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Speaker 1: Today on Fear and Greed. There's life yet in the

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Speaker 1: local property sector, with data centers, retail and office blocks

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Speaker 1: finding in best of favor. National Australia banks profit disappoints,

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Speaker 1: triggering a sell off among Australia's banks, and KFC is

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Speaker 1: leaving Kentucky. Plus good news on the Wag's front and

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Speaker 1: the Wayalas Steel Works goes into administration. Welcome to Fear

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Speaker 1: and Greed. Daily business news for people who make their

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Speaker 1: own decisions. It is Thursday, the twentieth of February twenty

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Speaker 1: twenty five. I'm Michael Thompson and good morning Sean Aylmer.

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Speaker 2: Good morning Michael Shawn.

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Speaker 1: The main story this morning. Three of the country's biggest

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Speaker 1: property groups reported yesterday the somewhat beleaguered sector is showing

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Speaker 1: some signs of life in some areas, notably data centers

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Speaker 1: and believe it or not, shopping centers actually, but it's

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Speaker 1: struggling in others like residential so bit of a mixed bag.

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Speaker 2: Plenty of profit results out over the past few days.

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Speaker 2: We thought would wrap them all up. The big one,

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Speaker 2: of course, was Goodman, the big Daddy of the property sector.

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Speaker 1: Please never never use the term big Daddy on this

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Speaker 1: podcast again.

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Speaker 2: Okay, what will be the big kahuna? Yeah, right, the

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Speaker 2: big kahuna of property. Goodman Group logistics company went through

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Speaker 2: boom time around COVID morphed into data centers. Now it's

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Speaker 2: really well and truly double down on data centers. It's

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Speaker 2: raising four billion with a B four billion dollars to

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Speaker 2: spend and develop sites in Los Angeles, Sydney, Melbourne, Madrid, Tokyo.

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Speaker 2: In fact, almost half its work nowadays is data centers.

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Speaker 2: This is a company we know about logistics, all those

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Speaker 2: industrial properties in the suburbs where they used to shift

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Speaker 2: goods into and out of Well, it's that company. Goodman

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Speaker 2: is really pushing into data centers. Reckons that Greg Goodman

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Speaker 2: to see. I reckons that the four billion dollars they're

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Speaker 2: raising will be used to create about ten billion dollars

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Speaker 2: worth of value and five one hundred megawatts of capacity.

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Speaker 2: We used to talk about property in terms of acreage

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Speaker 2: and square meters. Now we're talking about mega megawise.

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Speaker 1: Yeah, it's pretty cool.

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Speaker 2: It is the biggest capital rays among a property company. Ever,

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Speaker 2: Goodman's actual result was almost forgotten yesterday. The bottom line

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Speaker 2: went from two hundred and twenty million to eight hundred

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Speaker 2: million seems enormous. That's for the six months of December.

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Speaker 2: That's about revaluations though, so when we talk about property

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Speaker 2: the future gets a bit technical. We're going to talk

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Speaker 2: about future earning stream and won't do that. Basically, how

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Speaker 2: they value property in the future chops and changes depending

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Speaker 2: on interest rates and stuff like that. And the higher

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Speaker 2: interest rates are the worst, it looks because property companies

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Speaker 2: have lots of debts, they're paying higher interest rates. Lower

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Speaker 2: interest rates you get these big revaluations.

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Speaker 1: Let's talk about Vicinity because this is an interesting one

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Speaker 1: that obviously owned big retail assets Chadston in Victoria, QVB

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Speaker 1: and Sydney and a bunch of others. And they boast

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Speaker 1: that the two thirds, I think two thirds of Australians

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Speaker 1: live within thirty minutes of kind of one of these centers.

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Speaker 1: How is retail land looking.

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Speaker 2: I think this is a fascinating result because they reckon

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Speaker 2: there's going to be a shortage in shopping centers over

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Speaker 2: the next decade.

