20th Sep 2016 10:21
LONDON (Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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The Olympic and Paralympic sporting events helped to boost alcohol sales in the UK, according to the latest grocery market data released by Kantar Worldpanel. Kantar said alcohol sales grew by 8.5% in the four weeks ended September 11 from a year before, as consumers were keen to celebrate "Britain's Olympic and Paralympic golden summer". This was helped by 36% growth in sales of prosecco and champagne, as retailers rolled out promotional events on sparkling wine for the occasion. Tesco's summer 'Drinks Festival' helped grow its alcohol sales faster than any other major category, according to Kantar. While the UK's biggest retailer still saw its overall sales fall by 0.2% year-on-year in the 12 weeks to September 11, this was its best performance since March 2014. J Sainsbury saw sales fall for the third consecutive period, by 1.4% on year in the 12 weeks, as it continued to cut prices and reduce levels of promotional activity. Its market share dipped by 0.3 percentage point to 15.9%. Sales at Wm Morrison Supermarkets declined by 2.3% as its market share decreased by 0.3 percentage point to 10.4%, reflecting the grocer's store disposal programme.
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Drugmaker GlaxoSmithKline said Emma Walmsley will become its new chief executive when incumbent CEO Andrew Witty retires at the end of March 2017. Walmsley will join the board of directors of the blue-chip pharmaceutical company on January 1, before taking over from Witty on March 31. She is currently the chief executive of Glaxo's Consumer Healthcare business and has been part of the executive team at the group since 2011. Prior to this, she worked a slew of roles during a 17-year career at French cosmetics giant L'Orea.
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Irish pharmaceutical company Shire said it has priced USD12.1 billion worth of senior notes to help finance its takeover of Baxalta. Shire priced USD3.3 billion in senior notes due 2019 at 1.9%; USD3.3 billion in senior notes due 2021 at 2.4%; USD2.5 billion in senior notes due 2023 at 2.875% and USD3.0 billion in senior notes due 2026 at 3.2%. The funds will be used to fully repay funds outstanding from the bridge facility taken out to finance the USD32.0 billion acquisition of US firm Baxalta in January.
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Kingfisher reported growth in profit in the first half of its financial year on the back of good growth in sales, and said it has so far seen no impact on demand from the UK's vote to leave the European Union. The DIY retailer said its pretax profit in the six months ended July 31 grew to GBP427 million from GBP386 million in the same period a year before, as sales rose to GBP5.75 billion from GBP5.49 billion. Kingfisher will pay an interim dividend of 3.25 pence, up from the 3.18p paid the year before.
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Consumers goods giant Unilever has agreed to buy Seventh Generation, as the company plans to expand its business in the fast-growing "natural" category. Vermont-based Seventh Generation makes plant-based detergents and household cleaners. The company's turnover exceeded USD200 million in 2015. "Seventh Generation has a comprehensive product portfolio and a distribution network covering the 'natural' category in grocery, mass merchandise and e-commerce channels," Unilever said in a statement. Financial details of the deal were not disclosed.
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Online trading firm IG Group Holdings reported growth in revenue in its financial first quarter to the end of August, despite subdued conditions in the UK market. The firm said total revenue grew 5.1% year-on-year in the first quarter to GBP111.4 million from GBP106.0 million a year prior. Revenue increased by 13% in Europe to GBP23.4 million, by 9.0% in Australia to GBP16.2 milliion and by 18% in the Rest of the World to GBP16.4 million, but was down 1.8% in the UK & Ireland, its biggest market, to GBP55.4 million.
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The holding company for Regus Chief Executive Mark Dixon has agreed to sell 37.0 million shares, equal to a 4.0% stake, in the office-space provider at 275 pence per share, JP Morgan Securities said. Shares in Regus closed down 0.2% at 289.25p on Monday. The sale was worth GBP101.8 million. JP Morgan said that, following completion of the placing, expected on Thursday, Dixon will continue to indirectly hold around 257.7 million shares, equal to a stake of around 27.7%.
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GVC Holdings said it swung to a loss in the first half of 2016, but revenue more than tripled following its acquisition of bwin.party, as GVC also announced the departure of its chief financial officer. The sports betting and gaming company said it made a pretax loss of EUR86.1 million in the six months to the end of June, having made a pretax profit of EUR16.8 million in the first half of 2015. This was due to an increase in exceptional charges and costs relating to its acquisition of online gaming firm bwin.party digital entertainment in February. GVC's revenue, however, more than tripled to EUR382.1 million from EUR120.3 million. GVC also said Chief Financial Officer Richard Cooper will step down from February 2017. He will be replaced by Paul Miles, who is the CFO of money lender Wonga.
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UK water utility Pennon Group said it remains on track to deliver full-year results that are in line with expectations as its South West Water division continues to perform better-than-expected. "Pennon has made a good start to 2016/17 delivering a strong performance across both water and waste," said Chief Executive Chris Loughlin. "South West Water continues to significantly outperform its regulatory contract, and we anticipate achieving a sector-leading Return on Regulated Equity again this year."
