Business News in Brief: Are the days of the student grant numbered?
The ‘Vismændene’ – the four ‘economic wise men’ whose recommendations at De Økonomiske Råd have helped shaped much of Denmark’s economic policy since 1962 – have indicated that the days of complete state support for students could be numbered.
In their latest report, they recommend major cuts to the SU stipend whilst raising the size of available state loans.
A huge social price
Sana Mahin Doost, the head of Danske Studerendes Fællesråd, warned it will result in fewer people from poor backgrounds continuing on to higher education – not least because they tend to have a lower risk tolerance.
She cited the example of Norway, which recently pursued the policy recommended by the Vismændene.
New Øresund Metro would hugely benefit business, claims study
A Metro system linking Malmö and Copenhagen across the Øresund would bring huge financial benefits to the region, reports a study paid for by the cities’ municipalities and the EU. Reduced journey times could generate as many as 500,000 new jobs, taking the total up to 1.3 million, and also increase the number of people within reasonable distance of the ‘metropolis’ to 2.3 million, reports News Øresund. The Metro could be completed by 2035.
SKAT cautious of fraudulent business motives
SKAT is increasingly cautious when registering companies for VAT payments, and in 2017 it turned down 600 applications. Background checks are often carried out to ascertain whether there is any reason to suspect the company intends to commit fraud – normally by operating normally for a number of months to build up goodwill and then taking as much as credit as it can get. Companies not registered for VAT are prohibited from earning more than 50,000 kroner a year.
Brøndby shares take a plunge following Superliga failure
Shares in Brøndby IF took a huge tumble on Monday morning, the first day of trading following its failure to win the Danish Superliga, falling by 46 percent – thus wiping 313.8 million kroner off its value to stand as just 357.5 million. Nevertheless, the share price is still higher than its position at the start of the year.
OW Bunker executive sentenced to 18 months
Lars Møller, the former chief executive of OW Bunker’s Singaporean subsidiary, has been sentenced to 18 months in prison for his role in the company’s 2014 bankruptcy. The company went belly up just eight months after a lavish stock market listing as 600 jobs and billions of kroner disappeared, ultimately paying the price for the Singaporean subsidiary giving out far too much credit.
Nationalbanken warns banks over pre-financial crisis behaviour
Nationalbanken, the country’s central bank, has warned that some Danish banks are beginning to mirror the behaviour observed in the build-up to the financial crisis a decade ago – namely easing credit standards for corporate customers, increasing their position of risk. “This development emphasises the importance of having well-capitalised banks and of building up the counter-cyclical capital buffer so that the effects can be mitigated when the economy reverses,” noted Nationalbanken’s Financial Stability analysis.
Healthy rise in GDP, but down on Q1 of 2017
Denmark’s GDP rose by 0.4 percent over the first quarter of 2018 as private consumption increased by 0.9 percent – a jump partly attributed to an increase in car sales. Public consumption rose by 0.2 percent, exports fell by 0.5 percent and imports increased by 0.6 percent. However, despite the 0.4 percent increase on the fourth quarter of 2017, the figures represented a year-on-year dip of 5 percent.
Arla confirms job cuts with more probably on the way
Dairy giant Arla has eliminated 195 jobs as part of its ongoing cost-cutting measures, which plan to save 3 billion kroner over the next three years. The redundancies will primarily take place at the dairy’s HQ in Aarhus. A further 154 could be laid off in Britain as part of a plan to merge Arla’s cheddar production in Taw Valley and Lockerbie.
Analysts unconvinced by SAS optimism
SAS’s second quarter results followed expectations, even though there are several analysts who believe their 2017-18 fiscal projections are a little optimistic. Turnover fell 597 million Swedish krona to 18.9 billion – a dip the airline blamed on currency fluctuations and fewer flights.
Genmab shares take a hit following disappointing tests
Biotech company Genmab’s news that is has stopped testing its cancer drug Darzalex led to a 25 percent fall in its share price on Monday, before a late rally reduced the overall market value loss to a fifth – the equivalent of 14.7 billion kroner. Darzalex is used to treat bone marrow cancer, and it was hoped the new tests would widen its treatment area.
Nordisk Film continues venture into gaming with huge acquisition
Nordisk Film has acquired Swedish computer game company Avalanche Studios for 660 kroner – the biggest purchase in its 111-year-old history. The takeover means Nordisk Film has now invested around 1 billion kroner in gaming in Scandinavia. It has also bought into Star Stable Entertainment, Reto Moto, Multiverse and Flashbulb Games. Avalanche Studios has 320 employees in Stockholm and New York.
Jysk to withdraw from China after disappointing eight years
Furniture manufacturer Jysk is closing down all 13 of its stores in China following a failure to appeal to consumers. The journalist Christina Boutrup, an expert on the country, told BT that Jysk paid the price for not properly researching the market, for not tailor-making products for sophisticated middle-class customers, and for charging uncompetitive prices. Jysk opened its first store in China in 2010.
21 opt for transfer from Intersport to Sport 24
A third of Intersport’s outlets are jumping ship to join the Sport 24 franchise. From October 1, the 21 stores will increase the number of Sport 24 outlets to 84.