The Times
British traders are first jailed by U.S. over Libor: Two British citizens were sentenced to prison in New York last night after being convicted in the first U.S. trial arising from a global investigation into manipulation of Libor, the leading benchmark for pricing financial transactions.
Typo foils hackers in $101 million cyber bank raid: One of the most brazen global bank raids ever mounted was foiled by a spelling mistake made by the thieves, banking officials revealed last night.
Riyadh begs for loan as oil funds dry up: The government of Saudi Arabia is seeking billions of dollars from foreign banks as the plunging oil price devastates the country’s finances.
Soma Chief denies links to Islamist terror group: A Director of Soma Oil & Gas, the exploration company that is being investigated over corruption allegations, has been accused of having links to al-Shabaab militants.
Rosy results bolster Argos’s appeal to suitors: Argos has put pressure on its two rival suitors to up the value of their bids by unveiling some decent sales figures and evidence that it has even more cash in the bank than thought.
Disgusted Sports Direct boss claims MPs trying to create media circus: Mike Ashley has hit back at MPs who have warned him that he faces public censure, saying that he was disgusted at their abuse of parliamentary procedure.
Stamp duty and EU vote threaten property market: The referendum on EU membership and changes to stamp duty are likely to lead to a slowdown in the U.K. property market over the coming months, Savills, the estate agency, said.
Creditors step up pressure on Mallya over $1 billion debts: Pressure was mounting on Vijay Mallya to return to India and face the music over his debts as the banks owed more than $1 billion seized nine trademarks relating to the tycoon’s defunct Kingfisher Airlines business.
Former worker stole secret market data, Ofcom admits: The media regulator Ofcom has been forced to tell broadcasters that one of its former employees stole a considerable amount of confidential market information from its database and passed it on to his new employer.
French warn over new £18 billion nuclear plant: The French state auditor has raised fresh doubts about plans to build the world’s most expensive nuclear power plant in Somerset by urging EDF, the energy company, to ask “serious questions” before going ahead.
Ireland rediscovers its tiger’s roar: Ireland’s economy is growing as fast as it was during its heyday 15 years ago, fuelled by exports and increasing domestic demand.
The Independent
RBS and Barclays made more than £300 million selling questionable loans to U.K. councils: Two of Britain’s biggest banks allegedly made more than £300 million in upfront profits by selling a string of questionable loans to U.K. councils, prompting claims that they have raised financial risks for local taxpayers.
BP to end controversial sponsorship of Tate in 2017: BP is to end its controversial sponsorship of Tate in 2017 after nearly three decades with the oil giant, The Independent can reveal.
Executive of oil company chaired by Michael Howard investigated by UN over ‘possible links’ to al-Shabaab: An executive of an oil company chaired by former Conservative leader Michael Howard is being investigated by the UN over “possible links” to the Islamist group al-Shabaab.
Allianz hires former Pru high-flier to take charge of ailing funds division Pimco: The German insurer Allianz has hired a former Prudential executive to oversee Pimco, its struggling funds division and the former home of bond king Bill Gross.
Twitter is reportedly giving out staff bonuses of up to $200,000 to retain talent: Twitter is reportedly offering its staff cash bonuses of up to $200,000 to keep them from leaving the company.
Financial Times
Lloyds to offer £1 billion in cut-rate loans for green buildings: Lloyds Banking Group is to deploy £1 billion in cut-rate loans to real estate clients seeking to improve the energy efficiency of their buildings as cutting carbon emissions rises up the agenda of the property sector.
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Van Beurden’s pay lowest of any Shell Chief for six years: Ben van Beurden has received the lowest total remuneration of any Royal Dutch Shell Chief Executive for six years, following the collapse in the international oil group’s profits — but he still enjoyed a 4% increase in his take-home pay in 2015.
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Cineworld’s pick of Nisan Cohen for finance Chief causes concern: Cinema chain Cineworld has courted controversy with its choice of new Chief Financial Officer as it reported a blockbuster year thanks to films such as Star Wars: The Force Awakens.
