bookmark_borderMicrosoft trusts the cloud to double its profits

The services in the cloud and especially the Azure platform were once again the key that allowed Microsoft to close its fiscal year 2019 with more than twice the benefits as last year, although this segment began to offer its first symptoms of fatigue.

The firm of Redmond announced Thursday a net profit of 39.240 million dollars (34.794 million euros), more than double the 16.571 million (14.693 million euros) obtained in the previous year , and an increase in turnover of 14% to reach 125,843 million dollars (111,814 million euros).

As usual in recent years -especially since Satya Nadella took over as CEO of the company, replacing the historic CEO Steve Ballmer in 2014- the great engine behind Microsoft’s growth was again the cloud, which entered a 21 % more than a year ago.

Within this business segment, which the firm has dubbed “Intelligent Cloud”, the most prominent element was also once again its Azure service platform, a direct competitor of Amazon Web Services (AWS) and Google Cloud and whose turnover went up 64%

Although it is still very good, this percentage of growth is the lowest that Azure has experienced in the last four years (in 2018, for example, it grew 89%), a slowdown that points to a certain fatigue in the market, where only Azure, but also its competitors, have grown at a dizzying pace in recent times.

The increase in revenue in the cloud was followed by the business segment “Productivity and Business Processes”, which includes, among other software products, the popular Office package and the professional social network LinkedIn, which in 2019 had a 14 , 8% more.

Finally, ” More Personal Computing”, which hosts products and services as disparate as the Windows operating system and the revenues derived from the Xbox video game console, increased turnover by 8.1%.

The increase in revenues, however, is not the main element behind the drastic increase in profits, but this is mainly explained by the large reduction from one year to the next in terms of tax provisions.

The 19,903 million allocated by Microsoft in 2018 to pay taxes were drastically reduced this year to 4,448 million, a downward consequence of the fiscal reform promoted by the Government that presides over Donald Trump, approved in December 2017 and that began to be implemented in 2018.

On the other hand, the shareholders of the company obtained a yield of $ 5.11 per share during the last twelve months, compared to the $ 2.15 earned in the previous year.

The operating results (before interest and taxes) of the company that Bill Gates and Paul Allen co-founded 44 years ago were 42,959 million (22% more than the 35,058 in 2018), and the company managed to reduce its long-term debt up to 66,662 million with respect to the 72,242 with which it closed 2018.

“It has been a record fiscal year for Microsoft as a result of our agreements with leading companies in each sector, and every day we work together with our clients to help them build their digital capabilities,” he congratulated when the results were published by the CEO of the company. , Satya Nadella.

Precisely on Wednesday, a day before presenting results, the company revealed an agreement with the US communications giant AT & T, which will become its main provider of cloud services, an operation valued at more than 2,000 million dollars.

The data from the Windows creator were well received on Wall Street, where Microsoft shares were up 1.44% to $ 138.38 per share in electronic transactions after the closing of the New York switchboards.

bookmark_borderAfrica: a challenge for the World Bank and the IMF

On the map of the world of extreme poverty, Africa is in bright red. And this problem is likely to increase as the population grows in the coming decades.
The work of the International Monetary Fund (IMF) and the World Bank to combat this long-standing plague on this continent has had mixed results since its inception 75 years ago.

Today, the Bretton Woods institutions are simultaneously faced with the need for massive investments in these countries’ infrastructure, job creation to cope with the population explosion and the threat posed by climate change. in a region unable to bear the costs.

“In Africa, the problems are particularly visible”, summarizes David Malpass, President of the World Bank in an interview with AFP.

The most recent data from the institution show that extreme poverty, defined by people living with a maximum of $ 1.90 a day, has fallen sharply worldwide falling to 10% in 2015 against about 30% in 1990.

However, it continues to grow in sub-Saharan Africa, which was already four years ago, more than half of the extremely poor people.

Projections show that by 2030, nearly 9 out of 10 people living in extreme poverty will come from this part of the world, while the population of the continent will grow at the same time by 1.3 billion, or more than half of the world’s population growth.

For 2019, the IMF expects a growth of 3.5% of GDP for this part of the world, against 3% in 2018. But the expansion recorded on average in recent years remains insufficient to create the 20 million jobs that would be each year to absorb new entrants into the labor market, warned the Fund in April.

Africa’s working-age population is projected to grow from 705 million in 2018 to almost one billion by 2030, according to the African Development Bank (AfDB).

Upon his arrival in April, David Malpass emphasized the urgency of tackling poverty. And it was symbolically in Madagascar, Ethiopia and Mozambique that he then surrendered.

There are still 700 million people living in extreme poverty: “700 million too many,” he lamented.

The former US Under Secretary of the Treasury, who has openly criticized the World Bank while still working under the Trump Administration, has set itself the goal of improving the effectiveness of the institution.

For African countries with heavy debt inherited from the mistakes of the past, he intends to encourage “good policies”, “a key element” to attract private investment.

For Masood Ahmed, who has worked for the IMF and the World Bank for a long time, the development of Africa is all the more difficult because it is weakened by climate change.

“In the next 20 years, the global economy will be twice as big as it is today, and the infrastructure we need to support this economy will have to double,” he said. AFP.

Projects will have to be carried out while reducing greenhouse gas emissions by a third.

bookmark_borderBercy wants a record fine of 117 million euros for Leclerc, accused of “abusive business practices”

To pursue at all costs its policy of the lowest prices of large distribution, in the name of the defense of purchasing power, Leclerc has again stumbled. In a statement issued Sunday (July 21st), the Minister of the Economy, Bruno Le Maire, and his Secretary of State, Agnès Pannier-Runacher, announced the judicial summons of several entities of the group to ask for a record fine of 117.3 million euros, confirming information from Le Figaro .

