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Amazon advances grocery store plans; Tesco names CEO, posts H1'20 profit beat

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Amazon advances grocery store plans; Tesco names CEO, posts H1'20 profit beat

TOP NEWS

* Amazon.com Inc. has signed more than 12 leases in Los Angeles as part of its plan to roll out a chain of grocery stores in the U.S., The Wall Street Journal reported, citing people familiar with the matter. A spokeswoman for Amazon told the Journal that the company does not comment on rumor or speculation.

* Tesco PLC reported better-than-expected earnings for its fiscal first half, boosted by fatter profit margins, and it announced the appointment of a new CEO. Ken Murphy, chief commercial officer at Walgreens Boots Alliance Inc., is due to succeed Dave Lewis in the summer of 2020. The British grocer reported operating profit for the 26 weeks ended Aug. 24 rose to £1.41 billion from £1.12 billion in the year-ago period, beating a mean consensus estimate for operating profit of £1.34 billion compiled by S&P Global Market Intelligence with three analysts reporting.

FOOD RETAIL & DISTRIBUTION

* U.K. retailer John Lewis Partnership PLC will cut about 75 senior management roles from the current 225 head office positions, effective Feb. 3, 2020, as part of its approximately £100 million cost saving plan to merge its namesake brand with supermarket unit Waitrose & Partners.

* Carrefour SA will acquire 49% of digital financial services provider Ewally for an undisclosed amount, with an agreement to take a controlling stake in the Brazilian company after three years.

* South African food distributor Bid Corp. Ltd. said it agreed to sell its Best Food Logistics business in the U.K. to the Booker Group PLC, a unit of Tesco PLC, for an undisclosed sum. The deal is subject to customary conditions and receipt of regulatory approval, which is likely to take several months.

BEVERAGES

* Pernod Ricard SA said it expects to cut about 280 jobs under a restructuring plan that will involve the combination of its French distribution subsidiaries Ricard and Pernod. Under the plan called Reconquer, the French spirits-maker will merge Ricard and Pernod into a single company to consolidate their distribution networks, effective July 1, 2020. The new entity will be called Pernod Ricard France and will be headquartered in Marseille.

* Coca-Cola Co. said it will launch its Coca-Cola Energy drink in the U.S. in 2020 in a bid to address an unmet need in the category. Coca-Cola Energy debuted in Spain in April and is now available in at least 25 other countries.

* Italy's Illycaffè SpA is likely to reach its goal of opening 200 cafes in the U.S. within five years with an operating partner, Chairman Andrea Illy told Reuters. On Sept. 27, the coffee-maker said it picked Goldman Sachs to find a strategic retail partner in the U.S.

* Hemp-derived cannabidiol-products maker Real Brands Inc. closed the previously announced acquisition of proprietary CBD formulas from Florida-based Integrative Medicine US for an undisclosed sum.

* Dotdash, owned by IAC/InterActiveCorp, purchased Liquor.com Inc., a digital media company with a focus on cocktails, spirits, entertaining and culture, for an undisclosed sum. The deal closed Sept. 30.

TOBACCO & SMOKING PRODUCTS

* The Virginia Department of Health confirmed the first vaping-related death of a state resident. The health department noted that there are 31 cases of lung illness, including one death, related to e-cigarette use in Virginia.

* E-cigarette manufacturer Juul Labs Inc. hired Altria Group Inc.'s former head of regulatory affairs Joe Murillo as its chief regulatory officer, The Wall Street Journal reported, citing an internal memo sent to staff. Murillo reportedly will help guide the applications that Juul is due to submit by May 2020 to the U.S. Food and Drug Administration for any products it wants to keep on the market. Tobacco giant Altria owns a 35% stake in Juul, which also recently named an Altria executive as its CEO.

PACKAGED FOODS

* Nestlé SA said it completed the CHF10.2 billion sale of its skin health unit to a consortium led by Swedish private equity firm EQT Partners AB and Luxinva, a wholly owned subsidiary of Abu Dhabi Investment Authority.

* Private equity firm Arbor Investments Management LLC, which focuses on the food and beverage sectors, invested an undisclosed sum in baked goods company The Bakery Cos. out of Arbor Fund IV.

* Brazilian meatpacking company Minerva SA entered into a memorandum of understanding to form a joint venture with two Chinese representatives named Xuefang Chen and Wenbo Ge to explore business opportunities in the Asian country.

* Brazilian police had opened the next phase in a corruption probe into an unidentified meatpacking company, which allegedly bribed over 60 food inspectors with 19 million Brazilian reais in illegal payments, Reuters reported, citing the country's police. The alleged activity ended in 2017 following an internal restructuring, the report said. In a separate Reuters report, the Brazilian police said meatpacker BRF SA is not under investigation in their latest corruption probe after the company cooperated with evidence of bribing public officials.

* British online recipe box company SCA Investments Ltd., trading as Gousto, is set to create over 700 jobs in its technology team in data science, analytics and software engineering over the next three years, Reuters reported, citing a company statement.

RESTAURANTS

* Papa John's International Inc. is ready to work with more food delivery apps, including GrubHub and Uber Eats, CEO Rob Lynch told CNBC. The new CEO added that he sees the threat of third-party aggregation companies as an opportunity.

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The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, the Hang Seng declined 0.19% to 26,042.69, and the Nikkei 225 was down 0.49% to 21,778.61.

In Europe, around midday, the FTSE 100 fell 2.01% to 7,211.84, and the Euronext 100 slid 1.56% to 1,067.79.

On the macro front

The U.S. ADP employment report and the U.S. EIA petroleum status report are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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