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US steelmakers seen returning to growth in 2017

Flying Into The Danger Zone; Norwegian Air Shuttle


Street Talk Episode 39 - A New Era For Blockbuster Bank M&A

Advertising Market Growth Unable To Keep Up With Strong GDP

Street Talk Episode 38 - PG&E Bankruptcy Reveals Climate Change Risk Facing Calif. Utilities

US steelmakers seen returning to growth in 2017


US steelmakers expected to return to growth in 2017, say analysts

Steelmakers in the U.S are expected to return to growth in 2017, with production and demand seen increasing thanks to lower imports due to protectionist measures, the Financial Times predicted based on a survey of 20 analysts. Crude steel output is expected to increase 4.4% on a yearly basis in 2017, compared to almost two years of contraction. U.S. steelmakers such as Nucor Corp., U.S. Steel Corp. and AK Steel Holding Corp. have been struggling since steel prices started collapsing 2015, triggered by overcapacity, lower raw material prices and low-cost imports.

Former Chalco exec jailed for 16 years

Sun Zhaoxue, a former vice chairman of Aluminum Corp. of China Ltd., was sentenced by a Chinese court to jail for 16 years for graft, Reuters reported, citing a court statement.

Mechel completes debt restructuring with state banks

Mechel PAO extended until 2022 the maturity on 70.2 billion Russian rubles of credit lines with VTB Bank. Payment on the debt was extended to the first quarter of 2020, with repayment by the first quarter of 2022. Additionally, the company renegotiated the terms of about €45 million in trade financing and extended the deal until April 2022.


* Glencore Plc and Qatar Investment Authority have jointly spent about US$11.5 billion to grab a 19.5% stake in Russia's state-run oil giant Rosneft, Reuters and Sputnik reported.

* X2 Resources, a fund set up by mining veteran Mick Davis to snap up assets during the commodities downturn, has spent over £11 million on pay, rent and other costs over the past two years, but has yet to secure any deal, The Australian reported.


* Vedanta Resources Plc unit Hindustan Zinc Ltd. received environment clearance to increase the lead-zinc production capacity at its Rajasthan, India-based facility to 4.5 million tonnes per annum from 2 Mtpa, India Today reported, citing a senior government official. The company will also increase ore beneficiation capacity to 5 Mtpa from 2 Mtpa at its Sindesar Khurd underground mine, also in Rajasthan.

* Union workers at BHP Billiton Group's Minera Escondida Ltda., which operates the Escondida copper mine in Chile, are requesting a bonus of 25 million Chilean pesos for the period from 2017 to 2019 as part of the collective agreement negotiations that began Dec. 27, daily Diario Financiero reported.

* Peruvian President Pedro Pablo Kuczynski said the government will aim to boosting pending mining projects, including Anglo American Plc's Quellaveco, Southern Copper Corp.'s Tia Maria and Galeano, as part of ongoing efforts to increase investment in the country, news agency Andina reported.

* Copper miner Compañía Minera Doña Inés de Collahuasi SCM reached an agreement with 27 employees who were laid off due to an illegal strike, resulting in the payment of 928 million Chilean pesos in compensations and legal costs, daily Pulso reported.

* PJSC MMC Norilsk Nickel signed a deal to buy copper concentrate from Rostec Corp., with an estimated volume of 1.5 million tonnes, containing base and precious metals. The transaction is valued at about 67.5 billion Russian rubles.

* A federal judge in Argentina's San Juan province filed charges against the chairman of Antofagasta Plc's Minera Los Pelambres, Francisco Veloso, over alleged illegal mining tailings deposited at Glencore Plc's El Pachon copper mine in the province, daily Tiempo de San Juan reported.

* China's Chihong Zn & Ge will close two zinc smelters, each with an annual capacity of less than 30,000 tonnes, as the company plans to upgrade another small smelter to a capacity of 50,000 tonnes per year, Metal Bulletin reported.


* Rostec Corp. CEO Sergei Chemezov said the Russian state-owned group will consider selling a 25% stake in the Sukhoi Log joint venture to partner PJSC Polyus, Reuters reported.

* Yamana Gold Inc. closed its offering of purchase rights and related transactions connected to taking its Brio Gold Inc. spinoff public. The company transferred 17,324,507 common Brio Gold shares priced at C$3.25 apiece for aggregate proceeds of C$56.3 million.

