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Kinder Morgan (KMI) to Proceed With PHP Expansion Project

Kinder Morgan (KMI) plans to bring the enhanced natural gas pipeline into service in November 2023, subject to necessary approvals. Kinder Morgan Inc. KMI, through its subsidiary, reached a final investment decision on its proposed natural gas pipeline expansion project.The final investment decision was taken after Permian Highway Pipeline (“PHP”) secured binding firm transportation agreements for all available capacities. PHP is owned by subsidiaries of Kinder Morgan, with a 26.7% ownership interest.The decision came as multiple liquefied natural gas processing facilities have been proposed along the Texas Gulf Coast to meet Europe’s rising demand for gas. The facilities would require 3.1 billion cubic feet per day of natural gas supply.Permian Highway transports natural gas from the Waha hub on the Texas side of the Permian Basin to Katy, TX, near Houston. The pipeline currently carries 1.2 billion cubic feet per day from the Permian Basin of West Texas and New Mexico.The expansion would increase the pipeline’s total capacity by up to 550 million cubic feet per day. The project will increase natural gas supplies from the Waha area to various mainline connections, which involve Katy, TX, and other U.S. Gulf Coast markets.Kinder Morgan plans to bring the enhanced natural gas pipeline into service in November 2023, subject to necessary approvals. The project will reduce transportation constraints from the Permian Basin, and help reach the company’s domestic and global energy requirements.The project is expected to support natural gas production growth in West Texas. It will provide several liquefaction facilities with a more affordable and reliable supply. Beside this, the project will grant access to high-priced markets and transportation flow assurance, which is crucial to reducing flared volumes.Company Profile & Price PerformanceHeadquartered in Houston, TX, Kinder Morgan is a leading midstream energy infrastructure provider.Shares of the company have underperformed the industry in the past six months. The KMI stock has gained 5.7% compared with the industry’s 8.7% growth. Image Source: Zacks Investment Research Zacks Rank & Stocks to ConsiderKinder Morgan currently has a Zack Rank #3 (Hold).Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.Phillips 66 PSX is the leading player in each of its operations like refining, chemicals and midstream in terms of size, efficiency and strengths. It has an oil and gas pipeline network of 22,000 miles, which is expected to increase in the coming days.Phillips 66 has hiked its quarterly dividend to 97 cents per share, representing an increase of 5% from the prior quarterly dividend. With the recent resumption of the stock repurchase program, the increment in the quarterly dividend represents Phillips 66’s strong focus on returning capital to stockholders. Since the company’s inception in 2012, this has resulted in its 11th annual dividend hike.Range Resources Corporation RRC is among the top 10 natural gas producers in the United States. The upstream energy firm expects the free cash flow to exceed $1.4 billion this year, which could be the highest among Appalachian players.Range Resources has reinstated its regular quarterly cash dividend, expected to start in the second half of this year. The company anticipated its annual dividend rate to be 32 cents per share. RRC’s board of directors approved the authorization of a $500-million share repurchase program, which is likely to be funded with the company’s free cash flow generation.Antero Resources AR is among the fast-growing natural gas producers in the United States. The leading natural gas producer is expecting a free cash flow yield of 25% for 2022, which could be the highest among Appalachian players.Antero Resources is targeting a capital return program of 25-50% of free cash flow annually, beginning with the implementation of the share repurchase program. The company’s board authorized a share repurchase program of up to $1 billion of outstanding common stock. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time. This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Range Resources Corporation (RRC): Free Stock Analysis Report Kinder Morgan, Inc. (KMI): Free Stock Analysis Report Phillips 66 (PSX): Free Stock Analysis Report Antero Resources Corporation (AR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJul 1st, 2022

ExxonMobil (XOM) Negotiates With the US for Golden Pass Project

The Golden Pass LNG expansion project is on schedule, but ExxonMobil (XOM) is seeking approval to start up before the due date. Exxon Mobil Corporation XOM is in discussions with the United States government to proceed faster with the Golden Pass liquefied natural gas (“LNG”) expansion project in Sabine Pass, per a report by S&P Global.Golden Pass LNG is a joint venture between ExxonMobil and Qatar Petroleum. ExxonMobil holds a 30% stake in the joint venture, while its partner Qatar Petroleum owns the rest. The project is planned to come online in 2024.The Golden Pass LNG expansion project is on schedule, but ExxonMobil is seeking approval to start up before the due date. The expansion would add natural gas liquefaction and export capacities to the existing facility in Sabine Pass, TX. The facility’s send-out capacity is estimated to be 18 million metric tons per year.The Golden Pass facility was initially constructed for importing natural gas. ExxonMobil and its partner Qatar Petroleum decided to convert the facility into an export terminal by investing about $10 billion. ExxonMobil earlier emphasized that the Golden Pass LNG export project is part of its five-year massive investment plan.With the commencement of the project, the companies will be able to export natural gas produced from the prolific shale fields in the United States. The joint venture intends to market its LNG volumes in various countries, where the demand for cleaner energy is on the rise.Golden Pass represents a notable collaboration between the United States and Qatar, even though the nations are expected to compete for LNG market share in the future as global demand increases rapidly.Company Profile & Price PerformanceHeadquartered in Irving, TX, ExxonMobil is one of the leading integrated energy companies in the world.Shares of ExxonMobil have outperformed the industry in the past six months. The stock has gained 53.1% compared with the industry’s 29.9% growth. Image Source: Zacks Investment Research Zacks Rank & Key PicksExxonMobil currently carries a Zack Rank #3 (Hold).Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Sunoco LP SUN is among the largest motor fuel distributors in the U.S. wholesale market by volume. SUN has a Zacks Style Score of A for Value and B for Growth.For 2022, Sunoco revised its adjusted EBITDA guidance to $795-$835 million from the previously mentioned $770-$810 million. The metric also suggests an improvement from the $754 million reported last year.Marathon Petroleum Corporation MPC is a leading independent refiner, transporter and marketer of petroleum products. MPC currently has a Zacks Style Score of A for Growth and Momentum, and B for Value.The industry’s improved fundamentals in the forms of constrained supply and robust demand have led to rising refining profitability for the players involved. As a reflection of this, Marathon Petroleum’s Refining & Marketing segment reported an operating income of $768 million in the first quarter, turning around from the year-ago loss of $598 million.Valero Energy Corporation VLO is the largest independent refiner and marketer of petroleum products in the United States. VLO currently has a Zacks Style Score of A for Growth and Momentum, and B for Value.The majority of Valero’s refining plants are located in the Gulf coast area, from where there is easy access to the export facilities. This Gulf coast presence helped the company expand its export volumes over the last few years and gain from high distillate margins. The company can benefit from the Gulf coast export volumes as fuel demand recovery gets support from the Asia economies. Notably, the Gulf coast contributed 60.5% to total throughput volume in the first quarter of 2022. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exxon Mobil Corporation (XOM): Free Stock Analysis Report Valero Energy Corporation (VLO): Free Stock Analysis Report Sunoco LP (SUN): Free Stock Analysis Report Marathon Petroleum Corporation (MPC): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksJun 22nd, 2022

Canadian Solar (CSIQ) Arm Acquires Energy Storage Projects

Canadian Solar's (CSIQ) subsidiary, Recurrent Energy, announces the acquisition of two standalone energy storage projects from Black Mountain Energy Storage in the ERCOT market. Canadian Solar Inc.’s CSIQ subsidiary, Recurrent Energy, recently acquired two standalone energy storage projects from Black Mountain Energy Storage (BMES) in the Electric Reliability Council of Texas (ERCOT) market. The move is in sync with Recurrent Energy’s aim to rapidly grow its business in the ERCOT market and boost its storage pipeline portfolio.Details of the AcquisitionThe projects, which are sited at the South Load Zone of the ERCOT market, claim a storage capacity of 200 megawatt-hour each. Recurrent Energy will be engaged in the next stage of developing the projects, finalizing entitlements and designs, selecting and procuring equipment, raising project financing as well as constructing facilities.The two projects are estimated to reach the notice to proceed in 2023, while the operation is expected to commence in the second quarter of 2024.Benefits of the AcquisitionThe ERCOT region boasts ample wind and solar potential, which further supports the development of solar and wind projects in the region. This, in turn, leverages the expansion of corresponding energy storage projects in the region. Impressively, the annual deployments of grid-scale storage almost tripled year over year to more than 3.5 gigawatts in 2021, with California and Texas leading the growth, per the report from Wood Mackenzie's U.S. Energy Storage Monitor.Hence, the region that entails such development capacity provides an edge for solar companies like Canadian Solar to benefit from the expanding market.Also, Recurrent Energy has developed 2.9 gigawatt-hour (GWh) of energy storage projects and has an additional pipeline of 15.5 GWh of projects under early to mid-stage development. The two energy storage projects, which will be operational as merchant projects in the ERCOT market, add to its development project pipeline portfolio.Such a solid pipeline of projects is likely to bolster CSIQ’s revenue generation prospects in the long haul.Peer MovesCompanies make strategic acquisitions to stimulate their growth trajectory and expand their businesses. In this context, solar companies that have engaged in valuable acquisition strategies are:In October 2021,SunPower SPWR acquired Blue Raven Solar to quickly expand in the solar market to serve more customers in underpenetrated areas, including the Northwest and Mid-Atlantic regions.The Zacks Consensus Estimate for SunPower’s 2022 earnings is pegged at 36 cents per share, which implies a growth rate of a solid 414.3% from the prior-year reported figure. SPWR shares have rallied 8.1% in the past month.In March 2022, Enphase Energy ENPH announced the acquisition of SolarLeadFactory, with the objective of substantially increasing lead volumes and conversion rates to help drive down customer acquisition costs for installers.The Zacks Consensus Estimate for Enphase Energy’s 2022 earnings suggests a growth rate of 51.2% from the prior-year reported figure. ENPH has rallied 10.5% in the past year.In April 2021,Sunnova Energy International NOVA completed its acquisition of SunStreet Energy Group and became Lennar’s exclusive residential solar and storage service provider for the new home communities with solar power across the country.The Zacks Consensus Estimate for Sunnova’s 2022 earnings indicates a growth rate of 44.1% from the prior-year reported figure. NOVA has returned 12% to its investors in the past month.Price MovementIn a year, shares of Canadian Solar have rallied 5.1% compared with the industry’s growth of 7.8%.Image Source: Zacks Investment ResearchZacks RankCanadian Solar currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time. This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Canadian Solar Inc. (CSIQ): Free Stock Analysis Report SunPower Corporation (SPWR): Free Stock Analysis Report Enphase Energy, Inc. (ENPH): Free Stock Analysis Report Sunnova Energy International Inc. (NOVA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJun 21st, 2022

Ethereum Tumbles Below Holders" Average Cost Basis

Ethereum Tumbles Below Holders' Average Cost Basis While bitcoin remains stuck to a $30,000, trading in a $2k range around the "nice, round number" for the past month... ...  In its latest weekly Crypto Compass note, UBS writes that what is most stunning is how bitcoin's biggest challenger, ETH has totally retraced its entire outperformance since late 2020 to the point where it has merely level-pegged with benchmark equities since both then and the start of 2019 for an equivalent unit of risk invested. Worse, after relentlessly dropping for 10 consecutive weeks.. ... the token which forms the backbone for web3, and which Goldman called the "Amazon of information" has just taken out a key long-term long-term support, tumbling 12% on Sunday to 1,500.22, the lowest price since Jan 2020. There are several reasons for Its latest relative softening according to UBS, chief among which is a sharper drop-off in activity that is a casualty of weaker transactional demand for Ethereum-based defi and NFTs. which in turn is a function of Fed tightening which is causing asset prices to tumble uniformly (in stocks, bonds and yes, crypto too) as "crash-correlations" approach 1. Some also point to concerns about a Terra-like implosion due to misplaced fears that a security attack on staked Ethereum could lead to a "fat tail" outcome ahead of the ETH 2 transition later this year due to 4 million ether deposited at Lido Finance, making the exchange a concentrated holder and threatening a centralized attack on the broader ETH network (Lido developer Vasiliy Shapovalov disagrees). Additionally, some slowing in the network as the so-called 'difficulty bomb' begins to bite ahead of the late-summer Merge may also be exerting some drag. Amid this wholesale selloff, bear-market blues, liquidations and outright capitulation have set in among even the most ardent crypto proponents (e.g., here). So much so that some have started to highlight how native technical indicators skew the balance of risks henceforth heavily to the downside. Yet in comparison to prior 'crypto winters,' bitcoin's price has yet to fall below holders' average cost base (23,500), although after today's drop, ether is now below the average cost basis which according to UBS is at 1,750. Furthermore, net unrealized profit/ loss metrics highlight specifically how long-term holders have yet to be tested. One way UBS suggests this could happen is via miners capitulating to sell down holdings of existing coins: indeed, their sales in early May coincided with the last lurch lower to and through 30k. Indeed, miners' businesses remain under significant pressure due to high energy costs and capex commitments, so their stock prices continue to make fresh lows even as the broader market has consolidated or even rebounded somewhat. Meanwhile, as UBS adds, there has been little positive news to offset investor concerns, and the Swiss bank proceeds to list some of these, starting with stablecoin issuers who have been put on notice by UST's collapse, while officials should feel spurred on to clamp down by Do Kown's plans for Terra2, Justin Sun's launch of the effective copycat USDD, and Tether's expansion onto Tezos. Japan's Diet has passed legislation allowing only banks and other licensed financial institutions to issue yen stablecoins as of next year. New York's Department of Finance likewise formalized guidance mandating full backing via short-dated T-bills or equivalent, segregated accounts and monthly audits by independent US CPAs. And a new UK consultation paper just floated procedures for dealing with failed issuers and makes provisions for systemically important designation Amongst the familiar fare of hacks, and outages, two additional items stood out in UBS' review of key events. One was the SEC moving to investigate Binance over its 2017 BNB exchange coin listing. The latter's price fell almost 10% in consequence. But the action matters beyond the fact that it involves the largest exchange by volumes and the industry's third largest non-stablecoin. It signals a fresh effort to enforce securities registration that will be applicable to the vast majority of crypto ventures. This comes atop other probes into the company that were already underway. These involve possible trading abuses by corporate insiders, insufficient segregation of the firm's local US subsidiary and concerns that it has been conducting unregulated broker-dealer activities. There is also the issue of whether founder CZ's ownership stakes in market-makers that are active on the platform constitute conflicts of interest. That said, UBS is quick to caution that none of this is to argue that crypto is sliding into oblivion, quite the contrary - after all Wall Street and Silicon Valley have invested tens of billions in crypto infrastructure and manpower (most did so around the time cryptos peaked),. Yet what it does point to is how the future will look very different. According to UBS' James Malcom, players will have to embrace regulation and collaborate with existing financial service providers; thus Singapore's just-launched Project Guardian, which represents a pilot project for the central bank to explore tokenized bonds and deposits via the establishment of permissioned liquidity pools in collaboration with DBS, JPMorgan and Marketnode. They must also have to compromise even as they seek to disrupt longstanding tradfi practices, per FTX's bold bid to disintermediate derivatives trading by clearing customers' swaps without the involvement of FCMs. The good news is that, as UBS concludes, those who can last beyond the near-term downward pressure and volatility, the longer-term demand-side outlook looks exceedingly healthy when recast in such terms. Accenture's newly released Future of Asian Wealth Management survey revealed that more than half of its 3,200 respondents already hold digital assets, and nearly three quarters plan to do so by year-end. However, two thirds of the 500 financial advisors surveyed have no plans to offer such services due to regulatory uncertainty and unfamiliarity with the space, which would require specialized research capabilities plus substantial investment in training for relationship managers.  Little wonder satisfaction ratings with primary counterparts score rather lowly.  It is also not surprising that many allocators end up relying on potentially less reliable online advice in consequence. UBS' Global Family Office Report 2022 finds, by contrast, most of the bank's clients are 'cryptocurious' rather than 'crypto-committed'— wanting to learn about the space rather than invest. It pegged just a quarter of Asian participants as active in the space, though that rises to more than a third in North America. The vast majority of allocations amount to less than 3% of portfolios and are being made to better understand the technology as much as on the expectation of strong, diversified returns at this point. As for Ethereum's latest tumble, it could certainly fall more amid capitualtory liquidations, now that selling below the average cost basis means cementing losses for retail investors. But when it comes to institutions one can be certain that instead of writing off their investments in the web3 space, most will simply double down, and why not: it is already widely accepted that after the Fed hikes enough to push the economy into recession (or depression) in the next few months, it will then proceed to aggressively cut rates again... ... with the benefit of QE again, and the moment Powell capitulates - which will be some time in late 2022 or early 2023  - is when all the "growth", high-beta assets that have gotten destroyed in the past few months, will erupt to new all time highs in anticipation of the biggest liquidity injection yet, one which is simply mandatory if for no other reason than central banks have to fund and finance the $150 trillion (with a T) spending over the next 30 years (via QE) that is unavoidable if the progressive "climate change" agenda is to pass. And it will - too many politicians and parties have staked their entire existence on it. Finally, none of this accounts for the growing risk that China, and its $54 trillion in bank assets or 150% more than the US... ... will suffer another devaluation, sparking another massive capital exodus using bitcoin and other crypto instruments. Tyler Durden Sat, 06/11/2022 - 13:06.....»»