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Rolls-Royce sheds another 150 managers: Rolls-Royce has shed a further 150 management jobs as Chief Executive Warren East winnows out bureaucracy at the U.K. jet engine maker following a string of profit warnings.
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UTC Chief defends jobs move from U.S. to Mexico: Greg Hayes, Chief Executive of United Technologies, on Thursday defended its decision to close an air conditioning plant in Indianapolis and move the jobs to Mexico in the face of attacks from Donald Trump, and signalled that more closures could follow.
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Lagardere shares suffer sharpest one-day fall in 7 years: Shares in Lagardere suffered their biggest one-day fall in seven years on Thursday after investors expressed deep fears over strategy at the French media group following the departure of its finance Director.
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Iliad’s profit rises on improved margins: Iliad reported a 16% jump in core earnings last year and the French low-cost telecoms operator pledged to continue adding customers and promised to increase margins significantly by 2020.
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Lex:
U.K. energy: spam, what spam?: Roger Witcomb, chair of the Competition and Markets Authority, wants to be clear. He does not intend U.K. households to be deluged in spam urging them to switch energy provider. Instead, “what they will be bombarded with is offers to save UP TO £300 A YEAR”. Apparently this is something quite different.
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Bank bonds: the yield field: People are naturally loss-averse: faced with the certainty of a small loss or turbocharged returns at the risk of being wiped out, they will often choose the former. Only this explains why anyone would agree to lend Germany’s Berlin Hyp €500 million for three years at a negative yield of 0.16%, guaranteeing a capital loss if they hold the instruments to maturity.
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Kansai Electric: volt from the blue: Nuclear power in Japan is about as popular as the Zika virus these days. While a vaccine may be developed soon for Zika, no amount of chemistry can dispel the nuclear fear. That has not stopped electric utilities trying to restart the one-third of Japan’s generation halted after the Fukushima nuclear disaster. One of these is Kansai Electric Power, Japan’s second largest electric utility by market value. Five years ago Kansai generated nearly half of its electricity using nuclear; today it is almost zero.
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Lombard:
Cometh the earnings downturn, cometh the gaming of executive pay: The spring flush of remuneration reports has barely begun and already some shareholders are arming themselves for a pop at BP. The oil major lifted the pay of Chief Executive Bob Dudley by a fifth to $19.6 million without apparent regard for the oil major’s losses or drooping share price. The contrast with Shell is painful. There, boss Ben van Beurden saw his pay fall from €24 million to €5.6 million in 2015.
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Aviva’s hawkish kiwi: Kiwis are meek creatures, prodding in the leaf litter for worms. But Mark Wilson, the New Zealander who runs Aviva, is a bird of more raptorial kind. Seizing the Chief Executive’s job three years ago, he has given the sluggish insurer the fright it needed. A year ago he swooped on closed book insurer Friends Life with a £5.6 billion takeover.
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The Daily Telegraph
Shake-up of energy market could save customers millions, watchdog says: Energy customers could face a rise in unsolicited mail under plans to shake up the gas and electricity market to make it more competitive and help people save money.
Bentley and Jaguar luxury paint supplier dips into BGF’s £2.5 billion warchest: Paintbox, the company that uses robots to paint Rolls-Royce, Bentley, Jaguar Land Rover and Aston Martin cars, has sealed a multi-million-pound deal with the Business Growth Fund (BGF), the venture capital fund backed by Barclays, HSBC, Lloyds and RBS.
Lavazza close to hitting €2 billion revenue target: Italian coffee roaster Lavazza has revealed it is “not far off” ambitious targets to hit €2 billion in annual sales by taking over smaller rivals, after announcing it has received clearance to buy Carte Noire.
City watchdog bans first big debt management firm: Debt management group PDHL has been banned from operating after the City regulator found it lacks the staff or expertise to help customers struggling with the finances.
