Economics
Goods trade gap The Office for National Statistics said the goods trade
gap shrank to £7.667 billion in July, from an upwardly revised £7.993
billion in June. A deficit of £7.5 billion had been forecast.
Eurozone economy The European Commission cut its economic forecasts,
predicting 1.3 per cent overall economic growth for the eurozone this year,
down from its previous forecast of 1.7 per cent. It also revised down its
forecast for Britain, predicting 1.1 per cent growth, from 1.7 per cent. It
added that Britain, Germany and Spain would fall into recession this year.
French industrial output rose by 1.2 per cent during July, against
analysts’ expectations of a 0.1 per cent rise.
The Italian economy contracted by 0.3 per cent in the second quarter,
official figures confirmed.
Japan’s annual wholesale inflation held near a 27-year high
during August, rising by 7.2 per cent compared with a year earlier. This
follows a 7.3 per cent increase in July, which was the highest since 1981.
Banking
& finance
Lehman Brothers, the beleaguered Wall Street investment bank, said that
it plans to spin off up to $30 billion (£17.1 billion) of commercial
property, sell a majority stake in its investment management division and
cut its dividend by 93 per cent. It also said it would consider offers for
the entire group.
Newcastle Building Society has added 200 extra staff since last
September, taking its numbers to 1,300, and will add a further 200 by the
end of the year. It added that it expects to create 500 new jobs by 2012,
with opportunities for workers made redundant at Northern Rock.
Crédit Agricole, France’s biggest retail bank, said it would cut
500 jobs worldwide, half of them at Calyon, its investment bank, in France.
The group said the lay-offs were designed to make savings worth €300 million
(£240 million) by the end of 2009.
Old Mutual Julian Roberts, the new chief executive of Old Mutual, has
given himself two months to sort out the problems at the insurance group’s
US life division before deciding whether to put the struggling unit up for
sale.
Just Retirement, the Surrey-based financial services group, saw its
full-year pre-tax profits slump to £12 million, from £61.6 million last
time.
Delta Lloyd, the Dutch business arm of Aviva, the British insurance
group, has agreed compensation of about €300 million for unit-linked
insurance policyholders.
RAB Capital, the embattled hedge fund, has threatened to liquidate its
flagship $900 million Special Situations fund unless investors agreed to
leave their capital locked up for the next three years.
Construction
& property
Barratt Developments, Britain’s biggest housebuilder, has cut its final
shareholder dividend and reported a 67 per cent slide in pretax profits. The
group also pledged to pay customers’ stamp duty on purchases up to £500,000
and said it would launch a part-exchange service.
SMC Group, the architectural design company, reported a first-half
pretax profit of £1.6 million, compared with a loss of £4.9 million last
time, helped by a restructuring drive. It added that first-half sales had
risen by 4.3 per cent to £22 million.
Consumer
goods
InBev, the brewer, said that it has signed a distribution agreement
with the University Catering Organisation to supply brands such as Stella
Artois, Staropramen and Hoegarden to student unions across Britain.
Nestlé, the Swiss food company, said its second-half growth will
slow as it relies less on price rises to drive earnings and added that it
expects more stable commodity prices in 2009.
Engineering
Avingtrans, the maker of precision engineering components based in
Nottingham, said that its full-year pre-tax profits had dropped but added
that it has opportunities in the pipeline.
Airbus The US Pentagon has cancelled a defence contract agreed earlier
this year with Airbus, the European plane maker, to supply the United States
Air Force with refuelling tankers. The wings for all 179 aircraft would have
been made at the Broughton factory in Flintshire in a deal worth more than
£4 billion to the British economy.
Health
GlaxoSmithKline, Europe’s biggest drugs maker, has signed a deal worth
up to $1.5 billion (£855 million) to develop new treatments against
inflammatory disease with Cellzome, the Anglo-German biotech company.
Cellzome will receive an upfront payment of £14.4 million in cash and
equity. Industrials
Dow Chemical, the largest US chemicals maker, said it was exploring the
sale of certain businesses in an effort to mitigate any potential antitrust
issues associated with its acquisition of the Rohm and Haas group. Earlier
Dow had announced a deal to acquire its rival, for $15.3 billion (£8.7
billion) in an attempt to broaden its product offerings in markets such as
paints, coatings and electronic materials.
ArcelorMittal, the steel group, said that it is facing cost overruns
for its projects in India because of delays in securing regulatory approvals
and is looking to expand in other emerging markets. It had earlier said that
it would invest $20 billion to build two steel plants in the eastern Indian
states of Jharkhand and Orissa.
Industrials
Dow Chemical, the largest US chemicals maker, said it was exploring the
sale of certain businesses in an effort to mitigate any potential antitrust
issues associated with its acquisition of the Rohm and Haas group. Earlier
Dow had announced a deal to acquire its rival, for $15.3 billion (£8.7
billion) in an attempt to broaden its product offerings in markets such as
paints, coatings and electronic materials.
ArcelorMittal, the steel group, said that it is facing cost overruns
for its projects in India because of delays in securing regulatory approvals
and is looking to expand in other emerging markets. It had earlier said that
it would invest $20 billion to build two steel plants in the eastern Indian
states of Jharkhand and Orissa.
Leisure
Prezzo, the AIM-listed Italian restaurant operator, said it planned to
slow down its opening programme after conceding that it had entered “an
extended period of more challenging conditions”.