Category: blogSource: zerohedgeJun 11th, 2022

FuelCell Energy Reports Second Quarter of Fiscal 2022 Results

Second Quarter Fiscal 2022 Financial Highlights(All comparisons are year-over-year unless otherwise noted) Revenues of $16.4 million compared to $14.0 million Gross loss of $(7.3) million compared to $(4.8) million Loss from operations of $(28.2) million compared to $(17.4) million Backlog of $1.33 billion as of April 30, 2022, compared to $1.32 billion as April 30, 2021 DANBURY, Conn., June 09, 2022 (GLOBE NEWSWIRE) -- FuelCell Energy, Inc. (NASDAQ:FCEL) -- a global leader in decarbonizing power and producing hydrogen through our proprietary, state-of-the-art fuel cell platforms to enable a world empowered by clean energy -- today reported financial results and key business highlights for its second quarter ended April 30, 2022. "We continue to execute on our Powerhouse business strategy, and we are very pleased with our progress over the past few months, including extending our Joint Development Agreement with ExxonMobil related to our carbon capture solution and growing our generation revenue after commencing commercial operations of the 7.4 MW LIPA Yaphank fuel cell project," said Mr. Jason Few, President and CEO. "Additionally, we expect to further bolster our generation portfolio revenue with the addition of the 7.4 MW Groton Sub Base project to our generation portfolio which we expect to be placed in service this summer." "Following the achievement of a critical technical milestone associated with our differentiated carbon capture application under the Joint Development Agreement with ExxonMobil Technology and Engineering Company or EMTEC (formerly known as ExxonMobil Research and Engineering Company), we entered into an extension of our collaborative development agreement enabling the two companies to continue working to advance fuel cell carbon capture and storage technology closer to commercialization," continued Mr. Few. "Not only will we work to advance the technology for various carbon capture applications, but we are also conducting a joint market study to define application opportunities and commercialization strategies and identify partners for potential pilot/demonstration projects in our pursuit of carbon capture from a broad landscape of industrial applications. We continue to support ExxonMobil's technology readiness review ahead of a potential deployment of the technology at an ExxonMobil facility. We are proud of the progress being made toward commercializing our unique carbon capture solution." Mr. Few added, "Beyond our work with EMTEC and other funded programs such as our recently announced carbon capture project with Canadian National Resources Limited and our U.S. Department of Energy solid oxide programs, we continue to invest in internal research and development activities with a focus on commercialization of our advanced technologies at an accelerated pace. Spending in this area has increased over 150% from the comparable prior year quarter, as we invest in our patented solid oxide platform. Our solid oxide development team is focused on both megawatt scale electrolysis and sub-megawatt power generation, and we are currently in the process of designing and building prototypes of our commercial offerings for each." "FuelCell Energy delivered increased revenue in the second fiscal quarter, compared to the comparable prior-year quarter, reflecting higher Service and Generation revenues. No modules were delivered to POSCO Energy's subsidiary, Korea Fuel Cell Co., Ltd. ("Korea Fuel Cell"), in the second fiscal quarter. However, of the initial twelve module order which Korea Fuel Cell was required to make under the terms of the Settlement Agreement, we expect to deliver additional modules from that order in the third quarter of fiscal 2022 and, pursuant to the terms of the Settlement Agreement, we expect Korea Fuel Cell to place a non-cancelable order for eight additional modules by June 30, 2022. We continue to target delivery of all 20 modules by the end of fiscal year 2022," said Mr. Few. "Additionally, we continue to invest in scaling our commercial organization in Korea in support of building a pipeline of opportunities in the Korean and broader Asian market." "Achieving commercial operation of our 7.4 MW fuel cell platform located on the U.S. Navy Sub Base located in Groton, CT will be a milestone for FuelCell Energy. When commissioning is complete, this project is expected to demonstrate our high quality and reliable clean energy solution to enable electrical resiliency with some of the country's most critical infrastructure, while supporting the U.S. Navy's decarbonization goals," continued Mr. Few. "The project contains two fuel cell platforms, one of which has been fully commissioned and load tested. The second platform requires additional component work, and once complete we will resume the final stages of commissioning." Mr. Few concluded, "During the quarter, we hosted our 2022 Investor Day, our first as a Company, where we discussed the unique solutions we deliver, the market opportunities that we believe our technologies address, how we see our Company evolving over the next several years, and ultimately what it means for our stakeholders. We are in a dynamic period of transition at FuelCell Energy as we work to launch several new solutions in support of the accelerating energy transition. During our Investor Day, we highlighted the approximately $2 trillion in combined, cumulative total addressable market opportunities through 2030 which we believe may be served by our commercially available solutions and solutions that are actively under development by the Company. We also shared our aspiration to have a substantial impact on addressing climate change and deliver revenue of over $300 million by the end of fiscal year 2025 and revenue of over $1 billion by the end of fiscal year 2030. In order to reach these goals, we are, among other things, investing in commercializing our technologies and adding to our capabilities, both in terms of manufacturing capacity and talent." Consolidated Financial Metrics In this press release, FuelCell Energy refers to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures. The non-GAAP financial measures may not be comparable to similarly titled measures being used and disclosed by other companies. FuelCell Energy believes that this non-GAAP information is useful to gaining an understanding of its operating results and the ongoing performance of its business. A reconciliation of EBITDA, Adjusted EBITDA and any other non-GAAP measures is contained in the appendix to this press release.                       Three Months Ended April 30,         (Amounts in thousands)   2022        2021      Change          Total revenues $   16,384      $    13,953      $       2,431           Gross loss   (7,310 )     (4,756 )            (2,554 )         Loss from operations   (28,217 )     (17,390 )     (10,827 )         Net Loss   (30,126 )     (18,917 )     (11,209 )         Net loss attributable to common stockholders   (31,017 )     (19,717 )     (11,300 )         Net loss per basic and diluted share $       (0.08 )   $        (0.06 )   $       (0.02 )                             EBITDA   (22,885 )     (12,582 )     (10,303 )         Adjusted EBITDA $   (21,189 )   $    (11,329 )   $     (9,860 )                                         Second Quarter of Fiscal 2022 Results Note: All comparisons between periods are between the second quarter of fiscal 2022 and the second quarter of fiscal 2021, unless otherwise specified. Second quarter revenue of $16.4 million represents an increase of 17% from the comparable prior-year quarter. Service agreements revenues increased 300% to $2.6 million from $0.7 million. The increase in revenues for the second quarter of fiscal 2022 is primarily due to the fact that there was a refurbished module exchange and non-routine maintenance activities during the quarter. Generation revenues increased 46% to $9.1 million from $6.2 million, primarily due to the completion of the Long Island Power Authority ("LIPA") Yaphank project during the three months ended January 31, 2022 and the higher operating output of the generation fleet portfolio as a result of module replacements during the last six months of fiscal year 2021. Advanced Technologies contract revenues decreased 34% to $4.7 million from $7.1 million. Compared to the second quarter of fiscal 2021, Advanced Technologies contract revenues recognized under the Joint Development Agreement with EMTEC were approximately $3.2 million lower during the second quarter of fiscal 2022, offset by an increase in revenue recognized under government contracts and other contracts of $0.9 million for the second quarter of fiscal 2022. Gross loss for the second quarter of fiscal 2022 totaled $(7.3) million, compared to a gross loss of $(4.8) million in the comparable prior-year quarter.  The increase in gross loss was driven by higher manufacturing variances, $4.8 million of non-recoverable costs related to construction of the Toyota project, and lower Advanced Technologies margin, partially offset by reduced generation gross loss (excluding the impact of non-recoverable costs related to construction of the Toyota project) and reduced service gross loss.   Operating expenses for the second quarter of fiscal 2022 increased to $20.9 million from $12.6 million in the second quarter of fiscal 2021. Administrative and selling expenses increased due to higher sales, marketing and consulting costs, as the Company is investing in rebranding and accelerating its sales and commercialization efforts including increasing the size of its sales and marketing teams, which resulted in an increase in compensation expenses from an increase in headcount. Research and development expenses of $7.7 million during the quarter, up from $3.0 million in the second quarter of fiscal 2021, reflect increased spending on the Company's hydrogen commercialization initiatives, namely the ongoing commercial development efforts related to our solid oxide platform. Net loss was $(30.1) million in the second quarter of fiscal 2022, compared to net loss of $(18.9) million in the second quarter of fiscal 2021 driven by a higher gross loss and higher operating expenses. Additionally, interest expense was higher in the second quarter of fiscal 2022 compared to the second quarter of fiscal 2021. Adjusted EBITDA totaled $(21.2) million in the second quarter of fiscal 2022, compared to Adjusted EBITDA of $(11.3) million in the second quarter of fiscal 2021. Please see the discussion of non-GAAP financial measures, including Adjusted EBITDA, in the appendix at the end of this release. The net loss per share attributable to common stockholders in the second quarter of fiscal 2022 was $(0.08), compared to $(0.06) in the second quarter of fiscal 2021. The higher net loss per common share is primarily due to the higher net loss attributable to common stockholders, partially offset by the higher number of weighted average shares outstanding due to share issuances since April 30, 2021. Cash, Restricted Cash and Financing Update Cash and cash equivalents and restricted cash and cash equivalents totaled $489.6 million as of April 30, 2022 compared to $460.2 million as of October 31, 2021. Unrestricted cash and cash equivalents totaled $467.8 million compared to $432.2 million as of October 31, 2021. Restricted cash and cash equivalents were $21.8 million, of which $5.3 million was classified as current and $16.5 million was classified as non-current, compared to $28.0 million of restricted cash and cash equivalents as of October 31, 2021, of which $11.3 million was classified as current and $16.7 million was classified as non-current. During the second quarter of fiscal 2022, the Company sold approximately 19.9 million shares of common stock under its at-the-market offering program, resulting in total gross proceeds of $120.8 million and net proceeds to the Company of approximately $118.3 million. Operations and Commercialization Update During the quarter, the Company continued to make progress on projects for which we have executed power and/or hydrogen purchase agreements, with updates regarding certain current projects provided below.      Groton Sub Base. The commissioning process has been completed on one of the two platforms installed onsite. The second platform requires additional component work, and once complete, we will resume the final stages of commissioning and expect the project to be commercially operational this summer. The project, when commercially operational, will be added to our generation portfolio. Incorporation of the platform into a microgrid is expected to demonstrate the capacity of FuelCell Energy's platforms to increase grid stability and resilience while supporting the U.S. military's efforts to fortify base energy supply and demonstrate the U.S. Navy's commitment to clean, reliable power with microgrid capabilities. Toyota -- Port of Long Beach, CA. This 2.3 MW trigeneration platform will produce electricity, hydrogen and water. Fuel cell platform equipment has been built and delivered to the site, and civil construction work has significantly advanced. We are nearing the completion of the construction phase of the project, with the remaining construction activity anticipated to be completed in late 2022 or early 2023. As a result, while we have made substantial progress, we do anticipate that commercial operations will be delayed beyond June 30, 2022, and an extension to our Hydrogen Power Purchase Agreement ("HPPA") will be required from Toyota who may or may not grant such extension in its sole discretion. Derby, CT. On-site civil construction of this 14.0 MW project continues to advance, the Company has largely completed the foundational construction, and balance of plant components have been delivered and installed on site. This utility scale fuel cell platform will contain five SureSource 3000 fuel cell systems that will be installed on engineered platforms alongside the Housatonic River. To date, the Company has invested approximately $18.3 million into the project, with the majority of site work complete and the electrical and mechanical balance of plant installed. The Company continues work with the utility customer, United Illuminating, on the interconnection process, the timing of which will drive the continued development of the site, including the delivery of the 10 fuel cell modules required to complete the project. Manufacturing Output, Capacity and Expansion. For the three months ended April 30, 2022, we operated at an annualized production rate of approximately 40.8 MW, which is an increase from the annualized production rate of 32 MW for the three months ended April 30, 2021. We are working to increase our production rate during fiscal year 2022 and are targeting achieving a rate capable of producing 45 to 50 MW on an annualized basis during fiscal year 2022. At this time, the maximum annualized capacity (module manufacturing, final assembly, testing and conditioning) is 100 MW per year under the Torrington facility's current configuration when being fully utilized. The Torrington facility is sized to accommodate the eventual annualized production capacity of up to 200 MW per year with additional capital investment in machinery, equipment, tooling, and inventory. We expect to make investments in fiscal year 2022 in our factories for molten carbonate and solid oxide production capacity expansion; the addition of test facilities for new products and components; the expansion of our laboratories; and upgrades to and expansion of our business systems. Commercialization Update. The Company continues to advance its solid oxide platform research, including the anticipated delivery in fiscal 2022 of a high-efficiency electrolysis platform to Idaho National Laboratories for demonstration. This project, done in conjunction with the U.S. Department of Energy, is intended to demonstrate that the Company's platform can operate at higher electrical efficiency than currently available electrolysis technologies through the inclusion of an external heat source. To further accelerate the commercialization activity for the solid oxide platform, the Company recently commenced the design and construction of two advanced prototypes: (i) a 250 kW power generation platform, and (ii) a 1 MW high-efficiency electrolysis platform. Backlog                     As of April 30,     (Amounts in thousands) 2022    2021    Change Product $ 60,247   $ -   $ 60,247   Service   121,287     141,427     (20,140 ) Generation   1,109,293     1,115,573     (6,280 ) License   -     22,182     (22,182 ) Advanced Technologies   35,393     44,972     (9,579 ) Total Backlog $ 1,326,220   $ 1,324,154   $ 2,066                       Backlog increased by approximately 0.2% to $1.33 billion as of April 30, 2022, compared to $1.32 billion as of April 30, 2021, primarily as a result of the addition of product sales backlog, partially offset by a reduction in Service and Advanced Technologies backlog, and reflecting the continued execution of backlog and adjustments to generation backlog. Specifically, changes to backlog reflect: (i) the addition of product sales backlog from the module order received from KFC and (ii) module exchanges in our Generation portfolio that are expected to contribute to higher future output and revenues. Advance Technologies backlog reflects new contracts from the U.S. Department of Energy, partially offset by work performed under our Joint Development Agreement with EMTEC. Note that approximately $22.2 million of backlog which was previously classified as "Service and license" backlog was reclassified to "Product" backlog as a result of the settlement agreement with POSCO Energy and KFC. This amount represents the value of the performance guarantee associated with KFC's module order. Only projects for which we have an executed power purchase agreement ("PPA") or an executed HPPA are included in generation backlog, which represents future revenue under long-term agreements. Together, the service and generation portion of backlog had a weighted average term of approximately 18 years, with weighting based on the dollar amount of backlog and utility service contracts of up to 20 years in duration at inception. Backlog represents definitive agreements executed by the Company and our customers. Projects sold to customers (and not retained by the Company) are included in product sales and service backlog and the related generation backlog is removed upon the sale. Conference Call Information FuelCell Energy will host a conference call today beginning at 10:00 a.m. EDT to discuss second quarter results for fiscal year 2022 as well as key business highlights. Participants can access the live call via webcast on the Company website or by telephone as follows: The live webcast of the call and supporting slide presentation will be available at www.fuelcellenergy.com. To listen to the call, select "Investors" on the home page, proceed to the "Events & Presentations" page and then click on the "Webcast" link listed under the June 9 earnings call event, or click here. Alternatively, participants can dial 646-960-0699 and state FuelCell Energy or the conference ID number 1099808. The replay of the conference call will be available via webcast on the Company's Investors' page at www.fuelcellenergy.com approximately two hours after the conclusion of the call. Cautionary Language This news release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 regarding future events or our future financial performance that involve certain contingencies and uncertainties, including those discussed in our Annual Report on Form 10-K for the fiscal year ended October 31, 2021 in the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations". The forward-looking statements include, without limitation, statements with respect to the Company's anticipated financial results and statements regarding the Company's plans and expectations regarding the continuing development, commercialization and financing of its current and future fuel cell technologies , the expected timing of completion of the Company's ongoing projects, the Company's business plans and strategies, the markets in which the Company expects to operate, and the size and scope of its total addressable market opportunities, which is an estimate based on currently available public information and the application of management's current assumptions and business judgment. Projected and estimated numbers contained herein are not forecasts and may not reflect actual results. These forward-looking statements are not guarantees of future performance, and all forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could cause such a difference include, without limitation: general risks associated with product development and manufacturing; general economic conditions; changes in interest rates, which may impact project financing; supply chain disruptions; changes in the utility regulatory environment; changes in the utility industry and the markets for distributed generation, distributed hydrogen, and fuel cell power plants configured for carbon capture or carbon separation; potential volatility of commodity and energy prices that may adversely affect our projects; availability of government subsidies and economic incentives for alternative energy technologies; our ability to remain in compliance with U.S. federal and state and foreign government laws and regulations and the listing rules of The Nasdaq Stock Market; rapid technological change; competition; the risk that our bid awards will not convert to contracts or that our contracts will not convert to revenue; market acceptance of our products; changes in accounting policies or practices adopted voluntarily or as required by accounting principles generally accepted in the United States; factors affecting our liquidity position and financial condition; government appropriations; the ability of the government and third parties to terminate their development contracts at any time; the ability of the government to exercise "march-in" rights with respect to certain of our patents; our ability to successfully market and sell our products internationally; our ability to implement our strategy; our ability to reduce our levelized cost of energy and deliver on our cost reduction strategy generally; our ability to protect our intellectual property; litigation and other proceedings; the risk that commercialization of our products will not occur when anticipated or, if it does, that we will not have adequate capacity to satisfy demand; our need for and the availability of additional financing; our ability to generate positive cash flow from operations; our ability to service our long-term debt; our ability to increase the output and longevity of our platforms and to meet the performance requirements of our contracts; our ability to expand our customer base and maintain relationships with our largest customers and strategic business allies; changes by the U.S. Small Business Administration or other governmental authorities to, or with respect to the implementation or interpretation of, the Coronavirus Aid, Relief, and Economic Security Act, the Paycheck Protection Program or related administrative matters; and concerns with, threats of, or the consequences of, pandemics, contagious diseases or health epidemics, including the novel coronavirus, and resulting supply chain disruptions, shifts in clean energy demand, impacts to our customers' capital budgets and investment plans, impacts to our project schedules, impacts to our ability to service existing projects, and impacts on the demand for our products, as well as other risks set forth in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2021. The forward-looking statements contained herein speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement contained or incorporated by reference herein to reflect any change in the Company's expectations or any change in events, conditions or circumstances on which any such statement is based. About FuelCell Energy FuelCell Energy, Inc. (NASDAQ:FCEL) is a global leader in sustainable clean energy ...Full story available on Benzinga.com.....»»

Category: earningsSource: benzingaJun 9th, 2022

Insulet (PODD) to Expand Base in Malaysia With New Facility

The new manufacturing facility by Insulet (PODD) is set to have approximately 400,000 square feet of manufacturing space. Insulet Corporation PODD, in line with its market expansion strategy, plans to construct its new manufacturing facility in Johor Bahru, Malaysia. The company will host the groundbreaking ceremony of this project on Jun 2.  Insulet expects the facility to be operational by the middle of 2024 and strengthen its global manufacturing capabilities.The Manufacturing Facility in DetailThis new manufacturing facility will have approximately 400,000 square feet of space. Insulet aims to produce Omnipod Insulin Management System in the facility.Insulet plans to invest approximately $200 million over five years and hire more than 500 full-time employees once the facility is operating at full capacity.According to Insulet, this is going to be an important step to further diversify its footprint globally.Image Source: Zacks Investment ResearchInsulet also plans to source environmentally responsible and resource-efficient materials for the new facility. Per the press release, the architectural design includes sustainable elements that qualify for Green Building Initiative (GBI) and Leadership in Energy and Environmental Design (LEED) certification.Insulet officials will be joined by several Malaysian dignitaries including the Malaysian Investment Development Authority, the Ministry of Internal Trade and Industry, Iskandar Regional Development Authority, Iskandar Puteri City Council, and members of the U.S. Embassy in Malaysia for the groundbreaking ceremony.High Global Market PotentialGoing by a Global Market Insights report, Insulin delivery devices’ market size surpassed $14.7 billion in 2021 and is estimated to register over 7% CAGR between 2022 and 2028. Per the report, the growing prevalence of diabetes is the key factor promoting market growth.Considering the huge prospect, Insulet’s latest decision to invest in an emerging economy like Malaysia seems well-timed.Insulet’s Market Expansion at a GlanceIn terms of Insulet’s strategy to grow its global addressable market, Insulet recently rolled out Omnipod DASH through targeted geographic expansion by entering the Asia Pacific region through Australia and expanding into Turkey. The company recently launched the Omnipod DASH in Saudi Arabia and looks to enter the United Arab Emirates. Together, these countries expand Insulet’s total addressable market by nearly 1 million.The company is also progressing with the introduction of Omnipod 5 in international markets. During the first quarter, the CE mark submission for the Omnipod 5 continued to proceed well.Price PerformanceShares of the company have lost 21.6% in a year compared with the industry's fall of 22.1%.Zacks Rank and Key PicksInsulet currently carries a Zacks Rank #3 (Hold).A few better-ranked stocks in the broader medical space are UnitedHealth Group Incorporated UNH, Medpace Holdings, Inc. MEDP and Alkermes plc ALKS.UnitedHealth, having a Zacks Rank #2 (Buy), reported first-quarter 2022 earnings per share (EPS) of $5.49, which beat the Zacks Consensus Estimate by 1.7%. Revenues of $80.1 billion outpaced the consensus mark by 14.2%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.UnitedHealth has an estimated long-term growth rate of 14.8%. UNH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 3.7%.Medpace reported first-quarter 2022 adjusted EPS of $1.69, which surpassed the Zacks Consensus Estimate by 34.1%. Revenues of $330.9 million outpaced the Zacks Consensus Estimate by 1.1%. It currently has a Zacks Rank #2.Medpace has a historical growth rate of 27.3%. MEDP’s earnings surpassed estimates in the trailing four quarters, the average surprise being 17.1%.Alkermes reported first-quarter 2022 adjusted EPS of 12 cents, which surpassed the Zacks Consensus Estimate of a penny. Revenues of $278.6 million outpaced the Zacks Consensus Estimate by 6.2%. It currently carries a Zacks Rank #2.Alkermes has an estimated long-term growth rate of 25.1%. ALKS’ earnings surpassed estimates in the trailing four quarters, the average surprise being 350.5%. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time. This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report UnitedHealth Group Incorporated (UNH): Free Stock Analysis Report Alkermes plc (ALKS): Free Stock Analysis Report Insulet Corporation (PODD): Free Stock Analysis Report Medpace Holdings, Inc. (MEDP): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJun 2nd, 2022