Small business spurt boosts Aldermore Bank’s profits: Aldermore’s profits surged 88% to £95 million in 2015 as the challenger bank reported another year of record loan and deposit volumes.
Argos sales decline slows as Home Retail enjoys a cash boost: Argos, the retailer at the centre of a takeover battle between Sainsbury’s and South African retail giant Steinhoff, has managed to halve the pace of its sales decline after a tough trading year for the electrical and homeware brand.
The Questor Column:
Aviva investors cheer 15% dividend increase: Aviva rewarded income investors with a 15% increase in the annual dividend after better-than-expected profits in annual results. Aviva has been through significant change during the past three years. Chief Executive Andrew Moss left the company in 2012 and the dividend was slashed shortly after. Aviva became the market leader in life insurance after agreeing a £5.6 billion deal to buy rival Friends Life in 2014. The balance sheet also boasts a surplus of £9.7 billion, or a ratio of a 180% based on the new Solvency II European capital requirement regulations. The new, combined group is trading well. Aviva said the U.K., the company’s largest region, saw profits rise by more than a third, and were still up 2% if the impact of the Friends Life deal is excluded. Aviva’s general insurance business managed to deliver a respectable performance, despite the impact from the December floods, with operating profit falling to £430 million, from £499 million a year earlier. The investment management business increased assets to £290 billion at the end of December, from £246 billion a year earlier, largely helped by additional Friends Life funds. Aviva said it has found £168 million in savings, and maintained its target of cutting costs by £225 million to the end of 2017, mainly from reducing employee numbers and in IT. The group is clearly making progress but investors need to be wary of how returns are exposed to a market downturn. The shares are down 8% so far this year, are currently trading on nine times forecast earnings and offer a 5.1% prospective dividend yield. That rating looks fair given risks inherent in another market sell-off. Hold. Aviva at 465.8p +6.2p. Questor says “Hold”.
Morrisons buying opportunity in year ahead: Morrisons is still facing challenges from falling food prices and increased competition, but dig deeper into yesterday’s annual results and the long-term investment outlook is improving as the supermarket group cuts debt and makes more cash. Morrisons said like-for-like food sales declined 2% during the 12 months to the end of January. This meant that underlying pretax profits fell 30% to £242 million and turnover dropped 4% to £16.1 billion during the year. Morrisons is taking action to reduce its property portfolio. It has disposed of 140 local convenience stores, raised £300 million from such sales last year and generated a profit of £131 million. This has brought total property sales during the past two years to £750 million. The company aims to increase this to £1.1 million by this time next year, up from a previous target of £1 billion. Net debts (total debt less cash) were reduced by £594 million last year to £1.75 billion at the end of January, down from £2.8 billion two years ago. David Potts, Chief Executive, is targeting a further reduction to about £1.4 billion during the next 12 months. The supermarket has also focused on cash generation, efficiency and buying and selling goods. The free cash flow improved by about £70 million to £854 million during the past year, and this covers the £260 million in annual dividend payments more than twice. Morrisons looks well equipped to ride out the supermarket price war. The shares have rallied 36% from their December lows and now look expensive, trading on a price to earnings ratio of 20 times, especially when you consider lower profits are probably here to stay. That said, we are approaching buying territory and if we got a rating of around 15 times earnings, or returned to a share price of 150p, we would tuck them away for the long term. Hold for now. Morrisons at 192.9p -9.1p. Questor says “Hold”.