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Sports Direct International said its forthcoming review into working practices and corporate governance will now be led by an independent party, rather than law firm RPC which had initially been selected. RPC had already undertaken an initial review into the sporting goods retailer's working practices, after conditions at its Shirebrook warehouse came under fire late last year. Following the conclusion of that review, RPC was to undertake a follow-up investigation which would also examine Sports Direct's corporate governance. However, this was criticised by shareholders and trade unions due to RPC's previous links to the retailer
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MARKETS
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London share prices were higher in late-morning trade with miner BHP Billiton among the blue-chip risers benefiting from a broker upgrade. The pound slid below the USD1.30 mark ahead of the US Federal Reserve and Bank of Japan monetary policy decisions on Wednesday. Wall Street was pointed to a higher open.
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FTSE 100: up 0.4% at 6,843.33
FTSE 250: up 0.1% at 17,901.10
AIM ALL-SHARE: up 0.1% at 812.39
GBP: down at USD1.2989 (USD1.3064)
EUR: flat at USD1.1182 (USD1.1184)
GOLD: up at USD1,315.14 per ounce (USD1,313.49)
OIL (Brent): down at USD45.72 a barrel (USD46.78)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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The leaders of the other 27 European Union countries will sign a trade deal with the UK, Prime Minister Theresa May has insisted as she committed to be "ambitious" in the negotiations. The prime minister claimed that a good deal for the UK would also benefit the remaining members of the bloc. She was speaking after Slovakian leader Robert Fico warned that Britain should expect the negotiation process to be "very painful". May told reporters accompanying her on her visit to the UN General Assembly in New York that a deal would be done and she had previously had constructive talks with Fico. She said: "The 27 will sign up to a deal with us, we will be negotiating with them. We will be ambitious in what we want to see for the United Kingdom."
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Jeremy Corbyn and Owen Smith will make a final push for votes in the UK Labour party leadership race against the backdrop of a crunch party meeting on who decides their shadow cabinet. Voting in the Labour leadership contest closes at noon on Wednesday, with the two candidates seeking to make the most of the last full day of campaigning. But distractions from the main event include a meeting of the party's ruling body on Tuesday, with the National Executive Committee expected to decide whether to reintroduce votes for the shadow cabinet and what system to take forward - if any.
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Germany's producer prices declined at a slower pace in August, Destatis reported. Producer prices decreased 1.6% year-on-year in August, slower than the 2% decline seen in July. Nonetheless, producer prices have been falling since August 2013. Excluding energy, producer prices fell 0.3% from the prior year and remained unchanged from July.
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A UN humanitarian aid convoy was attacked near Aleppo on Monday as a week-long ceasefire in Syria brokered by Russia and the US collapsed. The United Nations said 18 of 31 trucks taking part in an aid mission near Urum al-Kubra, north-west of Aleppo city in northern Syria, were hit. At least 36 people were killed, including 12 in the aid convoy, according to activists and the Syrian Observatory for Human Rights, a Britain-based monitoring group. While the UN said the source and type of attack is under investigation, a senior Obama administration official, who spoke to reporters on a conference call, said that "from all indications, it was an airstrike, and it wasn't one from the coalition." The official said that it wasn't clear at this point if Russian or Syrian jets were involved. "In either case, the Russians have the responsibility certainly to...refrain from taking such action themselves, but they also have the responsibility to keep the regime [of Syrian President Bashar al-Assad] from doing it."
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The suspect in a series of weekend bombings in New York City and New Jersey was charged late Monday with five counts of attempting to murder a police officer. Ahmad Rahami was also charged by the prosecutor in Union County, New Jersey, on weapons-related offences, news reports said. Police believe the 28-year-old naturalized US citizen from Afghanistan is behind the bombings, but charges directly related to those crimes have yet to be filed. The charges filed in Union County stem from a shoot-out Monday with police in Linden, New Jersey, that ended with Rahami being taken into custody. Two police officers were wounded in the gun battle. Rahami was wounded in the leg.
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US President Barack Obama is expected to speak about the refugee crisis when he delivers his final speech to the UN General Assembly on Tuesday. The refugee issue has already been a major topic at the United Nations this week where the 193 UN member states adopted a non-binding political declaration Monday, committing to better manage the flow of migrants and refugees by ensuring human rights, protecting vulnerable groups and enhancing global responsibility-sharing. However, the document only reaffirms existing laws and guidelines and has been criticized for its shortcomings. US Secretary of State John Kerry said Monday that Obama will use his speech to call upon leaders to go even further during the remainder of his time in New York, which includes a leaders' summit on the global refugee crisis to also take place Tuesday.
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Members of Latin America's Mercosur bloc have agreed to strengthen trade with the European Union and to push for a free trade agreement. Meeting ahead of Tuesday's UN General Assembly in New York, the governments of Mercosur's founding countries - Brazil, Argentina, Uruguay and Paraguay - agreed to continue negotiations in Brussels from October 10-14. The bloc also includes Venezuela. EU parliamentarians confirmed there was room for fresh talks, after leadership changes in Argentina and Brazil installed liberal-conservative governments.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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