* Southern Gold Ltd. and Westgold Resources Ltd. each received A$2 million as part of the first profit share distribution from the Cannon gold mine. Southern Gold applied A$1.5 million of the distribution to the repayment of the working capital facility provided by Westgold.

* Thai Prime Minister Prayut Chan-o-cha urged Kingsgate Consolidated Ltd. not to sue the government over the closure of the company's Chatree gold mine, noting that the move was just a suspension, The Nation reported.

* Separately, Kingsgate said the final payment against the Akara loan facility of US$6.3 million was made Dec. 23, and the Chatree mine is now debt free. Additionally, the company received the final payment of A$4.1 million from Silver Mines Ltd., which completes the sale of the remaining 15% of the Bowdens silver project in New South Wales to Silver Mines.

* Sumatra Copper & Gold Plc's lenders and major shareholders agreed to amend a US$45 million senior secured debt facility to improve the group's financial position. In addition, the company amended its gold hedging arrangements to delay 50% of the cash value on the six monthly deliveries from Oct. 31, to be repaid by mid-2017 without interest.

* Kuczynski proposed dredging Peru's biggest reservoir and a key source of water for drinking and farming in the northern Piura region to extract "much more gold" than what the country's biggest gold mine holds. Kuczynski said the reservoir could hold 1 gram of gold per cubic meter in 580 million cubic meters of sediment.

* Manas Resources Ltd. completed the sale of all of its mineral assets in the Kyrgyz Republic to Chinese state-owned Guizhou Geological and Mineral Resources Development Co. Ltd. and Kyrgyz firm NewGeo Technology LLC. The sale included the Shambesai gold project and Savoyardy gold assets.


* India's mines ministry is considering a 5% increase in basic customs duty on the import of primary aluminum products to help take the pressure off local producers, including Vedanta Ltd., National Aluminium Co. Ltd. and Hindalco Industries Ltd., Live Mint reported.

* Avenira Ltd. expects to reach full nameplate production at its Gadde Bissik Operations Sarl mine plant in the first quarter next year. The subsidiary holds the company's Baobab phosphate project in Senegal, which has produced about 20,000 tonnes of phosphate product that is now on the drying pads.

* Bellzone Mining Plc secured up to US$4 million of working capital funding for 2017 from its 61.93% shareholder Hudson Global Ltd. The company's 2016 capital requirements were funded by a US$6.5 million loan due for repayment in March 2018.

* Orbite Technologies Inc. filed a preliminary prospectus in Canada to raise up to C$60 million over the next 25 months.

* The Fair Work Commission ruled that sick leave taken by 81 South32 Ltd. workers at the Appin coal mine from Nov. 28 to Dec. 11 was part of a coordinated illegal industrial action, The Australian Financial Review reported.

* Aluminum Corp. of China returned to full production at its unit Shanxi Huaxing Aluminum Co., Ltd.'s alumina plant after a pulp leakage, Metal Bulletin reported, citing a company spokesman. The leakage, caused by an equipment failure at the Shanxi Huaxing refinery, resulted in a loss of 940 tonnes of alumina production.

* South32 Ltd. secured approval for two more 305-meter-wide longwalls at its Dendrobium coal mine, part of the Illawarra operation in New South Wales, extracting coal from underneath the Metropolitan Special Area created to protect the waters of the Avon, Cataract, Cordeaux and Nepean reservoirs, The Sydney Morning Herald reported. The miner noted that the approval, which was made despite incomplete studies, would secure up to 400 jobs.

* The Korea International Trade Association said North Korea's coal exports to China jumped 112.1% on a yearly basis in November to US$139.4 million, The Korea Herald reported. This was observed ahead of the U.N. Security Council's resolution Nov. 30 to curb North Korean mineral exports, the organization added.

* Industrial and Commercial Bank of China signed three debt-for-equity swaps with Shanxi province's highly indebted state-owned coal and steel firms, Taiyuan Iron and Steel (Group) Co. Ltd., Datong Coal Mine Group Co. Ltd. and Yangquan Coal Industry (Group), to cut their corporate leverage, Reuters reported.

* Tata Steel Ltd. signed a definitive agreement to acquire for 9 billion Indian rupees Brahmani River Pellets Ltd. from Aryan Mining and Trading Corp. Pvt. Ltd. and other owners within the Moorgate Industries Group.

* A worker at the government-owned Singareni Collieries Co.'s Prakasam Khani opencast project-II in the Indian town of Manuguru was killed in an incident involving two vehicles, The Hindu reported.

