Business news in brief

Massmart sees oil prices hurting retail

Massmart Holdings Ltd., the South African retailer controlled by Wal-Mart Stores Inc., said lower oil prices may affect sales growth in some African countries while weak spending is a concern in its home market.

The company is "cautious about the impact of lower oil prices on those larger African countries with some dependency on oil revenues," Johannesburg-based Massmart said in a Thursday statement. The "relatively fragile South African consumer economy" could also damp growth, it said.

Same-store sales increased by 7.4 percent in the 13 weeks ending March 29, the company said. That compared with 7.1 percent growth in the equivalent period last year. The figures "may be indicative of future sales levels for the short-term," Massmart said.

"This business runs on a model of high volume, low margins," Alec Abraham, an analyst at Sasfin Securities in Johannesburg said by phone. "The current trading conditions in South Africa are not conducive to this model; they need a wind to lift them."

Massmart's Game chain trades in 11 African countries including Nigeria, the continent's biggest crude producer. Bentonville-based Wal-Mart, the world's biggest retailer, bought Massmart in 2011 to boost the U.S. company's presence in Africa.

-- Bloomberg News

Pandora's ad sales soften quarterly loss

Pandora Media Inc., the largest Internet radio service, reported first-quarter sales that beat analysts' forecasts, buoyed by increased advertising revenue.

Revenue grew 19 percent to $230.8 million from a year earlier, exceeding the $224.6 million average of 28 estimates compiled by Bloomberg. The quarterly loss amounted to 12 cents, excluding items, the Oakland, Calif.-based company said late last week in a statement. Analysts projected a 17-cent loss.

Pandora is trying to pry advertising dollars and customers away from traditional radio fast enough to pay for rising royalty costs for songs. The U.S. Congress is contemplating bills that could increase how much Internet radio pays for the music it plays.

Active listeners rose to 79.2 million from a year earlier, Pandora said, while listener hours grew to 5.3 billion from 4.8 billion. Ad revenue increased 27 percent to $178.7 million. Sales from mobile ads increased 23 percent, while subscription and other revenue shrank.

This quarter, the company forecasts sales of $280 million to $285 million, compared with analysts' estimates of $281.9 million. For the year, the company projects as much as $1.18 billion.

-- Bloomberg News

German official: 'No future' for war rifle

BERLIN -- A widely used assault rifle has "no future" with the German military in its current form, Germany's defense minister said last week, escalating a dispute over the weapon's alleged shortcomings.

Ursula von der Leyen said last month that a study showed the G36 rifle has a "precision problem, particularly at high temperatures." Manufacturer Heckler & Koch has questioned those conclusions, complained about a lack of consultation and accused the government of damaging its reputation.

After parliament's defense committee met Wednesday, von der Leyen said another expert report finds "the G36 as it is constructed now has no future in the Bundeswehr" -- the German military -- though she didn't rule out the possibility of using a modified version.

The G36 is a standard weapon for the German military, which currently uses more than 166,000 of them. Germany also has supplied some 8,000 of the rifles to Kurdish forces battling the Islamic State group in northern Iraq.

Von der Leyen herself has faced questions from the media and opposition politicians over how long her ministry has been aware of the extent of problems with the G36. She commissioned a study last summer, six months after taking office, but the ministry acknowledged some problems with its precision three years ago.

Von der Leyen said officials are working urgently to find a replacement, news agency Deutsche Presse-Agentur reported. She acknowledged that it won't be possible to replace the rifles within a year -- "it will take longer."

-- The Associated Press

SundayMonday Business on 04/27/2015

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