The Evolution Of Credit & The Growing Fiat Money Crisis

The Evolution Of Credit & The Growing Fiat Money Crisis Authored by Alasdair Macleod via GoldMoney.com, After fifty-one years from the end of the Bretton Woods Agreement, the system of fiat currencies appears to be moving towards a crisis point for the US dollar as the international currency. The battle over global energy, commodity, and grain supplies is the continuation of an intensifying financial war between the dollar and the renminbi and rouble. It is becoming clear that the scale of an emerging industrial revolution in Asia is in stark contrast with Western decline, a population ratio of 87 to 13. The dollar’s role as the sole reserve currency is not suited for this reality. Commentators speculate that the current system’s failings require a global reset. They think in terms of it being organised by governments, when the governments’ global currency system is failing. Beholden to Keynesian macroeconomics, the common understanding of money and credit is lacking as well. This article puts money, currency, and credit, and their relationships in context. It points out that the credit in an economy is far greater than officially recorded by money supply figures and it explains how relatively small amounts of gold coin can stabilise an entire credit system. It is the only lasting solution to the growing fiat money crisis, and it is within the power of at least some central banks to implement gold coin standards by mobilising their reserves. Evolution or revolution? There are big changes afoot in the world’s financial and currency system. Fiat currencies have been completely detached from gold for fifty-one years from the ending of the Bretton Woods Agreement and since then they have been loosely tied to the King Rat of currencies, the dollar. Measured by money, which is and always has been only gold, King Rat has lost over 98% of its relative purchasing power in that time. From the Nixon Shock, when the Bretton Woods agreement was suspended temporarily, US Government debt has increased from $413 bn to about $30 trillion — that’s a multiple of 73 times. And given the US Government’s mandated and other commitments, it shows no signs of stabilising. This extraordinary debasement has so far been relatively orderly because the rest of the world has accepted the dollar’s hegemonic status. Triffin’s dilemma has allowed the US to run economically destructive policies without undermining the currency catastrophically. Naturally, that has led to the US Government’s complacent belief that not only will the dollar endure, but it can continue to be used for America’s own strategic benefits. But the emergence of rival superpowers in Asia has begun to challenge this status, and the consequence has been a financial cold war, a geopolitical jostling for position, particularly between the dollar and China’s renminbi, which has increased its influence in global financial affairs since the Lehman crisis in 2008. Wars are only understood by the public when they are physical in form. The financial and credit machinations between currency-issuing power blocs passes it by. But as with all wars, there ends up a winner and a loser. And since the global commodity powerhouse that is Russia got involved in recent weeks, America has continued its policy of using its currency status to penalise the Russians as if it was punishing a minor state for questioning its hegemonic status. The consequence is the financial cold war has become very hot and is now a commodity battle as well. Bringing commodities into the conflict is ripe with unintended consequences. Depending how the Russians respond to US-led sanctions, which they have yet to do, matters could escalate. In the West we have comforted ourselves with the belief that the Russian economy is on its uppers and Putin will have to either quickly yield to sanctions pressures, or face ejection by his own people in a coup. But that is a one-sided view. Even if it has a grain of truth, it ignores the consequences of Putin’s military failures on the ground in Ukraine so far, and his likely desperation to hit back with the one non-nuclear weapon at his disposal: Russia’s commodity exports. He may take the view that the West is damaging itself and little or no further action is required. And surely, the fact that China has stockpiled most of the world’s grain resources gives Russia added power as a marginal supplier. Putin can afford to not restrict food and fertiliser exports, blaming on American policy the starvation that will almost certainly be suffered by all non-combatant nations. He could cripple the West’s technology industries by banning or restricting exports of rare metals which are of little concern to headline writers in the popular press. He might exploit the one big loophole left in the sanctions regime by supplying China with whatever raw materials and energy it needs at discounted prices. And China could compound the problem for the West by restricting its exports of strategic commodities claiming they are needed for its own manufacturing requirements. While everyone focuses on what is seen, it is what is not seen that is ignored. Commodities are the visible manifestation of a trade war, while payments for them are not. Yet it is the flow of credit on the payment side where the battle for hegemonic status is fought. The Americans and their epigones in Europe have tried to shut down payments for Russian trade through the supposedly independent SWIFT system. And even the Bank for International Settlements, which by dealing with both Nazi Germany and the Allies retained its neutrality in the Second World War, is siding with the West today. But step back for a moment to look at how broadly based the West’s position is in a global context, because that will be a factor in whether the dollar’s hegemony will survive this conflict. We see America, the EU, Japan, the UK, Canada, Australia, and New Zealand on one side. In population terms that’s roughly 335, 447, 120, 65, 38, 26 and 5 million people respectively, totalling 1,036 million, only 13% of the world population. This point was made meaningfully by the Saudis who now want to talk with Putin rather than Biden. As long ago as 2014, this writer was informed by a director of a major Swiss refinery that Arab customers were sending LBMA 400-ounce bars for recasting into Chinese four-nine one kilo bars. The real money saw this coming at least eight years ago. Even if the US’s external policies do not end up undermining the dollar’s global status, it is becoming clear that the King Rat of currencies is under an existential threat. And the Fed, which is responsible for domestic monetary policies, in conjunction with the Biden administration is undermining it from the inside as well by trying to manage a failing US economy by accelerating its debasement. A betting man would therefore be unlikely to put money on a favourable dollar outcome. Whether the dollar suffers a crisis or merely an accelerated decline, just as Nixon changed the world’s monetary order in 1971 it will change again. That the current situation is unsatisfactory is widely recognised by multiple commentators, even in America, calling for a financial and currency reset. And it is assumpted that the US Government and its central bank should come up with a plan. There are two major problems with the notion that somehow the deck chair attendant can save the ship from sinking by rearranging the sun loungers. The first error is insisting that money is the preserve of only the state and is not to be decided by those who use it. It was the underlying fallacy of Georg Knapp’s State Theory of Money published in 1905. That ended with Germany printing money to arm itself in the hope that it would win: it didn’t and Germany ended up destroying its papiermark. The second error is that almost no one understands money itself, as evidenced by the whole financial establishment, from the governments down to junior fund managers, thinking that their currencies are money. Commentators calling for a reset are themselves in the dark. Events will deal with the fallacies behind the State Theory of Money and whether it will turn out to be an evolution or revolution. But at least we can have a stab at explaining what money is for a modern audience, so that the requirements and conditions of a new currency system to succeed can be better understood. What is money for? The pre-Keynesian classical economic explanation of money’s role was set out in Say’s Law, otherwise known as the law of markets. Jean-Baptiste Say was a French economist, who in his Treatise on Political Economy published in 1803 wrote that, “A product is no sooner created than it, from that instant, affords a market for other products to the full extent of its own value.” And “Each of us can only purchase the productions of others with his own productions — and so the value we can buy is equal to the value we can produce. The more men can produce the more they will purchase.” Money or credit is the post-barter link between production and consumption facilitating the exchange between the two. What to produce and what is needed in exchange is a matter for those involved in individual transactions. And the medium of exchange used is a decision for each of the parties. They will tend to use a medium which is convenient and widely accepted by others. Say’s Law was incorrectly redefined and trashed by Keynes to “…that the aggregate demand price of output as a whole is equal to the aggregate supply price for all volumes of output is equivalent to the proposition that there is no obstacle to full employment.” This has subsequently been shortened to “supply creates its own demand”. Keynes’s elision of the truth was leading to (or was it to justify?) his erroneous invention of mathematical macroeconomics. It is simply untrue. All Say was pointing out is we divide our labour as the most efficient means of production for driving improvements in the human condition. That cannot be argued with, even by blinkered Keynesians. Money, or more correctly credit has two roles in this division of labour. The first is as the medium for investment in production, because things must be made before they can be sold and there are expenses in the form of presale payments that must be made. And the second is to act as the commonly accepted intermediary between the sale of products to their buyers. Instead of opining that supply creates its own demand, if we say instead that people make things so they can buy the products and services they don’t make for themselves, it is so obviously true that Keynes and his self-serving theories don’t have a leg to stand on. And importantly, full employment has nothing to do with it. The money involved is always credit. Even the act of lending gold coins to an entrepreneur to make something is credit because it is to be repaid. If gold coins are the payment medium between production and consumption, they are the temporary storage of production before it is spent. In this very narrow sense, they represent the credit of production which will be spent. The principal quality of gold, which when it is at rest is undeniably money, is that it has no counterparty risk and is to be parted with last. The point is that money in circulation is a subsection of wider credit and is the very narrowest of definitions of circulating media. But even under a gold standard, it is hardly ever used in transactions and rarely circulates. This is partly due to a Gresham’s Law effect, where it is only exchanged for inferior forms of credit as a last resort, and partly because it is less convenient than transferring banknotes or making book entries across bank ledgers. By far the most common forms of circulating media are credit in the form of banknotes issued by a central bank, and transferable credit owed by banks to depositors. But in our estimate of a practical replacement of the current fiat currency-based system, we must also acknowledge that credit is far broader than that recorded as circulating by means of the banking system. We are increasingly aware of the term, “shadow banks” most of which are pass-through channels of credit rather than credit creators. But doubtless, there is expanded credit in circulation originating from shadow banks, the equivalent of officially recorded bank credit, which is not captured in the money supply statistics. But there are also wider forms of credit in any economy. Defining credit To further our understanding of credit, we must define the fundamental concept of credit: Credit is anything which is of no direct use, but which is taken in exchange for something else, in the belief or confidence that we have the right to exchange it away again. It is the right to a future payment, not necessarily in money or currency. It is not the transfer of something, but it is a right to a future payment. Consequently, the most common form of credit is an agreement between two parties which has nothing to do with bank credit per se. Bank credit is merely the most obvious and recorded subset of the entire quantity of credit in an economy. And the whole world of derivatives, futures, forwards, and options, are also credit for an action in time, additional to bank credit. Global M3 money supply is said to be $40 trillion equivalent, about 3% of investments, derivatives, and cryptocurrencies, all of which are forms of credit: rights and promises to future payments in credit or currency. And this is in addition to private credit agreements between individuals and other individuals, and between businesses and individuals, which are extremely common. The commonly stated position among sound money advocates of the Austrian school is that bank credit should be replaced by custodial deposit-taking banks and separate arrangers of finance. But given the broad definition of credit in the real world, eliminating bank credit appears untenable when individuals are free to offer multiple amounts of credit and the vast bulk of credit creation is outside the banking system. Consider the case of a bookie accepting wagers for a horse race. Ahead of the event, he takes on obligations many times the capital in his business, in return for which he is paid in banknotes or drawings on bank credit by his betting customers. When the race is over, he keeps the losers’ stakes and is liable for payments to holders of the winning bets. He has debts to the winners which are only extinguished when the winners collect. While there are differences in procedures and of the risks involved, in principal there is little difference between a bookie’s business and that of a commercial bank; they are both dealers in credit. Arguably, the bookie has the sounder business model. The restriction imposed on an individual providing credit to others is his potential liability if it is called upon. The unfairness in the current system is not that bank credit is permitted, but that is permitted with limited liability. Surely, the solution is to ensure that all providers of credit are responsible for the risks involved. Licenced banks and their shareholders should face unlimited liability. It is even conceivable that listed capital in an overleveraged bank might trade at negative values if shareholders face a risk of unlimited calls on their wealth. That should promote responsibility in bank lending. It will not eliminate the cycle of bank credit expansion and contraction, but it will certainly lessen its disruptive impact. Variations in the purchasing power of a medium of exchange A proper consideration of credit, the all-embracing term for mediums of exchange to include future promises, shows that government statistics for money supply are a diminishingly small part of overall credit in an economy. We must take this fact into account when considering changes in the official quantity of money on the purchasing power of units of the medium of exchange (that is credit in the form of circulating banknotes and commercial bank credit — M1, M2, M3 etc.). A downturn in economic activity must be considered in the broader sense. If, for example, I say to my neighbour that if he arranges it, I will cover half the cost of fencing the boundary between our properties, I have offered him credit upon which he can proceed to contract a fencing supplier and installer. However, if in the interim my circumstances have changed and I cannot deliver on my promise, the credit agreement with my neighbour is withdrawn and the fence might not be installed. A father might promise his son an allowance while he attends university. That is a credit agreement with periodic drawdowns lasting the course. Later, the father might promise help in buying a property for his son to live in. These are promises, whose values are particular and precarious. And they will be valid only so long as they can be afforded. If there is a general change in economic conditions for the worse, it is almost certainly driven more by the withdrawal of unrecorded credit agreements between individuals and small businesses such as corner shops, and not directly due to bank credit contraction. An appreciation of these facts and of changes in human behaviour which cannot be recorded statistically explains much about the lack of correlation between measures of credit (i.e., broad money supply) and prices. The equation of exchange (MV=PQ) does not even capture a decent fraction of the relationship between the quantity of credit in an economy and prices. Our understanding of the wider credit scene goes some way to resolving a mystery that has bedevilled monetary economists ever since David Ricardo first proposed the relationship over two centuries ago. In theory, an increase in the quantity of measurable credit (that is currency in the banking system) leads to a proportionate increase in prices. Even allowing for statistical legerdemain, that is patently not true, as Figure 1 illustrates. Figure 1 shows that over the last sixty years, the broadest measure of US dollar money supply has increased by nearly seventy times, while prices have increased about nine. The equation of exchange explains it by persuading us that each unit of currency circulates less so that the increase in the money quantity somehow leads to less of an effect on prices. This interpretation is consistent with Keynes’s denial of Say’s Law. The Law tells us that we all make profits and/or earn salaries, which in the time-space of a year means we can only spend and save once. That is an unvarying velocity of unity. Instead, the mathematical economists have introduced a variable, V, which simply balances an equation which should not exist. That is not to say that credit expansion does not affect the purchasing power of a currency. Logic corroborates it. But an understanding of the true extent of credit in an economy confirms that the sum of currency and recorded bank credit is just a small part of the story – only one eighth as indicated by the divergence between M3 and consumer prices — all else being equal. It brings us to the other driving force in the credit/price relationship, which is the public acceptability of the currency. Ludwig von Mises, the Austrian economist, who lived through the Austrian inflation in the post-WW1 years and whose advice the Austrian government was reluctant to accept, observed that variations in public confidence in the currency can have a profound effect on its purchasing power. Famously, Mises described a crack-up boom as evidence that the public had finally abandoned all faith in the government’s currency and disposed of all of it in return for goods, needed or not. It leads to the sensible conclusion that irrespective of changes in the circulating quantity, the purchasing power is fully dependent on the public’s faith in the currency. Destroy that, and the currency becomes valueless as a medium of exchange. If confidence is maintained, it follows that the price effects of a currency debasement may be minimised. This brings us to gold coin. If the state backs its currency with sufficient gold which the public is free to obtain on demand from the issuer of the currency, then the currency takes on the characteristics of gold as money. We should not need to justify this established and ancient role for gold, or silver for that matter, to the current generations of Keynesians brainwashed into thinking it’s just old hat. Though they rarely admit it, central bankers fully committed to their fiat currencies still retain gold reserves in the knowledge that they are no one’s liability; that is to say, true money while their currencies are simply credit. Given what we now know about the extent of credit beyond the banking system and the role of public confidence in the currency when it is a credible gold substitute, we can see why a moderate expansion of the currency need not undermine its purchasing power proportionately. While the cycle of bank credit expansion and contraction leads to the boom-and-bust conditions described by Von Mises and Hayek in their Austrian business cycle theory, the effects on prices under a gold standard do not appear to have been enough to destabilise a currency’s purchasing power. Figure 2 illustrates the point. Admittedly there are several factors at work. While the increase in the quantity of currency in circulation was generally restricted by the gold coin standard, the bank credit cycle of expansion and contraction led to periodic bank failures. Then as now, the quantity of bank credit relative to bank notes was eight or ten times, and so long as the note-issuing bank remained at arm’s length from the tribulations of commercial bank credit the overall price effects were contained. Britain abandoned the gold standard in 1914, and just as the abandonment of the silver standard in the 1790s led to an increase in the general price level, a dramatic increase occurred during the First World War. This was due to deficit spending by the state driving up material costs at a time when imported factors of supply were limited by the destruction of merchant shipping. The end of the war restored the supply/demand balance and saw a reduction in military spending. Prices fell and then stabilised. A gold bullion standard at the pre-war rate of exchange was re-established in 1925, only to be abandoned in 1931. The Second World War and subsequent lack of any anchor to the currency led to an inexorable rise in prices before America abandoned the Bretton Woods Agreement in 1971. And since then, the sterling price of gold has risen even further from £14.58 when the Agreement ceased to £1,470 today. Measured in true money the currency has lost over 99% of its purchasing power over the last fifty-one years. Both logic and the empirical evidence point to the same conclusion: price stability can only be achieved under a working gold coin standard, whereby ordinary people can, should they so wish, exchange banknotes for coin on demand. Despite making up most of the circulating medium, fluctuations in bank credit then have less of an effect on prices, for the reasons stated above. Can cryptocurrencies replace gold? The reason gold is relatively stable in purchasing power terms is that through history, above ground stocks have expanded at similar rates to population growth. A very gradual increase in gold’s purchasing power comes from manufacturing, technological, and competitive production factors. In other words, the price stability clearly demonstrated in Figure 2 above between 1820—1914 is evolutionary. Whether cryptocurrencies or central bank digital currencies might have a stabilising role for prices in future is highly contentious. We can readily dismiss yet another version of state-issued currencies as being a worse form of credit than failing fiat currencies. The aim behind them is communistic, to enable the state to allocate credit resources wherever and to whomsoever its political class may desire. It is with the intention of reducing the vagaries of human action on the state’s intended outcome. Just as every replacement currency for failing fiat in the past has failed, if CBDCs are introduced they will fail as well. It is unnecessary to comment further. Cryptocurrencies, particularly bitcoin, are seen by a small minority of enthusiasts as the money of the future, being outside the state’s printing presses. But as observed above, in reality, sound money is augmented by fluctuating quantities of credit in far larger quantities. So long as sound money provides price stability, circulating credit inherits those characteristics. Bitcoin, the leading claimant to being future money, lacks both world-wide acceptance and the flexibility required for long-term stability and therefore economic calculation. Imagine an entrepreneur planning to invest in production, a project which from the drawing-board to final sales takes several years. His nineteenth century forebears had a reasonable idea of final prices, so could calculate costs, sales values, and therefore the interest cost of the capital deployed over the whole project to leave him with a profit. No such certainty exists with bitcoin because final prices cannot be assumed. Furthermore, central banks do not have bitcoin as part of their reserves, and by embarking on plans for their own CBDCs have signalled that they will not have anything to do with it. But in most cases central banks or their government treasury ministries possess gold bullion, which as a last resort they can deploy to stabilise a failing currency. While there will undoubtedly be future benefits from their underlying technologies, it is impossible to see how cryptocurrencies can have a practical role in backing wider credit. Conclusion The evolution of fiat dollars which dates from the abandonment of the Bretton Woods Agreement is coming to an inevitable conclusion: fiat currencies come and go and only gold goes on forever. Whoever wins the financial battle now raging with increasing intensity over commodity prices, the US dollar as the King Rat of fiat currencies is losing its assumed superiority over the renminbi, and possibly the rouble if the Russians can stabilise it. The old-world population backing the dollar is heavily outnumbered by the newly industrialising Eurasia as well as its commodity and raw material suppliers in Africa and South America. Not mentioned in this article is the Federal Reserve Board’s commitment to sacrifice the dollar to support financial values — that ground has been well covered in earlier Goldmoney articles. But it is a repetition of John Law’s policies in 1720 France, now underway to stop the global financial bubble from imploding. And just as the Mississippi Company continued after 1720 when the French livre collapsed entirely that year, we see the same dynamics in play for the entire fiat currency system today. John Law’s policies of credit stimulation for the French economy were remarkably like those of modern Keynesians. This time, the expansion of money supply on a global basis has been on an unprecedented scale, encouraged by the subdued effect on prices measured by government-compiled consumer price indices. Undoubtedly, much of the lack of price inflation is down to statistical method, but from Figure 1 we have seen that over the last sixty years the quantity of currency and credit captured by US dollar M3 has grown about seven and a half times more rapidly than prices. We have concluded that this disparity is partly due to not all credit in the economy being captured in the monetary statistics. Understanding the relationship between money which is only physical gold coin, currency which is bank notes and credit which includes bank credit, shadow bank credit, derivatives, and personal guarantees, is vital to understanding what is required to replace the fiat-currency system. It also explains why a relatively small base of exchangeable gold coin in relation to the overall credit in an economy is sufficient to guarantee price stability. Tyler Durden Sat, 03/19/2022 - 18:30.....»»

Category: dealsSource: nytMar 19th, 2022

LaGuardia Airport"s newest concourse is fully open with a brand-new section for American Airlines, 4 more gates, and a premium lounge— see inside

Developers gave the concourse the feel of a hotel lounge and travelers will also have access to new shops, eateries, and lounges, in the new LaGuardia. Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/Insider LaGuardia Airport and American Airlines are celebrating the opening of the second half of Terminal B's Western Concourse.  Four new gates opened on Thursday along with new retail shops and a 20,000-square-foot American Airlines Admirals Club.  As part of the LaGuardia redevelopment plan, the new Terminal B is replacing the 1960s-era Central Terminal Building.  Christmas has come early for travelers going through LaGuardia Airport.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe latest phase of the renovation and overhaul for the infamous airport made its debut on Thursday with the opening of new gates, retail shops, and lounges in Terminal B.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderTwo concourses in LaGuardia's current flagship terminal are now fully open and the redevelopment as a whole is 90% complete. By 2023, Terminal B will be completely transformed.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderI visited the newly opened LaGuardia terminal and saw how it has turned the infamous airport into one of the best in the USThursday's opening also marked the end of a nearly 60-year era for the Central Terminal Building, from which the final flight departed on Wednesday night. Known for its low ceilings and aging infrastructure, the piers have only served to bring down LaGuardia's reputation in recent years.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderInsider joined representatives from American Airlines and LaGuardia Gateway Partners, the private company tasked with the terminal's redevelopment, on a tour of the newly opened section of the Western Concourse. Here's what travelers can expect.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAmerican Airlines will be the Western Concourse's primary tenant and the airline's passengers, as a result, will be the beneficiaries of Thursday's expansion.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderPassengers bound for the Western Concourse will proceed through the arrivals and departures hall, also known as the headhouse, as they normally would. American's ticket counters remain in their usual positions and going through the Transportation Security Administration's security screening will remain the same.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAnd while en route to the new concourse, travelers will notice that Terminal B's retail area, currently covered in holiday decorations, is being filled out with more and more shops and restaurants.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderIn the mall section, called The Bowery Bay Shops, Minute Suites is the latest addition in which travelers can reserve a private room to rest and relax before a flight. Travelers enrolled in the Priority Pass program can use Minutes Suites through their membership.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderI used a credit perk to dine for nearly free at an airport restaurant and it's my new favorite travel hackEateries in the terminal span from fast-food spots like Wendy's to Texas-style barbecue joints like Hill Country Barbecue Market.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderSit-down restaurants have also opened in the terminal including Mulberry Street, an Italian restaurant from chef Marc Forgione.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderNot all eateries have opened in the terminal even after more than one year since its June 2020 debut. But the hope is that more will open as construction comes to an end and more passengers visit the terminal.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderPassengers bound for the Western Concourse will still have to use a temporary passageway to get to their gates as the pedestrian bridge has still yet to be completed.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderOnce construction on the pedestrian bridge is complete in early 2022, travelers will have a more direct routing to the Western Concourse with a shorter walking distance to boot.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe shell of the bridge is largely complete and sits just behind a temporary wall in the terminal.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderA new restaurant will also be opened along the pedestrian bridge with an outdoor seating area that offers direct views of the Manhattan skyline.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAnd once the passenger bridge is open, aircraft will be able to taxi underneath it just as they can underneath the pedestrian bridge connecting the headhouse with the Eastern Concourse. The additional taxi lane will help prevent the congestion that once plagued Terminal B.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderBut until the bridge is ready, travelers will still have a bit of a walk in order to get to the Western Concourse that actually includes a trip back in time to the old Central Terminal Building.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThis connector that currently bridges the two buildings is one of the old passageways that linked the former Terminal B parking garage with the check-in area. Passengers also walk through a hallway from the Central Terminal Building.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderLaGuardia Gateway Partners estimates that the walking time from the security checkpoint to the Western Concourse is between six and seven minutes. It’s a shorter walk to the Western Concourse than the Eastern Concourse that will be aided by moving walkways.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe difference between the old Concourse D and the newly-opened section of the Western Concourse is immediately clear as the developers have gone from one extreme to another. Incredibly low ceilings in the former terminal have been replaced with 55-foot ceilings in the new one.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderWhile travelers formerly had to fight for space in the old terminal, there's almost too much space in the new one.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderLaGuardia Gateway Partners designed the airport to have the feel of a hotel lounge. And as such, travelers may notice that the sights and sounds of the terminal are not the same as they might expect from other airports.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderConcessionaires have limits on how they play music and terminal announcements are kept to a minimum. Carpeted flooring also keeps noise levels down in the gate area as opposed to the tiled flooring commonly found at other airports.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderEven lighting fixtures have are not the type to be found in a typical airport.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe concourse is very clearly built for arriving and departing passengers rather than connecting passengers as the majority of American's customers are either originating or terminating in New York.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderSignage for arriving passengers guides them towards baggage claim rather than to connecting gates and most of the flight information display screens are located towards the center of the concourse as opposed to in the main gate areas.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAs the first half of the Western Concourse has already opened, businesses have been able to open and are already serving customers. Eateries include Bar Veloce, Beecher's Market Café, Sweetleaf Coffee, and Gotham News while retail stores include The Scoop and InMotion.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe Scoop will use Amazon's "Just Walk Out" technology that replaces cashiers with cameras that detect purchases.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderI visited a brand-new Amazon Go-powered store at Newark Airport and it's clear more airports should adopt the tech as travel returns to normalSome of the shops and eateries in the Western Concourse won't open until the new year with future eateries including the Hunt and Fish Grill and Mi Casa Cantina.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderA new arrival in the terminal that opened along with the new gates is the American Airlines Admirals Club.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderLocated on the second floor of the concourse, American opened the first phase of its 20,000 square foot lounge on Thursday with a capacity for around 130 passengers.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe full lounge will be able to accommodate more than 350 passengers — around 50 more passengers than the former Admirals Club in Concourse D — allowing more of American's flyers to be welcomed in.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe Admirals Club is conveniently located at the bottom of the pedestrian walkway that brings passengers to the Western Concourse and is the last stop before descending down into the gate area. Behind a temporary wall is the escalator bank used to access the pedestrian bridge.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderA team of American customer agents greets customers and processes them into the club. They can also assist with travel itineraries when needed.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderA living room greets passengers as they enter complete with a mix of armchairs and couches.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAmerican used New York City-inspired design elements with darker design accents including black metal and rustic finishes, in line with the terminal's goal to incorporate local flair into the redevelopment.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderBut the colors of the American brand can be found throughout the lounge.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderGlass walls along the edge of the lounge let patrons look down into the concourse while still providing a modicum of privacy.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThere are no COVID-19 pandemic-related capacity restrictions in effect and seats are not blocked off for social distancing, as was the case for most of 2020.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAn informal cafe can be found at the edge of the lounge that's intended to be a temporary placeholder until larger dining areas open in the final phase of the lounge.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAll food in the lounge is self-serve and options consist mostly of snacks including hummus, snack mixes, cheese cubes,Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderPastries and sweets also include Rice Krispie treats, cookies, and marble bread.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderHot options include Italian wedding soup and lounge staff also serve avocado toast and guacamole throughout the day.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe complimentary lounge offering is intended to be small bites while more fulfilling food items can be purchased.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderMenus are accessible via QR codes found throughout the dining area.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderSome alcoholic drinks are complimentary in the lounge and a full bar will open once the second phase is completed in spring 2022. The liquor display found in the Concourse D lounge will be brought into the new section, as well.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderA variety of seating can be found in the cafe area ranging from small tables to private booths.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAnd while there are no seats blocked for social distancing, lounges are already designed to maximize privacy.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderIndividual seats with high walls, for example, are ideal for solo travelers looking to keep their distance and privacy in luxury.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderJetBlue departures are also displayed on flight status boards in the lounge as part of the new Northeast Alliance between JetBlue and American.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderAmerican and JetBlue passengers departing out of the terminal's Eastern Concourse will, however, have to leave some extra time to walk over to the other building.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThursday's debut is just the latest cause for celebration at LaGuardia but the hits will keep on coming. Delta Air Lines will be opening the first phase of its terminal renovation plan in the spring as part of a $3.9 billion project.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderDelta is months away from debuting its new $3.9 billion terminal at New York's LaGuardia Airport with 37 gates and its largest lounge everChase will be building a lounge of its own, the Chase Sapphire Lounge, in partnership with The Club, giving the airport its first lounge that will be open to Priority Pass members and Chase Sapphire Reserve cardholders.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderThe Chase Sapphire Lounge will join the new American Express Centurion Lounge in Terminal B that's open to all Platinum and Centurion cardholders.Touring American Express' new Centurion Lounge at LaGuardia Airport.Thomas Pallini/InsiderAmex just opened its newest lounge inside LaGuardia Airport's brand-new terminal and it's just what the infamous airport neededIn less than a decade, nearly all of LaGuardia's terminals will be entirely new builds. The only remnant of the old LaGuardia will be opposite the airport at the 1930s-era Marine Air Terminal.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderIn 10 years' time, using New York City's two airports will be a radically different experience for air travelers.Touring LaGuardia Airport's new Western Concourse at Terminal B.Thomas Pallini/InsiderRead the original article on Business Insider.....»»