* The European Commission started a probe into allegations of the dumping of grey iron and ductile cast iron by India and China into the EU, The Hindu reported. A complaint was launched by seven EU-based producers in late October, saying that the dumping was harming local industry.

* To balance the domestic steel market, Iran may cut import duties on flat steel by half, to 10%, on the back of insufficient supplies in the country as well as to support recovering downstream industries, Metal Bulletin reported, citing Deputy Minister of Industries Jafar Sarqeyni.

* Thailand's Iron and Steel Industry Club expects the country's iron and steel industry to grow 10% in 2017, with about 17.5 million tonnes of iron and steel products being used, Thailand's Manager Daily reported.

* CCX Carvão da Colômbia SA will liquidate its remaining assets in Colombia as commercial output is not viable and attempting to off-load these assets would be impractical, Business News Americas reported.

* The Vorkuta City Court in Russia suspended operations at all the mines owned by OAO Severstal's coal mining unit, AO Vorkutaugol, for 90 days starting Dec. 26, due to alleged violations in the equipment of lock chambers, Kommersant reported. The decision was made at the request of mine safety agency Rostekhnadzor.


* Électricité de France, or EdF, requested additional security from Paladin Energy Ltd. against a US$200 million prepayment under the long-term uranium off-take contract between the companies. EdF already has existing security over 60.1% of Paladin's Michelin uranium project in Canada under the August 2012 agreement.

* Enirgi Group Corp. confirmed US$300 million in investments to build a lithium project in the Rincón salt flat in Argentina's Salta province. Meanwhile, Italian investors reportedly approached the government of Jujuy province to develop the Jama, Salinas Grandes and Guayatoyoc salt flats, daily Inversor Energético reported.

* Sociedad de Inversiones Oro Blanco SA filed an official complaint against Chilean securities regulator SVS over the leak of sensitive information to potential investors during the failed sale period of its stake of Sociedad de Inversiones Pampa Calichera SA, which, in turn, holds a 23% stake in Sociedad Quimica y Minera de Chile SA, daily Diario Financiero reported.


* The ASX has been the most active this year for mining IPOs compared to the other major exchanges globally, largely due to a lift in market sentiment but also the sector's preference for the Australian bourse. There have been eight successful IPOs and listings on the ASX this year, compared to two in 2015, according to SNL Metals & Mining data.

* According to Chilean Corp. of Capital Goods data, mining investment projects for the period from 2016 to 2020 could total US$13.06 billion, the lowest since 2008, and representing 22% of the total investment expected nationwide. Codelco would account for 52% of the investment in the sector, daily El Mercurio reported.

* Salary expectations of top first and second level executives in the mining sector have declined. On average, they are willing to change jobs for a 5% raise, according to a study by consultancy firm DNA Human Capital, daily Pulso reported.

SNL Metals & Mining is an offering of S&P Global Market Intelligence.

The Daily Dose is updated as of 7 a.m. ET, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.

Credit Analysis
Flying Into The Danger Zone; Norwegian Air Shuttle


This analysis was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global. This is not investment advice or a stock suggestion.

Feb. 13 2019 — The headwinds are picking up for Norwegian Air Shuttle ASA (“Norwegian”), the eighth largest airline in Europe. The carrier has been battling with rising fuels costs, increased competition from legacy carriers, and persistent aircraft operational issues. Norwegian’s problems are a continuation of what have been turbulent months for budget airlines in Europe resulting in a collapse of Primera Air, based in Denmark, near-default of WOW air, Iceland’s budget carrier, and most recently bankruptcy of Germania.

When we pull back the curtain and review the creditworthiness of European airlines to explore further some of the causes for Norwegian’s turbulent period, we see Norwegian’s business strategy and financial structure have made the carrier highly exposed. Coupled with the traditionally slow winter season, the airline may have to navigate through the storm clouds forming on the horizon.

A View From Above

S&P Global Market Intelligence has developed CreditModelTM Corporates 2.6 (CM2.6), a statistical model trained on credit ratings from our sister division, S&P Global Ratings. The model combines multiple financial ratios to generate a quantitative credit score and offers an automated solution to efficiently assess the credit risk of both public and private companies globally.1 Within CreditModel, the airline industry is treated as a separate global sub-model to better encompass the unique characteristics of this industry.

