20th Aug 2014 10:20
LONDON (Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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Glencore reported a higher profit for the first half of the year as it continued to benefit from the synergies it is eking out of its Xstrata and Viterra acquisitions, and as higher production offset commodity price falls and a hit from currency movements. The metals and mining giant also raised its interim dividend and announced a buyback of up to USD1 billion over the next seven months. Net profit more than tripled in the first-half, reaching USD1.72 billion compared with USD645 million a year earlier. Profit in the year-earlier period was lowered by USD466 million after the company finalised the fair value adjustments relating to the Xstrata acquisition. Glencore increased its interim dividend to USD0.06 cents per share, an 11% increase over the 2013 interim distribution.
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Miner Antofagasta said Executive Chairman Jean-Paul Luksic will become non-executive chairman at the start of September, with the head of the company's mining division, Diego Hernández, stepping up to become chief executive. The move means the company has fallen back into line with the UK corporate governance code which says that companies should split the chairman and chief executive roles. Luksic, who's family own 65% of the company's share capital, has been doing the CEO job since former CEO Marcelo Awad resigned in March, 2012 when the company missed production targets at a new mine.
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Hochschild Mining said its pretax loss narrowed sharply in the first half of the year, after a big impairment the previous year was not repeated and the company reined in costs across the business, although revenue was hit by lower metal prices. The precious metals producer posted a pretax loss of USD3.4 million for the six months to June 30, compared with a USD48.7 million loss in the first half of 2013 when it booked a USD61.9 million net impairment and write-off related to the Azuca project and the San Jose mine unit. Still, revenue declined to USD282.0 million, from USD308.6 million, due to lower silver and gold prices.
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British Land Co has sold its office block on Poland Street, London to Amazon Property in a deal worth GBP26 million, reflecting a capital value of nearly GBP1,300 per square foot. The site at 52 Poland Street, near Oxford Circus underground station, is a 20,500 square foot multi-let building. The total passing rent of GBP693,373 equates to GBP33.84 per square foot.
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UK Commercial Property Trust reported an increase in profit and net asset value in the first half of 2014, after last year's results were dented by valuation losses. The Guernsey-based company posted net profit GBP85.4 million for the six months ended June 30, up from GBP18.0 million million a year earlier, as it booked revaluation gains of GBP61.0 million, compared with the GBP5.4 million valuation loss it recorded a year earlier. Rental income, however, dipped slightly to GBP35.6 million from GBP35.8 million, reflecting changes in vacancy levels. Its net asset value per share rose 6.8% from the year-end to 78.1 pence, from 73.1 pence, mainly due to a 6.0% like-for-like increase in the capital value of the property portfolio, which is now worth GBP1.1 billion.
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Hikma Pharmaceuticals reiterated its guidance of around 5% revenue growth for 2014, as it raised its guidance for its generics business and lowered guidance for branded products, while reporting a rise in pretax profit in the half year to end-June. The pharmaceutical company maintained its interim dividend of 7.0 cents, in line with the previous year, and declared a special dividend of 4.0 cents, which it said was due to the "exceptionally strong market opportunities" secured by its US businesses during the period. Hikma posted a pretax profit of USD219 million in the recent half, up from USD111 million in the same period a year before, as revenue rose to USD738 million from USD638 million and it posted fewer exceptional costs.
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Balfour Beatty effectively closed the door on a proposed merger with Carillion, stating that Carillion's revised GBP2.09 billion proposal late Tuesday failed to address two key concerns that it raised last week. Balfour Beatty said the new proposal did not address the considerable risks associated with the proposed business plan, including the strategy to reduce the scale of the UK construction business when it is "poised to benefit from a recovery in the market" and Carillion's continued intention to terminate the sale of Parsons Brinckerhoff, when talks are well advanced. Balfour said it won't be requesting an extension to Thursday's deadline by which Carillion must make a firm offer or walk away, effectively ending the saga for at least six months.
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Standard Chartered said late Tuesday it has agreed a USD300 million settlement with banking regulator the New York State Department of Financial Services over deficiencies in the anti-money laundering transaction surveillance system at its New York branch. Standard Chartered said it "accepts responsibility for and regrets" the deficiencies. In addition to the penalty, the settlement also calls upon Standard Chartered to make enhancements to the transaction surveillance system at the New York office and a two-year extension to the term of the Department of Financial Services-appointed independent monitor.
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MARKETS
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UK stock indices trade mixed after a disappointing start to the day.