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Speaker 1: Hang on, hang on, didn't shopping centers die? Yes?

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Speaker 2: Apparently so rumors of their deaf greatly eager.

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Speaker 1: Yes.

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Speaker 2: As it turns out, long way from that post COVID idea.

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Speaker 2: There's population growth. That's the bottom line, and as a result,

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Speaker 2: they reckon retail sales demand will be up about thirty

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Speaker 2: percent over the next ten years, but the actual amount

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Speaker 2: of space given to retail shops will only be all

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Speaker 2: In fact, they say it'll drop by five percent, So

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Speaker 2: that mismatch means that there'll be great demand for shopping

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Speaker 2: center space. I think that's really fascinating. Vicinity itself, it

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Speaker 2: reported I did, I mean very well on the back

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Speaker 2: of revaluations as well announced a big jump in this profit.

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Speaker 2: Stockland also reported. Now Stockland does retail, but it also

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Speaker 2: mostly that's in the suburbs and regions. It's also a

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Speaker 2: big residential developer nowadays it creates master planned communities, medium

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Speaker 2: density housing. That part of the property sector ain't doing

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Speaker 2: so well now. It's bottom line did very well on

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Speaker 2: the back of revaluations, but chief executive Taram Gupta said,

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Speaker 2: really more rate cuts are needed to spark that residential

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Speaker 2: property sector. It was down about four percent yesterday. If

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Speaker 2: you are adding recent announcements from a bunch of the office

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Speaker 2: block owners Dexas, Mervak Lindley's, they've all talked about the

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Speaker 2: return to work trend being real, and you know where

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Speaker 2: I parked my car in the morning at the railway station.

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Speaker 2: I can never find a park f I'm not there

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Speaker 2: by eight o'clock. So as a result, it's real. You

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Speaker 2: get that you're really finding, say, data centers and logistics

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Speaker 2: is doing well, retail is doing better, office is doing better,

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Speaker 2: maybe not residential. There's sort of life out there in

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Speaker 2: the property sector. Now. If you take all the reds

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Speaker 2: to get and they're a very diverse bunch, what you're

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Speaker 2: finding is that they've had a bit of a renaissance,

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Speaker 2: up thirteen percent in the last twelve months, five percent

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Speaker 2: this year, and just the outlook finally after probably six

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Speaker 2: really poor years, is looking better.

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Speaker 1: That's a bit of a good news story that one.

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Speaker 1: The big shock yesterday in earning season was National Australia

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Speaker 1: Banks quarterly report. The result itself was okay, solid even,

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Speaker 1: but it didn't beat expectations and NAB's share price at

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Speaker 1: one point was down something like eight percent.

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Speaker 2: I mean that's where it finished it. In the end.

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Speaker 2: The profit disappointment was down to be said, but you know, well,

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Speaker 2: revenue were flat bad and doubtful debts and mortgage arears

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Speaker 2: were a touch higher than Commonwealth Bank and West BAC,

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Speaker 2: but really it wasn't too bad. But all these bank

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Speaker 2: shares are priced to perfection. So NAB said we made

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Speaker 2: one point seven million dollars during the December quarter. People

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Speaker 2: wanted a little bit more than that. It was almost

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Speaker 2: like there was a reason to sell National Australian Bank

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Speaker 2: shares yesterday and they did down eight percent. All the

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Speaker 2: other bank stocks got sold off as well. You know,

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Speaker 2: we've talked a lot about priced perfection and come off

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Speaker 2: Bank JB high five. Some of these companies doing really well.

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Speaker 2: Anyone that misses when your price to perfection gets sold

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Speaker 2: down hard. And that's exactly what happened to NAB yesterday.

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Speaker 1: Yeah, that's what we saw now. The South Australian Parliament

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Speaker 1: sean moving away from earnings now has effectively forced the

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Speaker 1: Wyala Steel Works, owned by Indian billionaire Sanjeev Gupta into administration,

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Speaker 1: putting thousands of jobs at risk. This is a big employer.

