Texas Blackout Boosts Macquarie Bank By Up To $270 Million
Kanebridge News
    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,627,086 (-0.52%)       Melbourne $991,016 (+0.02%)       Brisbane $1,008,247 (+0.57%)       Adelaide $881,757 (-1.94%)       Perth $857,431 (+0.47%)       Hobart $728,683 (+0.15%)       Darwin $650,080 (-2.29%)       Canberra $1,042,488 (+1.17%)       National $1,052,954 (-0.17%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $754,033 (-0.54%)       Melbourne $493,897 (-0.18%)       Brisbane $575,927 (+2.34%)       Adelaide $460,725 (+2.82%)       Perth $451,917 (+0.14%)       Hobart $507,207 (+0.52%)       Darwin $359,807 (+0.61%)       Canberra $486,447 (-2.01%)       National $534,000 (+0.26%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,472 (+43)       Melbourne 14,783 (-132)       Brisbane 7,948 (+15)       Adelaide 2,170 (+81)       Perth 5,836 (+49)       Hobart 1,243 (+2)       Darwin 251 (+7)       Canberra 967 (-21)       National 43,670 (+44)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,699 (+113)       Melbourne 8,259 (+38)       Brisbane 1,637 (+2)       Adelaide 386 (+14)       Perth 1,480 (-37)       Hobart 204 (+6)       Darwin 409 (+5)       Canberra 1,034 (+6)       National 22,108 (+147)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $820 ($0)       Melbourne $600 ($0)       Brisbane $640 (-$10)       Adelaide $610 (+$10)       Perth $680 ($0)       Hobart $550 ($0)       Darwin $740 (-$10)       Canberra $680 ($0)       National $675 (-$2)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $760 ($0)       Melbourne $595 ($0)       Brisbane $630 (-$10)       Adelaide $500 ($0)       Perth $625 (+$5)       Hobart $460 (+$10)       Darwin $535 (-$5)       Canberra $550 ($0)       National $595 (-$1)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 6,053 (+221)       Melbourne 6,376 (+263)       Brisbane 4,431 (+5)       Adelaide 1,566 (+60)       Perth 2,666 (-61)       Hobart 431 (0)       Darwin 102 (+7)       Canberra 621 (+19)       National 22,246 (+514)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 10,306 (+260)       Melbourne 6,173 (+102)       Brisbane 2,248 (-24)       Adelaide 399 (+26)       Perth 754 (+14)       Hobart 148 (+5)       Darwin 145 (+9)       Canberra 785 (+39)       National 20,958 (+431)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.62% (↑)        Melbourne 3.15% (↓)       Brisbane 3.30% (↓)     Adelaide 3.60% (↑)        Perth 4.12% (↓)       Hobart 3.92% (↓)     Darwin 5.92% (↑)        Canberra 3.39% (↓)       National 3.33% (↓)            UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 5.24% (↑)      Melbourne 6.26% (↑)        Brisbane 5.69% (↓)       Adelaide 5.64% (↓)     Perth 7.19% (↑)      Hobart 4.72% (↑)        Darwin 7.73% (↓)     Canberra 5.88% (↑)        National 5.79% (↓)            HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.8% (↑)      Melbourne 0.7% (↑)      Brisbane 0.7% (↑)      Adelaide 0.4% (↑)      Perth 0.4% (↑)      Hobart 0.9% (↑)      Darwin 0.8% (↑)      Canberra 1.0% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)      Melbourne 1.1% (↑)      Brisbane 1.0% (↑)      Adelaide 0.5% (↑)      Perth 0.5% (↑)      Hobart 1.4% (↑)      Darwin 1.7% (↑)      Canberra 1.4% (↑)      National 1.1% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND         Sydney 28.7 (↓)       Melbourne 30.2 (↓)       Brisbane 30.7 (↓)     Adelaide 25.9 (↑)        Perth 35.8 (↓)       Hobart 37.6 (↓)     Darwin 37.0 (↑)      Canberra 28.5 (↑)      National 31.8 (↑)             AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 29.2 (↓)     Melbourne 30.4 (↑)        Brisbane 29.5 (↓)     Adelaide 26.3 (↑)        Perth 36.6 (↓)       Hobart 29.7 (↓)       Darwin 45.0 (↓)     Canberra 39.6 (↑)        National 33.3 (↓)           
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Texas Blackout Boosts Macquarie Bank By Up To $270 Million

Macquarie shares up as a result of Texan deep freeze.

By Joe Wallace and Ryan Dezember
Tue, Feb 23, 2021 3:41amGrey Clock 4 min

The deep freeze that plunged millions of Texans into darkness is rippling through energy markets in unexpected ways, producing a financial windfall for Macquarie bank and severe pain for other companies caught up in the disruption.

The extreme weather froze wind turbines and oil-and-gas wells, closed oil refiners and prompted power stations to trip offline, sending a jolt through energy markets. Wholesale power prices rocketed, as did spot prices for natural gas in Texas, Oklahoma, Kansas and Arkansas.

