LONDON (Alliance News) - The following is a summary of top news stories Thursday.
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COMPANIES
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Next reported a sixth consecutive year of annual pretax profit growth, as sales increased in its stores and particularly online, but it cut its sales guidance for the current year as it predicted slower growth in international sales due to the issues in Russia and Ukraine and due to tough overall comparative figures. Next reported a pretax profit of GBP794.8 million for the year to January 31, up from GBP695.2 million a year earlier, while excluding a GBP12.6 million gain that included a profit on the sale of its investment in Cotton Traders, pretax profit rose to GBP782.2 million from GBP695.2 million. Revenue grew 6.9% to GBP4.00 billion, from GBP3.74 billion, with Directory sales up 12.1% and retail sales up 4.8%.
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AstraZeneca said it will co-commercialise its Movantik treatment for opioid-induced constipation in adults with chronic non-cancer pain with Daiichi Sankyo Inc, in line with its recent strategy of developing and commercialising drugs on its own as well as through partnerships. Under the deal, Daiichi Sankyo will pay a USD200 million up-front fee and subsequent sales-related payments of up to USD625 million. AstraZeneca will be responsible for manufacturing, will book all sales and will make sales-related commission payments to Daiichi Sankyo. Both companies will be jointly responsible for commercial activities.
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BHP Billiton said it has priced a five-year AUD1.0 billion note issued under the company's Australian medium-term note programme. It said the Australian dollar notes will pay interest at 3.00% and mature in March 2020. The proceeds will be used for general corporate purposes.
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UK telecoms regulator Ofcom confirmed a new rule requiring BT Group to maintain a sufficient margin between its wholesale and retail superfast broadband prices, although it will not be imposing any changes to BT's prices at this time as it is currently meeting the requirements of the new rule. BT is required to allow other operators to use its network to sell broadband to customers, and the new rule is intended to make sure that competitors can match BT's own broadband prices profitably. However Ofcom's indicative assessment of the market shows BT's margin is sufficient under the new rule, so as such it is considered a "safeguard" to stop BT reducing retail margins in the future, and makes sure that increases in BT's costs are reflected in its prices.
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Sky has announced an unseasonal increase to the price of its television packages, the Financial Times reported, coming just over a month after the broadcaster paid GBP4.2 billion to secure live Premier League rights. The company, which traditionally increases its prices in September, is to increase the average price of packages by GBP2.50 per month, with the cost of a Sport bundle to increase by GBP1 to GBP47 per month.
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Ted Baker reported further growth in profit and sales in its last financial year, and said it plans to open more stores in the year ahead. Pretax profit grew 25.3% to GBP48.8 million in the year ended January 31, from GBP38.9 million a year earlier, as revenue grew 20.4% to GBP387.6 million, from GBP321.9 million. It raised its total dividend for the year to 40.3 pence per share from 33.7p. The fashion retailer has been having a successful few years, as the brand has continued to expand internationally leveraging its British identity, and has kept its strategy of not discounting its goods and by using word of mouth rather than expensive marketing campaigns to promote itself.
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Ophir Energy said it swung to a pretax profit in 2014, bolstered by a USD671.7 million gain after the sale of its interest in three blocks in Tanzania. In a statement, the company said it made a USD288.5 million pretax profit in 2014, compared with a USD280.5 million pretax loss in the prior year. The move into the black was enabled by the sale of its 20% stake in blocks one, three and four in Tanzania, for USD1.29 billion before tax to Pavilion Energy PLC. The gain registered on the farm-out more than offset an increase in exploration expenses to USD333.8 million from USD229.1 million. That was also helped by other operating expenses including administration.
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Property adviser Savills hiked its dividend payout as its pretax profit pushed higher in 2014 on the back of stronger revenue, with the company boosted by a strong London market, a recovery in the UK regional property market and a good performance in the US. Savills said its pretax profit for the year was GBP84.7 million, up from GBP70.1 million a year earlier. On the back of the rise in profit, the company has proposed a hike to its final dividend to 7.25 pence, from 7.00 pence, and said its total dividend payout for the year will be 23 pence per share, up 21% year-on-year, on the back of a further 12 pence supplementary dividend the company will pay based on the underlying performance of its transaction advisory business.
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Luxury shoe and accessories maker Jimmy Choo reported a narrowed pretax loss for 2014 thanks to a debt-for-equity swap deal it did last autumn, and its closely-watched revenue and operating earnings rose as its goods continued to prove popular and it opened more new stores, mainly in China, and renovated others. In its maiden set of annual results as a listed company, Jimmy Choo reported a pretax loss of GBP8.3 million for 2014, compared with the GBP21.4 million loss it posted in 2013, as finance costs dropped by GBP20 million following a debt-for-equity swap that it did last October. That meant its debt stood at GBP125.6 million at the end of 2014, down from GBP582.4 million a year earlier.