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Speaker 2: Premier Peter malanowskis called in court AMNTA after passing legislation

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Speaker 2: that basically gave the state rights to enter the steelworks

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Speaker 2: get access to the accounts and to give the state

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Speaker 2: government a first charge over debts owed by the steelworks.

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Speaker 2: Son Jeev Gupta's LPMA, which is owned by his global

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Speaker 2: group GFC Alliance, owes the government tens of millions of

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Speaker 2: dollars in unpaid royalties, whilst South Australian Water is owed

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Speaker 2: something about around fifteen million. Now that tens of millions

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Speaker 2: have been media reports, it could be up to three

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Speaker 2: hundred million dollars, though yesterday the premiere wasn't saying how

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Speaker 2: much it was. The background to this, mister Goopda, he's

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Speaker 2: in the steel works lender A crowd called green Sill

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Speaker 2: collapsed about four years ago, leaving the group in a

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Speaker 2: big financial hole and it has never worked its way

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Speaker 2: out of it. About three thousand people work in South

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Speaker 2: Australia or two thousand people in South Australia worked for

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Speaker 2: the company one way or another. Mister Gooder previously said

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Speaker 2: he's aiming to get the steel works back to profitability

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Speaker 2: by midyear. The South Australian government didn't have patience for that.

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Speaker 2: They've pretty much taken the decision out of his hands.

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Speaker 1: Big start to the show immediately after today's episode, stick around.

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Speaker 1: You've got a chat coming up with Patrick Coglan from

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Speaker 1: Credit to Watch.

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Speaker 2: Yes, So it's a fantastic We fantastic talk to Patrick

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Speaker 2: about the SME side of the business. So we've been

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Speaker 2: talking a lot about big business over recent weeks because

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Speaker 2: of the season. We talked to him about where the

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Speaker 2: sector is, what the interest rate cuts mean for the sector,

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Speaker 2: in terms of administrations, those sorts of things, where small

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Speaker 2: business is up to. It's a fantastic look at that.

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Speaker 1: Yeah, it's coming up after the show. Got plenty more

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Speaker 1: still to come. We're talking about Clive Palmer is back Sean.

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Speaker 1: It's politics though. I've had a bit of a facelift,

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Speaker 1: so we'll talk about that. A shocker for Mineral Resources

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Speaker 1: KFC leaving Kentucky. A lot more to come. We'll be

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Speaker 1: back in a moment with the rest of the day's

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Speaker 1: business news sewn. The federal government has played down suggestions

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Speaker 1: that an election could be called soon, with Treasurer Jim

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Speaker 1: Chalmers saying that he doesn't think Prime Minister Anthony Albanezi

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Speaker 1: has made a decision on a pole date yet. Do

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Speaker 1: you believe that.

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Speaker 2: Well, I think he's thinking about his wedding date. He

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Speaker 2: came out yesterday and said, you know, he and his

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Speaker 2: fiance j D. Hayden again to get married in the

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Speaker 2: second half of this year after the election. Pictures everywhere

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Speaker 2: hand in hand. I reckon, he's thinking about that morning.

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Speaker 1: Everyone look over here.

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Speaker 2: Nothing's going on. Honestly, Jim Chalmers did get a bit serious.

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Speaker 2: He said that he thinks the worst of infations over,

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Speaker 2: but he wasn't going to comment too much on interest rates.

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Speaker 1: Meanwhile, Clive Palmer's back. I've got to talk about this.

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Speaker 1: The billionaire says he will chair a new political party.

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Speaker 1: It is called Trumpet. It's hard to say seriously, Trumpet

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Speaker 1: of patriots, and he says Australia needs quote more trump policies.

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Speaker 2: Is it collective noun for patriots, a Trumpet?

