TheChek News Flow

Move follows water cannon blasts on Philippine ships, islet tensions with Japan

TOKYO -- China's newest aircraft carrier, the Fujian, set out for its first sea trials on Wednesday, the latest milestone in Beijing's military buildup as tensions simmer in both the East and South China seas.

The vessel, which is equipped with advanced electromagnetic catapults for launching fighter jets, left Shanghai's Jiangnan Shipyard at about 8 a.m., Chinese state news agency Xinhua reported. The goal, it said, is to test the carrier's propulsion and electrical systems.

Excluding exceptional items, the company’s adjusted loss before interest and taxes widened to £57.1 million from a loss of £47.8 million.

Aston Martin AML -7.69%decrease; red down pointing triangle Lagonda Global Holdings reported a widened loss for the first quarter on lower revenue, but said it expects the launch of four new models this year will drive growth in the second half.

The British maker of luxury sports cars on Wednesday joined European peers in reporting weaker sales and earnings for the first three months of the year compared with a year ago, but stuck to its 2024 outlook. This echoed trends shown in first-quarter updates from carmakers Volkswagen, Stellantis and Mercedes-Benz Group MBG -5.15%decrease; red down pointing triangle on Tuesday.

At Aston Martin, revenue for the first three months of the year dropped to 267.7 million pounds ($334.4 million) from GBP295.9 million in the year-earlier period.

Pretax loss for the quarter widened to GBP138.8 million from GBP74.2 million. Excluding exceptional items, the company’s adjusted loss before interest and taxes widened to GBP57.1 million from a loss of GBP47.8 million.

Total wholesale volumes fell 26% in the quarter, but the average selling price climbed 19%, Aston Martin said.

The company said it is on track to deliver its 2024 targets, with a second-quarter performance expected to be broadly similar to the first, and an inflection point to positive cash flows expected in the second half of the year.

The EV maker delivered 25,787 vehicles in April, up 0.4% on the year, its slowest monthly growth since August 2022

Li Auto LI -2.49%decrease; red down pointing triangle posted its slowest deliveries growth in nearly two years amid an intensifying EV price war, lower-than-expected sales of its first fully electric model, and rising competition from Huawei-backed Seres.

The Chinese electric-vehicle maker said Wednesday that it delivered 25,787 vehicles in April, up 0.4% on the year. That marked its slowest monthly growth since August 2022, and a drop of 11% from March’s deliveries.

That adds to the challenges the hybrid-vehicle specialist has faced so far this year as it wages a price war in China against heavyweights like BYD and Tesla.

The Beijing-based company’s venture into the fully electric-vehicle space has yet to show clear signs of success. Sales of Li Auto’s debut model the Mega missed analysts’ forecasts in the first quarter after it hit the market with a slightly higher-than-expected price tag.

The company is also facing intensifying competition from Seres, another hybrid-car specialist backed by Chinese telecoms giant Huawei Technologies. Seres outdelivered Li Auto in the first quarter, tallying 85,842 units versus Li Auto’s 80,400.

Li Auto last week cut prices on all of its models except the new plug-in hybrid L6 by up to around $4,000. The company also said Wednesday that it will begin large-scale deliveries this month of the L6, its first model priced under 300,000 yuan, the equivalent of about $41,400.

Whether the latest price cuts and delivery ramp-up pay off for Li Auto remains to be seen, with other carmakers like Tesla also continuing to reduce prices in the increasingly cut-throat competition for China’s EV consumers.

Other Chinese EV makers including XPeng, NIO and BYD are expected to release monthly sales later today and on Thursday.

Nearly 71% of the votes cast at ProSiebenSat.1’s AGM were in favor of the proposal, falling short of the 75% required for the resolution to be approved

ProSiebenSat.1 PSM -3.12%decrease; red down pointing triangle Media shareholders rejected a proposal by top investor MFE-MediaForEurope MFEB -3.03%decrease; red down pointing triangle to begin preparations for splitting the German company into two businesses as it didn’t get the required majority.

Nearly 71% of the votes cast at ProSiebenSat.1’s annual general meeting on Tuesday were in favor of the proposal, falling short of the 75% required for the resolution to be approved, while around 29% were against it, according to voting results published by the company.

MFE—the biggest shareholder in ProSiebenSat.1 with a 26.58% stake—in March called on ProSiebenSat.1 to begin preparations for a separation of its core entertainment operations from its noncore commerce-and-ventures and dating-and-video segments. ProSiebenSat.1 initially urged shareholders to reject MFE’s plan, but in April said it had started a sale process for its Verivox and Flaconi e-commerce businesses to reduce debt.