Figure 1 shows the overview of S&P Global Market Intelligence credit scores obtained using CreditModel for European airlines. Norwegian’s weak position translate into the weakest credit score among its competitors. The implied ‘ccc+’ credit score suggests that Norwegian is vulnerable to adverse business, financial, or economic conditions, and its financial commitments appear to be unsustainable in the long term. In addition to Norwegian, Flybe and Croatian Airlines rank among the riskiest carriers in Europe and share a similar credit risk assessment. The airlines with the best credit scores are also Europe’s biggest airlines (Lufthansa, Ryanair, International Airlines Group (IAG), and easyJet). The exception among the top five European airlines is Air France-KLM, which is crippled by labour disputes and its inability to reshape operations and improve performance.

Figure 1: Credit Risk Radar of European Airspace
Overview of credit scores for European airlines

Source: S&P Global Market Intelligence. For illustrative purposes only.
Note: IAG operates under the British Airways, Iberia, Vueling, LEVEL, IAG Cargo, Avios, and Aer Lingus brands. (January 3, 2019)

S&P Global Market Intelligence’s sister division, S&P Global Ratings, issued an industry outlook for airlines in 2019 noting that the industry is poised for stability.2 It stated the global air traffic remains strong and is growing above its average rate at more than 6% annually. The report also cited rising interest rates dampening market liquidity while increasing the cost of debt refinancing and aircraft leases. Oil prices are expected to settle, and any further gradual increases in oil prices are expected to be compensated by rising airfares and fees. The most significant risks for airlines are geopolitical. Potential downside scenarios include a crisis in the Middle East or other disruptions in oil, causing oil prices to spike. The possibility of trade wars and uncertainty surrounding the Brexit withdrawal agreement represent additional sources of potential disruption or weakening in travel demand.

Flying into the danger zone

Although Norwegian has so far dismissed any notion of financial distress as speculation, it has simultaneously implemented a series of changes to prevent further turbulence.3 The airline announced a $230mm cost-saving program that included discontinuing selected routes, refinancing new aircraft deliveries, divesting a portion of the existing fleet, and offering promotional fares to passengers to shore up liquidity.

In Figure 2, we rank Norwegian’s financial ratios within the global airline industry and benchmark them against a selected set of competitor European budget carriers (Ryanair, easyJet, and Wizz Air). Through this chart, we can conclude that Norwegian’s underlying problems are persistent and the company’s financial results are weak. Norwegian’s business model of rapid growth and a debt-heavy capital structure have resulted in severe stress for its financials. Norwegian ranks among the bottom 10% of the worst airlines in the industry on debt coverage ratios, margins, and profitability. This is in sharp contrast to other European budget carriers, which are often ranked among the best in the industry. On the flip side, Norwegian’s high level of owned assets represents its strong suit and gives the carrier some flexibility to adjust its operations and improve performance in the future.

Figure 2: Flying at Low Altitude
Norwegian’s financial ratios are among the worst in the industry

Source: S&P Global Market Intelligence. For illustrative purposes only. (January 3, 2019)
Note: Presented financial ratios are used in CreditModelTM Corporates 2.6 (Airlines) to generate quantitative credit score in Figure 1.

Faster, Higher, Farther

Norwegian has undergone a rapid expansion in recent years, introducing new routes and flying over longer distances. Between 2008 and 2018, the carrier quadrupled its fleet from 40 to 164 planes.4 This enabled it to fly more passengers and become the third largest budget airline in Europe, behind Ryanair and easyJet. However, unlike its low-cost rivals, Norwegian ventured into budget long-haul flights. After establishing its new base at London Gatwick, it started operating services to the U.S., South-East Asia, and South America.

As a result of this expansion, Norwegian’s capacity as measured by available seat kilometres (ASK) and traffic as measured by revenue passenger kilometres (RPK) grew nine-fold between 2008 and 2018, as depicted in Figure 3. By offering deeply discounted fares, the carrier was able to attract more passengers and significantly grow its revenues, which were expected to reach $5bn in 2018. However, to be able to support this rapid growth, Norwegian accumulated a significant amount of debt and highly increased its financial leverage. This rising debt is putting Norwegian under pressure to secure enough liquidity to repay maturing debt obligations.