Category: personnelSource: nytDec 18th, 2021

Target Hospitality Delivers Exceptional Third Quarter 2021 Results Driven by Significant Cash Flows and Strengthening Customer Demand Led by Government Contracts

THE WOODLANDS, Texas, Nov. 12, 2021 /PRNewswire/ -- Target Hospitality Corp. ("Target Hospitality", "Target" or the "Company") (NASDAQ:TH), North America's largest provider of vertically-integrated modular accommodations and value-added hospitality services, today reported results for the three months ended September 30, 2021. Financial and Operational Highlights for the Third Quarter 2021 Revenue increased to $89.2 million for the three months ended September 30, 2021, an increase of 85% year-over-year Net income increased to $6.7 million for the three months ended September 30, 2021, an increase of $14.3 million year-over-year Basic and diluted earnings per share of $0.07 for the three months ended September 30, 2021 Adjusted EBITDA(1) of $37.5 million, up 121% year-over-year Strong cash generation with net cash provided by operating activities of $40.0 million and Discretionary Cash Flow ("DCF") (1) of $34.7 million for the three months ended September 30, 2021, representing 39% DCF yield(1) to revenue Improved net leverage ratio by 52% since the beginning of 2021, marking significant progress towards year-end 2021 target net leverage ratio of below 3.0 times Raised full year 2021 financial outlook by 7% for revenue and 9% for Adjusted EBITDA(1), representing a 25% and 42% increase, respectively, from full year 2020 Executing on premier customer diversification with approximately 52% of third quarter 2021 revenue related to committed revenue contracts backed by the United States Government Continued strengthening customer demand for Target's premier modular hospitality solutions, with third quarter utilization of 75% Approximately 73% of 2021 revenue under committed revenue contracts, with approximately 53% of anticipated 2021 revenue related to government services Meaningful financial flexibility with over $155 million in total available liquidity, with zero outstanding borrowings under the Company's $125 million credit facility Executive Commentary "Our impressive third quarter results demonstrate Target's commitment to executing on its strategic objectives.  Target continues to benefit from its unique position as North America's leader in modular accommodation solutions and the scale of its world-class network, which has created a unique and efficient operating platform.  This platform, along with broadening customer demand, has allowed Target to capture margin expansion and generate significant cash flow through 2021," stated Brad Archer, President and Chief Executive Officer. "We have utilized this positive momentum to meaningfully enhance Target's balance sheet, through the significant reduction of outstanding debt, which has resulted in a 52% improvement in Target's net leverage ratio in 2021.  We believe this commitment to prudent capital allocation builds the foundation to continue executing on our strategic growth objectives.  We are committed to pursuing a growth strategy focused on enhancing value through a balanced portfolio of service offerings, which we believe creates the greatest opportunity to accelerate value creation for our shareholders," concluded Mr. Archer. Financial Results Third Quarter Summary Highlights Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s, except ADR and per shareamounts) September 30, 2021 September 30, 2020 (Restated) Revenue $ 89,169 $ 48,263 Net income (loss) $ 6,675 $ (7,603) Income (loss) per share – basic and diluted $ 0.07 $ (0.08) Adjusted EBITDA $ 37,534 $ 17,010 Average daily rate (ADR) $ 76.78 $ 81.28 Average utilized beds 11,087 4,823 Utilization 75 % 36 % Revenue for the three months ended September 30, 2021, was $89.2 million compared to $48.3 million for the same period in 2020. The increase in revenue was primarily driven by the execution of the government services contract, which began March 2021, and continued increasing customer demand in the Company's HFS – South segment. Net income for the three months ended September 30, 2021, was $6.7 million compared to a net loss of $7.6 million for the same period in 2020. Adjusted EBITDA was $37.5 million for the three months ended September 30, 2021, compared to $17.0 million for the same period in 2020. ADR decreased by $4.50 to $76.78 for the three months ended September 30, 2021, compared to the same period in 2020.  The decrease in ADR was primarily driven by lower average ADR in the HFS - South segment, where third quarter 2021 ADR was lower than prior period as a result of committed minimum revenue contracts having materially lower occupancy due to the COVID-19 pandemic.  In instances when actual occupancy is substantially lower than minimum contractual commitments, realized ADR can be materially higher than contractual ADR.  Third quarter 2020 ADR reflects this scenario and creates a higher ADR when compared to a more normal operating environment in third quarter 2021. Average utilized beds increased by 6,264 to 11,087 for the three months ended September 30, 2021, an increase of 130%.  The increase was driven by the government services contract, which began March of 2021, contributing 4,000 fully utilized beds to the Government segment and continued increasing customer demand in the HFS – South segment, which contributed over 2,000 additional utilized beds.     Capital Management The Company had approximately $8.9 million of capital expenditures for the three months ended September 30, 2021, predominately associated with its Government segment and the recently executed government services contract.  As of September 30, 2021, the Company had $30.6 million of cash and cash equivalents and $340 million in gross amount of total debt.  The Company has made significant progress towards strengthening its capital flexibility by reducing outstanding debt by approximately $80 million and improving its net leverage ratio by 52% since the beginning of 2021.  These deliberate actions have resulted in no outstanding borrowings under the Company's $125 million revolving credit facility, with more than $155 million of total available liquidity and a net leverage ratio of 3.1 times as of September 30, 2021.  As a result, the Company has accelerated its year end 2021 total net leverage ratio target to below 3.0 times. Business Update Demand fundamentals have strengthened throughout 2021 and have supported the broadening of customer activity and consistent increases in demand for Target's premium modular hospitality service offerings.  Since year-end 2020, Target has experienced an over 40% increase in customer demand across its Hospitality and Facilities Service segments.  This robust demand has resulted in sequential quarterly expansion of operating margins and utilization throughout 2021. The sustained momentum has allowed Target to execute on its diversification and growth strategy, focused on utilizing existing core competencies to pursue a balanced portfolio of service offerings.  Target has meaningfully advanced its diversification strategy with approximately 52% of third quarter 2021 revenue and approximately 53% of anticipated full year revenue related to its Government services segment. This positive business momentum has resulted in approximately 99% of the Company's anticipated 2021 revenue being under contract with approximately 73% of contracted revenue having minimum revenue commitments.  As the Company previously announced, on November 2, 2021, it has raised 2021 financial outlook to: Full Year 2021 Financial Outlook Total revenue between $280 and $285 million Adjusted EBITDA(1) between $110 and $113 million Interest expense(2) between $33 and $35 million Discretionary Cash Flow(1) between $75 and $80 million Total capital spending between $25 and $30 million, excluding acquisitions Targeting a total net leverage(3) ratio below 3.0x by year end 2021 (2)  Interest expense excludes amortization of deferred financing cost and original issue discount(3)  Total net leverage ratio is defined in the credit facility as consolidated total debt to consolidated EBITDA for the preceding four fiscal quarters Strategic Focus            Target has strategically positioned itself as North America's market leader in premier vertically integrated hospitality solutions by systematically identifying and transitioning its business mix to expand its growth pipeline.  Target has accomplished this strategic growth by intentionally focusing on markets and customers that offer greater long-term growth potential, while optimizing its existing asset fleet and unique capabilities to maximize economic returns.  The scale of Target's modular network and expansive core competencies has created an efficient operating structure, providing substantial revenue visibility from highly contracted revenue with high renewal rates.  These attributes result in a high return on growth capital and significant Discretionary Cash Flow.  Target has experienced a 98% increase in Discretionary Cash Flow from full year 2020, supported by minimum committed revenue contracts from a diversified customer base under multiyear contracts with historical renewal rates exceeding 90%.  This highly attractive financial profile generates best-in-class margins and impressive cash flow conversion, which has allowed Target to systematically execute on its strategic objectives and meaningfully enhance Target's operational flexibility.  This enhanced profile provides the opportunity to reinvest cash flows into complementary growth markets, intended to expand Target's long-term growth pipeline.  Target remains committed to enhancing value through a balanced portfolio of service offerings, focused on a range of adjacent end-markets, while continuing to expand its reach providing critical support to the United States Government.  Target's financial strength, and robust core offerings, creates a platform to continue pursuing these highly economic growth initiatives, which it believes is the greatest opportunity to accelerate value creation.  Segment Results – Third Quarter 2021 GovernmentRefer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s, except ADR) September 30, 2021 September 30, 2020 Revenue $ 46,428 $ 16,264 Adjusted gross profit $ 25,823 $ 13,213 Adjusted gross profit margin 56 % 81 % Average daily rate (ADR) $ 78.10 $ 72.27 Average utilized beds 6,400 2,400 Utilization 100 % 100 % Revenue for the three months ended September 30, 2021, was $46.4 million compared to $16.3 million for the same period in 2020.  Average available beds of 6,400 were fully utilized for the three months ended September 30, 2021, with an ADR of $78.10.  On March 18, 2021, Target executed a $118 million minimum revenue contract, which is fully committed over its initial one-year term.  The contract adds 4,000 available beds, which will be fully utilized over the contract term. Hospitality & Facilities Services - South Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s, except ADR) September 30, 2021 September 30, 2020 Revenue $ 31,066 $ 18,968 Adjusted gross profit $ 13,945 $ 8,606 Adjusted gross profit margin 45 % 45 % Average daily rate (ADR) $ 75.39 $ 89.56 Average utilized beds 4,428 2,277 Utilization 64 % 24 % Revenue for the three months ended September 30, 2021, was $31.1 million compared to $19.0 million for the same period in 2020. Revenue increased as a result of sustained momentum in customer activity and demand for Target's premium hospitality services supported by strengthening commercial activity and economic demand.  ADR decreased by $14.17, to $75.39 compared to the same period in 2020.  Third quarter 2021 ADR was lower than prior period as a result of committed minimum revenue contracts having materially lower occupancy due to the COVID-19 pandemic.  In instances when actual occupancy is substantially lower than minimum contractual commitments, realized ADR can be materially higher than contractual ADR.  Third quarter 2020 ADR reflects this scenario, and creates a higher ADR when compared to a more normal operating environment in third quarter 2021.    Utilization was 64% for the three months ended September 30, 2021, compared to 24% for the same period in 2020.  Target has experienced an 87% increase in customer demand from the third quarter of 2020, as customers find added value in Target's expansive network, which provides superior flexibility in labor allocation while offering world-class service offerings.    Hospitality & Facilities Services - Midwest Refer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s, except ADR) September 30, 2021 September 30, 2020 Revenue $ 1,266 $ 1,154 Adjusted gross profit $ (56) $ 87 Adjusted gross profit margin (4) % 8 % Average daily rate (ADR) $ 68.43 $ 98.11 Average utilized beds 195 127 Utilization 18 % 12 % Revenue for the three months ended September 30, 2021, was $1.3 million compared to $1.2 million for the same period in 2020. The increase was attributable to select communities re-opening in the segment, which had been closed in the prior period, as a result of modest improvement in customer demand. TCPL KeystoneRefer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s) September 30, 2021 September 30, 2020 Revenue $ 9,880 $ 11,598 Adjusted gross profit $ 8,329 $ 2,027 Adjusted gross profit margin 84 % 17 % This segment's operations consist primarily of revenue from the construction phase of the TC Energy Keystone XL Pipeline ("TCPL") project. Revenue for the three months ended September 30, 2021, was $9.9 million compared to $11.6 million for the same period in 2020.  On July 23, 2021, the Company entered into a termination and settlement agreement with TC Energy, which terminated, the Company's contract with TC Energy that was originated in 2013. The agreement released the Company from any outstanding work performance obligations under the 2013 contract (including all change orders, limited notices to proceed, and amendments) and provided for payment of a termination fee of approximately $5 million, which the Company collected in cash on July 27, 2021.  The termination agreement also resulted in the recognition of approximately $4.9 million of deferred revenue.  No further revenue will be generated from the 2013 contract with TC Energy and as of September 30, 2021, there are no unrecognized deferred revenue amounts or costs related to this contract.  All OtherRefer to exhibits to this earnings release for definitions and reconciliations of Non-GAAP financial measures to GAAP financial measures For the Three Months Ended ($ in '000s) September 30, 2021 September 30, 2020 Revenue $ 529 $ 279 Adjusted gross profit $ (139) $ (220) Adjusted gross profit margin (26) % (79) % This segment's operations consist of hospitality services revenue not included in other segments. Revenue for the three months ended September 30, 2021, was $0.5 million compared to $0.3 million for the same period in 2020. Conference Call The Company has scheduled a conference call for November 12, 2021, at 8:00 a.m. Central Time (9:00 am Eastern Time) to discuss the third quarter 2021 results. The conference call will be available by live webcast through the Investors section of Target Hospitality's website at www.TargetHospitality.com or by dialing in as follows: Domestic: 1-888-317-6003 International: 1-412-317-6061 Passcode: 3424376 Please register for the webcast or dial into the conference call approximately 15 minutes prior to the scheduled start time. About Target Hospitality Target Hospitality is North America's largest provider of vertically integrated modular accommodations and value-added hospitality services in the United States. Target builds, owns and operates a customized and growing network of communities for a range of end users through a full suite of value-added solutions including premium food service management, concierge, laundry, logistics, security and recreational facilities services. Cautionary Statement Regarding Forward Looking Statements Certain statements made in this press release (including the financial outlook contained herein) are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "should," "future," "propose" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside our control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the severity and duration of the COVID-19 pandemic, related economic repercussions and the resulting negative impact to global economic demand; operational challenges relating to the COVID-19 pandemic and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees and customers, vaccine mandates, contract and supply chain disruptions; operational, economic, political and regulatory risks; federal government budgeting and appropriations; our ability to effectively compete in the specialty rental accommodations and hospitality services industry; effective management of our communities; natural disasters, including pandemics and other business disruptions; the effect of changes in state building codes on marketing our buildings; changes in ...Full story available on Benzinga.com.....»»

Category: earningsSource: benzingaNov 12th, 2021

University of Hawaii regents OK $30M expansion of Ching Athletics Complex

The project would increase the seating at the complex from 9,300 to 17,000 seats, and relocate the UH women's track......»»

Category: topSource: bizjournals1 hr. 10 min. ago

Here"s Why You Should Hold on to Catalent (CTLT) Stock Now

Catalent's (CTLT) robust facility expansion activities and a slew of strategic deals raise optimism about the stock. Catalent, Inc. CTLT is well-poised for growth in the coming quarters, backed by its robust facility-expansion activities over the past few months. A robust third-quarter fiscal 2022 performance, along with a slew of strategic deals over the past few months, is expected to contribute further. Catalent’s operation in a competitive landscape and regulatory requirements pose threats.Over the past year, this Zacks Rank #3 (Hold) stock has lost 13.9% compared with a 24.6% fall of the industry and 4.6% decline of the S&P 500.This renowned global provider of advanced delivery technologies has a market capitalization of $19.05 billion. Catalent projects 16.5% growth for the next five years and expects to maintain its strong performance. It has delivered an earnings surprise of 9.2% for the past four quarters, on average.Image Source: Zacks Investment ResearchLet’s delve deeper.Expansionary Activities: We are upbeat about Catalent’s robust expansionary activities, like opening a slew of facilities over the past few months. In June, the company announced that it had expanded its primary packaging capabilities at its clinical supply facility in Shiga, Japan. The company has installed a high-speed blister packaging line to augment its existing automated bottling line.In May, Catalent announced that it commenced a $175-million project to expand its flagship U.S. manufacturing facility for large-scale oral dose forms in Winchester, KY.Strategic Deals: We are optimistic about Catalent’s robust growth opportunities via its recent tie-ups and buyouts. This month, the company reached an agreement to acquire Metrics Contract Services (a full-service specialty Contract Development and Manufacturing Organization) with a facility in Greenville, NC from Mayne Pharma Group Limited.In June, Catalent entered into a development agreement with MigVax to leverage its proprietary Zydis Bio orally disintegrating tablet technology for delivering the MigVax-101 vaccine.Strong Q3 Results: Catalent’s solid third-quarter fiscal 2022 results, along with the year-over-year uptick in the top and bottom lines, buoy optimism. Continued strength in its Biologics arm in the quarter under review looks encouraging. Robust performances by the Clinical Supply Services, and the Softgel and Oral Technologies segments also raise optimism. A raised financial outlook for the year heightens our positivity regarding the stock.DownsidesRegulatory Requirements: The healthcare industry is highly regulated, wherein Catalent and its customers are subject to various local, state, federal, national and transnational laws and regulations. Any future change to such laws and regulations could affect the company. Failure by Catalent or its customers to comply with the requirements of these regulatory authorities could result in warning letters, among others.Stiff Competition: Catalent operates in a highly competitive market, wherein it competes with multiple companies, including those offering advanced delivery technologies and outsourced dose form or biologics manufacturing. The company also competes in some cases with the internal operations of those pharmaceutical, biotechnology and consumer health customers that also have manufacturing capabilities and choose to source these services internally.Estimate TrendCatalent is witnessing a flat estimate revision trend for 2022. In the past 90 days, the Zacks Consensus Estimate for its earnings has remained unchanged from $3.79.The Zacks Consensus Estimate for the company’s fourth-quarter fiscal 2022 revenues is pegged at $1.33 billion, suggesting a 12.1% improvement from the year-ago quarter’s reported number.Key PicksSome better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. AMN, Patterson Companies, Inc. PDCO and McKesson Corporation MCK.AMN Healthcare, flaunting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 3.2%. AMN’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 15.7%.You can see the complete list of today’s Zacks #1 Rank stocks here.AMN Healthcare has lost 2.6% compared with the industry’s 29.9% fall in the past year.Patterson Companies, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 7.9%. PDCO’s earnings surpassed estimates in all the trailing four quarters, the average beat being 16.5%.Patterson Companies has gained 0.8% against the industry’s 6.7% fall over the past year.McKesson, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 9.9%. MCK’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average beat being 13%.McKesson has gained 83.9% against the industry’s 6.7% fall over the past year. How to Profit from the Hot Electric Vehicle Industry Global electric car sales in 2021 more than doubled their 2020 numbers. And today, the electric vehicle (EV) technology and very nature of the business is changing quickly. The next push for future technologies is happening now and investors who get in early could see exceptional profits. See Zacks' Top Stocks to Profit from the EV Revolution >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report McKesson Corporation (MCK): Free Stock Analysis Report Patterson Companies, Inc. (PDCO): Free Stock Analysis Report AMN Healthcare Services Inc (AMN): Free Stock Analysis Report Catalent, Inc. (CTLT): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacks9 hr. 58 min. ago

Is The Ethereum Merge Priced In?