G4S shares exposed to looming debt deadlines: Shares in G4S tumbled 12% yesterday after the support services group unveiled a 40% slump in annual pretax profits. However, Questor doesn’t think this represents a buying opportunity, as the company is struggling to bring its debt pile under control. There is no quick fix for the problems facing G4S. The firm grew rapidly by agreeing contracts to provide a range of services, from housing asylum seekers to reading gas meters. The positive aspect of these deals is that they tend to be long-term, and generate regular cash payments. However, the nightmare scenario that G4S now finds itself in is that costs are rising far higher than initially expected, and many of these contracts remain firmly loss-making. To compound the problem, G4S borrowed heavily to buy companies that could provide those services. The profits and cash generation that are needed to repay those debts haven’t transpired. G4S now faces a debt repayment of €600 million (£469 million) in May 2017, along with a further £136 million connected to a U.S. private placement in the same year. G4S’s net debt (the total amount of debt less cash) increased to £1.78 billion at the end of December, up £100 million from June, while net assets were £691 million. G4S isn’t a lost cause as revenue increased 4% to £6.4 billion during the year and the contract pipeline was £5.7 billion at the end of December. G4S’s shares have fallen 26% since we highlighted concerns over the debt three years ago (Sell, 252p, August 2013), and we thought there would be more problems when we last looked at them (Sell, 197.5p, Feburary 8). We are keeping our negative stance on G4S. Sell. G4S at 187p -25.70p. Questor says “Sell”.
Hill & Smith shares jump on solid results: The situation at engineering group Hill & Smith looks far better after a solid set of annual results yesterday that rewarded investors with a 15% increase in the full year dividend. The company, which specialises in galvanising and other steel products, was forced to write off an investment in the U.S. during the first half of the year. This weighed on results, sending pretax profits down 10% to £33.2 million to the end of December. However, the core business of providing specialist steel products for infrastructure projects in the U.K. and U.S. was good, and underlying pretax profits increased 15% to £53 million, on revenue up 3% to £467.5 million. The group saw revenue from its roads business rise 3% and profits jumped 20%. After a slow start, infrastructure spending in North America is rapidly accelerating. In particular, galvanised frames to hold solar panels are in demand. This helped increase revenue by 8% and profits by 10% at the division. Market consensus for the year ahead is for underlying pretax profits to increase to £56 million, on revenue of £496 million, giving 53.7p in earnings per share. The shares, which jumped 10% yesterday, offer a prospective yield of 2.9% and have gained 40%, or almost £2.40 per share, since we said they looked too cheap this time last year (Buy, 603p, March 10). We also thought they were worth holding on to when we updated that view last August. Now, trading on 14 times forecast earnings, Hill & Smith remains a quality operator, and we are happy to remain holders. Hold. Hill & Smith at 842.50p +92.50p. Questor says “Hold”
The Guardian
EU referendum: Brexit bad for U.K., Europe and the world, warns OECD: The west’s leading economic thinktank has provided backing for David Cameron’s pro-EU stance by warning that a U.K. vote to leave the union would cause lasting damage and would harm the rest of the world.
Competition regulator’s energy market plan ‘will lead to junk mail deluge’: The competition watchdog has been warned that proposals to give energy suppliers access to a new industry-wide database of customers could unleash a junk mail deluge.
ECB cuts interest rates to zero amid fears of fresh economic crash: The European Central Bank has cut interest rates across the eurozone to zero as it unveiled an unprecedented package of growth-boosting measures against the backdrop of a fragile global economy.
Daily Mail
John Lewis cuts bonuses to its employee ‘partners’ as it find it is not immune to the retail gloom: John Lewis revealed that it is still suffering from the retail gloom as profits fell and staff bonuses dropped for the third year running.
Aviva savers in a £650 million rush to withdraw cash after the pension freedoms: About 40,000 Aviva savers cashed in their retirement pots last year as they rushed to exploit the Chancellor’s new pension freedoms.
Daily Express
Morrisons target £100 million extra profits after online development: Morrisons is targeting extra profits of up to £100 million from developing its online appeal and utilising its food-making skills as it looks to build on its first quarterly sales rise for four years.
Leaving the EU is not a risk for investors, says world’s largest sovereign wealth fund: The boss of the world’s biggest sovereign wealth fund dismissed the prospect of Britain leaving the EU as a large investment risk.
The Scottish Herald
Garrett-Cox walks away with £668,000 and £5 million of shares: Katherine Garrett-Cox will pick up a redundancy payment of £668,000 and keep share options worth £5 million when she leaves Alliance Trust today.
