

And the profit reporting season is finally ending. Here are the latest results. Construction firm, Lend Lease’s half year results for financial year 2019 showed profit falling 96 per cent to $15.7 million compared to the year earlier period. Bedding retailer Adair’s net profit rose 6.8 per cent to $14.9 million in the December-half. Insurance giant QBE posted full-year net profit of $US390 million ($A547 million) after shedding a number of overseas businesses and a fall in the number of natural catastrophe claims.  G8’s earnings before interest and tax came in at $136.6 million. Ooh!media reported a 29 per cent increase in gross profit to $225.7 million. Energy Australia’s net earnings jumped 24 per cent to in 2018 to $566 million. Estia Health reported a 3.1 per cent lift in earnings to $46.9 million. Caltex Australia announced a full year replacement cost operating profit of $558 million along with a $260 million buyback. Afterpay has reported a loss of $22.2 million. Law firm Slater and Gordon posted a $10.3 million loss.  Incitec Pivot said its full-year pre-tax profit will fall as much as $120 million because of the heavy rains in north Queensland. Jewellery retailer Michael Hill’s net profit fell 36.4 per cent to $19.5 million,

The report cited an example of a pensioner who spoke limited English and relied on a disability pension from the government but was signed up to a crippling debt despite already owing the same provider $3500.

And that’s it for this week. And next week I talk to Scarlett Vespa, a personal branding expert titled the ‘Human Brand Futurist’ and the Founder of the Mrs V Shift. She be talking about how executives, entrepreneurs and small business owners can build unique personal brands that stand out in an age when technology and artificial intelligence is changing business. And then I talk to AMP Capital chief economist Dr Shane Oliver assessing the latest profit reporting season and how Australian businesses are tracking. And of course, I’ll be bringing you all the week’s news. In the meantime, you can find me on Twitter at talkingbizz, on Facebook and on LinkedIn. And if you want, leave a comment. Wishing you all a great week, take care, be good and looking forward to bringing you Talking Business next week. Rio Tinto announced a $US4 billion ($5.57 billion) special dividend, after reporting a 2 per cent rise in underlying profit to $US8.8 billion.