Is The Ethereum Merge Priced In? By Hal Press, founder of North Rock Digital, first published in Bankless What’s Up With The Merge? As we approach the Merge, we wanted to provide a write-up on how we are thinking about the Ethereum ecosystem and specifically Merge-related investments. This is meant as a follow-up to the prior article we wrote on Ethereum, which can be found here.  Since I published the original article in January much has transpired, some assumptions have changed and the outlook for the future has been altered. Despite this, the core thesis remains, Ethereum is set to undergo the largest structural shift in the history of crypto. Back in January, the path to the Merge was extremely uncertain. Now, that path has crystalized. The final testnet, Goerli, was recently completed successfully and a Mainnet target date has been set for Sep 15/16.  So where do we stand? The Biggest Structural Shift in Crypto History Regarding the Merge the thesis has not changed, Ethereum is set to undergo a massive structural shift as expenses will effectively be reduced to zero. The shift will give rise to the first large-scale structural demand asset in crypto history. As we have stated in our core thesis many times, this paper will address what has changed and new topics not discussed in the prior article. First, it is useful to highlight aspects of the core Ethereum model to get a sense of some of the key fundamentals such as supply reduction and the post-Merge staking rate.  The largest shift since last December is that ETH-denominated fees have fallen significantly. However, there is an interesting dynamic at play here. Although fees have declined, active users have experienced a steady uptrend since late June.  This may seem inconsistent as more users should lead to higher gas. However, we believe this dynamic is caused by recent efficiency optimizations of various popular Ethereum applications. The best and most significant example is Opensea, which in migrating Seaport (from Wyvern) increased gas efficiency by 35%. This has led to a reduction in gas that doesn’t correlate to a decline in activity.  In fact, multiple indicators suggest that despite the low gas readings activity has been increasing recently (more on the specifics here later). This raises an interesting question: what is the optimal fee run rate for Ethereum? Higher fees mean more ETH is burned and post-Merge also correlates to a higher staking rate, but these higher fees also limit adoption.  As we saw in ’21, when fees are too high, some users get pushed to other L1 ecosystems. After roll-ups scale appropriately, Ethereum should be able to achieve both high fees and continued adoption. In the current environment though, it is interesting to think about the optimal mix. We believe the optimal point is approximately the point at which fees are high enough to burn all new issuance. This will enable ETH supply to be stable while also keeping fees low enough not to inhibit adoption. Interestingly, of late, fees have found an equilibrium near this point. Lower fees also seem to be having a positive impact on adoption as active users have begun to increase after a long downtrend.  Despite the fact that we seem to be near an optimal fee run rate, the reduced fees do negatively impact various model outputs. This impact is not critical as at the current run rate the burn would still be still large enough for ETH to be slightly deflationary post-Merge. Importantly, the current run rate would continue to drive structural demand as the majority of issuance is unlikely to be sold, while fees that are used must be purchased off the open market.  The staking rate will increase post-Merge by ~100 bps from 4.2% to 5.2%. However, this does not properly illustrate the true impact. To fully appreciate the shift, we must evaluate the real yield rather than the nominal yield. While the current nominal yield is ~4.2%, the real yield is close to zero, as 4.4% of new ETH is issued every year. In this context, the real yield is currently ~0% but will increase to ~5% post-Merge. This is an enormous shift and will create the highest real yield in crypto by a large margin. The only other comparable yield is BNB with a 1% real yield. ETH’s 5% yield will be a market-leading figure. What is the significance of this yield? Stakers will receive a net ~5% rate, which equates to 100/5= ~20x earnings. This multiple is considerably cheaper than the revenue multiple because the staking participation rate is quite low, meaning stakers receive an outsized share of total rewards. This is one of the key advantages of ETH from an investment standpoint.  As there are so many other uses for ETH, throughout the crypto ecosystem, most ETH ends up locked in those applications rather than staked. This in turn allows stakers to receive an outsized real yield.  In terms of the flows, ETH will transition from enduring structural outflows of ~$18mm/day to structural inflows of ~$0.3mm/day. While the demand side of the flow equation has softened, the complete reduction of the supply side remains the most important variable. Our estimate for the ETH-denominated supply reduction is actually larger than it was previously. This is due to the fact that the price declines from the highs have not been accompanied by a corresponding hash rate reduction. As a result, miner profitability has decreased dramatically, and they are likely selling close to 100% of mined ETH. For calculation’s sake, I have assumed 80% of miner issuance is being sold. In this context, ETH has found an equilibrium in which miners sell roughly 10.8k ETH ($18mm USD) per day. Given that fees have been averaging ~$2mm this yields a net outflow of ~$16mm. Post Merge this sell pressure will reduce to zero, and it is projected that there will be a structural inflow of ~$0.3mm/day post-Merge.  To conclude, while many of the numbers have shifted meaningfully in the last eight months, the conclusion remains roughly the same, ETH will shift from requiring ~$18mm of new money entering the asset to keep the price from declining to requiring ~$0.3mm exiting to keep the price from increasing.  To summarize, the staking rate and structural demand are lower than they were 6 months ago. However, this is to be expected in a period of slower activity, and if activity continues to rebound these rates will increase. The primary investment case remains the same, there is an enormous opportunity to front-run the largest structural shift in the history of crypto.  Another point that I think is often overlooked here is that the Merge is more than a shift in supply and demand. It is also a massive fundamental upgrade for Ethereum as the network becomes much more efficient and secure in many ways. This is part of what differentiates the Merge from prior BTC halvings.  It is 3x as large of a supply reduction combined with a massive improvement in fundamentals compared to a decline in fundamentals in the case of BTC halvings (reduced security).  Finally, there are two additional dynamics worth discussing. 1. Time Harvesting Before addressing how this relates to ETH it is important to lay some contextual groundwork.  Why is it that the SPX (or virtually any US/Global equity index) has been such a profitable and consistent investment vehicle over the long term? Most people think this dynamic has been driven almost entirely by earnings growth and multiple expansion. They would posit that if growth slows or the multiple stops expanding these investments would be unlikely to have positive returns going forward. This is incorrect.  The primary and most reliable source of growth for the price of these indices has been the passage of time.  Here is an example to illustrate this somewhat unintuitive point. A lemonade stand, LEMON (LEMON = The Enterprise, $LEMON = LEMON shares), earns $1 each year. There are 10 shares of $LEMON outstanding. LEMON has no cash or debt on its balance sheet. The market currently values $1 of ex-growth equity earnings at a 10x multiple. What is LEMON worth today? What about each share of $LEMON?  If we assume that next year LEMON will continue to earn $1 annually while the market applies the same multiple, what will LEMON/$LEMON be worth in a year? Take a minute and come to an answer.  If you answered $10/$1 for the first pair of questions you are correct. If you answered $10/$1 for the second pair, you are not. For part 1, LEMON is worth $10 as the market applies a 10x multiple to its $1 of earnings and assigns 0 value to its balance sheet. For part 2, the market continues to apply a 10x multiple to the $1 of earnings, but importantly, it also assigns $1 to the $1 of cash that now sits on LEMON’s balance sheet. LEMON is now worth $11 and each share is worth $1.10. When companies earn money, the money doesn’t disappear, it flows to the company’s balance sheet and the value of it accrues to the owners of the business (the equity holders). $LEMON has appreciated 10% in a year due to the earnings they have generated, despite 0 growth and 0 multiple expansion.  This is the power of earnings yield paired with the passage of time.  Crypto hasn’t benefited from this dynamic at all. In fact, crypto actually suffers from the reverse effect. Since almost all crypto projects’ expenses are greater than their revenues, they must dilute their holders to generate the funds necessary to cover their negative net income. As a result, unless earnings grow or their multiple expands, the price of each individual token will decline. The most notable exception I can think of is BNB, which is the sole current L1 to generate more revenue than expenses. It is no surprise the chart of BNB/BTC is essentially up only and recently broke an ATH. ETH will enter this exclusive class the moment it transitions to PoS. Post-merge ETH will generate a real yield of approximately 5%. This yield will be very different from virtually every other (non-BNB) L1 where the staking yield simply comes from inflation that offsets the yield. All else equal ETH holders will earn 5% each year. Time will become a tailwind rather than the headwind it is for 99.9% of other projects.  This will also change the psychology of holders and incentivize a stronger long-term buy and hold approach, effectively locking up more illiquid supply. Additionally, the “real yield” thesis and the fact that ETH will be the first large-scale real yield crypto asset will be particularly appealing to many institutions and should help accelerate institutional adoption. 2. The Wall of Worry Throughout the last few months, investors have been extremely skeptical about technical risks, edge cases, and timing risks.  The latest edge case that has generated attention is the potential for PoW forks of Ethereum that live on after the Merge. Some PoW maximalists (miners etc.) would prefer to use PoW ETH and think that a forked version of the current ETH is superior to ETC, which already exists as a PoW alternative. We do not believe there is much value in the fork, but our opinion on this matter is not particularly relevant.  The important point is that this fork will have no impact on post-Merge PoS ETH. All of the potential risks are either easily managed or not risks in the first place. For example, replay attacks will most probably not be an issue as the PoW chain is unlikely to use the same chain ID. Furthermore, even if they maliciously choose to use the same chain ID, this can be managed by either not interacting with the PoW chain or first sending the assets to a splitter contract.  Finally, even if a user does get replay attacked, it will only impact that individual user’s assets and not the overall health of the chain. What the PoW fork does do is provide a dividend to ETH holders, further adding to the value of the Merge. If the fork has any value, ETH holders will be able to send it to an exchange and sell it for additional capital, much of which will then be recycled back into PoS ETH. While we view this as a positive for the Merge-related investment case, many are worried about the potential risks and a litany of other edge cases. We have weighed each risk and concluded the upside far outweighs the downside.  Nonetheless, these concerns are keeping many long-term believers sidelined.  As we approach the Merge many of these issues will be addressed. Eventually, many of these skeptics will be converted, creating fueling continued inflows as we approach the event and culminating with a large set of buyers who will purchase ETH the day the Merge occurs successfully. This should help offset any “sell the news” dynamic.  Just last month, less than 1/3 of people thought the Merge would occur before October. Now the date has been confirmed for mid-September and still, the market is only pricing in two-thirds chance of it occurring before October. Given this backdrop how should we expect prices to move as we approach the Merge? This is the central question. First, we acknowledge the reality that macro will continue to have a large impact on absolute price levels despite the Merge. However, it is still reasonable to think through how Merge related alpha will evolve over the coming weeks. In our opinion, the path gets harder to predict the further out you look but then at some point when you’ve gone far enough it starts to become easier again. Short-Term Despite the narrative that has already been building around the Merge, positioning is still quite light within the more discretionary pockets of the market. Perpetual funding has remained negative for most of the rally since June, indicating that there are more shorts than longs in the perp market. Recently, Bitfinex longs, another notable discretionary pocket of ETH exposure, were reduced back to the lows. IMO, this light positioning is likely due to many larger participants viewing this move as a “bear market rally” and therefore wanting to put hedges on as we have continued higher. Historically, there is a large contingent of investors, who lean in the direction of BTC maximalism and will always look to fade the Merge narrative. Their theses primarily revolve around one of two central points.  The first is: “the Merge has been 6 months away for 6 years.” The second concern is around technical/execution risk. After evaluating the timing and execution risk, we have become comfortable with both. After the final testnet, Goerli, was successfully Merged earlier this week, the core developers set a target for the Mainnet Merge for September 15/16. All that remains is coordination. While many are concerned about the execution risk, the upgrade has been tested extremely rigorously over the years and cross-checked by many teams. Furthermore, one of the core pillars of Ethereum is resilience. This is the reason there are so many different clients–the redundancy acts as a safety net to protect against singular edge cases or bugs. Multiple, usually well over two, unrelated fluke events occurring simultaneously would be required to affect the protocol. This built-in resilience, the most accomplished developer team in the space, and many years of preparation have given us comfort that a technical issue, though a risk, is unlikely.  Given the cautious positioning and constant desire to “fade” the trade, I expect the next four weeks to follow a similar path as the prior four. There will be periods of pronounced fear as people overanalyze extremely unlikely edge cases. However, I expect the price declines around these periods to be shallow as there are many underexposed parties looking to add exposure on any weakness. Furthermore, almost everyone selling ETH over these next few weeks is only selling it tactically and planning to buy it back at some point before, or immediately after the Merge occurs.  This dynamic means net outflows are measured. On the flip side, I expect the hype around the Merge to magnify significantly as the date comes into focus and the narrative is picked up by the mainstream media. As I believe the thesis is extremely compelling and digestible by both institutional and retail capital, I expect inflows to accelerate as we approach the Merge creating a higher high, higher low dynamic as we approach the date.  What happens once the Merge actually occurs? Normally, you would think there would be risk of a “sell the news” reaction; many investors concerned about technical risk, plan to buy post-Merge. They believe they will capture the structural effect of the Merge without the technical risks. The post-Merge period will also depend on how much FOMO is generated as we approach the Merge and positioning when we actually get there.  We do expect significant buy flows and follow-through directly after the Merge as it is effectively “de-risked.” Medium-Term We expect a period of range trading as short-term traders sell, and this sell flow will be digested by the structural demand and larger slower moving institutional accounts. Price action in this period is less predictable and depends on the macro environment. As I have said previously, macro is incredibly hard to predict, but I will offer a few thoughts, nonetheless.  The crypto macro environment is driven by one core metric: whether adoption is growing, stable, or declining. This metric is somewhat impacted by the broader macro environment, but ultimately what matters most is this adoption metric. The reason this metric affects prices is because adoption also drives the long-term flow of funds into or out of the space. Simply put, when users are adopting crypto, they are generally also investing new money into the crypto ecosystem, and this is what drives the macro. When adoption is declining macro is hostile, when it is flat, macro is neutral and when it is growing, macro is accommodating. So how does the macro look today?  For the majority of the last 8-9 months, we have been in a declining adoption environment with a net outflow of users departing the ecosystem.   From May ’21 until the end of June daily active users have experienced a declining trend. Over the last ~6 weeks, we have seen a nascent recovery as users have steadily been increasing. This is a green shoot and indicates a potential thawing of the macro environment. We had been in a declining adoption phase, and we have now, at least, entered a stable adoption phase and potentially an increasing adoption phase. There are other green shoots that have been sprouting recently as well. After many weeks of redemptions, Tether has started to slowly mint new coins. After a long period of outflows, new money has started to enter the space again.  This impact is not unique to the Ethereum ecosystem, AVAX has also recently seen daily active users increase. NFT users and transactions have been stable recently. And certain web searches have started to positively inflect, while others are more stable. These are not dramatic increases, nothing like the exponential increases we saw at the start of the ’21 bull market. This is why I label them green shoots. They are still young and fragile. If they are smothered, they will likely wither and die, but if nurtured they could grow into something material.  We think the broader macro environment will play a key role in determining whether these green shoots live or die. To us, inflation is by far the most important macroeconomic variable; therefore, we believe that if inflation moderates and allows the fed to pivot and ease monetary policy there is a good chance these green shoots will grow stronger. However, if inflation remains high and the fed is forced to continue tightening policy they will likely be smothered and die. Predicting the course of inflation is not our primary domain, however, due to its significance in markets today, we studied it closely. After review, we feel moderating inflation is the most likely outcome, which should give these green shoots a chance to blossom.  Another advantage, in favor of a more sustained bottom, is the fact that an enormous amount of vesting from project launches in the last 24 months has now been absorbed. Furthermore, as most of the projects are down 70-95%, the USD notional size of all future vesting is also vastly reduced. Together, these two dynamics help meaningfully reduce the overall daily supply the space must absorb.   Lastly, the final variable that we think will impact this equation is none other than the Merge. Investors underestimate the impact the Merge will have on the macro environment of the entire space. There is some uncertainty about how much the supply reduction caused by prior BTC halvings has fueled the ensuing price action rather than coincidentally aligning with the natural cycles of human emotion and monetary policy.  We sympathize with these uncertainties and think there has been an element of luck in the timing. However, we think the supply reductions also had an impact and the truth likely lies somewhere in the middle. Another common criticism is that supply changes don’t drive price and all that matters are demand changes. We are not in accord with this thinking. A supply reduction is not different than a demand addition. Let’s say miners sell 10k ETH/day, and instead of getting rid of this sell pressure we simply add 10k ETH/day of buy pressure. This would have the exact same impact as eliminating the miners’ sell pressure but would be a demand change rather than a supply change. It is obvious these two options would have the same impact and it, therefore, makes no sense to us why one would matter more than another.  If we then believe that BTC halvings have impacted crypto’s macro, then it stands to reason that the Merge should do the same. While ETH dominance is significantly lower than BTC dominance at the time of the last halving, the impact from the Merge is nearly as large as the prior BTC halving as a % of total crypto market cap and significantly larger on an absolute basis.  Post-Merge crypto will be relieved of ~$16mm of daily supply. This is not an insignificant amount. To recognize this, it is useful to consider the cumulative impact. We think a TWAP of 70k ETH per week would have a market impact. That is effectively the impact the Merge will have except it doesn’t stop after a year; it continues into perpetuity. This has the potential to positively influence the entire space as the positive flow impact trickles into other parts of the market. This should provide an added macro tailwind to help nurture the green shoots we referenced earlier and increases their odds of survival. To conclude, if macro moderates at all, there is a real chance that what began as a bounce off of a capitulation bottom morphs into a more sustainable and organic recovery and the Merge should help aid this process. Long-Term In the long-term, the future becomes easier to predict, as structural flows are most important over this time horizon and easier to forecast. This is where the Merge’s impact is most pronounced. As long as Ethereum’s network adoption continues, which we deem likely, structural demand will remain and further inflows will also exist. This should result in sustainable and consistent appreciation, especially compared to other tokens, over many years (hopefully decades) to come. We expect Ethereum to surpass Bitcoin as the largest cryptocurrency within the next few years as we believe flows are the most important variable in crypto. Ethereum will forever have a flow tailwind post-Merge. Bitcoin will forever have a flow headwind. To get a sense for how things may look, the BNB/BTC chart is a good place to start.  BNB/BTC has steadily increased and made multiple new ATHs during this bear market despite little narrative momentum. We believe this is primarily due to the fact that BNB is the only L1 with structural demand. Post-Merge Ethereum will have greater structural demand than BNB both on an absolute and market cap weighted basis. Investment Strategies to Win the Merge 1. ETH/BTC Before evaluating the ETH/BTC trade it is necessary to provide some more general context on the PoW vs PoS debate. Much of the following is paraphrased from the appendix of the first article but it is worth reiterating. We believe PoS is a fundamentally more secure system for a variety of reasons. Firstly, each unit of security costs less with PoS. To understand why PoS provides more efficient security than PoW we first need to explore how these consensus mechanisms generate security in the first place. A consensus mechanism is as secure as the cost to 51% attack it. The efficiency of the system can then be measured by the cost (issuance) required to generate a unit amount of security.  In other words, how many dollars the network has to pay out to receive $1 of protection from a 51% attack. For PoW, the cost of a 51% attack is primarily the hardware required to obtain 51% of the hash rate. The relevant metric is how much money miners require to invest $1 in mining hardware. The math tends to work out close to 1 to 1 meaning miners require 100% annual rate of return on their investment or in other words $1 of annual issuance for each $1 they spend on hardware and utilities. In this context, the network needs to issue roughly $1 of supply each year to generate $1 of security. In the case of PoS, stakers are not required to purchase hardware, so the question becomes what return do stakers demand to lock up their stake in the PoS consensus mechanism? In general, stakers require a significantly lower rate of return than the 100% miners typically demand. The primary reason for this is that there is no incremental cost outlay and their assets do not depreciate (mining hardware typically depreciates close to 0 after a few years). The required rate should generally fall in the 3-10% range. As we calculated earlier, the current estimated post-Merge staking rate of 5% falls right in the middle of this range. This means that to gain $1 of security a PoS needs to issue $0.03-$0.10 of issuance. This is 10x-33x more efficient than PoW (20x more in the case of Ethereum’s PoS).  To conclude, this means that a PoS network can issue ~1/20th the issuance of a PoW network and be just as secure. In the case of ETH, they will actually issue about 1/10th of the issuance and the network will be twice as secure as it was during PoW. This efficiency is not the only advantage. Both consensus mechanisms share a common issue, which is that the security of the chain is correlated to the price of the token. This has the potential to create a self-reinforcing negative feedback loop whereby the reduction in token price causes a reduction in security, which therefore causes a decrease in confidence and drives a further decrease in token price and then repeats. PoS has a natural defense against this dynamic, PoW doesn’t. The attack vector for PoS is much more secure than PoW. First, to attack a PoS system you must control a majority of the stake. To do this you must purchase at least as many tokens as are staked from the market. However, not all tokens are available for sale. In fact, much of the supply is never traded and is effectively illiquid. Furthermore, and most importantly, with each token acquired the next token becomes harder and more expensive to acquire.  In the case of Ethereum, only ~1/3 of tokens are liquid (moved in the last 90 days). This means that once a steady state staking participation rate of closer to 30% has been reached it will be extremely difficult no matter the amount of money possessed, to attack the network. An attacker would need to purchase the entire liquid supply, which is impractical and nearly impossible. Another important feature of this defense mechanism is that it is relatively unaffected by price. Because the limiting factor to attack is liquid supply rather than money it does not get much easier to attack the network with lower prices. If there is not enough liquid supply (measured as a % of total tokens) to purchase, it doesn’t matter how cheap each token becomes because the limiting factor is not price. This price-insensitive defense mechanism is incredibly important to deter the potential negative feedback loop that declining prices could otherwise create. In the case of PoW, in addition to being 20x less efficient, there is no such defense mechanism. Each hardware unit may be marginally harder to acquire than the next, but there is no direct relationship, and if there is a correlation that does exist, it is weak at best. Importantly, it also becomes significantly easier to attack at lower prices as the number of hardware units required decreases linearly with price and the supply of hardware units does not change. It is not reflexive in the manner the PoS liquid supply defense is.  Other advantages of PoS such as better energy efficiency and better healing mechanisms are articulated clearly elsewhere, therefore we will not focus on them in this piece.  Another misconception about PoS is that it drives centralization by rewarding large stakers more than small stakers. We believe this to be incorrect. While large stakers receive more staking rewards than smaller stakers, this does not drive centralization. Centralization is the process by which large stakeholders increase their percentage of the stake over time. This is not what occurs in the PoS system. As large stakers have a larger stake to begin with, the larger rewards do not increase their percentage of the pool. For example, if 10 ETH is staked between two counterparties, Counterparty X has 9 ETH and counterparty Z has 1 ETH. X controls 90% of the stake. A year later X will have received 0.45 ETH and Z will have received .05 ETH. X has received 9 times the amount of rewards as Z. However, X still controls 90% of the stake and Z still controls 10%. The proportions have not been altered and therefore no centralization has occurred.  These inherent differences impact the debate around ETH/BTC. Most consider ETH a totally different asset to BTC as they do think is designed to be a decentralized SoV (replace gold), while BTC is. We believe in many important ways Ethereum is better suited to be a long-term SoV than Bitcoin. Before we compare the two, it is first necessary to evaluate Bitcoin’s current security model and how it may evolve over time. As discussed earlier, a system’s security is derived from the cost of a 51% attack. As a PoW network, this cost is determined by the amount of money it would take to purchase enough hardware rigs and other equipment/electricity necessary to control 51% of the hash power. This is roughly equivalent to the cost necessary to recreate the current mining hash rate that exists on the network. In an efficient market (mostly an accurate assumption over the medium/long term), the total hash rate is a product of the value of the issuance that miners receive. Bitcoin is as secure as the value of its issuance. As discussed earlier, this security is both inefficient and importantly lacks the reflexive defense of a PoS system. What happens when Bitcoin halves its issuance every four years? The system fundamentally becomes 50% less secure assuming all other variables are held constant. Historically, this has not been a large problem as the value of the issuance (and therefore the security) is a function of two variables: the number of tokens issued and the value of each token. As the price of the tokens has more than doubled around every halving cycle, this has more than compensated for the issuance reduction on an absolute basis. The absolute security of the network has increased through each cycle despite the number of tokens being issued halving. However, this is not a sustainable dynamic long-term for multiple reasons. First, it is not realistic to expect the value of each token to continue to more than double with each cycle. An exponential price increase is mathematically impossible to sustain over long periods of time. To illustrate this point, if BTC price doubled every halving cycle it would exceed global M2 after ~7 more halving cycles. Eventually, BTC price will stop increasing at this rate; when it does each halving cycle will drastically cut into its security. If the BTC price declines around the halving cycle, the security reduction will be even more significant and could trigger the negative feedback loop referred to earlier. This security system is fundamentally unsustainable so long as prices are capped, which they are. The only way to counter this issue is to generate meaningful fee revenue. This fee revenue could then replace some of the issuance and continue providing an incentive for miners and therefore provide security even after issuance is reduced. The issue for Bitcoin is that fee revenue has been negligible, and also declining, over a long period of time. In our opinion, the only practical way to generate security over the long term is through significant fee revenue. Therefore, to function as a sustainable SoV a system must generate fees. The alternative is tail emissions, which guarantees inflation compromising the SoV utility. Long-term security represents the most important property of an SoV. For example, gold has captured the majority of the SoV market for so long as nearly all market participants are confident that it will remain legitimate long into the future. For a crypto asset to become an adopted and successful SoV, it too must convince the market that it is extremely secure and that its legitimacy is guaranteed. This can only be possible if the protocol’s security budget is sustainable for the long term, inherently favoring a PoS system that has a large and durable fee pool. We believe the most likely candidate for this system is ETH. It is one of only two L1s with a significant fee pool. The other, BNB, is extremely centralized.  Credible neutrality is the second critically important characteristic of a successful SoV. Gold has no allegiance or reliance on anything. This independence creates its success as an SoV. For another asset to be widely adopted as an SoV it must also be credibly neutral. For a cryptocurrency credible neutrality is accomplished through decentralization. Today, the most decentralized cryptocurrency is undoubtedly Bitcoin. This is primarily because Bitcoin has very little development effort, and the protocol is mainly ossified, but nonetheless, the fact remains that it is by far the most decentralized protocol today. If you tried to kill Bitcoin today, it would be extremely hard. If you tried to kill ETH today, it would still be extremely hard, but likely easier than BTC.  However, we believe it is more important to look at the end state than the current state so long as there is a realistic path to achieve this end state. Ethereum has a clear roadmap ahead of it. We believe that while we are currently only in the middle of this roadmap, eventually (I’d estimate ~8-12 years) this roadmap will be complete, and the significance of the core developer team will fade. At this point, ETH will have a compelling case that it is more decentralized than BTC in addition to possessing far superior long-term security.  Contrary to popular belief, PoS naturally promotes decentralization more than PoW. Larger PoW miners receive a clear benefit from economies of scale, which drives centralization. Scale is much less relevant for PoS as the cost of setting up a node is vastly lower than a PoW rig and there is no real benefit to large-scale electricity as the electricity required for PoS is 99%+ lower. The economy of scale is a large factor for PoW but is not for PoS. 400,000 unique ETH validators exist today and the top 5 holders only control 2.33% of the stake (excluding smart contract deposit). This level of decentralization and diversity separates ETH from all other PoS L1s. Furthermore, this compares to BTC favorably as the top 5 mining pools today control 70% of the hashrate. While some critics will point out that liquid staking providers control an overwhelming portion of Ethereum’s stake, we believe these concerns are overblown. Additionally, we expect these concerns to be addressed by the liquid staking protocols and expect additional checks to be put in place to further protect against these concerns.  In summary, PoS is a fundamentally better consensus mechanism for a crypto SoV. This is the reason the Merge will represent a major milestone on Ethereum’s roadmap, marking a critical juncture in its journey to become the most appealing cryptographic SoV. The fundamental reasons discussed above are the reason we favor the ETH/BTC trade long-term and specifically around the Merge. However, flows, and specifically structural flows, are most important in determining price. It is the structural shift in flows that the Merge triggers that makes this trade so appealing and why the Merge is such a large catalyst for it. Historically, the structural flow for both BTC and ETH have been quite similar. Although ETH has had a smaller market cap its issuance has been ~3x larger on a market cap weighted basis. This larger issuance has made it extremely difficult for ETH to ever surpass Bitcoin in market cap as it would require ETH to absorb 3x the daily USD denominated supply. An interesting exercise is to think about the chart above and what the inputs are as clearly there has been a strong relationship (stronger than normal correlation would imply). The charted values are a product of tokens issued and token price. What happens if you reduce the tokens issued variable but want to retain the relationship? You must increase token price. So what should we expect to happen when we reduce the token issued variable for Ethereum by 90%? This is not to say that price should 10x to offset this reduction as the impacts are not necessarily linear, but the relationships are worth considering.  To conclude, post-Merge the passage of time will forever be a flow tailwind for Ethereum while for Bitcoin it will always be a headwind. Ultimately, this straightforward reality is what we believe will be the primary driver of the eventual flippening. 2. Staking Derivatives As Ethereum is such a large ecosystem many other areas will be tangentially affected by the Merge. As an investor, it is often interesting (and profitable) to consider the second and third-order effects of certain catalysts to search for opportunities that may be inefficiently priced in the market. Regarding the Merge, there are many options such as L2s, DeFi, and Liquid Staking Derivative (LSD) protocols. After a comprehensive review of the different alternatives, we have concluded that the liquid staking protocols are set to be the largest fundamental beneficiaries of the Merge (even more so than ETH).  The thesis is simple. The LSD protocols’ revenues are directly impacted by the price of ETH plus multiple other Merge related tailwinds that compound each other.  Additionally, their largest expense, the cost of subsidizing the liquidity pool between their staking derivate token and native ETH, declines, effectively to zero, shortly after the Merge. At a high level, I expect a 4-7x Merge driven increase in ETH protocol revenue (assuming only modest a ETH price increase) and a 60-80% reduction in their largest expense. This is a uniquely powerful fundamental impact.  We must examine the revenue and expense model of these protocols to fully comprehend this thesis. Using Lido as an example, as it is the largest of the LSD protocols, let’s examine the model. Note that these principles also apply to the other players as they are generally quite similar. Lido generates revenue as a percentage of the staking rewards that accrue to their liquid staking derivatives, stETH. Lido receives 5% of all staking rewards generated. If a user deposits 10 ETH for 10 stETH and generates an additional 0.4 stETH over the course of a year. The user keeps 90% of 0.4, the validator keeps 5% and Lido keeps the other 5%. As can be seen, Lido’s revenue is purely a function of the staking rewards generated on its LSD.  These staking rewards are a function of four separate variables: total ETH staked, ETH staking rate, LSD market share, and ETH price. Importantly, the staking rewards are the product of all four variables. If multiple variables are impacted their effect on the output compounds. In other words, if you double one and triple the other the impact on the staking rewards is 600%. All the variables, except market share, are directly impacted by the Merge. Total ETH staked will likely increase dramatically from the current 12% to closer to ~30% a 150% increase. As discussed earlier, the staking rate is likely to increase from 4% to ~5%, a 25% increase. There is no reason to think the Merge will significantly impact LSD market share so we can assume this is held constant and has no impact. Lastly, for the sake of this exercise let’s assume a 50% increase in the price of ETH. The aggregate effect of these different variables is 250%*118%*150%= 444% or a ~4.4x increase in revenue.  Expenses also meaningfully drop. The largest expense of these LSD protocols is incentivizing the liquidity pools between their LSD and native ETH. Given there are no withdrawals yet, it is extremely important to create deep liquidity to manage large flows between the LSD and native ETH. However, once withdrawals are enabled these incentives will no longer be required. As there will then be an arbitrage if the two ever differ materially, natural market forces will keep them relatively pegged as arbitrageurs buy the LSD on any dips.  This will allow the LSD protocols to drastically reduce their issuance (expenses), which will also materially reduce the sell pressure on the tokens.  LDO is trading at ~144x revenue on a pre-Merge number but this declines to ~31x when you look at it on a post-Merge number. While not overly cheap by traditional measures, this is attractive for a high-growth strategic asset in the crypto space where valuations are typically elevated. Importantly, this is real revenue that will accrue to the protocol.  A common concern among LDO critics is that this revenue does not get returned to holders. They often compare the protocol to Uniswap for this reason. While it is true the revenue is not passed through to token holders at current, we do not think this is a legitimate concern nor do we think the Uniswap comparison is correct—just because token holders do not receive cash flow today does not mean they will not in the future. We believe there will be a time when these returns are enabled. We also know that multiple large stakeholders agree on this issue. Furthermore, we do not think Lido should return cash today and would actually be very concerned with management’s competence if they did. This is an extremely early-stage business (~1.5 years old) that is still in its infancy growth phase. They require regular cash raises and are burning cash on a run rate basis today (this will change post-Merge). It would not be sensible to raise money from investors to cover the burn and then distribute protocol revenue to token holders, in turn increasing the burn. This would be akin to a startup paying out investor distributions with early revenue despite not generating enough revenue to cover expenses. This would never happen in the traditional capital markets because it is not rational.  Many crypto participants are also concerned about Lido’s dominant market share. They have 90% share of the LSD market and stETH makes up ~31% of total staked ETH. While we think the concerns around centralization are overstated, we still believe Lido should remain below 33% share of staked ETH to eliminate any doubt about Ethereum’s credible neutrality. As far as the investment case for the protocol we do not think a 33% market share cap is concerning. In our opinion, there are many other growth vectors Lido can pursue other than market share, and the investment is already quite compelling with its current share.  To conclude, Lido is a key piece of infrastructure in the Ethereum ecosystem that has established product market fit and dominant market share in what will remain an incredibly fast-growing portion of the market. In our opinion, the frequently cited concerns around the protocol are either misplaced or misrepresented. Furthermore, it is reasonably priced considering its past and expected future growth prospects and therefore represents one of the most investable assets in the space. While Lido is the market leader and largest player there are two other LSD protocols, Rocketpool and Stakewise, that also merit consideration. There are many unique aspects of each LSD and intricate detail that could be expanded upon. However, for the sake of digestibility, we will focus primarily on the high-level differences and expand upon the finer points in future discussions. Both RPL and SWISE should benefit from any share that Lido cedes due to the centralization concerns. While we think any Lido share losses will be modest, even modest losses for Lido would equate to outsized gains for the smaller players. For example, if LDO loses 4% market share, RPL gains 2.5% of that, and SWISE gains 1.5%, LDO will lose ~12% of their market share but RPL will gain ~50% and SWISE ~125%.   The 2nd largest player in the market, Rocketpool (RPL), has a unique staking mechanism and tokenomics. To stake through RPL, validators must pair RPL with native ETH and are required to maintain a minimum ratio between the two. This dynamic creates predictable and guaranteed demand for RPL as the ETH staking participation rises and more validators adopt the solution. Another benefit of RPL is the practice of validators pooling with other users, allowing the required ETH to set up a staking node to be reduced from the normal 32 ETH to only 16 ETH. This reduced minimum allows for smaller operators to set up nodes and further incentivizes decentralization. This makes RPL a perfect complementary player to LDO, which should act as a tailwind for RPL’s market share as they will be a primary beneficiary of Lido’s effective market share cap.  Lastly, Stakewise is another interesting alternative to LDO. Their model is very similar to LDO’s but they are focused increasingly on institutional adoption, which should position them well for a post-Merge marketplace. They also benefit from a highly driven and professional team that has continued to execute well. Notably, they have discussed plans to eventually implement token-holder-friendly tokenomics that would see token holders directly receive excess protocol revenue. Additionally, SWISE has been gaining notable traction with larger accounts looking to diversify their staking products (one proposal alone was recently approved by Nexus Mutual which would increase their TVL by 20-25%). As they are the smallest player with the highest valuation, they are likely the highest risk/reward investment in the category.  To conclude, it’s hard to differentiate between value within the group. LDO is the cheapest and most secure, but with the least market share upside. SWISE is the most expensive, but with the most market share upside and RPL is in between with the added benefit of unique tokenomics and a decentralizing staking mechanism. Relative valuations are rational which suggests to us the market is efficiently pricing the different opportunities. We have elected to own all three. We believe the LSD tokens are the highest EV Merge-related investments! They will likely outperform ETH, but investors should expect higher volatility and lower liquidity. The Merge Is Coming The Ethereum Merge is coming. There’s no doubt about it. With the date locked in for September 15th or 16th, this will be the biggest structural change in the history of crypto. There are a lot of dynamics at play that investors need to consider. Hopefully, this report helps you parse through all the information. What’s the key takeaway? The Merge is not priced in. * * * Tyler Durden Fri, 08/19/2022 - 09:58.....»»

