This is what the Flux I'm brand aren't justin And it's Friday, the fourth of.
October, douzyboy. The annual rate of retail spending jumped more than three percent in August, a result that really nobody expected. But there is a reason behind this result, my friend. It was the warmest August nationally since nineteen ten, if you don't mind. And as a result, summer merch was on the shelves and then quickly off the shelves as well.
Actually, update statman a flexim did you know that September was the best performing September in over a decade on the share market in Australia. And if you still have no idea how to get into the share market, what to do? We have the Flex Academy this month dedicated to investing in the share market, how to buy and sell, what your investing strategy should be, and also how to manage your portfolio. It's at thanks to our partnership with Rays and if you want to check it out this month,
there are big prizes on offer. Make sure to download the Flux app and check out the academy.
Three very educational stories today, Dozy boy, let's do it for our first. SPC, the Aussie canned fruit and veg producer, has finalized a three way merger with Original Juice Company and Nature One Dairy.
Geez, not often you hear about a three way corporate marriage here, b man, no very polygamous of them.
So tell me more well. SBC Global was founded in nineteen seventeen and specializes in food manufacturing.
You know those iconic little dist fruit salents that every primary school kid has in the larch.
Box, YEP and Jazi boy. These little fruit packs helped SPC generate two hundred and seventy one million dollars in revenue for the twenty twenty four financial year.
In comparison, Original Juice Company had about forty nine mel in revenue and the powdered milk maker Nature One Dairy.
Posted around forty six meal Now, Jose Boy, the three companies are merging into one bigger beast. Now.
According to SBC, this merged company is all about maximizing the unique strength to.
Achieve spc's globble vision Yep. Now SBC is going to provide Original Juice with some extra manufacturing capacities.
It's going to be a bigger distribution network so they can expand.
And old Nature one Dairy They're going to give their new partner companies access to exporting so they can export to Asian customers.
Ultimately, b Man, this means SBC is one giant step closer to achieving their global company they've really been striving for.
They want to build the nestlay of Australia, if you don't mind, Jusie boy very bold. So what is the key learning here? When it comes to going global in an aggressive way, It's important to pick the right product mix.
You see, b Man, SBC has rush delicious ambitions of entering into Asia Pacific, then up to the Middle East and then to Europe.
And this deal has quote unquote synergies written all over it.
Yeah, approximately ninety five percent of Nature one Dairies products assault in pharmacies in Asian markets across thirteen countries.
And so SBC and therefore original juice company they want to take advantage of this and be Man.
This expansion overseas could potentially offset some of the challenges that SPC has faced in Australia. This three way merger is now expected to generate four hundred million bucks in revenue and more than twenty nine mili in.
Earnings and suddenly SPC is the best chance we've got in Australia to achieve our very own Nesley. So true for our second story, Character one of the leaders in AI, is ditching its plans to make AI models after its founders were poached by Google more than two point seven billion US dollars. Yep, Character ai has really been thrown under the bus. So I want to know what's going on, Josey boy okay. So.
Character ai is an AI chatbot that was started up by an ex Google developer back in twenty twenty one.
The service that simulates conversations with characters that you can design and also celebrities. And I'm talking text and voice, so.
B man, if you really wanted an your big fan, you could ask Gandal for some life advice.
That's huge for me, or jose boit you could ask Voldemort, your hero, why he was so obsessed with taking down a teenage boy. Straight, very good.
Question, now, mean man. Originally, Character ai was building its own large language model for its product, but now it's decided to abandon building AI models and instead is going to focus on improving its chat bok and this is after Google made a deal with character Ai for one time license to its tech and its founders came away with a two point seven billion US dollar deal.
And Jesse, wait, why did they take this deal with so much hype around the product? Good question.
They said that building models is insanely expensive for a startup.
Meanwhile, tech giants like Microsoft, Google, they are splashing their hundreds of billions of dollars to get ahead in this AI race. So what is the key learning here? Innovation pays off for those who can afford it.
You see me, man, tech giants like Google, Microsoft, Apple, they're sitting on a lot of cash.
We'd be talking around four hundred billion dollars in cash collectively, which makes it.
A lot easier for them to stay ahead of the curb. With innovation, they can continue pumping money into R and D without thinking twice.
On the other hand, startups like character Ai have restrictive budgets, which.
Means they tend to run out of cash or get acquired by one of the bigger players. And the man, it kind of reminds me of what happened with Pebble, that smart watch company back in the day.
Oh right, I remember Jasi Void Pebble was one of the first players in this smart watch space.
But by twenty sixteen, it's sold a fit bit for just forty million US dollars because it struggled to keep up with smart watches that were made by Google and Apple.
Seems like the cycle of tech giants leading innovation will just continue.
For our third and final story, Origin Energy has seen its share price drop after REVI It's going to abandon its plans to develop hydrogen energy.
Hydrogen energy running out of a bit of steam. Sadly here, jussy boy go on.
Origin Energy is the electricity and gas provider over four and a half million Australian customers.
Yep, the same very providers that send you a five hundred dollar bill when you freezed through the entire winter. So true you see, juzy boy. Back in twenty twenty two, Origin announced plans for a potential hydrogen project in the Hunter Valley of New South Wales and.
If successful, they would start to produce hydrogen, a renewable energy. By twenty twenty six.
It's sadly Origin warned that it will be abandoning its hydrogen ventures.
And what was the reason for this? One?
B man, Well, it's pretty simple. Juzzy Boy, too expensive and costly to continue pursuing this one.
And I must say this is a pretty big blow for the federal government as well.
Yep. They were hoping that Origin would become one of the pioneers in this transition to renewable power here in Australia.
Yep.
And despite all the government subsidies and the incentives for hydrogen producers, it's still couldn't convince Origin to build the facility. Interesting not strong on the old convincing side of things. So what is the key learning here?
Unlocking innovative technology is one thing, but making it commercially viable is another.
Yep. Now, hydrogen was considered to be the solution to decarbonization and a transition to renewable energy, but Joey Boy sadly turning into a pretty big commercial bust.
And that's because it's costing a pretty penny to get cardridg and scalable and joy boy.
Origin isn't the only energy company to pull the pin yep.
Ford Eskew had a green hydrogen initiative, but it accumulated over two billion dollars in losses with nothing to show for it.
So they pulled the pin as well and.
Be man while cutting out technology. The battles climate change sounds exciting, shareholders are sadly only willing to wait so long to see the results.
Buckspam.
We always talk about different companies who share prices are gone up, gone down on the pod. But if you want to learn more about how you can invest in these companies, it all starts in the Flux Academy. This month we talk about how to buy and sell shares, what analysis you need to do, and also how to manage your portfolio.
Thanks for listening and we'll see you on Monday