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FTSE 100: down 0.3% at 6755.74
FTSE 250: down 0.7% at 15783.19
AIM ALL-SHARE: flat at 763.37
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The pound spiked against the dollar, as the minutes from the Bank of England's latest monetary policy meeting showed that some members of the monetary policy committee voted for an immediate rise in bank rate, due to improved economic growth in the UK
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GBP-USD: up at USD1.6644
EUR-USD: down at USD1.3255
GOLD: down at USD1294.66 per ounce
OIL (Brent): up at USD102.16 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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The Bank of England maintained its key rate unchanged at a historic low at the August meeting on a split vote, the minutes showed. Ian McCafferty and Martin Weale sought a quarter point hike in the bank rate, to 0.75%, while all other seven members of the Monetary Policy Committee voted to keep the rate unchanged at 0.50%. Regarding the stock of purchased assets, the MPC unanimously voted to leave the the programme unchanged at GBP 375 billion. McCafferty and Martin Weale said economic circumstances were sufficient to justify an immediate rise in Bank Rate. Even after a rise of 25 basis points in Bank Rate, monetary policy would remain extremely supportive, and an early rise would facilitate the Committee's aspiration that the rises in Bank Rate should be only gradual.
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Russian President Vladimir Putin and Ukrainian President Petro Poroshenko will meet at a summit next week in Belarus, the Kremlin said Tuesday, raising hopes for a political solution to the bloodshed in eastern Ukraine. Putin and Poroshenko will participate in an August 26 regional summit in Minsk, which will also be attended by EU officials. The Kremlin said "a number of bilateral meetings" were planned at the summit, but Putin's spokesman Dmitry Peskov said it was too early to say with whom the president will meet, the Itar-Tass news agency reported.
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A ceasefire between Israel and militants in the Gaza Strip broke down, with exchanges of fire between the sides on Wednesday as negotiators failed to agree on a deal for a longer term truce. Dozens of rockets were fired from the Gaza Strip into Israel while the Israeli military carried out retaliatory airstrikes, killing at least three people, including a young girl. Hamas denied involvement in the initial rocket which broke the ceasefire, but its armed wing claimed credit for later volleys into southern and central Israel that caused no injuries. Israeli Prime Minister Benjamin Netanyahu ordered his negotiators at indirect talks in Cairo with Palestinian militant factions to return home immediately after the rocket fire resumed on Tuesday afternoon.
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Germany's producer prices continued to decline in July, data from Destatis showed. Producer prices were down 0.8% year-on-year in July, sharper than the 0.7% fall seen in June. Economists had forecast prices to fall again by 0.7%. Month-on-month, producer prices slid 0.1% after staying flat a month ago.
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Japan posted a merchandise trade deficit of JPY963.99 billion in July, the Ministry of Finance said - remaining in the red for a record 25th consecutive month. The headline figure missed forecasts for a deficit of JPY713.9 billion following the JPY823.2 billion shortfall in June. Exports were up 3.9% on year to JPY6.188 trillion - slightly ahead of estimates for an increase of 3.8% following the 1.9% decline in the previous month. Imports were up an annual 2.3% to JPY7.152 trillion versus forecasts for a decline of 1.7% following the 8.4% spike a month earlier.
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The Islamic State militia released a video purporting to show the decapitation of US photojournalist James Foley, who went missing in Syria in November 2012. The gruesome video, posted on social media by the Islamists, could not be independently verified.
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Some 6,300 fighters have joined the Islamic State jihadist militants since last month in the northern Syrian provinces of Aleppo and al-Raqqa, a monitoring group said Tuesday. The Britain-based Syrian Observatory for Human Rights said the new recruits included 5,000 Syrians, 800 of them experienced fighters who switched allegiances from various rebel groups or from the Syrian al-Qaeda affiliate al-Nusra Front. The remaining 1,300 were foreigners, most of whom had entered Syria across its northern border with Turkey, said the group, which compiles its reports based on updates from a network of activists across Syria. The extremist group now counts more than 50,000 fighters, compared to only 15,000 a year ago, Observatory director Rami Abdel-Rahman told dpa.
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About 200 people suspected of being newly infected with Ebola were quarantined in northern Sierra Leone, the World Food Programme said Tuesday as the outbreak spread across West Africa. The cases had all been reported this week in the town of Lunar in Port Loko district, said Glen Myers, a representative with the UN's food aid agency. Myers said the large number of new cases were "worrisome."
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Residents of the riot-struck US city of Ferguson, Missouri should come out during the daytime to call for calm and distinguish themselves from the violent protests that resulted in 31 arrests overnight, police said Tuesday. Racially charged clashes, which have been ongoing for more than a week following the shooting of an unarmed black teenager by a white police officer, resumed late Monday after the lifting of a curfew. Meanwhile, another black man was shot and killed by police officers in nearby St Louis Tuesday. The unnamed 23-year-old allegedly stole two energy drinks and a pastry from a convenience store and then brandished a knife at the responding police officers, police said.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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Related Shares:
HochschildBalfour BeattyHikma PharmaceuticalsStandard CharteredGlencoreUKCM.L