Category: blogSource: zerohedge9 hr. 58 min. ago

Duke Energy (DUK) Arm Adds 2 Lithium-Ion Battery Facilities

Duke Energy Corp's (DUK) subsidiary, Duke Energy Florida, announces the completion of two of its lithium-ion battery facilities in Alachua and Hamilton. Duke Energy Corp’s DUK subsidiary, Duke Energy Florida, recently unveiledthe completion of two new lithium-ion battery facilities in the Alachua and Hamilton counties, thus highlighting its increased focus on investing in modern and advanced technology to deliver clean energy.Details of Battery SitesDuke Energy Florida, which already has 10,300 megawatts (MW) of energy capacity at its discretion, further aided its electric services by adding the Micanopy battery site in Alachua County, which boasts a capacity of 8.25 MW. The other facility on the Florida-Georgia border has a capacity of 5.5 MW.Duke Energy Florida’sInvestment in Battery TechnologyDuke Energy Florida has been consistently boosting its renewable portfolio by investing in innovative and advanced technology that can enhance its capability to deliver reliable and clean energy to its customers and improvise its grid operations.Before these developments, the company added three battery projects in the Gilchrist, Gulf and Highlands counties this year only. Such expansion strategies in the battery storage arena form an integral part of Duke Energy's pledge to have six battery sites in operation in Florida this year. This boasts a storage capacity addition of 50 MW.These apart, the company aims to further bolster its battery storage capabilities in Florida by adding a 3.5-MW solar-plus-storage microgrid site at Pinellas County's John Hopkins Middle School.Such massive investments in battery technology highlight the company’s commitment to continuously upgrade its energy generation capabilities that can efficiently align with the energy of the future.Peer MovesAlongside Duke Energy, major utility companies, such as PG&E Corporation PCG and Consolidated Edison ED and NextEra Energy NEE, have carved out a position in the battery storage market.In January 2022, PG&E Corporation proposed nine new battery energy storage projects totaling approximately 1,600 MW to further integrate renewable energy resources and improve the reliability of the California electric system.PCG boasts a long-term earnings growth rate of 2.5%. The Zacks Consensus Estimate for PG&E Corporation’s 2022 earnings is pegged at $1.09 per share, suggesting a growth rate of 0.9% from the prior-year period. PCG shares have returned 33.5% in the past year.In March 2022, Consolidated Edison announced the installation of a battery system in the Woodside area. The battery system can provide 1 MW or a million watts for customers. The Woodside system is the third battery project that Consolidated Edison and Endurant Energy installed at customers’ properties under an innovative demonstration project.The long-term earnings growth rate for Consolidated Edison is pegged at 2%. ED shares have returned 31.3% in the past year.NextEra Energy has more than 180 MW of battery energy storage systems in operation. Its Babcock Ranch Solar Energy Center is the largest combined solar-plus-storage facility in the country and boasts a 10-MW battery storage project into the operations of a 74.5-MW solar power plant.NextEra boasts a long-term earnings growth rate of 9.3%. NEE shares have returned 6.9% in the past year.Price MovementIn the past year, Duke Energy’s shares have rallied 4.7% compared with the industry’s growthof 11.4%.Image Source: Zacks Investment ResearchZacks RankDuke Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Free: Top Stocks for the $30 Trillion Metaverse Boom The metaverse is a quantum leap for the internet as we currently know it - and it will make some investors rich. Just like the internet, the metaverse is expected to transform how we live, work and play. Zacks has put together a new special report to help readers like you target big profits. The Metaverse - What is it? And How to Profit with These 5 Pioneering Stocks reveals specific stocks set to skyrocket as this emerging technology develops and expands.Download Zacks’ Metaverse Report now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NextEra Energy, Inc. (NEE): Free Stock Analysis Report Pacific Gas & Electric Co. (PCG): Free Stock Analysis Report Duke Energy Corporation (DUK): Free Stock Analysis Report Consolidated Edison Inc (ED): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksAug 18th, 2022

Williams" (WMB) Shares Barely Move Since Q2 Earnings Beat

The Williams Companies, Inc.'s (WMB) second-quarter earnings beat the consensus mark, while sales underperform the same. The Williams Companies, Inc. WMB shares have gone up by a mere 0.9% since its second-quarter earnings announcement on Aug 1.This slight rise, however, could be attributed to the Oklahoma-based energy infrastructure provider posting earnings for the reported quarter that outperformed the consensus mark.Behind the Earnings HeadlinesThe Williams Companies reported second-quarter 2022 adjusted earnings per share of 40 cents, beating the Zacks Consensus Estimate of 37 cents and surpassing the year-earlier period’s profit of 27 cents per share.The outperformance was due to higher-than-expected contributions from a couple of segments. Adjusted EBITDA from the Others segment totaled $92 million, ahead of the Zacks Consensus Estimate of $81 million. Adjusted EBITDA increased year over year by 28.1% in the West unit.Meanwhile, in the quarter ended Jun 30, Williams’ revenues of $2.49 billion missed the Zacks Consensus Estimate of $3 billion but outperformed the last year’s second-quarter revenues of $2.28 billion, which could be attributed to increased product sales.Key TakeawaysAdjusted EBITDA was $1.49 billion in the quarter under review, reflecting an increase of 13.6% from the corresponding period of 2021. Cash flow from operations totaled $1.09 billion, up 3.8% from the prior-year period.Segmental AnalysisTransmission & Gulf of Mexico: Comprising WMB’s massive Transco pipeline system and Northwest Pipeline, the segment generated adjusted EBITDA of $652 million, rising only 0.6% from the year-ago quarter. This unit’s performance was largely driven by higher service revenues, primarily at Transco, largely from the Leidy South expansion project.West: This segment includes the gathering and processing assets in the Western region of the United States. It delivered adjusted EBITDA of $296 million, 32.7% higher than the $223 million recorded in the year-earlier quarter. The improvement in results was primarily due to the Trace Midstream acquisition, which closed on Apr 29, as well as higher commodity-based rates and higher Haynesville gathering volumes.Northeast G&P: Engaged in natural gas gathering and processing, along with the NGL fractionation business in the Marcellus and Utica shale regions, the segment generated adjusted EBITDA of $450 million, up almost 10% from the prior-year quarter’s $409 million. This uptick was driven by top-line Gathering and Processing revenue growth on slightly higher volumes. The G&P rate growth was supported by a combination of factors, including higher commodity-based rates, annual fee escalations and other expansion-related fee increases.Gas & NGL Marketing Services: This unit generated adjusted EBITDA of $6 million, down 25% from the prior-year quarter’s $8 million.  The result of this segment was impacted by higher commodity margins, more than offset by the absence of a favorable impact in 2021 from Winter Storm Uri and higher administrative costs associated with the Sequent business acquired in July 2021.Williams Companies, Inc. The Price, Consensus and EPS Surprise Williams Companies, Inc. The price-consensus-eps-surprise-chart | Williams Companies, Inc. The QuoteCosts, Capex & Balance SheetIn the reported quarter, total costs and expenses of $2.01 billion rose by almost 20% compared with the year-ago quarter’s figure of $1.68 billion.Williams’ total capital expenditure was $1.36 billion in the second quarter, up from $460 million a year ago. As of Jun 30, 2022, the company had cash and cash equivalents of $133 million and a long-term debt of $20.8 billion, with a debt-to-capitalization of almost 65%.2022 GuidanceWMB raised its full-year adjusted EBITDA guidance and now expects 2022 adjusted EBITDA in the range of $6.1 billion-$6.4 billion, a $450-million midpoint increase from the earlier guidance range of $5.9-$6.2 billion, with growth capital spending still anticipated in the range of $2.25 billion-$2.35 billion. Further, Williams expects to achieve a leverage ratio midpoint of 3.6X, lower than the original guidance of 3.8X.The company maintained its maintenance capital expenditure guidance between $650 million and $750 million, including the capital for emissions reduction and modernization initiatives.Zacks RankWilliams currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Earnings Snapshot of a Few Energy PlayersTotalEnergies SE TTE reported second-quarter 2022 operating earnings of $3.75 per share, meeting the Zacks Consensus Estimate. The improvement was due to an increase in commodity prices.In the second quarter of 2022, TotalEnergies acquired $2,464 million worth of assets and sold assets valued at $388 million. TTE bought back shares worth $2 billion in the second quarter. TotalEnergies expects to invest $16 billion in 2022, out of which 25% will be allocated to further strengthen renewable operations and electricity.Shell plc SHEL reported second-quarter earnings per ADS (on a current cost of supplies basis, excluding items — the market’s preferred measure) of $3.06. The bottom line beat the Zacks Consensus Estimate of $2.91 due to stronger commodity prices and refining margins.Shell has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Value, Growth and Momentum. SHEL is expected to see earnings growth of 130.5% in 2022.Chevron Corporation CVX reported adjusted second-quarter earnings per share of $5.82, beating the Zacks Consensus Estimate of $5.02. The outperformance was driven by robust commodity prices and product margins, which propelled both CVX’s segments to record better-than-expected bottom-line results.As of Jun 30, Chevron had $12 billion in cash and cash equivalents and total debt of $26.2 billion, with a debt-to-total capitalization of 14.6%. Further, CVX paid out $2.8 billion in dividends and bought back $2.5 billion worth of shares in the second quarter. Free: Top Stocks for the $30 Trillion Metaverse Boom The metaverse is a quantum leap for the internet as we currently know it - and it will make some investors rich. Just like the internet, the metaverse is expected to transform how we live, work and play. Zacks has put together a new special report to help readers like you target big profits. The Metaverse - What is it? And How to Profit with These 5 Pioneering Stocks reveals specific stocks set to skyrocket as this emerging technology develops and expands.Download Zacks’ Metaverse Report now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Williams Companies, Inc. The (WMB): Free Stock Analysis Report Chevron Corporation (CVX): Free Stock Analysis Report TotalEnergies SE Sponsored ADR (TTE): Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksAug 18th, 2022

Avison Young to acquire Office and Industrial Property Management, Agency Leasing and Project Management Services from Madison Marquette

Avison Young has signed an agreement to acquire Madison Marquette’s office and industrial property management, agency leasing and project management service lines. The trio of services will operate under the Avison Young brand and the deal is expected to close in September. The acquisition includes more than 20 million square feet (msf),... The post Avison Young to acquire Office and Industrial Property Management, Agency Leasing and Project Management Services from Madison Marquette appeared first on Real Estate Weekly. Avison Young has signed an agreement to acquire Madison Marquette’s office and industrial property management, agency leasing and project management service lines. The trio of services will operate under the Avison Young brand and the deal is expected to close in September. The acquisition includes more than 20 million square feet (msf), and 235 team members including, property managers, agency leasing professionals, project managers, building engineers and accountants that will integrate with the firm’s markets primarily in Texas and California, the East Coast Region and, adding a new market for the firm in Hawaii. The combined operations will elevate both the client experience and Avison Young’s competitive advantage in the real estate industry, amplifying the firm’s presence in 11 states. “I am delighted to welcome the team members from Madison Marquette to the Avison Young family,” said Juan Bueno, Principal and U.S. President at Avison Young. “Both organizations are aligned with the cultural mindset that focuses on people first and embraces the diversity of experiences that our people bring to our business and to our clients.” Over the past year, Avison Young has invested in expanding its service offerings to support occupiers, owners and investors as they navigate through accelerating marketplace needs during challenging times. The firm’s expansion of property management, agency leasing and project management services lines in its robust Texas and California operations, significantly bolsters Avison Young’s presence in those geographically important markets. Avison Young’s data analytics, technology and global real estate intelligence platform coupled with Madison Marquette’s trophy assets and institutional clients, such as CenterPoint Energy, Starwood Property Trust, LLC and Principal Global Investors, formulate a mutually transformative opportunity for both firms and for their clients who will benefit from their fundamental strengths and operations. ”Growing our real estate management platform across the U.S. is a strategic priority for Avison Young. This transaction underscores our commitment to delivering new, improved and expanded services in all markets, especially those that are critical to all of our growing clients’ needs,” added Randel Waites, Principal and Managing Director, U.S. Real Estate Management Services Group at Avison Young. “Madison Marquette’s solutions-oriented approach to real estate management services complements our entrepreneurial and client-centric solutions, delivering long-term sustainable improvement in CRE services across the industries and critical operating environments of Avison Young’s clients.” The unification of multi-sector assets and services stretches from the East Coast to Hawaii. Avison Young’s Texas market alone will gain 68 property management assets with a sum of 12.2 msf.  The Houston market inherits the largest portfolio of property management buildings with 54 properties at 11.2 msf and Dallas adding 14 buildings totaling 966,451 sf. California will add 27 buildings at 4.2 msf; 2.5 msf on the East Coast, followed by Hawaii at seven buildings totaling 1.2 msf. The Hawaiian assets are comprised primarily of class A office buildings in downtown Honolulu. “This is a transformative opportunity for both companies to build on their core strengths to achieve competitive advantage,” said Madison Marquette Chief Executive Officer Vince Costantini. “We made the strategic choice to move a portion of our services to Avison Young to better serve our office clients, and look forward to a new partnership with the firm with respect to their industry-leading data analytics platform, AVANT by Avison Young.” “Madison Marquette will now be able to focus on enhancing and growing its core investment management programs and advisory services, which includes its retail and mixed-use property management and development activities,” said Madison Marquette Chairman Amer Hammour. “Our renewed focus will allow us to build on our expertise in retail, mixed-use, multifamily, office, and the medical and senior living categories.” Avison Young’s transformative expansion of capabilities and service offerings also includes the addition of seven seasoned industry leaders coming from Madison Marquette. In Houston, Wade Bowlin will join the firm as Principal and Managing Director, Kim Shapiro and Brad Sinclair will be Principals focusing on Agency Leasing and Brenda Dougherty will join as Principal, Director, Texas Real Estate Management Services. In Irvine, CA Jim Proehl will join as Principal and Director of the Western Region, Real Estate Management Services and Eileen Doody and Mark Mattis will join as Principals specializing in Agency Leasing. The post Avison Young to acquire Office and Industrial Property Management, Agency Leasing and Project Management Services from Madison Marquette appeared first on Real Estate Weekly......»»