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Speaker 1: I think it is now. I think we'll use this

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Speaker 1: now henceforth forever.

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Speaker 2: After the Australian Electric Commission confirmed the United Australia Party

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Speaker 2: his former party could not reregister as a party, Clive

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Speaker 2: Palmer said he'd take the helm of a new political outfit.

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Speaker 2: Let me quote Clive Palmer yesterday. The party believes in

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Speaker 2: the policies of Donald Trump, which is shown to be

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Speaker 2: effective in bringing management back on track. Australia's Australia needs

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Speaker 2: Trump policy, Australians want them. I don't know whether that's

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Speaker 2: true or not. Trumpet of Patriots will run candidates in

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Speaker 2: the Upper and Lower House. It will focus on and

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Speaker 2: I need to quote here, ending the gender agenda. Ending

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Speaker 2: the agenda with policies banning trans people in women's sport

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Speaker 2: and gender affirming healthcare for young people. Prime Minister Anthony

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Speaker 2: Albinezi in response said Clive Palmer spending tens of million

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Speaker 2: dollars on a new party is a distortion of democracy.

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Speaker 1: You know one group that will be very happy about

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Speaker 1: this will be the media companies. Yes, because Clive Palmer

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Speaker 1: has historically been a very very big spender in election advertising.

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Speaker 1: And even last week we had the CEO of seven

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Speaker 1: West Media, Jeff Howard, was talking about it, and I

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Speaker 1: think it was talking about the expectation that between now

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Speaker 1: and over the next kind of three or four months,

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Speaker 1: there is the expectation that will be this influx of

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Speaker 1: political spending, as there always is. But the quote was

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Speaker 1: we've already seen a bit of Clive money already, as

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Speaker 1: referred to as Clive money.

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Speaker 2: Yellow Is it yellow?

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Speaker 1: I remember, yes, yes, Oh, the billboards. You could not

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Speaker 1: drive anywhere in Australia without one of the big yellow billboards.

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Speaker 2: Yeah, it's fantastic.

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Speaker 1: Yeah. Wages growth SEAN has weakened to its slowest pace

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Speaker 1: since the middle of twenty twenty two, providing support for

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Speaker 1: the Reserve Bank's decision to cut interest rates on Tuesday.

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Speaker 2: During the December quarter, wages grew by zero point sixty

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Speaker 2: five percent three point two percent four of the year,

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Speaker 2: which is actually slower than what the Reserve Bank forecast.

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Speaker 2: If you include bonuses stuff like that, it gets to

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Speaker 2: that three point four percent level. Wages have decreased pretty

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Speaker 2: quickly since their peak. Maybe the employment market isn't quite

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Speaker 2: as red hot as the labor force figures suggest now.

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Speaker 2: The interest rate decision on Tuesday mentioned that the Reserve

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Speaker 2: Bank is still worried about wages growth pushing inflation. The

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Speaker 2: figures yesterday suggests that's not a major concern. Today we'll

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Speaker 2: find out what the January unemployment rate was when the

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Speaker 2: Bureau Statistics releases its data at about eleven thirty.

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Speaker 1: Mineral Resources had a shock a yesterday. Seawn At share

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Speaker 1: price tumbled twenty one percent after it said it needs

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Speaker 1: an additional three hundred million dollars to upgrade the road

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Speaker 1: to its new Onslow iron ore project in Western Australia.

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Speaker 2: So interesting though Onslow is a great hope for mineral resources,

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Speaker 2: but it's costing a stack of money. Now, the road

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Speaker 2: in question, it's one hundred and forty seven kilometers. It's

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Speaker 2: had five truck crashes since August. That sounds bad. Think

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Speaker 2: at the trucks, their triple trailer road trains carrying three

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Speaker 2: hundred and thirty tons of iron or each. They literally

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Speaker 2: every few minutes they are flying up that road and

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Speaker 2: it's a real problem. It's just hard to get a

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Speaker 2: head around. The size of those trucks carrying iron or

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Speaker 2: to the port.

