Read this Friday’s edition of the FolhaMercado newsletter (10) – 03/10/2023 – Market

ANDsta is the edition of newsletterr FolhaMercado this Friday (10). want to receive it from monday to Friday at 7 am In your email? Sign up below:

---

Adidas doesn’t know what to do with a stash of $1.3 billion (R$ 6.6 billion) in sneakers and clothes produced under the partnership with Kanye West, rapper now known as Ye.

Understand: The deal that created the Yeezy brand in 2015 was scrapped by the manufacturer in October last year after the singer posted anti-Semitic comments on social media.

Adidas said it continued to produce the partnership items to avoid laying off thousands of people involved. Now, she has four options on the table about what to do with them:

• Donate the products. What weighs against: there is a fear that this will create a parallel market, with sneakers being sold at a much higher price.

• Destroy the stock. What weighs against it: it would look bad for the sustainable footprint that the company has been working to build.

• Removing Yeezy branding from items. What weighs against it: the company said it does not consider this option because the rapper would still have a percentage of sales.

• Sell ​​the products and donate the money raised. What weighs against: the singer would also receive a share of the revenue, but that would be limited to the stock already produced.

This last option seems to be preferred by the company.

“If we sell the stock, I promise that the people who were hurt by this will also get something good from the sale,” said on Wednesday (8) Bjorn Gulden, the CEO who just took over after leaving rival Puma.

Impact: shaken by the fall in consumption in China with the restriction policies and by the departure of Russia after the War in Ukraine, Adidas registered a fall of 66% in operating profit, to 669 million euros.

• Thinking about 2023, without the 500 million euros of estimated earnings for the $1.3 billion Yeezy brand inventory, the CEO said it will be “a transitional year” with operating profit close to zero.

---

Hapvida loses BRL 18 billion in 7 trading sessions

In just over a week, Hapvida saw its size decrease by half.

On Wednesday, the company’s shares fell 33%taking BRL 7 billion in market value. Since March 1, the day the papers fell 32% after the disclosure of the balance sheet, the company lost about BRL 18 billion.

Which explains: the two expressive falls, this Thursday and the 1st, were motivated by company announcements.

The most recent it happened after she informed the market that she was evaluating the possibility of a capital increase through a share issue as a way to strengthen her cash position.

• The negative reaction from investors came because an issuance now, in which the share is at an all-time low, would end up diluting —that is, reducing the participation— of shareholders who ended up buying the stock at another time, at a much higher price.

• The company also said it is considering other fundraising strategies, such as a model where it sells its physical assets (hospitals, clinics) with an agreement to lease them back.

Day 1 bad mood, as we show here, came after the company’s balance sheet for the last quarter of 2022 was displeased by analysts. In the period, the net loss was R$ 316.7 million.

• What scared the market the most was the cash loss ratio (ratio between the cost of procedures and the amount paid by users), which reached 72.9%, an increase of 8.1 points compared to 2021.

---

---

take a break

• To watch: “Flight 370: The Plane That Disappeared” – on Netflix

The newly released documentary series investigates the main theories about the disappearance in 2014 of Flight 370, a Boeing of Malasya Airlines that carried 239 people on board and would make the journey from Kuala Lumpur to Beijing.

• Authorities believe that the aircraft would have crashed in the southern tip of the Indian Ocean. The official search by the governments of Malaysia, China and Australia was called off in January 2017.

Listening to family members, journalists and experts, the production tells a theory in each of the three episodes that tries to explain the reason for the fall:

• The first investigates the possibility of a pilot suicide;

• The second addresses the possibility of a hijacking of the plane;

• The third speaks of the theory that the plane was carrying a load unknown to the crew and was shot down before reaching its destination.

In all episodes, the narrative leads the viewer to believe in the theory being told, until new information emerges to end it and start the next hypothesis.

beyond the economy

• What? | “Red pill”: Has the internet made more room for misogyny?