BP Share News (BP.)

LONDON (Alliance News) - Royal Mail shares have fallen sharply after the company warned of increased competition in the parcels market and a big potential hit from rival TNT's plans to expand its own letter delivery service to more UK cities.

Equity markets in the UK and Europe are trading mixed following some weak PMI data from France and Germany, meaning the markets failed to follow the lead from strong gains in the US Wednesday and much-better-than-expected Chinese manufacturing PMI data overnight.

Wall Street is expected to open flat to slightly higher ahead of a raft of US macroeconomic data.

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FTSE 100: down 0.1% at 6,812.63
FTSE 250: up 0.2% at 15,638.28
AIM ALL-SHARE: up 0.7% at 797.26
GBP-USD: down at 1.6873
EUR-USD: down at 1.3660
GOLD: up at USD1,299.85 an ounce
OIL (Brent): up at USD110.69 a barrel

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Top UK Corporate News
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Royal Mail has dropped to the bottom of the FTSE 100 after the company reported a full-year performance in line with expectations, but said it was facing increased competition in its parcels business and a big potential hit from rival TNT Post UK's plans to expand its own letter delivery service to new cities. In its first set of full-year results since it listed, Royal Mail said pretax profit excluding the impact of the reform of its pension schemes rose to GBP363 million, from GBP304 million last year, as continued growth in parcels revenue more than offset a continued decline in letters revenue.
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Brewing giant SABMiller reported higher pretax profit for its last financial year, as it offset lower revenue by raising prices and expanding its portfolio of higher-margin premium brands. Lager volumes were up, driven again by emerging markets like Latin America and China, but it took a revenue hit from currency movements. The brewer of brands including Peroni, Pilsner Urquell and Grolsch reported a pretax profit of USD4.82 billion for the year ended March 31, up from USD4.68 billion a year earlier. The group declared a full year dividend per share for the year of 105.0 US cents, up 4% on the prior year.
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Anglo-Dutch consumer goods giant Unilever said it is selling its North America pasta sauces business, including the Ragu and Bertolli brands, to Japanese condiments maker Mizkan Group, in a deal worth USD2.15 billion. Unilever, the maker of consumer products including Dove soaps and Ben & Jerry's ice cream, had said last month that its was undertaking a "strategic review" of its North American pasta sauces businesses, and said that it was also considering sell its Slim Fast weight loss brand. Unilever said the disposal of Ragu and Bertolli to Mizkan allows its to "sharpen its focus within its foods business".
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Royal Dutch Shell said it will stop providing a scrip dividend from the point it gives out its second quarter 2014 interim dividend, meaning that the second quarter interim dividend and all other dividends from the company will now be provided in cash. The oil and gas major said the decision will allow for a more efficient share buy-back programme, and it expects that buy-backs will offset dilution created by scrip dividends by the end of 2015, with roughly 135 million shares currently outstanding. The company said shareholder distributions in 2013, including dividends announced and share buy-backs, totalled USD16 billion.
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BP said it is appealing to the US Supreme Court over a ruling on Monday supporting compensation claims for certain businesses affected by the 2010 Gulf of Mexico oil spill. The Fifth Circuit appeals court in New Orleans on Monday rejected BP’s request for a full review of the company’s case regarding settlement to victims of the disaster, as it seeks to establish that the compensation settlement it agreed with plaintiffs’ lawyers in 2012 is being interpreted unfairly. The oil and gas major's final chance to limit the level of compensation it has to pay above its original estimate of USD7.8 billion, will be by the appeal at the Supreme Court. The company argues that the terms of its original compensation agreement are being misinterpreted and it is now expected to pay out to unwarranted claims over events that were not connected to the Deepwater Horizon incident.
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United Utilities Group posted a 75% increase in pretax profit during its full year, as revenue rose and it booked a GBP157 million deferred tax credit. The water firm said its pretax profit increased to GBP544.7 million for the twelve months ended March 31, from GBP311.8 million the previous year, as revenues increased 3.7% to GBP1.70 billion from GBP1.64 billion. The company had flagged the revenue and underlying profit increase in March, citing further improvements in its customer service operations and as it remained ahead of schedule in delivering its 2010-15 regulatory out-performance targets.
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Capita said it has signed a contract, worth between GBP60 - GBP70 million over the next five years, to provide a new IT service for BAE Systems' submarine building business.
