LONDON (Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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Whitbread reported a rise in total revenue in the first quarter of its financial year as it continued to grow sales at both its Premier Inn and Costa Coffee chains. The hotel and coffee shop chain operator reported a 12.5% rise in total sales in the 13 weeks to May 28, with Premier Inn revenue up 14.3% and Costa Coffee up 17.2%. On a like-for-like basis, sales grew 6.3% and 5.0%, respectively.
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Industrial equipment rental company Ashtead Group reported strong growth in profit and revenue for its recently-ended financial year as it achieved growth in both the UK and US, hiked its dividend, and gave a positive outlook. The company reported a pretax profit of GBP473.8 million for the year to April 30, up from GBP365.5 million a year earlier, as revenue grew to GBP2.04 billion from GBP1.63 billion. It said it will pay a final dividend of 12.25 pence, meaning a total of 15.25p for the whole year, up by a third from 11.5p a year earlier.
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The UK's communications and postal regulator Ofcom widened its review of the regulation of Royal Mail in light of the decision by competitor Whistl to pull its plans to launch its own direct delivery services in the UK. Ofcom said it wanted to look at what changes to the overall postal framework might be appropriate to secure the so-called universal postal service - Royal Mail's obligation to deliver to every address in the UK. It also wants to look at how best to ensure Royal Mail continues to become more efficient in the absence of any competitor in the direct delivery market, and whether the company's wholesale and retail prices are affordable while being sufficient to cover the costs of the universal service.
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Kier Group said it has won new construction contracts worth GBP247 million in total through the National Health Service's ProCure21+ publicly-funded procurement programme.
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Crest Nicholson Holdings struck a bullish tone about its prospects, as the homebuilder reported that first-half pretax profit rose by about 52%. Chief Executive Stephen Stone said the business has the longer-term opportunity to achieve a "natural scale" approaching 4,000 units and GBP1.4 billion of revenue. The company said it is on track with a three-year plan to grow revenue towards GBP1 billion by October 2016.
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Dignity said it is spending GBP38 million in cash on expanding its funeral network. Dignity said it is acquiring 38 of 83 locations currently served by Laurel Funerals. Separately, Dignity said it has arranged a GBP26.25 million debt facility with Royal Bank of Scotland PLC, part of Royal Bank of Scotland Group PLC, which will be secured against assets including those being acquired. Dignity said the debt wasn't required to fund the acquisition. Dignity said it is only acquiring funeral locations in parts of the UK that "complement its own geographic spread" so as to avoid any concerns about competition.
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MARKETS
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UK shares are lower mid-morning, with the increasingly rancorous Greek debt negotiations in the background and with the news that UK inflation rose in May after falling into negative territory in April. Chinese stocks plunged Tuesday, with the benchmark Shanghai Composite Index losing 3.47%, as China's securities regulator tightened margin financing. Analysts said stock declines on Monday and Tuesday reflected investors' unease about new margin-trading regulations.
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FTSE 100: down 0.4% at 6,681.02
FTSE 250: down 0.4% at 17,661.70
AIM ALL-SHARE: down 0.4% at 767.80
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The pound is down against the dollar amid concerns about Greece and caution ahead of the Federal Reserve's two-day meeting which starts Tuesday.
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GBP: down at USD1.5564
EUR: down at USD1.1249
GOLD: down at USD1182.20 per ounce
OIL (Brent): down at USD63.71 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Athens' eurozone partners are drawing up an emergency plan to head off the threat of economic chaos in Greece if the nation fails to reach a deal with its creditors this week, German media reported. The plan includes the imposition at the weekend of capital controls to halt a possible run on Greek banks, according to the daily Sueddeutsche Zeitung. The Eurogroup of finance ministers are due to meet Thursday to take stock of the long-running and increasingly fraught negotiations between Greece and its creditors - the European Commission, the European Central Bank and the International Monetary Fund.
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UK consumer prices increased in May after falling in April for the first time since 1960, the Office for National Statistics reported. Consumer prices rose 0.1% from last year as expected by economists, offsetting April's 0.1% fall. Month-on-month, the consumer price index gained 0.2%, the same as in April, and matched expectations. Core inflation, which excludes energy, food, alcoholic beverages and tobacco, rose to 0.9% from 0.8% in April.
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House price inflation in the UK eased in April, reaching the lowest in sixteen months, after accelerating in the previous month, figures from the Office for the National Statistics showed. Average house prices increased 5.5% year-over-year in April, slower than March's 9.6% growth. In February, prices had risen 7.4%. The increase in April was the lowest since November 2013, when prices had risen 5.4%, and matched the rate of December 2013. The pace of annual house price growth fell across the majority of the UK, the ONS added.
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Germany's consumer prices increased for the fourth straight month in May at the fastest pace in seven months, as initially estimated, final data from the statistical office Destatis showed. Consumer prices rose 0.7% from last year, following a 0.5% increase in April. The annual increase matched the preliminary estimate published on June 1. The latest figure was the highest since October last year, when inflation was 0.8%. Prices of food and non-alcoholic beverages grew 1.4% year-on-year in May and recreation and culture prices increased 1.7%.
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The European Central Bank received the seal of approval on Tuesday for its government bond-buying programme. In endorsing the programme, the European Court of Justice in Luxembourg rejected challenges by a group of German politicians and economists to the ECB's bond-buying scheme as set out under the so-called Outright Monetary Transactions plan.
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Eurozone employment increased slightly in the first quarter, Eurostat reported. Employment rose 0.1% from the prior quarter, the same rate of growth as seen in the fourth quarter. Year-on-year, employment growth slowed marginally to 0.8% from 0.9% a quarter ago.
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Syrian Kurdish forces dealt a strategic blow to the Islamic State jihadist group, seizing a key border town that provided the extremists with one of their main supply routes from Turkey. Video recorded from the Turkish side of the border showed fighters waving the flag of the Kurdish People's Protection Units near the spot where, only 24 hours earlier, Islamic State members had pushed fleeing civilians back from the border fence. The green, white and black tricolour adopted by Syrian rebels was seen draped over the border crossing itself in the footage published by the Turkish DHA news agency.
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The Yemeni branch of al-Qaeda, seen as the international jihadist network's most active and dangerous branch, confirmed that its leader Nasir al-Wuhayshi had been killed in a US drone strike. A video message released by al-Qaeda in the Arabian Peninsula (AQAP) named the group's military leader Qasim al-Raimi as al-Wuhayshi's successor.
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The outbreak of Middle East Respiratory Syndrome, or MERS, in South Korea has claimed three more lives in the last 24 hours, bringing the number of deaths to 19, according to the latest government figures. One of the latest victims was 49 years old, the youngest person to die in what has become the biggest outbreak of MERS outside the Middle East, Yonhap News Agency reported. The coronavirus has infected over 150 people, and over 5,500 people are under quarantine, Yonhap reported.
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The Cairo Criminal Court sentenced three leaders of the Muslim Brotherhood, on trial alongside former president Mohammed Morsi, to death on charges of spying against Egypt. Morsi himself and 16 others received a life sentence. The court will shortly pronounce judgement on Morsi and others in a related case where they face a possible death sentence on charges of organizing a prison break
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By Arvind Bhunjun; arvindbhunjun@alliancenews.com; @ArvindBhunjun
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