MPs and ministers pouring scorn on hedge fund 'spivs' in the City for reckless short-selling are likely to be embarrassed by the revelation that the 367 million pound parliamentary pension fund has itself invested in hedge funds that cash in on falling shares. For example, public accounts show the fund has placed seven million pounds with Quellos, a fund for hedge funds. John Ralfe, a pensions consultant, said: 'It seems inconsistent for MPs whose own pension fund invests in hedge funds and short selling to criticise other people for doing the same.'
EMPLOYERS FACE HIGHER BILLS FOR HEALTH BENEFITS
A new independent study by Mercer indicates that the cost to UK companies of providing employee healthcare benefits is one of the highest in Europe. UK firms spend an average of seven percent of payroll costs on healthcare provision, compared with a Europe-wide average of 5.3 percent. According to a separate survey published earlier this summer, the overall cost to UK employers of providing medical cover for employees and their dependents has risen 67 percent since 1999.
BANKS FACE CRACKDOWN ON LOAN INSURANCE SALES
The Financial Services Authority has launched a crackdown on alleged mis-selling of lucrative insurance products and has urged companies to reform their sales practices ahead of 'escalating' intervention it was planning. In the interim, banks might 'wish to consider' stopping selling lump sum insurance policies on unsecured personal loans, according to John Pain, managing director of the FSA's retail markets division.
BAD NEWS FOR 1,000 AS ITV CUTS JOBS
ITV has unveiled a cost-cutting programme that will mean the loss of up to 1,000 jobs in the next six months. The broadcaster said the headcount reductions, which include 430 jobs being cut from regional news, are expected to save 40 million pounds a year. John Cresswell, chief operating officer, described the move as a 'self-funding' solution to the broadcaster's difficulties, saying: 'In order to sustain our investment in UK content we have to keep on top of our cost base.'
MOSAIC PAYS DOWN DEBT TO WEATHER STORM
Mosaic, the group of fashion brands including Karen Millen and Coast, has paid down debt as it attempts to weather the storm hitting retailers on the high street. The Baugur-controlled group announced a loss of 12.9 million pounds for the six months to July 26, up from 4.7 million pounds in the previous half, on sales that increased five percent to 410 million pounds. Derek Lovelock, chief executive, said: 'We are pleased with those first-half results because it has been a difficult climate'.
GAME BUCKS TREND WITH LEAP TO 33 MILLION POUNDS
Game Group has raised its expectations for the full year and defied the high-street slump to report a 26-fold jump in interim profits. Pre-tax profits in the first half rose to 33.4 million pounds, up from 1.3 million pounds, after revenues across the group rose 54 percent to 743.4 million pounds. Like-for-like sales for this year were now expected to grow between eight and 12 percent, compared to previous guidance of five to ten percent. The shares gained 10 pence to close at 205 pence.
CAUTIOUS OUTLOOK AT HARVEY NASH
Harvey Nash, the IT- and executive-focused recruitment and outsourcing group, reported a 25 percent increase in pre-tax profit to 3.9 million pounds, but admitted that the present turmoil in the financial markets left serious questions hanging over the recruitment sector as a whole. Albert Ellis, the chairman, insisted he was confident the business could weather the storm, saying: 'We have proven over the past five or six years now that we can grow the business organically.'
PURCHASE LIFTS ANIMALCARE
Animalcare reported that pre-tax profit had more than trebled for the year to June 30, up to 1.1 million pounds, helped by the 13.4 million pound acquisition of Genus's veterinary pharmaceutical business at the start of the year. Simon Riddell, chief executive, said the deal had been transformational for the company, contributing four million pounds to total revenues of 11.8 million pounds in the 24 weeks since the acquisition. The shares were unchanged at 55 pence.
CERES TO SPEND FIVE MILLION POUNDS ON FACTORY
Shares in Ceres Power fell 9.5 pence to 164.5 pence after it reported a pre-tax loss of five million pounds, although development payments from Centrica and EDF boosted first-half revenue from 98,000 pounds to 722,000 pounds. The company is planning to spend five million pounds to complete a factory for manufacturing fuel stacks for residential combined heat and power (CHP) units. Centrica is contracted to take 37,500 of the units, an alternative to wall-mounted boilers.
DEFICIT WIDENS AT PLETHORA
Plethora Solutions, the biotechnology company that focuses on urological disorders, reported a pre-tax loss of 7.5 million pounds for the six months to June. This was a 55 percent greater loss than the year before, on revenues up 18 percent to 3.3 million pounds. The company has lifted spending on clinical trials for a suite of new drugs, including a spray treatment for premature ejaculation that it hopes to bring to market by 2010. The shares closed at 29 pence, a fall of 4.5 pence.
Prepared for Reuters by Durrants
Keywords: PRESS DIGEST Financial Times Oct 1
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