PRESS DIGEST - British business - May 7

The Times

BRITISH AIRWAYS COUNTS COST OF T5 FIASCO

British Airways (BAY.L) announced passenger numbers had fallen by 7.9 percent due to the chaotic opening of Heathrow's Terminal 5. The resulting cancelled flights and negative publicity are thought to have contributed significantly to the fall in passenger numbers during the month. Nick van den Brul, Exane BNP Paribas aviation analyst, said: "T5 has clearly been a big problem and it will have an impact on profits."

BLOWS RAIN IN ON ROSE AS M&S TOLD IT IS "TIME TO GET REAL"

Tony Shiret, a retail analyst for Credit Suisse, has called on Marks & Spencer (MKS.L) to embark on a fundamental review of its strategy. The leading City analyst raised fresh concerns over the power wielded by Sir Stuart Rose and criticised the company for moving too downmarket. Shiret believes "issues currently facing investors have arisen because Stuart Rose has not been effectively challenged on his strategic decisions".

REBEL SHAREHOLDERS CRITICISE MOSS BROS BOARD

Rebel shareholders in Moss Bros (MOSB.L), the menswear retailer, have criticised its board after Bauger, the Icelandic investment group, revealed it needed yet more time to put together a 40 million pound takeover bid for the company. It is understood a formal offer could come in two weeks time.

The Daily Telegraph

PROPERTY PRICES WILL DROP 10 PERCENT, SAYS LENDER

The country's fourth-biggest mortgage lender, Lloyds TSB (LLOY.L), heaped fresh misery on home owners on Tuesday as it forecast a 10 percent drop in house prices over two years. Tim Tookey, acting finance director, said it made "slightly higher provisions on its mortgage book" as a result of the bank predicting "a 10 percent reduction in house prices in 2008 to 2009". Tookey also confirmed Lloyds has taken advantage of the current mortgage conditions to raise its profit margins and share of the market.

ABERDEEN DEAL SHRUGS OFF POOR PROPERTY VIBES

Aberdeen Asset Management (ADN.L) is to pay roughly 97.4 million pounds for Goodman Property Investors in a move which will make the combined entity Britain's second-largest property fund manager. Over the next two years, it will also pay the Goodman Group up to 12.5 million pounds more in incentives relative to the flow of Goodman Property Investor's assets under management. The Scottish group is funding the acquisition with a share placing that is set to raise about 95 million pounds.

BAE TO APPOINT ETHICS TSAR AFTER BRIBERY CLAIMS

BAE Systems (BAES.L) is set to appoint a senior executive to oversee the implementation of a new code of conduct at the company after its chairman and chief executive acknoledged it had not paid enough attention to ethical standards. The defence company will also incorporate 23 recommendations laid out on Tuesday in the Woolf Report.

The Independent

CENTRICA FIGHTS TO STAY IN BRIT ENERGY BIDDING