PRESS DIGEST - British business - June 19
The Times
ANOTHER WEEK, ANOTHER RATE INCREASE FROM HBOS
In the past six months, Britain's biggest lender, HBOS HBOS.L, has made 19 changes to two-year fixed rate mortgage deals. The bank has a 20 per cent share of the mortgage market which has a value of 220 billion pounds. The frequent increases will be a blow to homeowners hoping to remortgage on a two-year fixed-rate deal.
CENTRICA FIGHTS THE FRENCH FOR BELGIAN ENERGY TARGET
Centrica (CNA.L) wants to take control of SPE, Belgium's second biggest electricity supplier, but will have to match a bid from EDF (EDF.PA) to do so. In an effort to knock Centrica out of the race, EDF could offer a premium of between five and 10 per cent. Centrica wants to take over SPE in a sale ordered by the European Commission as a condition for approving the merger between GdF and Suez (LYOE.PA).
MISYS AVOIDS STORM DAMAGE, BUT THERE IS LITTLE TO LIFT PRICE
Misys (MSY.L) sales for the 12 months to May 31 were up six per cent to 498 million pounds. It is far ahead of the rise of between two and three per cent that the city was expecting. However it is hard to see what will drive the shares higher at 158.5 pence, or 13 times current-year earnings.
The Daily Telegraph
FUEL DRIVES GROWTH AT SAINSBURY'S
J Sainsbury (SBRY.L) has unveiled a 3.4 per cent rise in first-quarter food sales after pushing through price increases. The supermarket admitted that the volume of food was slightly down on last year. Rising fuel revenues were the main driver of growth sending total like-for-like sales up 7.3 per cent in the 12 weeks to June 14. Sainsbury's share price fell 10.5 pence to 325.5 pence.
DIGITAL ADS ARE THE FUTURE FOR AEGIS
Aegis (AEGS.L) expects its communications and marketing arm, Aegis Media, to generate most of its revenue from the fast-growing digital advertising sector in less than five years. The group said that although its market research division, Synovate, was not up for sale, Aegis would always look at an offer for Synovate if it was beneficial to shareholders.
DTZ SEEKS 50 JOB CUTS IN DOWNTURN
DTZ, the commercial property company, is understood to be seeking to axe up to 50 staff in response to the current downturn. The company said it would not know for another two weeks how many jobs would go. A spokesman said "we are currently consulting on how many jobs can be redeployed."
The Independent
MOUCHEL IS ON THE RIGHT ROAD DESPITE MISSING M25 DEAL
Mouchel (MCHL.L), the consulting and outsourcing group, is safe stock for investors in this period of economic misery. The problem is that there is not much to suggest that the shares are on the way up. The company issued a trading update on Wednesday saying that demand remains strong in its core markets. Altium says that missing out on the M25 widening contract is a blow.
JAGUAR LAND ROVER TO CREATE 600 JOBS IN ECONOMY DRIVE
Jaguar Land Rover is to hire 600 technical staff and engineers in an effort to increase the fuel efficiency of its vehicles. No current Jaguar or Land Rover models currently meet an EU proposal that, from 2012, average emissions from new cars should be 120 grams per kilometre. Failure to meet this target will result in a per-gram penalty which rises every year from 2012.
HAMLEYS BEGINS GLOBAL EXPANSION BY OPENING FIRST STORE IN JORDAN
Hamleys, the toy retailer, opened its first international store in Jordan on Wednesday. It marks the start of a global expansion for Hamleys. The three-storey shop in Amman sells traditional toys and more quirky products. It is operated by Hamleys franchise partner Jordan Centre. In August Hamleys is to open a new store in Dubai Mall, and in October a store in Dublin.
The Guardian
WOOLWORTHS OUSTS CHIEF AFTER ANOTHER SALES DIP
Trevor Bish-Jones, chief executive of Woolworths WLW.L, was ousted on Wednesday after another drop in sales. Mr Bish-Jones was asked to step down by the board after six years in the top job. The chain reported a further like-for-like sales decline of 2.2 per cent. Sales have now been falling for four years. Woolworths shares lost five per cent, closing at 9.25 pence, valuing the business at just over 130 million pounds.
BUILDERS IN A HOLE WEIGH HEAVY ON FTSE
Wednesday saw the slump among housebuilders continue with the worst one-day performance for nearly a month. Persimmon (PSN.L) is soon to lose its position in the FTSE 100. It fell 33.5 pence to 379.5 pence and Barratt Development (BDEV.L) dropped 10 pence to 80.5 pence. Apart from growing economic gloom the sector was unsettled by some negative analyst comments.
GLAXO WINS UK DEAL FOR CERVICAL CANCER VACCINE
GlaxoSmithKline (GSK.L) received a boost on Wednesday after it won a contract to supply its cervical cancer treatment for the government's immunisation programme. There has been industry speculation that the three year contract to supply Cervarix could be worth around 100 million pounds. It is said that the deal would help GlaxoSmithKline sell Cervarix to other European governments.
Prepared for Reuters by Durrants