ProSiebenSat.1 said Tuesday that its free-float shareholders supported all of the management team’s proposals and confirmed its strategy to focus on its entertainment business.

MFE said it welcomed the decisions adopted at ProSiebenSat.1’s AGM. The fact that discussions about a breakup took place created value for ProSiebenSat.1’s shareholders, with shares rising more than 22% since it made its proposal public, MFE said.

ProSiebenSat.1 said MFE also rejected a proposal from ProSiebenSat.1’s supervisory board for a reorganization regarding its Joyn streaming platform. Under the proposal, Joyn would have become directly subordinate to the group and would have become the parent company of Seven. One Entertainment, allowing it to use losses carried forward for tax purposes, ProSiebenSat.1 said.

Purchase of 10.5GW of electricity highlights rising energy needs of AI and cloud computing

Microsoft has agreed to back an estimated $10bn in renewable electricity projects to be developed by Brookfield Asset Management, in a deal that underscores the race to meet clean energy commitments while satisfying the voracious energy demand of cloud computing and artificial intelligence.

The “global framework agreement” signed by the Seattle-based tech giant is a commitment to bring 10.5 gigawatts of generating capacity online, or enough to power the equivalent of about 1.8mn homes. The power will be added to the grids from which data centres draw electricity.

Brookfield said the capacity was about eight times larger than the previous single biggest corporate renewable electricity purchase agreement, a deal between the mining company Rio Tinto and an Australian solar farm.

Microsoft expects its partnership with Brookfield to help finance the creation of large new wind and solar farms to be built between 2026 and 2030, beginning in the US and Europe. Adding 10.5GW of new capacity would cost more than $10bn, based on recent industry trends.

It comes as the frenzied interest in generative artificial intelligence has sparked concerns about their intense energy demand and associated carbon emissions.

By 2026, the International Energy Agency expects data centres could globally consume more than 1,000 terawatt-hours of electricity, more than double 2022 levels, roughly equal to Japan’s total electricity usage.

The US, which is home to a third of the world’s data centres, is experiencing rapidly growing electricity demand for the first time in two decades, spurred in part by the power-thirsty centres. Five-year forecasts for the growth in electricity demand in the US have nearly doubled in the past year from 2.6 per cent to 4.7 per cent, according to a report from Grid Strategies.

The anticipated demand has raised alarm from energy watchdogs over whether antiquated power grids can meet the surge in consumption without slowing the move to renewables or posing a threat to reliability.

The initial agreement is almost three times larger than the 3GW of power used by data centres in Virginia — the world’s largest hub for such facilities — that source energy from Dominion Energy, the area’s largest electric utility company.

It would also account for a significant piece of overall renewable energy generating capacity in the US and Europe. The US added 33.8GW of utility-scale renewable energy projects last year, the highest amount on record, bringing the total renewable capacity on the grid to 262GW, according to American Clean Power, an industry group.

While tech companies including Amazon and Google have signed new renewable energy deals, multiple fossil fuel and power executives have told the Financial Times that the electricity needed to meet the demand for AI will require higher natural gas consumption given the intermittent nature of renewable generation and the nascent battery storage buildout.

Wind and solar made up about 14 per cent of US electricity generation last year, while natural gas, the largest source of the country’s power, made up 43 per cent, according to the Energy Information Administration.

Brookfield is one of the world’s largest developers of renewable power; its US-listed company Brookfield Renewable has about 33GW of operating renewables assets, including wind, solar and batteries, around the world, and a further 155GW in development.

It has expanded over the past few years with deals to buy much smaller rivals including the renewable energy business of the UK’s Banks Group — which it has since renamed OnPath Energy — last year, and US-based renewable energy developer Urban Grid in 2022.

Renewables developers are increasingly striking long-term power deals with large corporations, helping both sides get some certainty over long-term power prices. In addition to Microsoft, Brookfield has announced power purchase agreements with Amazon.

Corporate deals covering a record 46GW of solar and wind capacity were announced in 2023, with Amazon the top purchaser, according to figures published in February by Bloomberg New Energy Finance.

Microsoft has committed to ensuring 100 per cent of its electricity consumption is “matched” 100 per cent of the time by “zero carbon energy purchases” by 2030, using mechanisms including power purchase agreements and renewable energy certificates.

“Microsoft wants to use our influence and purchasing power to create lasting positive impact for all electricity consumers,” said Adrian Anderson, the company’s general manager for renewables.