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China's Sinovac Posts 141% Sales Increase; Asciano Group Going Global; Liquor Companies Take a Shot at Vin & Sprit; Major Drilling has Jackpot Third Quarter
- China-based Sinovac Biotech Ltd. (SVA) posted huge sales-and-profit gains in its third-quarter report issued yesterday (Tuesday). Sales increased 141% to $10.8 million. Operating income soared 691% to $4 million. And net income skyrocketed from $93,000 last year to $2.2 million. The company attributed its success to strong sales of its flagship product, Healive, an inactivated Hepatitis A vaccine, and the successful marketing campaign for the new seasonal influenza drug, Anflu. Anuflu, which is co-marketed with the China business unit of GlaxoSmithKline PLC (GSK), accounted for 22% of third-quarter sales. Sinovac officials also said the firm started the Phase II trials of its pandemic influenza drug Panflu, and anticipated releasing preliminary results of the study as soon as the first quarter of 2008. Sinovac's share prices closed at $4.35, a 22.88% gain.
- Asciano Group (PINK: AANOF), Australia's largest operator of ports and rails, announced that it plans to dispose of its rural businesses and expand through future acquisitions, Reuters reported. Asciano will sell or close down its rural container business at a cost of approximately $43.6 million (A$50 million). "Rural rail services are under-performing and ongoing drought conditions mean outlook is poor. This volatility does not fit our strategy," company officials said in its investor presentation yesterday. The move is expected to save as much as $35.4 million (A$40 million) annually, according to company estimates. Asciano is looking to purchase ports throughout Europe, India and the Middle East, where the shipping markets are booming and overcrowded. Asciano will also expand its coal-hauling operations and compete with the government-controlled Queensland Rail, in the coal-rich state of Queensland. Its subsidiary, Pacific National, already dominates coal shipping in South Wales. Company officials also said that they would not be making a $20 billion takeover offer for Brambles, Ltd, an Australian logistics firm, addressing rumors. It also said that it doesn't think its 4.09% stake of Brambles is a good long-term investment and is exploring options to sell its stake.
- Sweden's government announced yesterday (Tuesday) the long-awaited sale of state-owned Vin & Sprit AB, whose assets include Cruzan rum, Plymouth gin and Absolut vodkas. Last year, Absolut generated $1.5 billion in sales, accounting for about half of the company's revenue. More than 20 suitors will be invited to make a bid, though several the world's largest liquor companies – Diageo Plc (DEO), Bacardi & Co. Ltd. and Fortune Brands, Inc. (FO) – have previously expressed an interest in acquiring Vin & Sprit, . Fortune is believed by many observers to be the thirstiest for Vin & Sprit because Bacardi owns the Grey Goose vodka brand, although Diageo has the Smirnoff vodka brand. Fortune, which currently doesn't have a vodka brand, recently sold its wine business for $885 million, a move many consider a fundraiser for a bid. Fortune also already distributes Absolut under an existing agreement. Other possible bidders include Swedish investment group Investor AB (IVSXF) and the Finland's state-owned alcohol group Altia. Vin & Sprit is expected to fetch for $6.3 billion. The auction's winner will be announced in 2008.
- Canadian mineral drilling company Major Drilling Group International set new company records for quarterly revenue [up 53.3% compared to 3Q 2006] and earnings [up 75.5%], the Canadian Press reported. Chief Executive Officer Francis McGuire attributed the results to a combination of investment in people and equipment as well as strategic acquisitions and improved mineral prices. He also noted that the results were achieved in spite of an unfavorable foreign exchange rates that reduced earnings by $1.8 million in the quarter as the Canadian dollar appreciated sharply against the U.S. dollar. Revenue from Canada-U.S. drilling operations were up 32% for the quarter, while South and Central American divisions were up 52%. Australian, Asian and African drilling revenue gained 78.6%. McGuire said that the outlook for the company remains strong, with gold prices above $800 and increasing activity in the uranium markets. The only obstacle to increased growth is a lack of trained labor and the high costs of training new employees, McGuire said.