PRESS DIGEST - Financial Times - July 8

Financial Times

NHS URGED TO SHED MARKET SYSTEMS

The British Medical Association has called on the NHS in England to follow Scotland's example in scrapping market-like methods in favour of integrated care. The doctors rejected at Monday's annual meeting almost every aspect of the free-standing policy of the NHS. Hamish Meldrum, the BMA's chairman of council, said the service was being "run like a shoddy supermarket war". Pro-market groups hit back, saying waiting times are shorter in England than Scotland and that competition methods have been introduced in several countries. David Wrede, of Doctors for Reform, said the BMA was "living in cloud cuckoo land".

RULES ON MARKETING GM PRODUCE FACE REVIEW

The Food Standards Agency is to collaborate with Defra to re-examine the regulatory system of genetically modified products after an official paper on food policy said on Monday the UK was in danger of importing feed "wrongly labelled as non-GM" if prices continued rising. With prices remaining at near record highs, farmers are struggling to meet supermarket requirements to feed some animals, including chickens, non-GM grains. Currently, the GM organisms that are used in food products must be labelled, but such a condition is not required for meat, milk and eggs from animals given GM feed.

INDUSTRIAL OUTPUT IN DECLINE AS SALES FALTER

The UK economy is facing a "real risk of recession" in the coming months, the British Chamber of Commerce said on Monday, as a new survey of 5,000 businesses revealed major falls in measures for cash flows, domestic sales and orders in the second quarter of the year. David Kern, economic adviser to the BCC, said: "The second-quarter results signal a menacing deterioration in UK prospects." Meanwhile, new figures by the Office of National Statistics painted an even bleaker picture as they showed a 0.5 percent drop in the industrial production index in the three months to May against the three months to April, while electricity and gas output also fell by two percent in the same period.

AUTONOMY EYES BENEFITS FROM DATA REGULATION

Software company Autonomy (AUTN.L) said on Monday it forecasts its second-quarter sales to be "significantly" ahead of analysts' predictions, with revenue for the period expected to be between 122 million dollars and 125 million dollars, above the forecast of 118 million dollars. Mike Lynch, the group's chief executive, attributed the strong trading to the growing demand for programmes that archive sensitive corporate information and said: "People realise that most data issues -- whether they're regulatory or legal -- are now found in the email. Because of these regulatory changes, it's making a lot of people do a lot of investment in this area." Shares in the company closed up 30.5 pence at 995 pence on Monday.

SPICE GAINS FROM UTILITY REBUILDING

Utility services group Spice (SPI.L) has posted a 40 percent increase in pre-tax profits to 17.1 million pounds for the year to April 30. Earnings per share were 25.8 pence, compared to 19.7 pence, while turnover rose from 228.6 million pounds to 312.2 million pounds. The company, set to move from Aim to the full list later in July, is expecting further future growth as utilities continue to raise capital spending in a bid to replace their infrastructures.

REBUTTAL SEES SOUTHERN CROSS RISE AGAIN

Southern Cross sought to clarify newspaper reports over the weekend which raised concerns that its occupancy rate was near to 80 percent. The troubled care home operator, whose new management team took part in a share purchase last Friday, said that across the 37,027 beds under its management, its occupancy rate was 89.8 percent. The news helped boost Southern shares, closing 7.25 pence ahead at 85.25 pence. The increase in share price came after a loss of 75 percent in value over last week as a result of the reaction of investors to the news that Southern Cross would have to renegotiate a bank loan for properties it had purchased.

HELPHIRE SHARES DROP ON WARNING OF SLOWING MARKET

After warning that its market might slow, Helphire (HHR.L) saw its shares lose nearly 20 percent in value at 104.25 pence. However, the company, which provides motorists with courtesy vehicles after "no-fault" accidents, said it expected profits for the year to June 30 to be in line with market expectations. If conditions did not recover and if "fuel prices remained high, motoring activity and therefore growth in the use of credit hire may slow", said the company. Helphire also alluded to its exposure to the drop in the valuation of the used car market, but said it was "satisfied at present that the group's depreciation policy is appropriate in the circumstances".

SYNERGY TURNS FOCUS TO CHINA