Scotgold raises £500,000 for Argyll gold mine project: Scotgold Resources has raised about £500,000 through a share issue to fund its gold and silver mine project at Cononish in Argyll.
Stirling-based Superglass says turnaround is on track: Superglass, the insulation maker which employs 150 people in Stirling, has said its turnaround programme is on track with the company on course to make a full year trading profit after cutting first half losses by around 75%.
Edinburgh-based Castle Street posts profit for year as cash shell: Castle Street Investments, the Edinburgh-based investment firm, said it had the funds to make a potential third acquisition later this year after securing £19 million of new banking facilities with Royal Bank of Scotland.
Aberdeen office market faces ‘perfect storm’: Aberdeen’s commercial property sector is facing a ‘perfect storm’ of falling demand, declining investment and record levels of occupier incentives, according to property consultancy Knight Frank.
The Scotsman
Blair Nimmo to lead KPMG’s U.K. restructuring arm: One of Scotland’s best-known business advisory experts, Blair Nimmo, has been promoted to KPMG’s U.K. head of restructuring, having previously overseen this part of the business north of the Border.
Tennent’s Lager owner seeks to ramp up sales across Africa: The Irish drinks group behind Tennent’s Lager today said it was confident about its prospects for the year ahead after seeing a pick-up in trading north of the Border.
Optician Duncan & Todd eyes further growth at lens lab: One of Scotland’s best known optician chains, Duncan & Todd Group, is growing its headcount by 12 and upgrading its production facilities after receiving financial backing from Business Growth Fund (BGF).
North Sea oil and gas ‘must not waste a good crisis’: A leading figure in North Sea oil and gas said the industry must get bolder and “steal” tried and tested innovations from other sectors to insure survival amid the low-price crisis.
City A.M.
House prices: Mortgage lending jumps in February as landlords make last sprint ahead of April stamp duty hike: The rush to beat April’s stamp duty surcharge on second homes continued to fuel record high levels of lending in February.
World Energy Council: Industry leaders are increasingly worried about volatile commodity prices: Global commodity prices have overtaken energy prices as the number one critical concern among energy leaders and world experts.
BCC cuts U.K. economic forecasts in “wake-up call” as global backdrop darkens: The British Chambers of Commerce (BCC) has cut its forecasts for U.K. economic growth in a “wake up” call to policymakers against a darkening global backdrop.
Waitrose is “well set up” to face arrival of Amazon, says outgoing boss Mark Price: Waitrose’s outgoing boss Lord Price played down the threat of Amazon’s entry in the U.K., insisting it was strong enough to fend off competition and would continue to be “one of the few” retailers to increase profitability this year.
U.S. justice department files iPhone encryption case response, accusing Apple of creating “barriers” against FBI: The United States Department of Justice has filed its latest response to Apple in the legal fight over iPhone encryption.
Chinese investments into Europe and United States reach record high in 2015 – but U.K. levels dip 35%: Chinese investment into Europe hit record levels last year – but dipped in the U.K., according to a new report.
Standard Bank talks up “buoyant” 2016 African landscape for M&A: Africa’s landscape for mergers and acquisitions (M&A) is “buoyant” and there are more opportunities in the continent than ever before, according to South Africa-based Standard Bank.
Spirits are down as Stock Spirits Group announces drops in 2015 results: Stock Spirits Group, the central European-focused vodka and spirits producer, saw a drop of around €30 million (£23.4 million) to €262.6 million (£204.9) in total revenue over 2015 after a year of “disruption” in the Polish spirits market, as the company announced its preliminary full year financial results.
Activist investor Worldview buys 69.44% of Petroceltic’s debt: Worldview has bought almost 70% of London-listed, Dublin-based Petroceltic’s debt, the company revealed today.
First U.S. shale gas shipment heads to Europe amid price war risk: The first shipment of U.S. shale gas earmarked for Europe left its terminal today, as analysts warn it could spark a price war with market leader Russia.