The turbulence led to a bonanza for commodity traders at Macquarie Group Ltd., whose ability to funnel gas and electricity around the country enabled them to capitalise on soaring demand and prices in states such as Texas.

The bank bumped up its guidance Monday for earnings in the year through March to reflect the windfall. It said that net profit after tax would be 5% to 10% higher than in the 2020 fiscal year. That equates to an increase of up to $273.1 million. In its previous guidance, issued Feb. 9, Macquarie said it expected profits to be slightly down on 2020.

“Extreme winter weather conditions in North America have significantly increased short-term client demand for Macquarie’s capabilities in maintaining critical physical supply across the commodity complex, and particularly in relation to gas and power,” the bank said.

Macquarie’s windfall shows how big profits can be made wagering on relative scarcity of natural gas in a country awash in the fuel.

The U.S. shale-drilling boom unleashed so much gas over the past decade that prices have been depressed to the point that producers with gushers have gone bankrupt. Yet gas buyers, such as power plants and manufacturers, are routinely left paying surging prices when demand peaks during winter storms.

Behind such instances of energy feast and famine is a gas infrastructure system that has failed to keep up with all the drilling. Pipelines laid decades before the shale boom are often in the wrong places, or too small to meet today’s demand. Having space reserved on certain pipelines can become incredibly lucrative when uncharacteristic weather causes swells in demand.

Scarcity in Texas and the Great Plains was amplified last week when temperatures dropped low enough to freeze shut many of the region’s gas wells and other energy infrastructure. Capacity on pipelines into the region became precious. Traders and energy firms that had paid in advance for the right to use these supply routes were suddenly in position to rake in huge profits as utilities vied for fuel deliveries.

Macquarie describes itself as the second-largest marketer of physical gas in North America behind BP PLC, with a team in Houston and access to 80% of pipelines spanning the U.S., according to a person familiar with the matter. The business, which Macquarie has built out for over a decade, received a boost from the acquisition of Cargill Inc.’s North America power and gas division in 2017.

The bank rents access to natural-gas pipelines and electricity networks across the U.S., enabling it to profit when prices in some regions are significantly higher than in others and when consumers are in urgent need of fuel or power. That was the case last week, when frozen energy infrastructure and the closure of oil-and-gas wells set off a race for natural gas among Texas power plants and other consumers.

Macquarie sent large volumes of gas from the north of the U.S. to the south, where the cold weather sent prices soaring last week, the person familiar with the matter said. It supplied electricity in Texas as well as gas to generate electrical power.

At one point, natural gas changed hands for more than $900 per million British thermal units at the ONEOK Gas Transportation hub in Oklahoma, according to commodities data provider S&P Global Platts. By Friday, prices at the hub had fallen back to about $14 per million British thermal units. That was still comparatively high: Benchmark futures for U.S. natural gas, which are tied to delivery at Henry Hub in Louisiana, have generally cost between $2.50 and $3.50 per million British thermal units in recent months.

Shares of Macquarie rose 3.4% on Monday after the company raised its profit outlook. They are now down 2.8% over the past 12 months.

Millions were left without power and heat in Texas last week as the lowest temperatures in decades wreaked havoc on the state’s utilities. Frozen water lines burst and left big residents in cities without safe drinking water. Stores closed because they had no power, which made food and water even more scarce.

Roughly 70 deaths, mostly in Texas, have been attributed to the cold weather, according to the Associated Press. Some are believed to have frozen to death in their homes.

Macquarie last year provided an undisclosed amount of investment capital to upstart Houston-based utility Griddy Energy LLC, whose business model is to pass variable wholesale electricity prices through to customers. Griddy customers complained of paying lofty sums when power prices shot up to thousands of dollars per megawatt hour last week, according to local Texas media reports.

One customer told the Dallas Morning News that his electric bill for five days stood at US$5000, the amount he would normally pay for several years of power. Another told the Dallas-Fort Worth NBC affiliate that he had been charged more than US$16000 for February.

A Griddy spokeswoman said an order by the state utility agency to the operator of the electricity grid to make market prices reflect the scarcity of power pushed up prices for its customers. On Feb. 12, the company started emailing and texting customers to say they might be better off switching providers for a short time to avoid exposure to wholesale prices, she said.

Corporate casualties from the freeze are also starting to emerge. Just Energy Group Inc., a Canada-based energy supplier, on Monday said it faced a financial hit of about US$250 million, in part from buying electricity at sky-high prices in Texas during the cold blast. The company, which said the blow could stop it from continuing as a going concern, saw its shares slump 31%.

In another instance, shares of Atmos Energy Corp. fell 4.4% Monday after the Dallas-based gas supplier said it would have to pay between US$2.5 billion and US$3.5 billion for gas it bought at elevated prices in Texas, Colorado and Kansas. Atmos may issue stock or raise debt to help to pay for the purchases, it said Friday.

German energy company RWE AG said its 2021 earnings would be hit by outages at the company’s wind turbines, as well as from high prices for electricity.



