Bosswatch News – March 12

It's half-yearly reporting season, where the corporate successes - and excesses - come under the microscope.

Profits

Big is Beautiful for BHP: While BHP has been crying poor over the tariffs, it's not as if they're facing financial roon. The recently merged BHP Billiton has proven the adage 'Big is Beautiful', reporting a profit of $2.2 billion, excluding exceptional costs, for the year to June. The combined profits were up 26% or $446m when compared with the combined results of the two companies from the previous year. The results are the first since BHP and Billiton merged in March this year to create the largest diversified mining group in the world.

Mitsubishi Profits Ease Job Fears: Meanwhile, Mitsubishi Motors has announced a $16.1 million net profit for the year ended December 31, 2001, easing fears about the company's long-term viability in South Australia. President and chief executive Tom Phillips said it represented a $200 million turnaround on the previous year. This hasn't stopped the company lobbying the federal government for more assistance.

Goodman Fielder Makes More Bread: The big food company, Goodman Fielder, has delivered a bottom line profit of $98.4 million for the six months to December, up 162 per cent on the previous corresponding period. Goodman Fielder's new chief executive, Tom Park, says the company has undergone significant restructuring over the last couple of years and is now "starting to deliver improved returns to shareholders".

Pay

Now That's a Bonus! Westfield Holdings are embroiled in an intriguing battle with overseas interests over the generous payments promised to executives of a company it is planning to take over. The Amsterdam based company, Rodamco recently implemented a controversial decision to award the top four officers a combined $44.24 million in severance payments upon the $10.5 billion sale to Westfield and its associates. This is bick bikkies - even for Frank Lowy et al - and the legitimacy of this decision is now being tested by shareholders.

Analysts Fell Enron Heat: Wall Street analysts who continued to recommend Enron's stock as the company careened toward bankruptcy last year have told the US Congress they formed their assessments objectively and were not pressured by their firms that invested in Enron. Millions of investors nationwide lost money, and thousands of current and former Enron employees lost the bulk of their retirement savings -- in accounts loaded with Enron stock -- when the company failed. As the port mortem continues, , Federal Reserve Chairman Alan Greenspan says Enron's collapse underscores how fragile companies can be when their main business is production of intangible services, such as energy trading in Enron's case. Meanwhile, it's been reported that Enron Corp founder Kenneth Lay and other executives reaped hundreds of millions of dollars in bonuses and stock options tied to four years of profits the energy trader later wiped off the books.

Punters Do It Harder:In contrast, the average Australian worker is receiving just $600 per week, according to the latest Australian Bureau of Statistics report.The median weekly pay packet - the level at which there were as many workers above it as below it - was $601 per week. Men stretched their lead over women in the pay stakes with average male weekly earnings rising $37 to $821 per week, while women's average pay rose $34 to $550 per week. Meanwhile, the Howard Government has rejected an ACTU claim for a $25 per week wage rise for the low-paid, arguing they should get just $10 a week more.

Job Losses

Gloom Across the Straits: The future of one of Tasmania's biggest exporters is under threat with Incat, producers of those huge catamarans, facing closure for want of some federal government assistance. The State Government and unions have joined the company in seeking the help but so far to no avail. They say the impact on the state would be greater than the collapse of Mitsubishi on South Australia.

US Threat to Steelworkers: The news is equally bleak in the Illawarra where BHP Steel says it will hold off on a decision about job cuts until it determines whether it can continue to make a profit out of exporting steel to the United States. The decision by George Dubya to impose tariffs on steel imports has caused an international outrage, with the national secretary of the Australian Manufacturing Workers Union (AMWU), Doug Cameron, says the Howard Government must fight, to protect jobs. "Thousands of manufacturing jobs have been lost by Howard's commitment to free trade and we believe that they should actually reconsider their position," Cameron says.

Pasminco Sold - with Some Strings: Perth's Perilya is to acquire the fabled Broken Hill lead/zinc/silver mining operation in NSW from the collapsed Pasminco for a maximum $90 million. Pasminco's 456 employees at the ageing operation will all be made redundant at the failed company's cost, leaving Perilya to start with a clean industrial relations slate. Perilya plans to operate Broken Hill with a workforce of about 320, most of which will be recruited from the existing workforce. But Pasminco has told the new owner of its Broken Hill mine a number of community responsibilities come with the ownership of the city's oldest and largest industry.

Dingo Blue Hangs Up on 170 Workers: Dingo Blue, a brave experiment in the cut-price telecommunications business, has given up the ghost. Australian Gas Light, which bought Dingo Blue from Optus in December 2000 for $22 million, has called stumps, leaving 170 staff redundant. The company says that the workers entitlements will be protected. The Consumers Association says the closure of the telephone, Internet and finance company, Dingo Blue, could push up the cost of telephone and Internet services.

More Tech Job Cuts: Meanwhile, Telecommunications network construction company NDC is about to shed 160 jobs across Victoria. In country areas, 80 people will be made redundant, and another 85 jobs will be cut in Melbourne. The company's Stephen Whitworth says there has been a significant drop in investment by the state's telecommunications companies.

And a Brisbane envelope factory is set to close its doors after 84 years in operation. The 140 workers from Besley and Pike were told they would be retrenched. General manager Andrew Rankine says the envelope industry has been going through a tough time due to technological advances.

Ethics

Greens Cripple Oil Plant

A Greenpeace campaign has been blamed for pushing the central Queensland shale oil project =- Southern Pacific Petroleum - to the brink of collapse. Greenpeace has been blamed by the Commonwealth Government and SPP for bullying refiners into not buying naptha - used to make unleaded petrol, diesel and aviation gas - from the central Queensland shale oil project. The yet-to-be-completed $3 billion Stuart shale project near Gladstone is behind schedule. The company says about 500 direct and indirect jobs could go, along with the chance to build a multibillion-dollar industry employing as many as 65,000, and potentially helping Australia achieve oil self-sufficiency.

Alcoa Faces Serious Illness Claims

Alumina producer Alcoa has acknowledged to its employees and residents living near the Wagerup refinery, in south-west Western Australia, who have complained the plant has made them sick. Alcoa World Alumina Australia has received a report from its chief medical adviser, Mark Cullen, who was flown from the United States to report on health issues associated with the Wagerup refinery. The report concludes that the threat of serious illness is negligible, but that a rehabilitation program for employees must go ahead immediately. The company is continuing to buy properties from nearby residents.

Afghan Asylum Seekers Welcomed in Young.

Finally, while asylum seekers are digging symbolic graves in one part of the country, another group is being hailed as making an "outstanding contribution" to a regional centre in Southern New South Wales. About 80 Afghan aslyum seekers have been hired to work at an abattoir in the regional centre of Young, once the home of the White Australia Policy. The locals have been so impressed with the Afghans' work - they want them to stay and apply for Australian citizenship.

For further information

Contact:   Peter Lewis