PartyGaming, the internet gaming operator, has signed a deal with
EvolutionGaming, the casino services supplier, to enable customers of its
PartyCasino website to play live roulette, blackjack and baccarat via a
video stream.
Camra, the real ale group, used the launch of the Good Beer Guide 2009
to call for the Government to take measures to prevent supermarkets from
selling alcohol as a loss leader, claiming the practice is killing the
British pub.
Morgans Hotel Group Zabeel Investments is considering raising its offer
for Morgans Hotel Group after the board of the luxury hotel operator last
week rejected a $1.4 billion (£796 million) bid from the Dubai-based
investment fund.
Media
Virgin Media Charles Allen, former chief executive of ITV, the
commercial broadcaster, has joined Virgin Media, the cable operator, as a
nonexecutive director. Virgin Media, then called NTL, failed in an attempt
to buy ITV in 2006, just months after Mr Allen had left the group.
The Walt Disney Company said that it may consider mounting a challenge
to BSkyB by bidding for the Premier League football rights next year. News
Corporation, parent company of The Times, has a 39.1 per cent stake
in BSkyB.
Natural
resources
Anglo American, the mining group, is to work with Eskom, the power
utility, to identify and implement ways to guarantee power supply in South
Africa. Anglo American’s Anglo Coal unit is South Africa’s top coal
producer. Most of South Africa’s power stations are coal fuelled.
Kenmare Resources, the London-listed mining group based in Dublin, said
that output at the Moma Titanium Minerals Mine, in Mozambique, had been 27
per cent higher for the first nine days of September than the previous best
month’s daily average production of heavy mineral concentrate.
Braemore Resources, the AIM-listed nickel and platinum producer, said
it has completed the installation of the new 3.2 megawatt smelter at the
Mintek facility in South Africa ahead of time and on budget, which will
increase production over the coming weeks.
Retailing
Comet, the electricals retailer, said that it will make a first-half
loss after its worst quarterly sales performance since its demerger from
Kingfisher in 2003. Low demand for white goods, such as fridges and
freezers, meant like-for-like sales fell 9.9 per cent in the three months to
July 31.
Next Simon Wolfson, chief executive of Next, the fashion chain, said
that the high street slowdown could last for a further 18 months as he
reported that the group’s half-year pre-tax profits had fallen by 12.4 per
cent.
Ikea, the Swedish furniture group, revealed that worldwide sales rose
by 7 per cent in the year to September, but admitted that trading conditions
in Britain, Germany and the United States had been “particularly weak”.
Thorntons said it was confident of expanding its share of the chocolate
market by more than 50 per cent after the success of a number of new
products such as ice-cream on a stick. It also reported that half-year
pre-tax profits had risen by 19.6 per cent to £8.5 million.
Faith The senior management at Faith are understood to have left the
struggling shoe chain ahead of a sale to John Kinnaird, the retail
entrepreneur. Retail Week said that Steve Cotter, Faith chairman, had failed
to raise the funds for a management buyout.
Support
services
Interserve, the services maintenance and building group, has signed a
£70 million seven-year contract with the Foreign and Commonwealth Office
(FCO) to provide facilities management services for the FCO’s UK estate and
14 diplomatic missions in Europe.
Camco International, the carbon offset developer based in Jersey, said
in a trading statement that it had made wider losses and higher revenues for
the first half of 2008 compared with last year.
Healthcare Locums, the London-listed healthcare recruitment company,
said half-year adjusted operating profits had risen by 53 per cent to £7.8
million and also announced a maiden interim dividend of 0.8p per share.
Technology
Anite, the Berkshire-based software group, said that the proposed
disposal of its public sector operations to Northgate Information Solutions
for £54.3 million would provide funds for acquisitions.
Ericssonand Nokia Siemens Networks are among six telecoms equipment
makers competing for a tender worth up to $9 billion (£5.12 billion) to
provide wireless infrastructure to India’s Bharat Sanchar Nigam group.
Telecoms
Avanti Communications, the satellite operator, said it has signed a
distribution agreement with CO.NA, Italy’s largest consortium of VSAT
(two-way satellite ground station) suppliers. Avanti said the partnership
would focus on rural broadband projects funded by the Italian regions to
address the below-average broadband take-up in the country.
KPN, the Dutch telecoms operator, is to launch as a mobile virtual
network operator in France on the Bouygues telecoms network.
Transport
Iberia The Spanish Government is considering asking Iberia, the
national carrier, to act as a white knight to save Spanair, its rival, after
one of its planes crashed last month, according to reports. Spanair, owned
by SAS, had already announced that it was cutting a third of its workforce
when one of its planes crashed on August 20 at Madrid’s Barajas airport,
killing 154 people on board.
Alitalia The bankruptcy commissioner for Alitalia, the Italian
air-line, has told unions that he will be forced to terminate their work
contracts and to liquidate the carrier unless they back its latest rescue
package.
Utilities
Modern Water, the water treatment company which is based in Surrey,
said it expects its Gibraltar desalination plant to be delivered on time as
it reported a first-half pretax loss of £1.1 million.
E.ON, the German utility group, is planning to build a £4 billion
nuclear power station at Oldbury-on-Severn in Gloucestershire. It has
applied to National Grid for a connection that would allow it to build a
1,600 megawatt nuclear station by April 2020.
