NAOS CEO Insights

CEO INSIGHTS – Week Ending 20 December 2019 By NAOS Asset Management

December 20, 2019

“People are enticed and they want to travel. They want to experience. I think there’s a number of reasons for that. I think technology has had a big impact on that. I think social media, whether you love it or you hate it, is a big driver of that.” Ed Bastian, CEO, Delta Air Lines Inc

CEO INSIGHTS – Week Ending 20 December 2019 By NAOS Asset Management

“People are enticed and they want to travel. They want to experience. I think there’s a number of reasons for that. I think technology has had a big impact on that. I think social media, whether you love it or you hate it, is a big driver of that.” Ed Bastian, CEO, Delta Air Lines Inc


As part of the NAOS investment process, we pay particular attention to the comments made by company CEOs and business leaders in order to gain a greater understanding of the current investment environment and key trends that may be emerging. Below are quotes from the week which in our view detail some of the most important and prominent industry trends and economic factors impacting their businesses.  
 
If you do not already subscribe and wish to receive this weekly publication of “CEO Insights” via email please click here. 

 

Tourism, Travel & Experiences

“People are enticed and they want to travel. They want to experience. I think there’s a number of reasons for that. I think technology has had a big impact on that. I think social media, whether you love it or you hate it, is a big driver of that.” Ed Bastian, CEO, Delta Air Lines Inc

“We are seeing increasing demand for leisure and experience-based venues in shopping centres and other large format retail centres across Asia Pacific as developers move to accommodate more retail and lifestyle tenants.” Scott Blume, CEO, The Entertainment & Education Group [owner of Timezone & Zone Bowlings]

“We have curated a major shift towards experience-based offerings, which now represent 42% of our portfolio.” Peter Allen, CEO, Scentre Group

Airlines

“It’s an attractive industry, an attractive place to be against the backdrop of an improved industry structure and industry dynamics where people are focused on returns, and you’ve got a consolidated structure that makes sense and we’re competing on quality and product and service rather than price solely, it’s a whole new world.” Ed Bastian, CEO, Delta Air Lines

Technology

“The need for people to engage digitally with customers is not just a U.S. phenomenon. It's a global phenomenon.” Shantanu Narayen, CEO, Adobe Inc

Food & Beverage

“The cider market has been in decline for about a year. Australia's never been a strong cider market compared with the UK.” Tim Cooper, MD, Coopers Brewery

Mining & Commodities

“There is remaining strength in the underlying [iron ore] market and market conditions.” Elizabeth Gaines, CEO, Fortescue Metals Group Ltd

“Mining of all major commodities is forecast to increase globally in the coming years.” Alberto Calderon, CEO, Orica

Agriculture

“This drying trend is the largest sustained change in Australian rainfall since records began and it is linked with atmospheric changes associated with global warming.” Market Announcement, Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES)

Media

“The competition has increased by 400 per cent, and not surprisingly, that's really hit our earnings.” John Hartigan, Chairman, Prime Media Group Ltd

Domestic Economy

“Credit conditions are improving, and we are seeing about half of our customers are first home buyers.” Mark Steinert, CEO, Stockland Corp Ltd

“What we've definitely seen is the bringing forward of [consumer spending] activity to the end of November.” Peter Birtles, Director, GWA Group

Global Economy

“In the last weekend that just finished, we delivered over 14 million packages on Saturday and Sunday...We weren’t even delivering packages on the weekend a couple of years ago.” Fred Smith, CEO, FedEx Corp

“Job growth, unemployment levels and consumer spending remains strong, which collectively are positive factors for our business.” Andrea Owen, CEO, Herman Miller Inc [global office furniture manufacturer]

US Economy

“I might also say that I think in this country, there's a little bit of an under estimation of what's going on in the rest of the world, the e-commerce growth, the technology sector that we had, the tax cut. All of these things have led us to have a high increasing employment. It's led us to have reasonable GDP growth that's virtually not true anyplace else in the world.” Fred Smith, CEO, FedEx Corp

“The US consumer is healthy, and the housing environment is stable and provides support for home improvement demand. With wage growth now at over 3% and a lowest unemployment rate in 50 years, the consumer remains confident heading into next year.” Richard McPhail, CFO, The Home Depot Inc

“We’ve got 50-year unemployment lows. Consumer balance sheets are in good shape. And obviously, the corporate sector, you know, after the tax cut, there was a major surge...Consumer remains very strong.” James Gorman, CEO, Morgan Stanley

 

 WHY INVEST WITH NAOS? 
 
Important information: This material has been prepared by NAOS Asset Management Limited (ABN 23 107 624 126, AFSL 273529) (NAOS) for general information purposes only and must not be construed as investment advice. Certain economic, market or company information contained in this material may have been obtained from published sources prepared by third parties. Nothing contained herein should be construed as granting by implication or otherwise, any license or right to use such third party content without the written permission of the owner.