30th Oct 2015 11:23
LONDON (Alliance News) - The following is a summary of top news stories Friday.
----------
COMPANIES
----------
International Consolidated Airlines Group said its operating profit surged in the third quarter and kept it tracking well ahead of 2014, as passenger traffic and load factor also both improved, prompting the carrier to upgrade its profit guidance for 2015. The British Airways and Iberia owner, which on Thursday approved its first dividend payment since it was created in 2011, said its operating profit in the third quarter to the end of September was EUR1.25 billion, up from EUR900.0 million a year earlier and still up to EUR1.21 billion when excluding the contribution from Aer Lingus Group, the Irish flag carrier IAG acquired this year. For the nine months to the end of September, operating profit for the group was up to EUR1.77 billion from EUR1.05 billion a year earlier, a 69% rise.
----------
Royal Bank of Scotland Group reported improved third-quarter net profit, as it booked a big gain on the loss of control of Citizens, the US retail bank it is selling, and warned that the costs of restructuring and addressing past conduct and litigation are not about to go away. The bank said it made a GBP952 million net profit in the three months to September 30, compared with GBP896 million in the corresponding quarter the prior year. That included a GBP1.15 billion gain on the loss of control of Citizens, and the bank also confirmed it is set to sell its remaining 20.9% stake.
----------
Earlier, Citizens Financial Group said RBS has launched a registered underwritten public offering to sell all of its remaining 110.5 million shares in the US retail bank. RBS had previously set out plans to divest the rest of its stake by the end of 2015.
----------
BG Group reported a decline in earnings during the third quarter of 2015 that was in line with expectations, and the company raised its full-year production guidance after reporting a large rise in production during the period. The oil and gas producer operating in over 20 countries, and the subject of a takeover offer by Royal Dutch Shell, reported earnings before interest, tax, depreciation and amortisation of USD1.24 billion in the third quarter of 2015, down 37% from USD1.98 billion a year earlier but ahead of the analyst consensus which estimated Ebitda of USD1.15 billion.
----------
The market bit back at Pets at Home Group morning after the company trotted out a disappointing set of figures for the first half, with like-for-like and total revenue growth slowing sharply year-on-year. Pets at Home said it is trading broadly in line with market expectations, but Chief Executive Nick Wood said sales in some parts of the business had been weaker-than-expected in the half. The note of caution on the outlook and the slowing sales growth sent shares in the pet products and services retailer down 8.1% to 286.00 pence, comfortably the worst performer in the FTSE 250.
----------
Elementis said its earnings for the full year should be in line with expectations as the trends experienced in the first half of the year have continued, despite sales being down compared to last year. David Dutro, chief executive of the global chemical security company, said cashflow has continued to perform well which will allow it to "reward our shareholders with attractive returns via our progressive dividend policy," including its special dividend programme.
----------
Moneysupermarket.com Group said it is confident of meeting its expectations for the full year despite an anticipated slowdown in revenue in the fourth quarter. The price comparison company said group revenue increased 14% year-on-year to GBP76.2 million in the three months to September 30. Moneysupermarket also said it is to pay 76% of the GBP27.0 million maximum possible in deferred amount and employee bonuses for MoneySavingExpert.com, which was acquired in September 2012. The company said that GBP19.2 million of the GBP20.6 million payment is due to Martin Lewis, the founder of the company.
----------
Motor retailer and aftersales services provider Lookers said it saw a strong performance in the third quarter across its whole business and said its results should be in line with market expectations. The company said its trading performance in the quarter to the end of September was very strong, with a record monthly result for the business in September despite coming against a strong comparable period the year before.
----------
Vectura Group said it secured two milestone payments following an approval of an inhaler in the US and after hitting a development milestone in Europe. Vectura said the US Food and Drug Administration has approved the dual combination Utibron Neohaler and Seebri Neohaler products for the long-term treatment of patients with chronic obstructive pulmonary disease. The approval has triggered a USD22.5 million milestone payment to Vectura from Swiss pharmaceuticals giant Novartis, Vectura's partner on the product. Vectura also has been paid a USD750,000 cash milestone after a further development milestone was hit for its VR632 therapy in the European Union. VR632 is an asthma and COPD inhaled treatment therapy which users Vectura's dry powder inhaler and formulation technology. That milestone payment hwas made by Sandoz, a unit of Novartis.