To justify its decision against the French number one retailer, Bercy relies on a thorough investigation of the Directorate General of Competition, Consumer Affairs and Fraud Prevention (DGCCRF). In early 2018, it was seized by various suppliers Leclerc. They accused its French central purchasing Galec and two other bases in Belgium, Eurelec and Scabel, which include orders from super- and hypermarkets, to use illegal means to lower prices, including threats – and updates. execution – dereferencing in the rays.

Read also Bercy sues the central purchasing Leclerc
“This is a very sophisticated investigation conducted by more than twenty agents: 5,000 messages and 8,000 pages of documents were seized during the searches , which took place in February 2018, details Ms. Pannier-Runacher. The fine is high, because there are many indications of a deliberate intention to circumvent French law to impose unrequited price cuts on suppliers. ” It is, she says, ” three times the amount of overpayments received by Leclerc ” , which was 39 million.

An amount that does not include repayments of indus and without comparison with the few million claimed so far. It sends a strong signal: farmers and agri-food manufacturers consider the fines too painless to stop these bad practices.

In its defense, the retail giant recalls that the negotiations concerned do not concern SMEs or the agricultural world. “We can not forbid companies to buy in Europe , says the World CEO Michel-Edouard Leclerc, pointing out that such contracts involve outright purchases with” the twelve largest companies ” such as Nestlé, Mondelēz, Procter & Gamble or Unilever.

“A gift made to multinationals”
For the president of the E. Leclerc centers, the government “is looking for scapegoats in a media mess” and “to blame E. Leclerc for the failure of the Egalim law” on food that came into effect in January. ” And to increase prices at Leclerc,” laments the leader, who considers this assignment as “a gift to multinationals . ”

In Bercy, we reply by pointing to the growing relocation of trade negotiations to Belgium. “We went from four industry groups in 2017 to 14 in 2018 and 27 this year,” notes the Secretary of State. The government does not want to stop there to track down these abusive business practices. “We are paying particular attention to central purchasing, not just Leclerc. Further investigations are underway, ” emphasizes M me Pannier-Runacher. It is the whole philosophy of the Egalim law that is at stake: finding an economic balance between the agricultural world, the agri-food industry and large-scale distribution, in particular to allow an increase in the income of certain farmers.

E. Leclerc had been the least conciliatory of major brands in the debates preceding this law. This is not the first time he is in the line of sight of Bercy. In June 2018, he had summoned her to the Paris Commercial Court, demanding a fine of 25 million and a refund of 83 million, or 108 million.

Article reserved for our subscribers Read also Price war: how the supermarket circumvents the new rules
After three years of investigation (2015-2017), the DGCCRF discovered that the group imposed price discounts of 10% to twenty of its suppliers in addition to that provided for in their contracts, without any commercial counterpart (advertising, implementation). before products in store …). These additional rebates were imposed on manufacturers of major food brands sold at Lidl, a competitor that E. Leclerc fears low prices. Justice still has to decide on this case.

In 2015, judges had already sanctioned the sign. The court of appeal had then condemned to repay 61.3 million to 48 suppliers (Bonduelle, Ferrero, Jacquet …) for sums improperly collected at end-of-year discounts. Rebate applications which, for justice, created a “significant imbalance” between the manufacturers and the brand, for the benefit of the latter. The reimbursement of these sums was accompanied by a fine of 2 million euros.

bookmark_borderBritish economy threatened by recession with Brexit

The British economy is at a standstill, estimates the British institute of economic studies NIESR which figures at 25% the probability that it switches in the recession because of a crisis of the Brexit which is prolonged .

The national institute of economic and social research points out that the risks for growth are “heavily downward” while it estimates at 40% the probability of leaving the United Kingdom of the European Union without agreement.

Boris Johnson, favorite to take the lead this week of the Conservative Party and become the next Prime Minister, said he would speed up preparations for an exit without agreement to force the EU to amend the divorce compromise negotiated by Prime Minister Theresa May and disavowed by the British parliament three times.

The NIESR has already estimated that the British economy contracted in the second half. A new quarter of contraction would technically correspond to a recession, the first since the great financial crisis of 2008-2009.

The Office for Budget Responsibility (OBR), an independent body that determines the macroeconomic framework for the budget, said last week that the country could enter a recession.

In a report released on Monday, the NIESR says the outlook for the next few quarters is surrounded by major risks.

“The prospects beyond the month of October, after which the United Kingdom must leave the European Union, are really dark with the risk of a severe contraction in case of a Brexit without agreement and disordered,” warns the institute.

The NIESR lowered its growth forecast for the UK economy to 1.2% in 2019 and 1.1% in 2020 from respectively 1.4% and 1.6% previously.

It attaches a 30% probability to a business contraction scenario in 2020, based on the various Brexit assumptions it holds.

“There will be no tangible growth for a few years after a Brexit without agreement,” said its managing director Jagit Chadha, at a press conference.

Even if an agreement is reached by the next Prime Minister, public finances will suffer, NIESR predicts.

“Some loosening of public finances appears inevitable and we expect the public deficit to reach 2% of GDP with the risk of substantial overruns of the government’s budget targets in case of Brexit without agreement.”

The two contenders for Prime Minister Boris Johnson and rival Jeremy Hunt have pledged to increase public spending, drawing criticism from current finance minister Philip Hammond.