Figure 3: Shooting for the Stars
Norwegian’s rapid growth propelled by debt

Source: S&P Global Market Intelligence. All figures are converted into U.S. dollars using historic exchange rates. Figures for 2018 are estimated based on annualized YTD 2018 figures. For illustrative purposes only. (January 3, 2019)

Norwegian’s strategy to outpace growing debt obligations by driving revenue growth is coming under pressure. The data tells us that expansion to the long-haul market and the undercutting of competitors to gain market share proved to be costly and negatively impacted Norwegian’s bottom line. Operational performance, measured as unit revenue (passenger revenue per ASK) and yield (passenger revenue per RPK), have been slipping continuously since 2008, as depicted in Figure 4. Negative free operating cash flow required Norwegian to continuously find new sources of capital to finance its operations, and profitability suffered. The carrier was able to ride a tailwind of low oil prices and cheap financing for a while, however, the winds seem to be turning.

Figure 4: Gravitational Pull
Slipping operational and financial performance

Source: S&P Global Market Intelligence, Norwegian Air Shuttle ASA: “Annual Report 2017”, Norwegian Air Shuttle ASA: “Interim report - Third quarter 2018”. Figures for 2018 are estimated based on annualized YTD 2018 figures. For illustrative purposes only. (January 3, 2019)

Norwegian’s plan to outrun a looming mountain of debt obligations is resulting in a turbulent flight. While growing its top line, the carrier has been unable to convert increased capacity and traffic into consistent profit. With a stable industry outlook and cost-cutting measures in place, Norwegian lives to fly another day. However, any additional operational issues or adverse macroeconomic developments could send Norwegian deep into the danger zone.

Learn more about S&P Global Market Intelligence’s Credit Analytics models.
Learn more about S&P Global Market Intelligence’s RatingsDirect®.

S&P Global Market Intelligence leverages leading experience in developing credit risk models to achieve a high level of accuracy and robust out-of-sample model performance. The integration of Credit Analytics’ models into the S&P Capital IQ platform enables users to access a global pre-scored database with more than 45,000 public companies and almost 700,000 private companies, obtain credit scores for single or multiple companies, and perform scenario analysis.

S&P Global Market Intelligence’s RatingsDirect® product is the official desktop source for S&P Global Ratings’ credit ratings and research. S&P Global Ratings’ research cited in this blog is available on RatingsDirect®.

1 S&P Global Ratings does not contribute to or participate in the creation of credit scores generated by S&P Global Market Intelligence. Lowercase nomenclature is used to differentiate S&P Global Market Intelligence PD credit model scores from the credit ratings issued by S&P Global Ratings.
2 S&P Global Ratings: “Industry Top Trends 2019: Transportation”, November 14, 2018.
3 Norwegian Air Shuttle ASA, “Update from Norwegian Air Shuttle ASA”, press release, December 24, 2018 (accessed January 3, 2019),
4 Norwegian Air Shuttle ASA: “Investor Presentation Norwegian Air Shuttle”, September 2018.

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Tesla Contemplates Going Private; But Who Is Going to Power Its Batteries

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Sears Strikes Out What Is In Store For Other Retailers In The US

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Listen: Street Talk Episode 39 - A New Era For Blockbuster Bank M&A

Feb. 08 2019 — The days of large bank buyers pursuing deals to plant a flag in a new market might be gone with acquirers now seeing deals as a way to support investments in technology. BB&T touted that prospect when discussing its landmark merger of equals with SunTrust. In the episode, we spoke with S&P Global Market Intelligence colleagues Zach Fox and Joe Mantone about the drivers of BB&T/SunTrust merger, how much i-banks advising on the deal stand to earn and the prospect of other similarly sized transactions emerging in the future.

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No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

Technology, Media & Telecom
Advertising Market Growth Unable To Keep Up With Strong GDP

Feb. 07 2019 — Cable and broadcast are losing their dominance in the viewing world. As more eyeballs migrate to online and mobile viewing, major media companies are struggling to adopt a common measurement system. Their goal is to track and consolidate the leaked viewers who have been switching first from analog, with a full ad load, to DVR, which lets them skip ads, and now to digital with limited or no advertising.

Click here for advertising market projections in Excel format.

The business models of the online services differ, with the majority of viewers still watching ads, albeit in much smaller pods. Others have voted with their wallets, paying a premium to view content on Hulu and other platforms without any advertising at all. Hulu with ads is only $5.99, while the subscription without ads is twice the price at $11.99. Clearly, viewers are willing to pay a premium for the privilege of not having to watch ads.