----------
MARKETS
----------
UK indices were trading lower following disappointing updates from airline IAG, which was the worst blue-chip performer, and state-backed lender RBS. IAG shares were down 3.8% and RBS's down 1.7%.
----------
FTSE 100: down 0.4% at 6,371.06
FTSE 250: down 0.1% at 17,106.43
AIM ALL-SHARE: down 0.2% at 739.52
----------
GBP: up at USD1.5350 (USD1.5296)
EUR: up at USD1.1012 (USD1.0965)
GOLD: down at USD1,148.47 per ounce (USD1,149.40)
OIL (Brent): flat at USD49.18 a barrel (USD49.19)
(changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
Consumer confidence in the UK slid to a four-month low in October, the latest survey from GfK showed on Friday with an index score of +2. That was shy of expectations for +4 and down from +3 in September. A sharp decline in construction is seen as the main factor weighing on confidence. "Good news on the domestic front - with households lifted by wage growth, low interest rates and near-zero inflation - is being tempered by concerns about our ability to shrug off the global downturn," GfK analyst Joe Staton said.
----------
The UK government tabled proposals for a reform of the beer tie, part of plans to ensure that tied pub tenants are no worse off in future than those free of the tie. Under the beer tie, tenant pub landlords must buy their beer from the company that owns the pub rather than on the open market. Under the new proposals, tenants will be able to request rent assessments every five years, whenever any significant change is seen in the price they are charged for drinks or when there is a change in their trading conditions. They will then be able to renegotiate their rent or switch to a "market rent only" system under which they would be allowed to buy beer from any supplier.
----------
Eurozone consumer prices stagnated in October, while the jobless rate unexpectedly fell to its lowest level in about two-and-a-half years in September, preliminary figures from Eurostat revealed Friday. The consumer price index remained unchanged from the same month a year ago, after declining 0.1% in September. The outcome was in line with economists' expectations. Meanwhile, core inflation, which excludes energy, food, alcohol and tobacco, rose to 1% from 0.9%. Economists had expected the figure to remain steady.
----------
Separately, Eurostat announced that the unemployment rate for the euro area fell to 10.8% in September from a revised 10.9% in August. Economists had expected the rate to remain unchanged at August's original figure of 11%. It was the lowest rate recorded in the euro area since January 2012, the agency said.
----------
Following the US Fed keeping monetary policy on hold on Wednesday, the Bank of Japan kept its massive stimulus unchanged Friday, as expected by economists. The post-meeting policy statement showed that the Monetary Policy Board of the BoJ governed by Haruhiko Kuroda decided by an 8-1 majority vote to maintain its target of raising the monetary base at an annual pace of about JPY80 trillion. The bank also maintained its asset purchase program unchanged.
----------
The BoJ also said Japanese inflation is likely to take more time to reach its 2% target and the economy is set to shift to a growth path thereafter. In its semi-annual outlook report, the central bank said inflation excluding fresh food prices is projected to be around 2% target in the second half of fiscal 2016. Earlier, the bank forecast inflation to be around target by the middle of next year. The bank lowered the core inflation projection for fiscal 2016 to 1.4% from 1.9%.
----------
US Secretary of State John Kerry arrived Thursday in Vienna ahead of talks that are aimed at ending the Syrian war and involve 20 countries, including bitter rivals and close allies of President Bashar al-Assad. Kerry - who said that finding a solution in Syria is like charting a "course out of hell" but also that Friday's negotiations present "the most promising opportunity for a political opening" - will meet Russian Foreign Minister Sergei Lavrov later Thursday.
---------
By Arvind Bhunjun; [email protected]; @ArvindBhunjun
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
RBS.L