With income tumbling, investors will have limited appetites and the outlook is only going to get worse
三级成人视频If there’s one place you wouldn’t want to be when there’s a lethal pandemic sweeping the globe, it is on a cruise ship, or “floating Petri dishes” as they are sometimes called. It’s bad enough having to endure the same food three times a day and sit with the same couples, but Covid-19 would have you banished to your room with only one way out – through the porthole and into the choppy waters below.
No wonder then cruise ship operator Carnival has hit the rocks. With the world on lockdown, demand for cruises has evaporated. Images of holidaymakers trapped on ships hasn’t helped. Even if the travel ban was lifted, how many people would choose to be stuck in a floating hotel with no escape?
三级成人视频Still, the owner of P&O and Cunard is one of several companies that has quickly shored up its finances by raising money from investors. Most listed firms have bolstered their balance sheets by shelving or postponing dividends but a handful have chosen share placings or rights issues.
Carnival has defied the odds and managed to raise $6.25bn (£5bn) in a debt and equity rescue fundraising but investors have ensured they extracted more than their pound of flesh. A $4bn bond comes with an eye-watering coupon of 11.5pc, meaning it will shell out more than $450m in interest payments in the first year. Carnival has also had to pledge its fleet of mega-ships as collateral.
A further $1.75bn will come from bonds that can be converted into shares, and a planned equity raise of $1.25bn has been cut to $500m. Having traded at around the $50 mark in January, new stock is being issued at just $8.
C三级成人视频arnival had no choice but to move quickly. Bankruptcy beckoned. But other, less distressed companies have acted swiftly too. White-collar recruiter Hays has launched a £200m cash call and pulled its dividend, alongside a profit warning and a series of other cost-cutting measures.
Companies will have a better chance of winning support if investors can see that emergency cost-saving measures are being taken too. Autotrader is tapping shareholders for £195m but to help get the fundraising away, management salaries are being slashed in half and bonuses for the year have been scrapped.
三级成人视频Still, the savvy bosses will be those that get in first. With income tumbling, investors will have limited appetites and the outlook is only going to get worse for most companies. Take Carnival. Its monthly overheads currently stand at $1bn, which means it could have run out of money again by October. Yikes.
Good old playground tactics
三级成人视频Playground football was a constantly fraught affair. There was always someone on the losing side who threatened to storm off home with their ball but the rest of the players soon stopped listening.
There will be a similar response to yet another report that HSBC is considering flouncing off to Hong Kong after the Bank of England put a stop to bank dividends. Apparently the regulator’s extraordinary intervention has reignited a debate in the boardroom over whether it should redomicile to the former British colony. Or at least, that’s what the Financial Times is reporting.
I’m sure there is genuine anger at the top. Understandably so. Banks are not used to being ruled by diktat from Threadneedle Street. And as the senior director of one of the big lenders told me, it creates the impression the banking system is weak, which of course it isn’t, as the Prudential Regulation Authority itself acknowledges.
S三级成人视频till, the idea that HSBC is going to up sticks and move back to Hong Kong is poppycock. That would put the bank about as close to the coronavirus ground zero as it could get without actually sticking its headquarters in Wuhan.
三级成人视频When HSBC moved from Hong Kong to London before the city was returned to Chinese sovereignty in 1997, it couldn’t wait to get as far away from China’s Communist rulers as possible. More recently, the rule of law in Hong Kong has crumbled away after it was besieged by student rioters.
There’s also the question of whether Hong Kong would even want HSBC these days. Word has it that Ireland is already questioning the wisdom of allowing Barclays to move its European headquarters to Dublin as part of its Brexit contingency plans. Big banks keep governments awake at night.
三级成人视频The HSBC board is throwing a hissy fit in the middle of the pitch. Play will carry on.
Is anyone *cough* profiteering?
Some interesting findings from the Office for National Statistics. The price of cough medicine increased by more than 10pc in just one week while paracetamol and rice also jumped. The Competition and Markets Authority will be compelled to look into the possibility of coronavirus profiteering.
三级成人视频But nothing can compare to a recent report from the Bank of England – 97pc of companies it spoke to between March 17 and 20 listed coronavirus as a top three source of uncertainty. What do the other 3pc know that we don’t?