VODAFONE CHAIRMAN TAKEN TO TASK OVER “DYSFUNCTIONAL” BOARD
Amid talk of Boardroom disharmony, Vodafone (VOD.L) chairman Sir John Bond is facing criticism from investors who are unhappy with the mobile operator’s performance and what they perceive to be the mismanagement of its global assets. There are concerns that the City veteran is hindering the efforts of chief executive Vittorio Colao, who is widely backed by investors. The company will issue a trading statement on Friday, ahead of next Tuesday’s annual meeting where shareholders are likely to express their concerns.
CHAIRMAN GETS TOUGH OVER GREEN “MUDDLE”
Renewable Power and Light RPL.L, the failed UK-registered energy company that backed palm-oil fired plants in the United States, is to de-list from Aim and pursue former directors and advisers for 55 million pounds in losses. Chairman Duncan Soukup, who took control of the firm in the spring following a boardroom coup, said the remaining two million pounds worth of assets would be parked in an unlisted investment vehicle. The company plans to resolve “legacy issues”, which arose between its 2006 float and Soukup’s takeover in 2010, and generate some recovery for shareholders.
LOSS OF BP‘S PAYOUT BLOWS BIG HOLE IN POCKETS OF INVESTORS IN UK
BP’s (BP.L) decision to cancel its dividend resulted in an eight percent fall in payouts to shareholders in UK companies in the second quarter. According to the share registration services provider Capita Registrars, payouts for the three months to June 30 totalled 15 billion pounds, down from 16.3 billion pounds in the same period last year. Under pressure from the U.S. administration, the oil major elected to scrap its 1.8 billion pound dividend, which more than accounted for the fall.
GKN (GKN.L) (should have farther to run)
De La Rue (DLAR.L) (only for the brave)
Wincanton (WIN.L) (it may be worth getting aboard)
The Daily Telegraph
Shares in GKN (GKN.L), the British engineering group, have risen sharply following a profits upgrade. GKN said pre-tax profits would be at least 170 million pounds for the six months to June 30, ten million pounds more than was forecast by analysts at financial services company Citi. A short statement issued by GKN said trading in the second quarter of 2010 “continued to improve strongly” with demand from automotive markets “well ahead of expectations”.
Land Securities (LAND.L), the commercial property company, has said it is set to begin building Trinity Leeds, a 750,000 sq ft retail centre in the heart of Leeds which will cost 350 million pounds. Work on the centre, originally halted in 2008, is expected to create up to 1,000 construction jobs and up to 3,000 retail positions when it opens in spring 2013. The company has revealed it has let 43 percent of the rental income of Trinity so far, with a further four percent in solicitors’ hands and 12 percent in negotiations. Retailers signed up include TopShop, Next and Hollister. Shares in Land Securities rose 8.5 pence to 589.5 pence.
OIL CHIEFS TO GIVE EVIDENCE IN UK OVER DEEPWATER DRILLING
Tony Hayward, the chief executive of oil giant BP (BP.L), will be asked along with other oil bosses to give evidence to a UK political inquiry into offshore deepwater drilling. The inquiry will be led by Tim Yeo, the Conservative MP who chairs the Energy and Climate Change Committee. Yeo said it would be “more than a disappointment” if BP did not allow its executives to be questioned. The inquiry will focus on the risks of exploration west of the Shetland Islands, where deepwater wells are set to be drilled.
SSL International SSL.L (take up offer)
Outdoor kit retailer Blacks Leisure BSLA.L has announced a 7.5 percent drop in like-for-like sales for the 17 weeks to 30 June, attributing the loss to dry weather and political uncertainty in May. Total sales for the period were down from 76.9 million pounds in 2009 to 53.9 million pounds this year. Blacks closed 107 stores in November but is looking to open eight new branches before the financial year ends. Shares in Blacks fell six percent on Wednesday.
Banknote printer De La Rue (DLAR.L) has launched an investigation to discover the cause of certain paper quality specifications not being met, which forced it to suspend print production at its Hampshire facility. The firm, which prints banknotes for the Bank of England and 150 other countries, said it has suspended production and the shipment of the paper involved but has not released any further details on the likely causes. The latest developments come after the firm announced on Monday that its paper revenues are likely to be “materially lower” than expectations, resulting in shares falling a further three percent. Analysts are now concerned that the print issues could damage De La Rue’s reputation among central banks.
Telecoms group Cable & Wireless Communications CWC.L saw 21 percent of shareholders voting against remuneration packages proposed for senior management at its annual general meeting on Wednesday. Despite the dissent, industry insiders suggest it would not result in a change to CWC’s long-term incentive plan. Pay awards at the group have resulted in finance director Tim Pennington seeing a rise from 400,000 pounds to 500,000 pounds, which has subsequently come under scrutiny by the Association of British Insurers. However, a spokesman for CWC has cited the 78.9 percent of votes for the remuneration packages as showing “good support” and being “based on a lower risk reward structure that was previously the case at Cable & Wireless”.
GlaxoSmithKline (GSK.L) (buy)
Euromoney (ERM.L) (buy)
Hochschild Mining (HOCM.L) (buy)
OWNERS TEST APPETITE FOR PENGUINS WITH TWO BILLION POUND PRICE
United Biscuits [UBGRIH.UL], the food company, has been put up for sale by its private equity backers Blackstone and PAI Partners for two billion pounds. The sale could raise concerns that another British brand could fall into foreign hands. United Biscuits last year reported a 14 percent rise in earnings to 233 million pounds on revenue of 1.3 billion pounds. At the end of 2009 the company had debts of 1.2 billion pounds. The private equity firms are believed to be considering selling the snacks and biscuits divisions to different buyers. They will retain a flotation option if the asking price is not met.
Tony Hayward, chief executive of BP (BP.L), will on Tuesday outline the company’s new corporate growth strategy. The move is seen as an attempt to reassure investors and cement his position. The London briefing will coincide with second quarter figures expected to show a year-on-year increase to about 3.2 billion pounds.
INVESTOR PROTEST OVER EXPERIAN BOSS ON DAY OF PAY REVOLTS
Nearly one in three investors failed to endorse the re-election of David Tyler to the board of Experian (EXPN.L), the credit checking firm. According to corporate governance experts Manifest, the average dissent on director elections is 2.3 percent. The protest vote is one of the biggest against a director this year. Experian said Tyler, chairman of supermarket J Sainsbury and technology services company Logica, was an excellent non-executive with a depth of knowledge and expertise. Experian was spun out of GUS in 2006. Shareholders were concerned about Tyler’s independence as he was finance director at GUS.
Prepared for Reuters by Durrants