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Speaker 1: That is huge. The amount of material that they are shifting,

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Speaker 1: and the weight of those trucks that is huge.

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Speaker 2: So men Rez. They made a loss of eight hundred

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Speaker 2: million dollars in the six months to the end of December.

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Speaker 2: They cut the interim dividend. No one expected that big

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Speaker 2: a loss. Share price down twenty one percent, falling commodity

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Speaker 2: prices so iron ore and liftium in this instance, trenchial weather,

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Speaker 2: uncertainty of its leadership, remember Chris Ellison the founder and

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Speaker 2: MD is facing a probe by the regulator into allegations

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Speaker 2: of corporate misconduct, all sorts of problems for mineral resources investors.

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Speaker 1: In ten seconds or less, Where did local markets finish

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Speaker 1: up yesterday?

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Speaker 2: Down zero point seven percent to eighty four hundred and

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Speaker 2: nineteen points. All about profits? Really? Kind of James Hardy

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Speaker 2: was good? Santos less good? Corporate travel jump ten percent

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Speaker 2: because it had a pretty good profit result. A lot

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Speaker 2: of incorporation did the same, although the waste management company

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Speaker 2: clean Away didn't do so well.

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Speaker 1: How you simplified things now to just good or that

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Speaker 1: that's the new market. Yeah. Let's turn to international news now,

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Speaker 1: and Donald Trump has said there should be elections in

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Speaker 1: Ukraine as part of a peace deal with Russia, and

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Speaker 1: his first public remarks after the US held high level

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Speaker 1: talks with Moscow about the war. This was between US

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Speaker 1: and Russia. Yeah, one party was missing.

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Speaker 2: Yes, So Russia and the US agreed to lay the

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Speaker 2: groundworks for future cooperation on ending the war in Ukraine. Now,

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Speaker 2: incredible turn of events really, because I mean Trump called

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Speaker 2: Russian President Vladimir Putin last week said let's end the war.

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Speaker 2: He didn't consult Ukraine. He didn't consult the rest of Europe,

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Speaker 2: who's on the doorstep in providing support to Ukraine. Yesterday,

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Speaker 2: the US President actually took a swipe at Ukrainian President

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Speaker 2: Vladimir Zelenski, saying, it's been a long time since an

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Speaker 2: election in Ukraine, and there was basically an election last year,

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Speaker 2: but that was put on hold because of the war.

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Speaker 2: Trump went on to say, and I quite you have

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Speaker 2: leadership now, as in Ukraine, you have leadership now that's

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Speaker 2: allowed a war to go on. They should have never

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Speaker 2: even happened. Now. He didn't mention that Russia actually invaded

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Speaker 2: Ukraine and didn't talk about Russia destroying cities and towns.

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Speaker 2: He also said, Trump this is that he was very

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Speaker 2: disappointed that Ukraine was upset about not having a seat

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Speaker 2: at the talks, chastising Kiev for not for Kiv for

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Speaker 2: not ending the war.

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Speaker 1: Yeah, some of those comments really came across as though

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Speaker 1: he was blaming Ukraine for actually starting the war and

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Speaker 1: suggesting that they should have made a deal earlier. So

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Speaker 1: it's just, yeah, it's a very interesting process watching this

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Speaker 1: diplomacy play out very very publicly, and probably finding out

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Speaker 1: about it. We're probably finding out about it at the

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Speaker 1: same time as Ukraine.

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Speaker 2: And diplomacy is probably been very generous word.

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Speaker 1: Yes, indeed, and the President said he was likely to

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Speaker 1: impose tariffs on cars, semiconductor chips, and pharmaceutically of about

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Speaker 1: twenty five percent, with an announcement coming a few weeks

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Speaker 1: as soon as April II.

