PRESS DIGEST - British Business Press - May 21

The Times

TRADITION IS SHELVED AS SUPERMARKET PUTS FORWARD OTHER NAMES

Marks & Spencer(MKS.L) will be selling some of the best-known food and drink brands in its stores from next month, breaking its "own label only" tradition. The retailer will stock 350 products, including Coca-Cola, Persil, Marmite and Whiskas, in 19 stores in the North East of England. The products will be rolled out nationwide if the three-month trial proves a success. Sir Stuart Rose, the company's chief executive, said: "Customers say to me: 'We love your store, but my husband loves Marmite and he can't buy it from you.' Others say the same about Weetabix. I like Tabasco, but I can't buy it at Marks & Spencer."

YELL HALVES DIVIDEND TO BOLSTER FINANCES

Yell(YELL.L) announced plans on Tuesday to slash its dividend by half to shore up its balance sheet. The group's shares dropped 26 percent as it also revealed that underlying profits would be "broadly flat" and that "tougher economic conditions" were holding back progress. The group's chief financial officer, John Davis, said: "It is difficult for all businesses to operate in the current market. If recession was dictated by caution, then I think we are there."

ROYAL MAIL TO POST 2.6 BILLION POUND SHORTFALL BY 2010

Royal Mail revealed on Tuesday that it will have made 2.6 billion pounds less than expected by the time its price-control period ends in 2010. The revenue shortfall from the present pricing plan was attributed largely to Postcomm's estimate in 2006 that the postal market would grow, rather than decline, as it has done. The postal group also recently said it would need a cash injection soon because of escalating pension problems and the declining market.

The Daily Telegraph

LADBROKE BOSS BUMPS BA FLIGHTS OFF ITS BOOKS

Ladbrokes(LAD.L) will no longer use British Airways(BAY.L) after the airline attempted to bump the chief executive's daughter and a friend off a flight from Barbados. The bookmaker's boss, Chris Bell, complained to Willie Walsh, the airline's chief executive, and instructed FCM Travel Solutions, the betting group's travel agent, not to book its 14,000 staff on BA flights unless there is no alternative. Mr Bell said the incident was the last straw after previous problems involving Ladbrokes' staff and the airline - including the Terminal 5 fiasco.

ROCK BILLIONS 'AT RISK IN A DOWNTURN'

Northern Rock'sNRK.L chairman, Ron Sandler, has conceded that taxpayers' money tied up in the nationalised lender is more at risk than first thought, as the credit crisis threatens to undermine its restructuring. Mr Sandler said: "If house prices decline five percent, ten percent, 15 percent, it would certainly put a great deal of stress on how we would deliver the plan." Currently, Northern Rock intends to repay the remaining 24.1 billion pound Bank of England loan by 2010, and release the Treasury from its 75 billion pounds of guarantees the following year.

M&S PROFITS SOAR BUT STAFF MISS BONUSES

Most M&S(MKS.L) staff will lose out on their annual bonuses after missing internal targets, despite the retailer achieving full-year profits of over one billion pounds for the first time. M&S's chief executive, Sir Stuart Rose, warned that the uncertain consumer environment will continue through the next year. As a result, the company has scaled back its capital expenditure plans by 200 million pounds to avoid disruption in its shops during the tough trading environment.

The Independent

BAE SYSTEMS AND VT UNITE AS MOD AGREES FOUR BILLION POUND DEAL.