CEO INSIGHTS – Week Ending 4 October 2024

Chemicals & Manufacturing

"It [the chemicals industry] will continue to be an essential industry for the successful transformation of all manufacturing industries downstream, and it will stay an absolutely crucial industry for the continuous growth of the economy and for wealth creation in all major societies" Markus Kamieth, CEO, BASF Group [world’s largest chemical producer]

Ocean Freight Rates

"The spot market has peaked in the last quarter. We see that coming off now. If a port disruption could happen or something else could happen in the Red Sea, could that go up? Absolutely, it could go up. But from what we're seeing now, the spot market did increase and is coming off at this point." Ron Vachris, CEO, Costco Wholesale Corp

Soft Commodities

“Significantly higher chocolate prices will likely hit shelves over the coming months and going into 2025, providing a major challenge for the chocolate sector, which is already battling a longer-term, structural decline in demand" Market Statement, Rabobank Group

Workplace Productivity

“People are looking at all the reasons that have contributed to slowing productivity. And many people feel that (work from home) may be one" Andrew Yates, CEO, KPMG Australia

Labour Shortages

"We know we have 800,000 less workers in the U.K. today, before obviously, COVID came. And whatever research you choose to look at, the story is consistent. We are going to see greater stress to organizations around fulfilling their talent needs and challenges." Toby Fowlston, CEO, Robert Walters plc [world leading recruitment agency]

“There is a shortage of tech skills in Australia, which is an issue for all industries because tech jobs exist across the economy – not just in the tech sector” Richard White, CEO, WiseTech Global Ltd

Elevators & Maintenance

“So, this market is actually made today of 25 million elevators…Out of those 25 million units, 10 million units are 15 years old. And if you would compare an elevator to a car, a car after 15 years, you would say either you change or you have to do quite a bit of work. When you look at an elevator, so it's sort of a car, with very similar technology except that instead of going sideways, it's going up and down. But it requires maintenance. It requires modernisation." Philippe Delorme, CEO, KONE Oyj [major multinational elevator & escalator company]

Education

"I mean, there's an overall trend which is kind of happening in the marketplace, which is that there's much greater attention being paid, particularly by education faculties, education departments, but also by state legislatures in making sure that they can get books to students at home." Peter Warwick, CEO, Scholastic Corp

Sydney Property Market

“We’re still seeing pockets of strong sales, but it does feel like the pressure of higher interest rates and cost of living is finally catching up with the Sydney property market” Thomas McGlynn, CEO, BresicWhitney Real Estate

Lotteries

“Lotteries are generally a low spend purchase with the average weekly spend by our customers in FY '24 being around $13.”  Susan van der Merwe, CEO, The Lottery Corp. Ltd

Tax & Bookkeeping

"There's a large market within this that's bookkeeping, taxes, accounting, where people go to somebody else to help them manage their life and so there's an incredible opportunity when it comes to digitisation...we believe for us as we look at the next 1 year, 5 years, 10 years, there's an incredible secular tailwind and an incredible secular shift that started several years ago. It's not new. And it's the convergence of [1] those that were born after the smartphone, [and 2] the capabilities that AI provides” Sasan Goodarzi, CEO, Intuit Inc [owner of QuickBooks and TurboTax]

Private Credit

“The other thing that happened is as governments around the world pushed rates to 0, both after the financial crisis and again, during COVID, everyone who had made commitments to policyholders, to retirees, to contractual counterparties found themselves in search of yield and they found us. Those 2 tailwinds [the abovementioned and a defence lending stance of financial institutions] didn't just power us, they powered our entire industry. But we also have to be clear that those tailwinds are now gone.” Marc Rowan, CEO, Apollo Global Management Inc.

Digital Infrastructure

“A lot of people are rightly excited about the end outcomes, but there’s a lot that has to be in place to unlock it. It’s not just going to happen. Those data centres aren’t islands. They’ve got to be connected.” Vicki Brady, CEO, Telstra Group Ltd

Restaurants & Frozen Foods

“This resilience of consumers' demand for fries as well as their importance to customers' menus are key reasons why we remain confident that the global fry category will return to its historical long-term growth rate over time as global traffic rates improve." Tom Werner, CEO, Lamb Weston Holdings [one of the world’s largest producers of frozen French fries]

"But from what we're seeing in the data now, the scratch cooking [cooking from all raw ingredients] behaviour shift we saw a year ago seems to be running its course and specifically, what we're seeing now is there's a pivot back to more convenient items. So consumers have pivoted back to convenience, which we are capitalising on in our frozen [foods] space." Sean Connolly, CEO, ConAgra Brands Inc [food brand conglomerate including Birds Eye]

Hydrogen

"It has become clear that the hydrogen market is developing more slowly than anticipated, and there remain risks and both input cost and technology advancements to overcome.” Frank Calabria, CEO, Origin Energy Ltd