28th Oct 2015 11:12
LONDON (Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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BT Group said the UK Competition and Markets Authority has provisionally cleared its proposed GBP12.5 billion acquisition of mobile operator EE. The clearance from the UK antitrust regulator has been given without any remedies required to gain approval.
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Anheuser-Busch InBev and SABMiller said the deadline for the two to agree their mega-merger has been extended, following press reports that the process of agreeing the deal was taking longer than anticipated. Belgium-based AB InBev has offered 4,400 pence per share for Anglo-South African rival SABMiller, valuing the company at GBP71.28 billion. SABMiller said in a statement on Wednesday that the deadline for AB InBev to make an offer for the company has been extended to November 4, having been due to expire on Wednesday. The Financial Times reported on Wednesday that the pair are considering selling off assets in the US in order to secure regulatory approval for the merger, including SABMiller's stake in the MillerCoors joint venture with Molson Coors.
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Barclays confirmed previous reports that it has chosen Jes Staley to be its new chief executive, with plans for him to take up the role on December 1. Staley is a former executive at JPMorgan Chase & Co, where he headed its equities, private banking and assets management businesses during his 30 years at the US bank, before ultimately heading its investment bank.
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Lloyds Banking Group missed earnings forecasts as it posted a third-quarter profit, largely lifted its guidance for the remainder of the year, and booked a new GBP500.0 million charge in relation to mis-sold insurance products. The new GBP500.0 million charge for payment protection insurance, which was meant to protect policyholders repay debt in the event of illness, redundancy or death but was widely mis-sold, means Lloyds has now set aside GBP13.9 billion over the scandal. On top of the PPI charge, Lloyds booked GBP100 million in the quarter for "potential claims and remediation" over products sold through its branch network.
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Standard Life reported stable assets under administration at the end of the third quarter and net inflows of GBP2.4 billion. The investment and savings company said that group assets under administration amounted to GBP301.9 billion at the end of September, down from the GBP302.1 billion at the end of the first half. However, assets under administration were up from GBP296.6 billion at the end of 2014 and GBP290.0 billion at the end of the corresponding quarter the prior year.
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Next reported a rise in sales in the third quarter of its financial year and raised the lower end of its pretax profit guidance for the full year. The fashion retailer said total full-price sales grew 6% in the quarter to October 24, growing 4.4% in the nine months to the same date. Of this, Retail sales increased 5.9% in the third quarter and 2.6% in the 9 months, while Next Directory grew sales by 6.2% in the third quarter and 7% in the nine months. Next said it now expects full-year pretax profit to be in the range of GBP810 million and GBP845 million, having previously set the guidance at GBP805 million to GBP845 million.
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British American Tobacco reported a fall in sales in the first nine months of 2015 as it was hit by movements in foreign exchange rates, which it warned may harm operating profit in the full year. The tobacco company said revenue in the nine months ended September 30 declined 6.5%, although it would have risen 4.2% if foreign exchange rates had remained constant. Cigarette volume from subsidiaries decreased 1.8% to 487 billion in the period.
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Aerospace and defence components manufacturer Meggitt issued a profit warning after the group said trading in the third quarter of 2015 had been below its expectations, with little optimism for any relief in the fourth quarter. Meggitt said there was a "marked deterioration" in trading in September, with organic growth in its civil original equipment sales more than offset by weaker-than-anticipated trading in civil aftermarket, military and particularly energy markets, the latter hit hard by the downturn in spending from oil and gas customers.
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Antofagasta lowered its full-year production guidance, reported falls in copper, gold and molybdenum production and said its cash costs have risen throughout 2015 whilst commodity prices have plummeted. The Chilean-based copper miner produced 157,000 tonnes of copper in the third quarter, broadly flat from the previous quarter despite lower grades and lower recoveries at the Centinela mine. That has pushed year-to-date production to 460,400 tonnes, which is down 11% from a year earlier as production has fallen from both Centinela and Antofagasta's other main mine Los Pelambres. The company cut its full-year guidance to 635,000 tonnes of copper from its original guidance of 665,000 tonnes.
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HSBC Holdings's wholly-owned subsidiary HSBC Bank Bermuda said it has agreed to sell Bermuda Trust Co and its private banking investment management operations in Bermuda to the Bank of NT Butterfield & Son. Additionally, it has entered into an agreement to refer its existing private banking clients to Butterfield. As at the end of 2014 the trust and investment business had around USD24 billion of assets under administration, and USD1.5 billion of assets under management. The banking portfolio had around USD1.2 billion of assets under management.