Category: realestateSource: realestateweeklyAug 18th, 2022

These are 20 countries that offer "golden visas" to wealthy immigrants — with costs ranging from $19,000 in Thailand to $2.5 million in Australia

Controversial "golden visa" programs allow immigrants to receive residency status in exchange for investments ranging from $19,000 to $2.5 million. Santorini, Greece.pavant/Shutterstock 20 countries, including Australia and Portugal, offer residence by investment programs.  The so-called "golden visas" allow foreign investors to receive local residency status.  Here are each of the programs' financial requirements — ranging from $19,000 to $2.5 million. 1. Australia: $2.5 million minimum investment requiredSydney, Australia with Harbor Bridge and Sydney skyline during sunset.Prasit photoThere are four different ways to receive a residency visa through Australia's "Business Innovation and Investment Program," which allows recipients to live and run a business in Australia. After five years, visa recipients can apply for citizenship status, according to Henley & Partners, an investment migration consultancy based in London. Here are the program's four application streams, according to the Australian government's Department of Home Affairs: 1. Business Innovation: Applicants must have net assets worth at least AUD 1.25 million and operate a new or existing business in Australia. 2. Investor: Applicants must invest at least AUD 2.5 million in Australian investments that meet certain requirements. 3. Significant Investor: Applicants must invest at least AUD 5 million in Australian investments that meet certain requirements. 4. Entrepreneur: Applicants must first be nominated by an Australian State or Territory government agency and provide evidence of a funding agreement with a third party backing their start-up.   2. Austria: Proof of at least €1,030.49 in monthly income and permanent real estateVienna, Austria.Sylvain Sonnet/Getty ImagesIn order to qualify for Austria's temporary residence visas known as "stay permits," you must demonstrate that you have at least €1,030.49 in monthly income (more depending on the number of dependents).In addition, you must show proof of permanent housing (purchased or leased) and private health insurance with coverage in Austria.  3. Canada: Approved start-up and a minimum of $13,310 in personal fundsA man canoes on Patricia lake in autumn at Jasper National Park in Alberta, Canada.Matteo Colombo/Getty ImagesTo be eligible for Canada's "Start-Up Visa Program" applicants need to have a qualifying business, get a letter of support from a designated organization, meet the language requirements, and bring enough money to settle. The minimum amount of personal funds required begins at $13,310 and increases depending on the number of family members applying. 4. Cyprus: €300,000 minimum investment requiredA panorama of Limassol, Cyprus.kirill_makarov/ShutterstockApplicants from non-European countries may qualify for Cyprus' investor immigrant visa by investing at least €300,000 in one of four approved categories, according to the country's Civil Registry and Migration department: 1. Investment in a house or apartment2. Investment in non-residential real estate such as offices, shops, or hotels3. Purchasing share capital of a company registered in the Republic of Cyprus4. Purchasing units in Cyprus-based investment funds  5. Greece: €250,000 real estate purchase requiredCorfu, Greece.Maniscule/Getty ImagesGreece's "Golden Visa program" offers several investment options in exchange for a residence permit, including a real estate purchase worth a minimum of €250,000, the acquisition of shares in a Greek company equal to at least €400,000, or purchasing government bonds worth at least €400,000. 6. Hong Kong: point-based systemVictoria harbor, Hong KongFei Yang/Getty ImagesTo apply to Hong Kong's "Quality Migrant Admission Scheme" applicants must meet the program's age, education, character, language, and financial prerequisites. There is no minimum investment required. Financially, applicants must demonstrate they have enough money to support themselves "without relying on public assistance" in Hong Kong.Applicants who successfully meet the requirements are then awarded points through a "general points test" and an "achievement-based points test," and "compete for quota allocation with other applicants," according to Hong Kong's Immigration Department. 7. Italy: €250,000 minimum investment requiredTuscany, Italy.Shaun Egan/Getty ImagesItaly's "Investor Visa" is a two-year visa for citizens of non-EU countries who "make significant investments in strategic areas for the Italian economy and society," according to Italy's Ministry of Economic Development. Here are the program's four investment options: 1. €2 million in Italian government bonds2. €500,000 in an Italian limited company 3. €250,000 in an Italian innovative start-up 4. €1 million in a philanthropic initiative  8. Jersey: Purchase or lease real estate worth at least £1.75 millionYachts, cruisers and speed boats moored at St Aubin's Bay in the Channel Island of Jersey.Tim Graham/Getty ImagesIn order to be eligible for Jersey's "High Value Residency" program, you must make a yearly income of at least £725,000 per year and demonstrate that "your residency in Jersey will benefit the Island in some way," according to Jersey's government website. If approved, you must purchase or lease real estate worth at least £1.75 million. Approved high-value residents can work and live on the Channel island, located approximately 14 miles off the coast of France. 9. Latvia: €60,000 minimum investment requiredRiga, Latvia around Christmas time.Joe Daniel Price/Getty ImagesThe real estate investment option within Latvia's golden visa program was recently suspended in January 2022, leaving three alternative investment routes for foreign nationals seeking a residency permit, according to Henley & Partners. 1. A €50,000 investment into the equity capital of a Latvian company, plus a €10,000 contribution to the state budget. 2. Purchase €250,000 worth of "special-purpose interest-free bonds," plus a €38,000 to the state budget.3. Invest €280,000 into the "subordinated capital of a Latvian bank for a period of five years," plus a €25,000 contribution to the state budget. 10. Luxembourg: €500,000 minimum investment requiredVianden, Luxembourg.Reuben Atienza / EyeEm via Getty ImagesLuxembourg offers a residence permit for investors who fulfill one of the four investment requirements listed on the government website. 1. Invest at least €500,000 in an existing company registered in Luxembourg. 2. Invest at least €500,000 in a new business registered in Luxembourg and create at least five jobs within 3 years. 3. Invest at least €3 million in a "management and investment structure, either existing or still to be created," registered in Luxembourg.4. Deposit at least €20 million worth of funds into a financial institution established in Luxembourg, and keep the deposit for at least five years. 11. Malaysia: Minimum investment of 1 million Malaysian ringgitsThe Sultan Abdul Samad building in Kuala Lumpur, Malaysia.Kiszon Pascal/Getty ImagesThrough the "Malaysia My Second Home" program, foreigners can receive a 10-year renewable residency visa in exchange for investing in the country. When the program re-opened following its closure during the COVID-19 pandemic, the Ministry of Tourism raised the investment requirement to a fixed deposit of 1 million Malaysian Ringgits (approximately $224,000). Applicants must also provide proof of "bankable assets" worth approximately $350,000, as well as proof of monthly income of approximately $10,000.  12. Malta: €500,000 in savings required, plus a €175,000 minimum contributionLuxury yachts and sailboats at Kalkara marina in Malta.Holger Leue/Getty ImagesMalta's "permanent residence" visa provides recipients with the ability to reside permanently on the island, located between Sicily and the North African coast. Up to four generations may be included in the application. Here are the program's five financial requirements, as listed by the Residency Malta Agency, the entity responsible for managing and promoting Malta's golden visa program: Submit an application via a Licensed Agent and pay a non-refundable administrative fee of €40,000.Rent a property for a minimum of €10,000 in the South of Malta/Gozo or €12,000 in the rest of Malta or purchase a property for a minimum value of €300,000 in the South of Malta/Gozo or €350,000 in the rest of Malta.Pay a Government contribution of €28,000 if purchasing a property or €58,000 if leasing a property.Hold the qualifying property for a minimum period of 5 years after which a residential address is required.Make a donation of €2,000 to a local philanthropic, cultural, scientific, artistic, sport or animal welfare NGO registered with the Commissioner of Voluntary Organisations.13. Mauritius: $375,000 minimum real estate investment requiredAerial view of Port Louis, Mauritius.Norbert Figueroa / EyeEm via Getty ImagesThe Mauritius "Residence by Investment Program" offers 10 different investment options in exchange for a 10-year residence visa, according to Henley & Partners. One path is to invest $375,000 in one of four real estate options including luxury residential property and smart city projects. Alternatively, applicants can invest $35,000 to $54,000 in start-ups, technology, and other approved business activities.  14. Panama: $40,000 minimum investment requiredPanama City, Panama.Rodrigo Cuel/ShutterstockPanama offers two main types of investor visas with requirements ranging from $40,000 to $750,000, according to Henley & Partners. The least expensive route is the "Panama Reforestation Visa Program," where foreign investors can contribute $40,000 into a reforestation initiative approved by the Ministry of Environment. Alternatively, you can apply through the "Qualified Investor Program" where applicants can receive permanent residence status in exchange for a real estate investment of $300,000, stock exchange investment of $500,000, or fixed-term bank deposit of $750,000. 15. Portugal: €250,000 minimum donation requiredFunchal, Madeira.GettyPortugal's golden visa program is one of the most popular investor visas among wealthy Americans, multiple investment migration firms previously told Insider. There are eight distinct investment options, according to Portugal's federal immigration agency:€1 million capital transfer into a Portuguese bank account. The creation of 10 job positions. Purchase of real estate property worth at least €500,000. Purchase of real estate property "with construction dating back more than 30 years or located in urban regeneration areas" for at least €350,000. €350,000 contribution to approved scientific research activities. €250,000 contribution to approved artistic or cultural heritage initiatives. €350,000 capital transfer for the acquisition of investment fund or venture capital fund units. €350,000 investment toward a business headquartered in Portugal, combined with the creation of five permanent working jobs.16. Singapore: minimum investment of S$2.5 million SGD ($1.8 million USD)Singapore, Marina Bay, Garden By the bay, botanic garden, Supertree Grove and Cloud Forest.Tuul & Bruno Morandi/Getty ImagesSingapore's "Global Investor Program" offers permanent residence status to eligible investors "who intend to drive their businesses and investment growth from Singapore."  Here are the program's three investment options, according to Singapore's Economic Development Board: 1. Invest S$2.5 million in a new business entity or in the expansion of an existing business operation.2. Invest S$2.5 million in an approved global investor program fund that invests in Singapore-based companies. 3. Invest S$2.5 million in a new or existing Singapore-based single family office with assets under management of at least S$200 million.17. Spain: €500,000 minimum investment requiredThe Cathedral of the Holy Cross and Saint Eulalia in Barcelona, Spain.Pol Albarrán/Getty ImagesSpain's investor visa program offers residence visas to foreigners "making a significant capital investment" through one of the four below options, as listed by the Ministry of Foreign Affairs.1. €2 million investment in Spanish public debt securities. 2. €1 million investment in stocks or shares in Spanish companies, in investment or venture capital funds incorporated in Spain, or in bank deposits in Spanish financial institutions. 3. Purchase of real estate worth at least €500,000. 4. The creation of a business project in Spain "considered to be of general interest" in regards to the creation of jobs and local socio-economic impact.18. Thailand: Minimum application fee of $19,000 requiredTwin pagoda monastery built on top of the mountain in the North of Thailand during sunset.Guntaphat Pokasasipun/Getty ImagesThailand's "Elite Visa" membership program provides qualified foreign investors with a "Privilege Entry Visa" that is valid for up to 20 years. There are eight different program options, ranging from "elite flexible one" to "elite ultimate privilege," according to Thailand Privilege Card Co., the state-owned enterprise within Thailand's federal tourism agency that runs the program. The minimum payment required is an application fee of approximately $19,000  19. United Arab Emirates: AED 2 million minimum investment requiredDubai cityscape.Getty ImagesDubai's golden visa program provides residence status to qualified foreign investors and entrepreneurs who meet one of five guidelines listed on the official UAE government website:1. Purchase a property worth at least AED 2 million (approximately $540,00) 2. Purchase a property with a loan from specific local banks or buy one or more "off-plan properties" worth at least AED 2 million (approximately $540,00) from approved local real estate companies.3. Own or partner in a start-up registered in the UAE that generates an annual revenue of at least AED 1 million (approximately $270,000).4. Obtain an approval for a start-up idea from an official business incubator or from Ministry of Economy or other approved local authorities.5. Be the founder of an entrepreneurial project that was sold for at least AED 7 million (approximately $1.9 million).20: United States: $800,000 minimum investment required, plus the creation of 10 full-time jobs for US workersThe White House is seen from Lafayette Park on July 10, 2022 in Washington, DC.Sarah Silbiger/Getty ImagesThe United States also offers a golden visa program, titled the "EB-5 Immigrant Investor Program."Eligible foreign investors may apply for a green card through the program upon completion of the following two investor guidelines: 1. Invest $1,050,000 into a "non-targeted employment area project" or $800,000 into a project in a rural area or an area with high unemployment. 2. Create 10 permanent full-time jobs for qualified USA workers. Read the original article on Business Insider.....»»

Category: topSource: businessinsiderAug 17th, 2022

US Utilities Embark On Huge Spending Spree, But There"s A Catch

US Utilities Embark On Huge Spending Spree, But There's A Catch By Leonard Hyman and William Tilles of OilPrice.com Electric utility managers run in herds so to speak. Decades ago they decided to build nuclear-generating stations and almost every utility company that could did it. Financial meltdown followed— caused by runaway cost escalations made even worse by rampant inflation. (Most of the plants eventually operated but the builders’ finances tanked and both equity and fixed income investors suffered.) Then the “herd” decided to diversify into varied industries: real estate, mining, paper, lending, and one company even processed spent hens into chicken soup. Most of these ventures ended badly too. The lesson learned? Only go into businesses you understand. So the “herd” plunged into power generation but with some foreign utility and generation investments. The result? Huge write-downs. So it’s back to basics for the U.S. electric utility industry which has worked out fairly well so far. So what comes next? The biggest spending spree in the industry’s history, thanks to the Inflation Reduction Act, is because the only way to receive the varied financial incentives is by investing money for the designated purposes.   Perhaps ironically the “herd” is now investing in the same carbon-free and carbon-reducing concepts they fought in the courts for years while smilingly endorsing far-off climate goals. What changed? The government offered carrots instead of sticks and made offers that would be financially hard to refuse.  But that brings us to financing. A few years ago, we estimated that the electric industry would have to invest an average of $350-400 billion a year over 20 years to decarbonize existing utility plant and replace related assets due for retirement. That estimate did not include any allowance to finance growth in sales, because, at the time, sales growth had stalled. Since that estimate, we’ve seen a pandemic, inflation, war-induced shortages, and now a huge batch of government incentives that could restart sales growth in the industry.   After making some heroic assumptions about improved productivity of renewables and storage (20% above current estimates)  and adding in a roughly 30% increase in construction costs since the original estimates as well expenditures needed to meet newly expected growth, we believe that required expenditures for decarbonization, modernization, and growth requirement will have to exceed $400 billion per year, in real terms.    We estimate that the electric utility industry will spend something like $170-$180 billion on capital projects in 2022. That number equals roughly 10% of non-farm business capital spending in the U.S. The industry also accounts for 8% of outstanding corporate debt and roughly 3% of new corporate debt issuance. So doubling industry spending or financing is a big deal for the industry, capital markets, and for the U.S. economy as a whole. Spending money at the pace required would put the industry into a position similar to when it was building nuclear power plants. Financially uncomfortable but do-able, especially with so much federal aid available. But with this caveat. The U.S. electric industry plunged into its previous nuclear spending program when it had impeccable financials, top-grade bond ratings, and rock-solid dividends. Now the average utility bond rating is close to the bottom of investment grade, and the industry has taken few discernible steps to get in shape for what is coming—which is plenty of rate requests, higher fuel and power prices, and a higher cost of capital along with inflation. The industry’s finances could deteriorate again. Is the “herd” again sort of sleepwalking the industry into a several decade-long period of financial underperformance? We all know to be skeptical of long-term estimates, especially those with more than one significant figure and decimal points, however, a big societal change like decarbonization will likely come about largely through electrification. The federal government is supporting the project and cleverly produced incentives and tax savings to encourage action. Even if the GOP returns to power, Republicans are typically reluctant to take tax benefits away from the business community. All of this adds up to a huge capital spending program by US electric companies and others in addition to electrification’s impact on the purchase of new electrical consumer goods, ranging from electric automobiles to heat pumps. Whatever the actual capital spending number, electrification spells opportunity for some, and US electric companies appear to be the biggest potential beneficiaries. Rate base (the underpinning of earnings) will grow at a faster rate than in decades— at least 8% per year. But let’s face it, decades of monopoly behavior have not sharpened the industry’s commercial acumen. The industry tends to overlook opportunities and can only make so much money before the regulators step in. We think the major beneficiaries of the industry’s big capital program will be investment bankers who finance the expansion,  companies that supply key metals, consultants who furnish expertise, construction firms and those that sell new products and services in the consumer electricity market. This is a major business opportunity.  Don’t debate the virtues of the Inflation Reduction Act or the honesty of the name. Go for the business. Tyler Durden Tue, 08/16/2022 - 13:20.....»»

Category: smallbizSource: nytAug 16th, 2022

Shell (SHEL) Postpones Prelude LNG Turnaround Until Next Year

Shell plc (SHEL) has announced that it is deferring the planned maintenance work at the Prelude floating liquefied natural gas facility. Shell plc SHEL recently stated that it is deferring the planned maintenance work at the Prelude floating liquefied natural gas facility, which was due to begin in September. The postponement came following the continued industrial action at the site situated off northwest Australia.A Shell spokesperson mentioned in emailed comments, “As a result of the ongoing Protected Industrial Action and inability to complete preparation work, we are not able to proceed with the planned turnaround at this time.”The London-headquartered firm said that the extensive maintenance work, called a turnaround, would be delayed until sometime next year contingent on numerous factors, including weather conditions and contractor availability, and when the strike action comes to a conclusion.Situated in the Browse Basin, Prelude came back into operation in April after being closed last December due to power failures initiated by a fire but was again shut last month due to work stoppages and strikes by workers. SHEL is the operator of the 3.6-million-ton-a-year Prelude facility and owns a 67.5% interest. Other partners in the project include Japan’s Inpex with a 17.5% stake, Korea’s Kogas with 10% ownership and Taiwan’s CPC holding the remaining 5%.Shell is one of the primary oil supermajors, a group of U.S. and Europe-based big energy multinationals, with operations spanning worldwide. The company, whose peers include ExxonMobil XOM, Chevron CVX and BP BP, is fully integrated as it participates in every aspect related to energy, from oil production to refining and marketing.ExxonMobil is a bellwether in the energy space with an optimal integrated capital structure that has historically produced industry-leading returns. It owns some of the most prolific upstream assets globally. Other aspects of XOM include the largest global refining operations, substantial chemical assets, dividend history and a credit profile that are second to none in this space.Meanwhile, Chevron is one of the largest publicly traded oil and gas companies in the world, with operations spanning worldwide. The only energy component of the Dow Jones Industrial Average, San Ramon, CA-based CVX generates around $95 billion in annual revenues and produces more than three million boepd.BP plc is a British oil and gas supermajor headquartered in London, England. It is a vertically integrated company operating in all areas of the oil and gas industry, including exploration and extraction, refining, distribution and marketing, power generation and trading. The firm is on track to capitalize on the global economy's transition to lower carbon fuels. Apart from focusing strongly on oil production growth, BP has been investing heavily in the renewable energy space. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time. This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BP p.l.c. (BP): Free Stock Analysis Report Chevron Corporation (CVX): Free Stock Analysis Report Exxon Mobil Corporation (XOM): Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksAug 15th, 2022

A wave of layoffs is sweeping the US. Here are firms that have announced cuts so far, from Shopify to Peloton.