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Speaker 2: The new duties, if implemented, would pretty much widen the

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Speaker 2: President's trade ward. Trump's previously now is twenty five cent

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Speaker 2: taris and steel and aluminium. They're supposed to take effect

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Speaker 2: next month. Now. These latest comments are his most detailed,

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Speaker 2: specifying other sectors that could be hit with fresh protectionist barriers.

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Speaker 2: Australia will be hit by that because we sell pharmaceutical

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Speaker 2: drugs into the US.

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Speaker 1: Sean hold the front page. In fact, we should have

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Speaker 1: led with this story almost KFC, which stands of course

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Speaker 1: for Kentucky Fried Chicken, it is moving its corporate headquarters

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Speaker 1: in the US from Kentucky to Texas. Does it have

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Speaker 1: to change the name TFC.

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Speaker 2: TFC from Louisville to PLANEO. I think it's going to

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Speaker 2: in Texas.

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Speaker 1: Yeah, it doesn't quite have the same ring to it.

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Speaker 2: No, it doesn't. So the parent company's Young Brands said

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Speaker 2: about one hundred corporate employees and dozens more remote workers

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Speaker 2: will be required to move. KFC headquarters is no longer

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Speaker 2: in Kentucky is heading to Texas. I think that's free disappointing.

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Speaker 2: But today that young Brands it owns in the US

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Speaker 2: KFC Pizza Hunt, Taco Bell, and then Habit Burger and Grill,

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Speaker 2: which we don't know so much about here. But it's

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Speaker 2: a massive chain over there. Isn't that quite amazing?

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Speaker 1: Do you reckon when they relocate and the eleven secret

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Speaker 1: herbs and spices get moved as well? Would that be

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Speaker 1: like a safe an armored vehicle, because I would have

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Speaker 1: to because that would be written down there and it

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Speaker 1: would be saved in a safe somewhere.

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Speaker 2: So the two great mysteries of my youth was what

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Speaker 2: went in to KFC the eleven herbs and spices? And

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Speaker 2: what were the ingredients in Coca Cola? And growing up

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Speaker 2: they were the two things that no one ever knew.

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Speaker 2: Apparently they were in vaults in Atlanta in the case

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Speaker 2: of Caca Colon and Louisville in the case of KFC.

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Speaker 1: Was reading about a case and you probably would have

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Speaker 1: reported this because it was probably only ten or fifteen

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Speaker 1: years ago where I was actually trying to be gentle

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Speaker 1: and now with Pepsi and Coca Cola, where someone from

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Speaker 1: Coca Cola approached Pepsi in a case of kind of

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Speaker 1: corporate espionage and said, hey, we will I'll sell you

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Speaker 1: the secret recipe. Yes, and Pepsi actually picked up the

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Speaker 1: picked up the phone yes, and called Coke and said,

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Speaker 1: you've got someone trying to sell your stuff taking up

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Speaker 1: on it. It's honorable. There is honor in business, Sean, Yeah, totally. Anyway,

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Speaker 1: got a bit off track there.

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Speaker 2: Anyway, Kentucky Fried Chicken is no longer. It's like Texas

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Speaker 2: Fried Chicken.

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Speaker 1: Yeah, so there we got all kind of tasty up.

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Speaker 1: Next is the Fear and Greed Daily Interview. Patrick Coglan

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Speaker 1: is your guest from Credit to watch great interview if

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Speaker 1: you are in business, particularly small business. It is coming

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Speaker 1: up Fear and Greed playlist podcast platform or at Fearangreed

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Speaker 1: dot com. Today you thank you, Sean, Thank you, Michael.

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Speaker 1: It is Thursday, the twentieth of February twenty twenty five.

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Speaker 1: Make sure you're following the podcast and please join us

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00:19:05,960 --> 00:19:10,119
Speaker 1: online on LinkedIn Instagram, x TikTok and Facebook Michael Thompson

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Speaker 1: that was fear and greed. Have a great day.