Although the broadcast networks have been somewhat flat for some time, the cable network industry has only recently had to cope with the reality that its heyday is over. After decades of showing strong single- or double-digit growth, cable networks have seen growth slow over the past five years to a range of just 3% to negative 1%.

A number of issues have been impacting cable networks, most notably cord cutting and cord shaving, with companies that are big in the children's market suffering disproportionately. Viacom Inc. was the first to show significant weakness: Gross ad revenue at its behemoth Nickelodeon peaked at nearly $1.3 billion in 2010 and 2011, then dropped to $1.10 billion in 2012. Nickelodeon's average 24-hour rating slipped from 1.44 in 2011 to 1.13 in 2012.

The company recovered slightly to a 1.2 rating in 2013 but has struggled significantly since then, with its overall rating at just 0.74 in 2017.

Parent company Viacom posted zero to negative ad revenue growth from the second quarter of 2014 all the way through the third quarter of 2018, an unprecedented negative run.

By contrast, the other cable network owners posted mixed results, but none have been as consistently negative as Viacom. The timing of big sporting events, especially the Olympics, contributes to much of the volatility at the various networks.

Broadcast and cable combined, including both local and national spots, increased ad revenue market share from 24% in 1988 to 32% in 2018. This was a strong showing given that cable alone rose from a less than 2% share in 1988 to almost 15% in 2018.

Overall, the ad market has continued to grow, mostly due to the popularity of digital spots. However, growth in the U.S. advertising market has been unable to maintain its historical trend of growing in lockstep with the gross domestic product, equating to approximately 2% of GDP.

Its share of GDP was generally in that range until the Great Recession, which pushed that metric from 1.8% in 2007 to 1.6% in 2008 and to 1.4% in 2009. In 2017, we estimate this fell as low as 1.2% with no sign that it can recover to the 2.0% range.

Although the growth of digital has been positive for the ad industry, there have been many less encouraging stories, particularly related to print, which shrank from 67.4% of the market in 1988 to just 41.1% in 2018.

Even after this dramatic shift over several decades left print with a much smaller base, all forms of print continue to struggle. Although the numbers below for the print sector do not include their digital operations, few companies have been able to offset the decline in traditional media with online initiatives.

Much of their revenue has been devoured by the usual internet giants such as Alphabet Inc.'s Google LLC and Facebook Inc. Even companies with disruptive business models targeting the younger generation, such as VICE Media LLC, have struggled.

We do not expect this to change much in our five-year outlook, although digital is certainly entering a mature phase. In 2023, we expect satellite radio to be growing the fastest, albeit from a much smaller base, and digital — although still in the No. 2 spot — is expected to grow at only 4.1% per year, down significantly from the 10.9% growth rate we expect for 2019.

Print is expected to continue to struggle, with Yellow Pages hit the hardest, declining at more than 16% per year. We do not expect most of these paper directories to survive over the long term, with the exception of those with very narrow niche audiences, such as small directories delivered to hotels in resort towns.

Digital has had remarkable progress, with a CAGR of 16.8% from $22.65 billion in 2009 to $91.89 billion in 2018. In sharp contrast, direct mail, the largest ad category in 2009, shrank from $44.50 billion in 2009 to $37.50 billion in 2018. The CAGR of decline has been modest at negative 1.9%.

Direct mail is now in third place with market share of 14.7% in 2018 versus 22.3% in 2009, behind digital at 35.9% and cable TV at 14.8%. The biggest slides occurred in Yellow Pages, which have fallen at a CAGR of negative 19.7% from a 5.5% share in 2009 to less than 1% in 2018; and daily newspapers, which contracted at a negative 11.8% CAGR from 12.4% in 2009 to 4.0% in 2018.

For a lengthy analysis which also includes an analysis of performance of the local ad market versus national, refer to the Economics of Advertising, or Click here.

Economics of Advertising is a regular feature from Kagan, a group within S&P Global Market Intelligence's TMT offering, providing exclusive research and commentary.

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.

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Listen: Street Talk Episode 38 - PG&E Bankruptcy Reveals Climate Change Risk Facing Calif. Utilities

Feb. 06 2019 — The PG&E Corp. bankruptcy shows that financial backers of California utilities need to consider the risks associated with climate change but that exposure might be unique to entities operating in the state. In the episode, Regulatory Research Associates analysts Dan Lowrey and Dennis Sperduto discuss the next steps in PG&E's bankruptcy process, the future of its power purchase agreements and the risks that climate change can bring to backing utilities.

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No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).