The reason behind the layoffs, broadly, is twofold: business growth is slowing, while labor costs are increasing. Elon Musk, CEO of Tesla and SpaceX. Tesla laid off 229 people in June.Marcio Jose Sanchez/AP A wave of layoffs has swept across American business in 2022. The cuts stem from slower business growth, paired with rising labor costs. The layoffs span across industries, from mortgage lending to digital-payment processing. Layoffs are sweeping across American businesses in 2022.Peloton has laid off thousands of employees this year. Real estate firm Re/Max has slashed 17% of its workforce. Even traditionally layoff-resistant companies like Netflix have made cuts, and now companies that saw a pandemic-era boom, like Shopify, are cutting hundreds of jobs.The reason, broadly, is twofold: business growth is slowing, while labor costs are increasing. The combination is causing American companies across a variety of industries to slash headcount.Here are some of the most notable examples so far: Peloton: Over 4,150 peopleScott Heins/Getty ImagesIn February, Peloton fired over 2,800 people amid an ongoing downturn in the company's business.It was the first of three rounds of layoffs in 2022, with a second round hitting Taiwan-based employees in July and a third wave of employees getting cut in August. In total, more than 4,150 jobs have been axed this year. Peloton was once a pandemic darling, but the fading popularity of at-home fitness and a mishandling of its logistics operation have put a strain on the business. Peloton replaced cofounder John Foley as CEO in February, and current chief exec Barry McCarthy appears to be taking several measures to revive the business. Shopify: About 1,000 workersShopify CEO Tobi Lutke.Reuters/Lucas JacksonShopify plans to lay off roughly 1,000 employees, equivalent to 10% of its workforce worldwide, the Wall Street Journal reported. In a memo to employees, CEO Tobi Lutke said that the company — which makes the tech that powers businesses' online stores — had bet big on the pandemic-era e-commerce boom. "It's now clear that bet didn't pay off. Ultimately, placing this bet was my call to make and I got this wrong," Lutke wrote in the letter, which was posted on the company's website. 7-Eleven: 880 jobsPaul Sakuma/APConvenience store chain 7-Eleven cut 880 corporate jobs in Ohio and Texas following the company's purchase of rival Speedway in 2020.A 7-Eleven spokesperson told Insider that the company has been assessing its new corporate structure and undergoing an "integration process" that led to the cuts, which will take place at its support centers and field-support operations in Irving, Texas, and Enon, Ohio. Vimeo: 6% of its workforceAnjali Sud, CEO of Vimeo.AP Photo/Mark LennihanVideo-hosting platform Vimeo cut 6% of its staff in July."We are making this decision in order to ensure we come out of this economic downturn a stronger company," Vimeo CEO Anijali Sud wrote in a blog post. "Our people are what makes Vimeo great, and losing any of them is a personal failure that I feel deeply. But after assessing the challenging market conditions and uncertainty ahead, I believe this is the responsible action to take."Tesla: 229 employeesTesla CEO Elon Musk.Yasin Ozturk/Getty ImagesTesla laid off 229 people in late June, according to WARN filings. The layoffs primarily impacted employees in its Autopilot division. Tesla also closed an entire office in San Mateo, California, and moved some of the office's workers to another location, Bloomberg reported.The cuts came after CEO Elon Musk said in early June that he wanted to cut jobs and that he had a "super bad feeling" about the economy.Rivian: Potentially around 5% of its workforceRivian CEO RJ Scaringe and a Rivian truck.Kevin Dietsch/Getty ImagesElectric car-maker Rivian is planning hundreds of layoffs after growing too quickly, Bloomberg reported. Rivian has more than 14,000 employees, and the layoffs could result in about 5% of the workforce being cut. While these cuts are still in the planning stages, Bloomberg reports that they will mostly likely focus on nonmanufacturing positions. Gopuff: 10% of its staffA delivery driver is shown picking up a Gopuff bagHannah YoonDelivery startup Gopuff will lay off 10% of its staff, according to an internal email obtained by Insider."As a business, during these uncertain times, we owe it to our investors and customers to accelerate our timeline to profitability. As such, we have decided to confront the current moment by making difficult decisions about our core business," cofounders Rafael Ilishayev and Yakir Gola wrote in an email to employees. The latest round of layoffs come after Gopuff cut 3% of its workforce, or more than 400 workers, in March. Re/Max: 17% of its workforceAn "Open House" sign is seen outside of a house for sale.Tim Boyle/Getty ImagesReal estate firm Re/Max will lay off 17% of its workforce by the end of the year, the company announced.The cuts will primarily affect employees in the technology division, the result of a "shift in strategy" as it partners with a third-party technology vendor, Re/Max said.  Microsoft: Less than 1% of employeesMicrosoft CEO Satya Nadella.Stephen Brashear/Getty ImagesMicrosoft announced in July that it was cutting a "small number" of employees across several groups, including consulting and customer and partner solutions, a company spokesperson told Bloomberg.JPMorgan: Over 1,000 workersAmr Alfiky/ReutersIn June, JPMorgan confirmed that it would lay off over 1,000 employees in its home-lending department. The cuts came amid slowing demand for mortgages and refinances. "Our staffing decision this week was a result of cyclical changes in the mortgage market," a JPMorgan spokesperson said in a statement to Insider at the time. "We were able to proactively move many impacted employees to new roles within the firm and are working to help the remaining affected employees find new employment within Chase and externally."Compass: 450 employeesA house for sale marketed by the real-estate brokerage Compass.Smith Collection/Gado/Getty ImagesReal estate brokerage Compass will lay off about 10% of its workforce, or 450 employees, the company announced in a regulatory filing. The cuts are part of a series of new cost-cutting measures that include pausing expansion, consolidating offices, and halting mergers and acquisitions, Bloomberg reported.Redfin: About 6% of total employeesRedfin CEO Glenn Kelman.RedfinReal estate brokerage Redfin is also conducting layoffs, a sign that the hot pandemic-era housing market is starting to cool off due to rising interest rates.CEO Glenn Kelman wrote in a blog post that about 6% of the company's total workforce will be laid off, which equates to 470 employees, according to a regulatory filing. "I said we wouldn't lay people off unless we had to. We have to," Kelman wrote. "Mortgage rates increased faster than at any point in history. We could be facing years, not months, of fewer home sales, and Redfin still plans to thrive."Coinbase: About 18% of its workforceCoinbase CEO Brian Armstrong.Patrick T. Fallon / Getty ImagesCrypto exchange platform Coinbase announced it would reduce its staff by 18% "to ensure we stay healthy during this economic downturn." That same day, over 1,000 employees were notified they'd been laid off when they were unable to log into their work email accounts — the company said in a regulatory filing that its workforce will be reduced to about 5,000 employees by the end of the second quarter of 2022.The layoffs come amid a crypto crash that has resulted in traders losing roughly $2 trillion since November, NBC News reported.Coinbase CEO Brian Armstrong wrote in a blog post that the layoffs are the result of the company growing too quickly, changing economic conditions, and the need to keep costs low during a downturn. Carvana: About 2,500 peopleErnest Garcia III, CEO of online car dealer Carvana.Brendan McDermid/ReutersCarvana plans to cut 12% of its staff, or about 2,500 employees, the online car dealer announced in a filing with the Securities and Exchange Commission. In an email to employees viewed by The Wall Street Journal, CEO Ernest Garcia III said that the company has overestimated growth amid a challenging time in the auto industry.By cutting staff, Carvana aims to find "a better balance between its sales volumes and staffing levels," the company said in the SEC filing. Carvana was founded by Garcia in 2012 as a subsidiary of his father's company, DriveTime Automotive. Carvana's service allows customers buy cars online, which are delivered to customers' doors or picked up at a Carvana vending machine. Both father and son saw their fortunes skyrocket during the pandemic as demand for used cars hit new highs. Carvana said in its SEC filing that executives will forego their salaries for the rest of 2022 to help cover employee severance pay.Reef: About 750 peopleEmployees unload at a Reef location.Pat Greenhouse/The Boston Globe via Getty ImagesGhost-kitchens company Reef Technology will cut 5% of its global workforce.The SoftBank-backed startup is laying off about 750 employees as it works toward profitability amid a challenging economic environment, CEO Ari Ojalvo wrote in a memo to staff obtained by Insider.The layoffs come months after Reef said it would pause operations on some of its "underperforming" locations. Current and former employees told Insider in recent weeks that Reef had closed one-third of its kitchens and focused on its partnerships with major chains like Wendy's and Buffalo Wild Wings.Better: About 4,000 peopleVishal Garg is the founder and CEO of Better.com. He was responsible for laying off hundreds of people right before the holidays in 2021.Better.comStarting in late 2021 and continuing through the first several months of 2022, mortgage startup Better.com laid off approximately 4,000 people.The first wave started right before the holiday season in 2021, when CEO Vishal Garg laid off "hundreds" of people.Garg told employees during a Zoom call that the company, "lost $100 million last quarter," which he said, "was my mistake." He then said the layoffs shouldn't have happened right before the holiday, but, "three months ago." Better followed up with another 3,000 layoffs in March, and is now accepting voluntary layoffs in some departments.Noom: 495 peopleSaeju Jeong, cofounder & CEO of Noom.Sam Barnes/Sportsfile for Web Summit via Getty ImagesThe weight-loss app maker Noom recently laid off hundreds of coaches, Insider reported in April — part of a bigger-picture pivot for the company toward more video-based coaching.The company, through its app of the same name, pairs dieting with personal coaches to achieve weight loss for users. Interactions with those coaches were often through text, which users critiqued as "canned advice." Some coaches told Insider they were responsible for giving advice to hundreds of users at any given time.Going forward, Noom is focusing on offering users scheduled video calls with coaches.Thrasio: Up to 20% of staff, sources sayThrasio founder and CEO Carlos Cashman.ThrasioThrasio, the company known for creating the Amazon aggregator market, is laying off an unknown number of people. Additionally, the company's CEO and founder, Carlos Cashman, is stepping down from leadership. Amazon aggregators work by identifying product leaders on Amazon, then buying the companies that make those products and consolidating them under one umbrella company. In a memo sent to employees, Thrasio leadership said the layoffs were due to the company's "hypergrowth" in acquiring companies. "At times we have been acquiring a new company almost every week," the memo said, "and running hard to build the infrastructure to support this growth."Two sources told Insider the layoffs could impact up to 20% of Thrasio's staff.Robinhood: More than 300 peopleRobinhood CEO Vlad Tenev.AP/David MartinDuring the pandemic, so-called "meme stocks" from GameStop and AMC exploded. Much of that explosion in stock value was driven by accessible trading platforms like Robinhood.And while new users piled in during the pandemic, Robinhood hired rapidly. Between 2020 and 2021, Robinhood staff grew dramatically: from 700 people to around 3,800, according to CEO Vlad Tenev. But that growth was apparently too much and too fast, and Robinhood was forced to slash headcount by 9% — more than 300 people altogether."This rapid headcount growth has led to some duplicate roles and job functions, and more layers and complexity than are optimal," Tenev said in April. "After carefully considering all these factors, we determined that making these reductions to Robinhood's staff is the right decision to improve efficiency, increase our velocity, and ensure that we are responsive to the changing needs of our customers."Wells Fargo: Unknown number of people in mortgage lendingREUTERS/ Shannon StapletonAs mortgage revenues fell at Wells Fargo in the first quarter of 2022, the company began laying off employees in mortgage-related positions, Insider reported in late April.Loan processors and underwriters, among other positions, were reportedly affected by the layoffs. Wells Fargo representatives declined to say how many people were impacted by the cuts, but did confirm the layoffs in an emailed statement."We are carrying out displacements in a transparent and thoughtful manner and providing assistance, such as severance and career counseling. Additionally, we are committed to retaining as many employees as possible and will do everything we can to help them identify other opportunities within Wells Fargo," a Wells Fargo spokesperson said in a statement provided to InsiderCanopy Growth: 250 peopleMaster Grower Ryan Douglas smells a marijuana plant in Smith's Falls, Ontario, on February 20, 2014.Blair Gable/ReutersOne of the world's largest publicly traded cannabis companies, Canopy Growth, slashed 250 jobs in Canada earlier this year as it faces increasing competition in the burgeoning cannabis market.Layoffs are among several cost-cutting measures that Canopy Growth is taking "to ensure the size and scale of our operations reflect current market realities and will support the long-term sustainability of our company," Canopy Growth CEO David Klein said in a statement.Canopy's stock has suffered as a result: It was trading around $6 a share as of early May, down from $9.30 in early January.Food52: About 20 peopleCofounder and CEO of Food52, Amanda Hesser.Food52After raising $80 million from investing firm The Chernin Group last December, the content-creation team at food publication and retailer Food52 was suddenly laid off in early April.About 20 of the company's 200 employees were let go in the layoffs, which came as a major surprise to those affected."Everyone on the team and my immediate boss were gut-punched," one of these employees told Insider. "We all had gotten raises and bonuses just a month prior."Two of the employees who were laid off said Food52 executives told them the company was "pivoting to commerce," and away from the type of content that was created by the affected employees: recipes and other instructional cooking content.Cameo: 87 peopleCameo operates a service where users can pay celebrities to record personalized audio or video clips.CameoCameo is laying off 87 people, CEO Steven Galanis confirmed in early May."Today has been a brutal day at the office," he wrote on Twitter. "I made the painful decision to let go of 87 beloved members of the Cameo Fameo."Through Cameo, people pay celebrities to make personalized audio and video recordings.Galanis described the layoffs as a "course correction" in a statement to Variety. The cuts follow a staffing boom during the pandemic — from around 100 employees before 2020 to about 400 in 2022.  PayPal: 83 peoplePayPal headquarters in San Jose, California, on February 2, 2022.Justin Sullivan/Getty ImagesPayPal quietly laid off 83 people, according to a Securities and Exchange Commission filing spotted by The Information.The company employs more than 30,000 people worldwide, over a third of whom are based in the United States. The cuts appear to be tied to the company downsizing its presence in the San Francisco Bay Area, according to TechCrunch.Gorillas: 'Nearly 300' peopleGorillas CEO Kagan Sumer.GorillasGerman grocery-delivery company Gorillas announced layoffs of "nearly 300" people around the world in May 2022. The layoffs, the company said, are part of a larger "shift to long-term profitability," which means trimming staff as Gorillas focuses on its five "core" markets: Germany, France, the Netherlands, the UK and the US.Impacted employees, who were mostly corporate staff, were shocked by the sudden layoffs."It's not a secret that the company hasn't been doing well, but I didn't expect to wake up and lose my job," a Berlin-based employee who was laid off by Gorillas told Insider. "My managers weren't even aware or consulted. It's not the laying off that hurts, it's the way it's been done."Netflix: About 150 peopleNetflix Co-CEO Reed Hastings.Getty Images LatamNetflix laid off around 150 people in mid-May, its second round of layoffs in 2022.The latest layoffs, which impact "mostly US-based" staff, are due to "slowing revenue growth," according to a statement from a Netflix spokesperson. "These changes are primarily driven by business needs rather than individual performance," the statement said, "which makes them especially tough." Earlier this year, Netflix revealed that it had lost around 200,000 subscribers to its video-streaming service in Q1 — its first subscriber loss in over a decade. And executives warned at the time that further subscriber losses were predicted for the future. They blamed "revenue growth headwinds" in a report to shareholders and said that heavy Netflix use during the height of the COVID-19 pandemic had "obscured the picture until recently."These are not the first layoffs to hit the streaming incumbent this year.After assertively recruiting high-profile writers and editors for its new fan site, Tudum, last year, Netflix laid off nearly a dozen contracted staffers from the editorial project in late April, in addition to about 25 employees in its marketing department.Outside, ClickUp, Zulily, and Latch all laid off peopleA Zulily logo on display at QVC Studio Park in West Chester, Pennsylvania, in 2018.Brendan McDermid/ReutersLayoffs aren't only impacting major corporations — a variety of smaller and lesser known companies are also firing people to save money:Online retailer Zulily laid off "fewer than 100" members of its corporate staff, Geekwire reported earlier this month. "Last week, we announced to our team members some hard choices we have made for our organization to bring our operating expenses in line with our revenue and position our business for future growth," a spokesperson said in a statement.Outside, the magazine conglomerate and publication, laid off 66 people as part of a larger restructuring to make the company a digital-first publishing house, Aspen Public Radio reported this week.ClickUp, a software company that makes a productivity app, cut 7% of its staff, "to ensure ClickUp's profitability and efficiency in the future," the company told Protocol. It's unclear how many people were impacted, but estimates put the company's total staff at over 500.Latch, a company that makes a smart lock, laid off about 130 people — 28% of the company's total staff, it said. The layoffs are intended to, "better align staffing and expense levels with current sales volumes and the current macroeconomic environment."Ben Gilbert contributed to an earlier version of this article.Read the original article on Business Insider.....»»

Category: smallbizSource: nytAug 15th, 2022

Prime Mining Announces Financial Results

VANCOUVER, British Columbia, Aug. 12, 2022 (GLOBE NEWSWIRE) -- Prime Mining Corp. ("Prime", or the "Company") (TSX.V: PRYM) (OTCQB:PRMNF) (Frankfurt: O4V3) is pleased to report its operating and financial results for the three-month period ending June 30, 2022. Unless otherwise stated, all amounts are presented in Canadian dollars. Prime is focused on the exploration and development of its wholly owned Los Reyes Gold-Silver Project in Sinaloa State, Mexico ("Los Reyes" or the "Project"). Prime Chief Executive Officer Daniel Kunz commented, "We are currently into the rainy season at Los Reyes but still have 5 drill rigs operating and already have completed 63,000 metres of drilling in Phase 2, for a total of 88,500 metres Phase 1 and 2 combined.   In July 2022, the Company reported results from eight drill holes at the San Miguel East deposit, which were drilled down dip of the known structure at depth. All eight encountered mineralization with seven of the eight extending mineralization beyond the current historic resource. The southernmost hole, 22SME‐11, with an 18‐metre intercept returning 2.72 gpt Au and 129.8 gpt Ag (16.9 m etw), was intersected outside the previously reported pit‐constrained resource." Corporate Highlights During the Quarter On May 10th, the Company announced financial results for the three-month period, ending March 31st, 2022. On June 8th, the Company announced upgrading to trade on the OTCQX under the symbol PRMNF Exploration Highlights During the QuarterOn April 12th, the Company announced positive drill results from 26 drill holes into its Guadalupe East deposit. These holes intercepted the high-grade Estaca, the San Nicolas and the San Manuel epithermal veins as well as other sub-parallel veins in the system. On May 2nd, the Company announced new drill results expanding the Zapote North deposit. These results included 17 new holes targeting the northern extension of the Z-T Structure, including 2 holes from the Mariposa deposit. This drilling confirmed that gold-silver mineralization extends from Zapote North to Mariposa. On June 1st, the Company announced 12 new step-out drill holes at the Guadalupe East deposit. Six of these holes interested high-grade gold and silver mineralization below the current pit-constrained resource which demonstrated the strong potential for near-pit resource expansion. On June 29th, the Company announced 20 additional assays from its expanded Phase 2 step-out and infill drilling program at the Tahonitas deposit on the western side of the project. These results continued to successfully identify shallow near surface mineralization as well as deeper mineralization down to 450 metres above sea level. Maintaining Health and Safety Protocols The Company continues to successfully mitigate the impact of Covid-19 on operations. To-date Covid-19 has not had a material effect on the Company's activities. Prime remains engaged with local stakeholders and is proactive in monitoring employees and contractors during this uncertain period. The Company continues to closely adhere to the directives of all levels of government and relevant health authorities in Mexico and Canada. Community Engagement and Environmental Stewardship Strategy We continued to gather environmental and community data in the quarter to help support our ESG programs, including completion of a materiality assessment, strategic plan and disclosure matrix. We strive to minimize the environmental impact of our activities and ensure that Los Reyes has a positive impact on our host communities. Selected Financial Data The following selected financial data is summarized from the Company's consolidated financial statements and related notes thereto (the "Financial Statements") for the three and six months ended June 30, 2022. A copy of the Financial Statements and MD&A is available at www.primeminingcorp.ca or on SEDAR at www.sedar.com.   Three months ended June 30, 2022.....»»

Category: earningsSource: benzingaAug 13th, 2022

The Inflation Reduction Act Includes a Bonanza for the Carbon Capture Industry

Some environmentalists are skeptical that the industry can deliver real emissions cuts Thanks to Senator Joe Manchin (D., W. Va.), there isn’t much in the way of consequences for big CO2 emitters in Democrats’ new climate bill. But there are huge new rewards for high-emitting companies to pump their greenhouse gasses underground, and for facilities that propose to remove emissions directly from the atmosphere. Those provisions have the startups, investors, and legacy oil companies proposing to provide that service over the moon. “We’re definitely going from a curiosity to a priority,” says Steve Lowenthal, chief commercial officer of Frontier Carbon Solutions, a carbon capture startup. “This changes the game.” [time-brightcove not-tgx=”true”] The Inflation Reduction Act, which passed the Senate on Monday and is poised to pass the House on Friday, includes a dramatic change in a crucial tax credit for the carbon capture industry—increasing the government subsidy for capturing CO2 from polluting sources from $50 to $85 per metric ton. Developers say that raising that incentive could tip many projects that once weren’t worth the investment over the financial finish line. The new bill also simplifies the process for receiving those tax credits, and opens the subsidy to smaller carbon capture projects, which together essentially fulfill a full industry wishlist for new carbon capture legislation. “The fact that [the legislation] actually happened isn’t a big surprise,” says Adrian Corless, CEO of CarbonCapture, a direct air capture startup. “The fact that it actually came out in such a good form and actually came out [so soon] is much better than we expected.” Read more: The Inflation Reduction Act Is About to Jumpstart U.S. Climate Policy and Change the World Formerly, the tax incentive, known as 45Q, only paid enough to convince investors to fund the easiest carbon capture projects, like pipelines to capture CO2 from ethanol processing facilities, which emit almost pure CO2 from tanks where corn is fermented into vehicle fuel. Emissions from power plants and other industrial facilities contribute hugely to climate change, but the actual gas escaping from their smoke stacks contains a much lower percentage of CO2 (coal plant emissions, for example are about 13% CO2), and the fact that that CO2 has to be first separated out from the other gasses makes it much more expensive to capture it and store it underground. But raising the incentive to $85 per ton means projects that capture carbon dioxide from industrial facilities with lower CO2 concentrations, like natural gas processing facilities and cement plants, could become financially viable. “It really can’t be [overstated] how meaningful 85 [dollars per ton] is to the industry at large,” says Lowenthal. The package also gives a good deal of government support to a fledgling industry proposing to remove carbon dioxide directly from the air, increasing tax credits for removing CO2 from the atmosphere to $180 per ton. “It’s going to make it easy for us to raise the capital to build the project earlier and to build it faster,” says Corless Massive Industry Boost The new bill comes on top of last year’s infrastructure law, which doled out a huge helping of government support for the sector, including $100 million for the Department of Energy to design pipelines to transport compressed CO2 emissions to underground storage sites, $2.1 billion in loans and grants for the private sector to build the pipelines, and $3.5 billion to construct four “hub” facilities to remove carbon dioxide from the atmosphere (although together those facilities will be able to sequester less than 0.1% of the CO2 the U.S. emits each year). Taken together, the measures could help the fledgling industry grow 13-fold by 2035, according to the Carbon Capture Coalition, an industry group representing startups and oil majors like Shell. “Together with the historic investments made in the Bipartisan Infrastructure Law, this package would provide the most transformative and far-reaching policy support in the world for the economywide deployment of carbon management technologies,” wrote the coalition’s external affairs manager Madelyn Morrison in a July 28 press release. Oil company Shell, which has eyed carbon capture as a potential growth avenue, lauded the changes as well. “We see the Inflation Reduction Act’s carbon capture-related provisions as key to developing projects that will help reduce emissions in critical industrial sectors,” the company’s media representatives said in a statement to TIME. Read more: The Inflation Reduction Act’s Name Says A Lot About The Climate Fight International players have also taken note. “It will establish the United States as the place to be to deploy such technologies,” says Christoph Gebald, co-founder of Swiss direct air carbon capture company Climeworks, which opened the first commercial CO2 removal plant in Iceland last year. “And I am very convinced that this will also kick off a spiral of action from investors.” Environmentalists Remain Skeptical Not everyone sees the industry’s likely expansion as a good thing. Until now, carbon capture technology has never really ramped up in a big way, despite years of talk by emitters. Many projects have ended in expensive failures, while others never were able to achieve the emissions cuts they promised when the energy costs of running the carbon capture equipment were factored in. Carbon capture funding is one of the few climate provisions that tends to get bipartisan support, but many environmentalists have long portrayed it as a costly distraction from urgently needed emissions cuts, as well as a handout to oil companies that tout the technology as a new revenue stream. That’s especially true of a controversial provision in the tax code that gives incentives to companies that pump the captured carbon underground in order to extract more oil, rather than just to permanently store it. (The new climate bill raises the government’s reward for this so-called “enhanced oil recovery” to $60 per ton.) Many in the environmental world, however, agree that we will need some carbon capture to decarbonize hard-to-abate industries like cement production, and that we will need to scale up atmospheric carbon removal technology in the decades ahead in order to have any hope of reaching net-zero targets. But those efforts also won’t do much if they’re not also accompanied by dramatic emissions cuts across society. Jim Walsh, policy director at Food and Water Watch, says the new legislation relies too heavily on carbon capture. A popular emissions analysis of the legislation from Princeton University’s REPEAT Project counts on companies to quickly scale up carbon capture projects that promise to deliver a fifth of total U.S. emissions cuts by 2030, even though the technology hasn’t been able to achieve significant climate benefits in the past. “The Inflation Reduction Act does not deliver mandates to cut pollution. It creates incentives that may drive up private investment, and it delivers billions to fossil fuel corporations based on the notion that their climate pollution can be somehow captured,” he wrote in an Aug. 11 statement. “This is a dangerous bet.” Fueling Local Battles The incentives and proposed expansion to the industry are likely to also set off local controversies. In Iowa, plans to build massive new pipelines to transport carbon dioxide have become a political flashpoint over the past year. Activists and landowners are facing off against investors and a pro-carbon capture governorship over plans to build massive pipelines to transport carbon dioxide released from ethanol plants to underground storage sites in North Dakota and Illinois. Proponents of the pipelines say they will make a serious dent in Iowa’s greenhouse gas emissions and help benefit farmers who grow corn that serves as a feedstock in the state’s ethanol industry. But opponents, including local environmentalist groups, say the pipelines put Iowans at risk of dangerous CO2 leaks, and prop up an obsolete, high polluting ethanol industry while trampling on local farmers who will have to allow developers to build through their land. Last week, this battle reached a new pitch, when one of the developers, Summit Carbon Solutions, notified state regulators that it would begin filing for eminent domain in order to take control of private land it needs to build the pipeline. “Summit showed their true colors today,” wrote Food & Water Watch organizer Emma Schmit in an Aug. 5 press release. “Summit may seek eminent domain but [it] is our public institutions, accountable to the people, that will be responsible for the final decision.” The genesis of Summit’s project goes back to a 2018 change in the 45Q tax credit, which raised the payment from about $24 per ton to $50, giving the developers an economic incentive to start building the pipeline. Speaking with TIME in February, Summit executives said another increase in 45Q, like the one the Senate just passed, might push them to look at building even more pipelines to capture emissions from farther-flung ethanol plants. That would seem likely to throw even more fuel on the fire in Iowa—potentially the first of many such clashes as federal funding helps the industry scale up in the years ahead......»»

Category: topSource: timeAug 12th, 2022