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Defence company QinetiQ Group swung to a small pretax profit in its last financial year as impairments halved, but its profit excluding charges fell as it continued to be hit by the drawdown in US military operations in recent conflict zones. Still the company raised its dividend, saying that it expects its performance to improve as it further lessens its heavy reliance on defence markets.
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Glencore said it will close its Newlands underground coal mine in Australia in late 2015 as part of its ongoing strategy to combat a collapse in coal prices. The mining giant said it will not extend the life of the Newlands mine in Queensland's Bowen Basin, which will therefore reach the end of its life in the fourth quarter 2015 after extracting the final volumes of coal from the site.
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Polymetal International said that it has agreed to acquire the major Kyzyl gold project in Kazakhstan for up USD1.12 billion in cash and shares, a move which will increase its reserves by 50%. The gold, silver and copper-mining exploration and production company, with operations in Russia and Kazakhstan, said it has entered binding agreements with Sumeru Gold BV and Sumeru LLP for the acquisition of Altynalmas Gold Ltd, the holding company for the Kyzyl gold project. The project is a highly prospective mining area including the Bakyrchik and Bolshevik gold deposits, which Polymetal said would increase its gold equivalent reserves by roughly 50% including a single high grade region holding 6.7 million ounces of gold at 7.5 grams per tonne.
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Ferrexpo said its operations in Ukraine remain unaffected by the political instability in the country, and it expects to shortly receive bonds with a value of USD117 million in local currency from the Ukrainian government for an outstanding value-added tax refund. The iron ore producer, which operates solely in Ukraine, will say at its annual general meeting that both production and shipment of its iron ore pellets have been in line with expectations and costs have continued to fall due to improved efficiency and a decline in the local currency exchange rates.
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Cycle and car maintenance product retailer Halfords Group said its profit and revenue rose in its last financial year, as the UK's growing passion for cycling and online shopping, plus a revamp of its products, drove strong growth across the business. For the year ended March 28, the retail chain recorded pretax profit of GBP72.6 million, up 2.3% from GBP71.0 million a year earlier, driven by a 7.9% increase in revenues to GBP939.7 million from GBP871.3 million last year.
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Property website Zoopla and B&M, the cheap fashion retail led by former Tesco boss Terry Leahy, led a number of companies adding themselves to London's initial public offering pipeline Thursday, but there was a further sign that the market for new issues is coming off the boil as fashion chain Fat Face became the second company this month to cite difficult market conditions for pulling its planned IPO.
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AIM MOVERS
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LightwaveRF is a big gainer after it reported a substantial reduction in its loss in the first half of its financial year as revenue more than tripled following a refocusing of the business on expanding its distribution outlets. Energy Technique is doing well after its pretax profit tripled in its full year, as fan coil sales drove up overall revenue and improved the operating profit of its Diffusion unit. Tangiers Petroleum is up after it said that drilling of its TAO-1 exploration well off the Moroccan Atlantic coast is on track to start in mid- to late-June. It said its jack-up rig has now been mobilised to the site, which the company says has the potential of 190 million barrels of net unrisked prospective resources. Deltex Medical Group is a big faller after it said it will raise up to GBP5.04 million through a placing and open offer at 11 pence a share, money it will use to expand its US team in the wake of approaches from 10 new US hospitals about its products, more than it expected. It added that it is making "satisfactory" progress in the UK, US and Internationally, and is expecting US growth to accelerate in the second half, and its UK surgical probe business to start growing after a flat first half. The placing set a new benchmark price. Prophotonix is also down, despite reaffirming its first-half revenue expectations of between USD7.8 million and USD8.2 million. It said it will cut its costs by about USD900,000 in an effort to become profitable as soon as possible, and will book USD150,000 in charges in its first-half accounts for the cost-cutting programme.
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Top Economics And General
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The UK budget deficit exceeded expectations in April, official figures showed. Public sector net borrowing excluding interventions totaled GBP 7.4 billion in April, which was GBP 1.7 billion higher than in April 2013, the Office for National Statistics said. The shortfall was forecast to fall to GBP 4.8 billion. For the financial year 2013/14, public sector net borrowing excluding the temporary effects of financial interventions, the transfer of the Royal Mail Pension Plan and the transfers from the Bank of England Asset Purchase Facility Fund was GBP 107.4 billion, data showed.