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New York Watch Auctions Record Uptick in Sales in the Face of Market Slowdown
By LAURIE KAHLE
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Luxury watch collectors showed ongoing strong demand for Patek Philippe, growing interest in modern watches and a preference for larger case sizes and leather straps at the June watch sales in New York, according to an analysis of the major auctions.

Independent and neo-vintage categories, meanwhile, experienced declines in total sales and average prices, said the report from  EveryWatch, a global online platform for watch information. Overall, the New York auctions achieved total sales of US$52.27 million, a 9.87% increase from the previous year, on the sale of 470 lots, reflecting a 37% increase in volume. Unsold rates ticked down a few points to 5.31%, according to the platform’s analysis.

EveryWatch gathered data from official auction results for sales held in New York from June 5 to 10 at Christie’s, Phillips, and Sotheby’s. Limited to watch sales exclusively, each auction’s data was reviewed and compiled for several categories, including total lots, sales and sold rates, highest prices achieved, performance against estimates, sales trends in case materials and sizes as well as dial colors, and more. The resulting analysis provides a detailed overview of market trends and performance.

The Charles Frodsham Pocket watch sold at Phillips for $433,400.

“We still see a strong thirst for rare, interesting, and exceptional watches, modern and vintage alike, despite a little slow down in the market overall,” says Paul Altieri, founder and CEO of the California-based pre-owned online watch dealer BobsWatches.com, in an email. “The results show that there is still a lot of money floating around out there in the economy looking for quality assets.”

Patek Philippe came out on top with more than US$17.68 million on the sale of 122 lots. It also claimed the top lot: Sylvester Stallone’s Patek Philippe GrandMaster Chime 6300G-010, still in the sealed factory packaging, which sold at Sotheby’s for US$5.4 million, much to the dismay of the brand’s president, Thierry Stern . The London-based industry news website WatchPro estimates the flip made the actor as much as US$2 million in just a few years.

At Christie’s, the top lot was a Richard Mille Limited Edition RM56-02 AO Tourbillon Sapphire
Richard Mille

“As we have seen before and again in the recent Sotheby’s sale, provenance can really drive prices higher than market value with regards to the Sylvester Stallone Panerai watches and his standard Patek Philippe Nautilus 5711/1a offered,” Altieri says.

Patek Philippe claimed half of the top 10 lots, while Rolex and Richard Mille claimed two each, and Philippe Dufour claimed the No. 3 slot with a 1999 Duality, which sold at Phillips for about US$2.1 million.

“In-line with EveryWatch’s observation of the market’s strong preference for strap watches, the top lot of our auction was a Philippe Dufour Duality,” says Paul Boutros, Phillips’ deputy chairman and head of watches, Americas, in an email. “The only known example with two dials and hand sets, and presented on a leather strap, it achieved a result of over US$2 million—well above its high estimate of US$1.6 million.”

In all, four watches surpassed the US$1 million mark, down from seven in 2023. At Christie’s, the top lot was a Richard Mille Limited Edition RM56-02 AO Tourbillon Sapphire, the most expensive watch sold at Christie’s in New York. That sale also saw a Richard Mille Limited Edition RM52-01 CA-FQ Tourbillon Skull Model go for US$1.26 million to an online buyer.

Rolex expert Altieri was surprised one of the brand’s timepieces did not crack the US$1 million threshold but notes that a rare Rolex Daytona 6239 in yellow gold with a “Paul Newman John Player Special” dial came close at US$952,500 in the Phillips sale.

The Crown did rank second in terms of brand clout, achieving sales of US$8.95 million with 110 lots. However, both Patek Philippe and Rolex experienced a sales decline by 8.55% and 2.46%, respectively. The independent brand Richard Mille, with US$6.71 million in sales, marked a 912% increase from the previous year with 15 lots, up from 5 lots in 2023.

The results underscored recent reports of prices falling on the secondary market for specific coveted models from Rolex, Patek Philippe, and Audemars Piguet. The summary points out that five top models produced high sales but with a fall in average prices.

The Rolex Daytona topped the list with 42 appearances, averaging US$132,053, a 41% average price decrease. Patek Philippe’s Nautilus, with two of the top five watches, made 26 appearances with an average price of US$111,198, a 26% average price decrease. Patek Philippe’s Perpetual Calendar followed with 23 appearances and a US$231,877 average price, signifying a fall of 43%, and Audemars Piguet’s Royal Oak had 22 appearances and an average price of US$105,673, a 10% decrease. The Rolex Day Date is the only watch in the top five that tracks an increase in average price, which at US$72,459 clocked a 92% increase over last year.

In terms of categories, modern watches (2005 and newer) led the market with US$30 million in total sales from 226 lots, representing a 53.54% increase in sales and a 3.78% increase in average sales price over 2023. Vintage watches (pre-1985) logged a modest 6.22% increase in total sales and an 89.89% increase in total lots to 169.

However, the average price was down across vintage, independent, and neo-vintage (1990-2005) watches. Independent brands saw sales fall 24.10% to US$8.47 million and average prices falling 42.17%, while neo-vintage watches experienced the largest decline in sales and lots, with total sales falling 44.7% to US$8.25 million, and average sales price falling 35.73% to US$111,000.

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