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Rentokil Initial said it has expanded its pest control business with the acquisition of US firm Eradico Services Inc and Sagrip SA, which will give the company a presence in the Guatemala and El Salvador markets. The FTSE 250-listed business services company did not provide any financial details on the acquisitions, but said the two businesses produced combined annual revenue of GBP7.3 million in the 12 months prior to the acquisition.
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Housebuilder Crest Nicholson Holdings said it has seen a strong start to the spring selling season and is confident of meeting its targets for the year. In a short statement ahead of the company's annual general meeting, Crest Nicholson Chairman William Rucker said the company's spring selling season has been strong since it published in January its results for the year to the end of October.
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MARKETS
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The FTSE 100 is trading in the green, having hit a new record intraday high of 6,982.79 earlier in the session, led by resource stocks as investors continue to focus on the outcome of Wednesday's US Federal Reserve meeting.
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FTSE 100: up 0.2% at 6,955.37
FTSE 250: up 0.3% at 17,413.28
AIM ALL-SHARE: flat at 715.35
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GBP-USD: down at USD1.4914
EUR-USD: down at USD1.0694
GOLD: down at USD1165.01 per ounce
OIL (Brent): down at USD51.34 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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The US Federal Reserve said a hike in its benchmark interest rate "remains unlikely" for the central-bank's April 29 meeting, but said nothing about the following meeting in June. In a statement, the Fed dropped its recent outlook of being "patient in beginning to normalize" monetary policy from its unprecedented near-zero rate, in place for nearly seven years. The Fed "anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labour market and is reasonably confident that inflation will move back to its 2% objective over the medium term," the statement said. "This change in the forward guidance does not indicate that the (monetary policy) committee has decided on the timing of the initial increase in the target range." In her press conference, Fed Chair Janet Yellen said: "Just because we removed the word patient from the statement doesn't mean we are going to be impatient."
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The Swiss National Bank kept its monetary policy unchanged and projected a deep negative inflation this year. The central bank also downgraded its growth forecast as the discontinuation of currency ceiling and the subsequent strength of the franc weighed on activity. The SNB maintained the target range for the three-month libor between -1.25% and -0.25%. The interest rate on sight deposits with the SNB remained at -0.75% and the exemption thresholds remained unchanged, the bank said in a statement. The SNB reiterated that the Swiss franc is significantly overvalued and should continue to weaken over time.
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Greek Prime Minister Alexis Tsipras was set to hold crisis talks with top European officials in Brussels, amid fears that his country is running out of cash. The meeting is to be conducted on the margins of an EU summit, following reports that Greece and its creditors have hit an impasse in reform negotiations needed before Athens can access EUR7.2 billion left to its international bailout.
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Japan and China held a top-level security meeting on Thursday, the first in four years, amid soured ties over a territorial spat and differing views of wartime history. Foreign affairs and defence officials of the two countries were expected to discuss a mechanism to avoid unintended clashes at sea. "It can be said that Japan-China relations appear to be advancing gradually," Japanese Deputy Foreign Minister Shinsuke Sugiyama told the meeting in Tokyo, Kyodo News agency reported.
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Swiss authorities have so far frozen about USD403 million in connection with the massive corruption case around Brazilian oil giant Petrobras, the Swiss Attorney General Michael Lauber said. Lauber, who addressed reporters during a visit to Brasilia, said that, of that total, Swiss authorities have already approved the return to Brazil of about USD121 million. The seizure was the latest development in the unfolding USD3.7 billion scandal around the state-controlled Petrobras, Brazil's largest company, that has tarnished Brazilian President Dilma Rousseff and provoked massive public protests.
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Russian President Vladimir Putin said Ukrainians and Russians are a single people. "We in Russia always thought that Russians and Ukrainians are one people. And I believe so today," Putin told a rally on Red Square marking the first anniversary of Crimea's "unification" with Russia. Putin argued that Crimea and Russia did not unite for territory or strategic aims, but that the peninsula was "the source of our spirituality and statehood."
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Benjamin Netanyahu's Likud party confounded all expectations by scoring a victory in Israel's parliamentary elections, all but guaranteeing a third-consecutive term for the hardline premier. Likud was projected to take 29 or 30 seats in the 120-seat Knesset after almost 99% of the ballots were counted Wednesday. Its primary rival, the centre-left Zionist Camp, trailed with 24 seats. Netanyahu aides said the premier would start the work of forming a government "immediately," seeking to complete it in two or three weeks.
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11 Jan 2017 09:36