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The UK economy expanded at a faster pace than initially estimated in the first quarter, second estimates from the Office for National Statistics showed. Gross domestic product grew 0.8% from the prior quarter, unchanged from the estimate published on April 29. The sequential growth follows 0.7% rise in the fourth quarter of last year. On a yearly basis, GDP was up 3.1%, also in line with initial estimate.
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The Federal Reserve discussed plans to exit stimulus but gave no indication that a rate hike is imminent, the minutes of the most recent Federal Reserve meeting showed Wednesday. In April, the Fed kept its benchmark rate unchanged at historic low levels near zero and it tapered quantitative easing by another USD10 billion per month. Before voting on that action, policy makers examined "several approaches" for tightening but have not decided on the appropriate mix of tools to wind down its unprecedented support for the US economy.
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French business confidence weakened unexpectedly in May, a closely watched survey data revealed. The business confidence index fell slightly to 99 in May from 100 in April, the Insee reported. The score was forecast to remain unchanged at 100.
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An index monitoring manufacturing activity in China came in with a score of 49.7 in May, the latest flash estimate from HSBC and Markit Economics revealed. That topped forecasts for a score of 48.3 and was up sharply from 48.1 in April - and while it does remain below the line of 50 that separates expansion from contraction, the May reading represents a five-month high.
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Thai Army Chief Prayuth Chan-ocha announced a coup after his efforts to reconcile rival political factions failed. Prayuth, flanked by the heads of the air force and navy, said it had been necessary to seize power to prevent further violence, deaths and damage to property in the country after months of political turmoil. The announcement broadcast on Thai TV followed a swift end to the second day of reconciliation talks at the Army Club in Bangkok, where Prayuth had gathered representatives of rival factions to find a solution to the political stalemate.
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Ukraine called Thursday for a special meeting of the UN Security Council ahead of a presidential election at the weekend, amid reports that at least eight Ukrainian troops were killed in fresh clashes with pro-Russian forces. "At the meeting, we will submit evidence that Russia wants to torpedo the presidential election with an escalation of the conflict," Prime Minister Arseniy Yatsenyuk said in Kiev.
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NATO has seen some activity at the Ukraine border that may be pointing to a long-promised withdrawal of Russian troops, the chief of the military alliance says. "Late yesterday, we have seen limited Russian troop activity in the vicinity of the border with Ukraine that may suggest that some of these forces are preparing to withdraw," NATO Secretary General Anders Fogh Rasmussen said during a visit to Montenegro. "It is too early to say what this means, but I hope this is the start of a full and genuine withdrawal," he added. "At present, most of the previously deployed Russian force remains near the Ukrainian border and we see continued Russian exercises in the same area."
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About 80 US military personnel have been sent to Chad to help locate and "support the safe return" of more than 200 schoolgirls abducted last month in neighbouring Nigeria by Islamist militants, the White House said Wednesday. The military deployment is meant to "support the operation of intelligence, surveillance and reconnaissance aircraft for missions over northern Nigeria and the surrounding area," US President Barack Obama told Congress in a letter. The US force will remain in Chad as long as needed to help resolve the abductions by Nigerian extremist group Boko Haram, Obama said in the formal notification. Earlier Wednesday, at least 30 people were killed by militants in a village in northern Nigeria, after twin blasts killed 118 people Tuesday in the central town of Jos.
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Afternoon Watchlist (all times British Summer Time)
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14:45 US Markit Manufacturing PMI
15:00 US Existing Home Sales Change
15:30 US EIA Natural Gas Storage change
16:00 US Kansas Fed manufacturing activity
20:00 US American Petroleum Institute Monthly Report
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Friday's Key UK Corporate Events
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Moss Bros Interim Management Statement
Close Brothers Interim Management Statement
Quintain Estates & Development Full Year Results
Assura Group Full Year Results
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Friday's Key Economic Events (all times British Summer Time)
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07:00 Germany Gross Domestic Product
09:00 Germany IFO
09:00 Italy Retail Sales
11:00 Italy Trade Balance non-EU
15:00 US New Home Sales
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