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Royal Dutch Shell said it will not continue construction of the 80,000 barrel per day Carmon Creek thermal in situ project located in Alberta, Canada. Shell originally sanctioned the project in October 2013 and announced in March 2015 that the project would be re-phased to take advantage of the market downturn to optimise design and retender certain contracts. After review of the potential design options, updated costs, and the company's capital priorities, Shell said its view is that the project does not rank in its portfolio at this time. The decision reflected current uncertainties, including the lack of infrastructure to move Canadian crude oil to global commodity markets.
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Bwin.Party Digital Entertainment reported a fall in revenue in the first nine months of 2015 as it said it faced a tough comparative period while being hit by VAT charges from the European Union. The online gaming company said total revenue in the nine months ended September 30 decreased 8% to EUR429.9 million from EUR465.8 million the year before, which it said reflected the absence of a major football tournament, the sale of non-core businesses and the impact of EU VAT.
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Petra Diamonds said production reached record levels in the first quarter of the financial year and said the weakening of the South African rand is mitigating the steep fall in diamond prices. The diamond miner produced a "record" 842,796 carats in the first quarter ended September 30, compared to 833,744 carats a year earlier. That figure means the company is running ahead of its guidance for the first half of the year to produce 1.5 million carats.
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Trinity Mirror said it agreed to acquire the 80% stake in Local World is does not already own for GBP187.4 million, valuing the regional newspaper publisher at GBP220.0 million, and conducted a share placing to back the deal. Trinity Mirror will acquire the 80% stake from Daily Mail & General Trust, the publisher of the Daily Mail, and from all other shareholders in the company, including the Iliffe Family. The deal will make Trinity Mirror the UK's largest regional news publisher. Trinity Mirror said it intends to deliver cost synergies of GBP10.0 million to GBP12.0 million by the second full year of ownership of the business, and it expects the deal to be earnings enhancing in the first full year of ownership.
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MARKETS
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UK indices were trading mixed, amid a slew of FTSE 100 company news, featuring a profit warning from Meggitt, the worst performer. BT led blue chips after gaining provisional clearance for its takeover of mobile provider EE.
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FTSE 100: up 0.4% at 6,392.11
FTSE 250: flat at 17,044.44
AIM ALL-SHARE: down 0.3% at 741.05
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The pound was down against the dollar ahead of the US Federal Reserve's monetary policy decision after the London close at 1800 GMT, though a press conference is not scheduled, damping expectations for an interest rate hike.
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GBP: down at USD1.5295 (USD1.5308)
EUR: flat at USD1.1059 (USD1.1040)
GOLD: up at USD1,171.95 per ounce (USD1,166.10)
OIL (Brent): up at USD47.17 a barrel (USD46.70)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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England and Wales house price growth accelerated in September to the highest level in six months, figures from Land Registry showed. House prices climbed 5.3% year-over-year in September, faster than August's 21-month low of 4.3% hike. In July, prices had risen 4.5%. The latest rate of increase was the quickest since March this year, when prices grew 5.5%. On a monthly basis, house prices went up 1.0% in September, following a 0.7% rise in the prior month.
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German consumer confidence is set to weaken for a third straight month in November owing to deterioration in households' economic expectations and willingness to make big purchases, results of the monthly survey by the GfK showed. The forward-looking GfK consumer confidence index for November dropped to 9.4 from 9.6 in October. The score was in line with economists' expectations. The latest reading was the lowest since February.
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China's consumer sentiment decreased markedly to a record low in October, results of a survey by MNI and Westpac showed. The Westpac-MNI consumer sentiment index fell to 109.7 in October from 118.2 in September, marking the weakest reading since the survey began in 2007. It was the first decline in five months. In August, the reading was at 116.5.
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Beijing summoned the US ambassador to China to express its "strong discontent" after a US naval destroyer sailed close to islets occupied by China but claimed by the Philippines, state media reported. Beijing said the USS Lassen illegally entered Chinese territorial waters when it sailed early Tuesday near the disputed Spratly, or Nansha, group of islands.
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Darqad district in northern Afghanistan's Takhar province fell to the Taliban around 4 am local time, an official said, after a six-hour battle. "The Taliban attacked the district centre from several sides and were able to take the district," said Khalil Asif, a spokesman for Takhar provinical police.
He said there might be casualties from the attack.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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