The Times
Social housing builder Genesis blames rent cut as it slashes affordable homes: One of Britain’s biggest housing associations plans to cut the number of affordable homes it builds each year and double the amount of properties it will sell after George Osborne said he would cut social rents. Neil Hadden, the Chief Executive of Genesis Housing Association, which operates in London and the East of England, said it would cut the number of affordable homes it builds each year and those for social rent to about 100, while it will construct about 500 for shared ownership and 400 for market rent and sale.
Upbeat Fed signals rate increase in December: America’s central bank signalled that interest rates could rise as soon as December as it struck a tougher tone than six weeks ago, despite leaving policy unchanged. The U.S. Federal Reserve dropped an earlier warning about global risks, skirted over soft recent jobs data and specifically mentioned making a decision at “its next meeting” in a message to markets that a rate rise this year is still on the cards.
Wall Street veteran Jes Staley set for £10 million at Barclays: The new Boss of Barclays could earn more than £10 million in pay, bonuses and other benefits in his first year as he battles to improve its investment bank and stabilise its leadership after a period of tumult.
Emissions crisis: VW suffers first loss in 15 years: Volkswagen has reported a €2.5 billion loss in the third quarter as the diesel emissions scandal that has rocked the group dragged it to its first quarterly loss in more than 15 years.
Mariner project delay is latest blow for North Sea: The biggest project in the North Sea for a decade has been pushed back by a year in another setback for the U.K.’s troubled oil industry. Statoil, the Norwegian state-controlled group, revealed that the cost of its Mariner project had risen 10% to $7.7 billion (£5 billion) following the delay, which means that the huge field will not go into production until 2018.
Standard Life boosted by strong cash inflows: Net inflows hit £2.4 billion in the three months to the end of September, more than quadruple the amount the pensions and investments group pulled in during the previous quarter, helped by investments from overseas customers. The company said wholesale and institutional money flowing into its funds hit £10 billion, more than doubling year-on-year, with 64%of the net inflows coming from its non-U.K. business.
Bosch and Siemens to sue Dyson over test claims: Dyson has been accused by the maker of Bosch and Siemens vacuum cleaners of falsely alleging that it cheated energy efficiency tests in a manner similar to the VW emissions scandal.
Boots Boss in fine form with Rite Aid takeover: Only months after Mr Pessina, 74, and the company he heads, Walgreens Boots Alliance, gained full control of the Boots chemist chain, it struck a deal to take over rival Rite Aid Corporation in the U.S.. Walgreens Boots Alliance said it would buy the drugstore group for $9 a share which, with debt, equates to a merger of more than $17 billion and reflects a premium of 48 per cent to RiteAid’s closing price on Monday.
Heineken puts the cap on talk of merger with sales rise: Heineken has offered strong evidence that it has no need to get involved in the big beer mergers favoured by its rivals. Sales in Heineken, the Dutch family-controlled lager group, rose 7.5% to more than $6 billion in the last three months. That is a level of growth that SAB, AB InBev and Carlsberg cannot match, suggesting it is happy to stay independent.
EU Ministers to hold talks over steel crisis: Emergency talks with Brussels over the steel industry are to be held in the next two weeks as China warned that the global supply glut that is rocking steelmakers was worsening. Sajid Javid, the business secretary, was in the Belgian capital to lobby for a meeting of European Ministers to discuss the industry’s plight as Zhu Jimin, the head of the China Iron and Steel Association, said the problem of oversupply would only worsen because of the slowdown in demand.
The Independent
Marks and Spencer website taken down after shoppers’ details leaked: The Marks & Spencer website had to be taken down temporarily on Tuesday after some customers said they saw other people’s private details when they logged into the site.
Apple sells 48 million iPhones, making $51.5 billion in sales to boost profits in ‘most successful year’: Sales of the iPhone have helped Apple record another quarter of booming profits despite reports of an economic slowdown in China. Apple said sales in Greater China hit $12.52 billion (£8.2 billion) in its fourth quarter, more than double the level of a year ago and making up a quarter of its total revenue.
Retail investors lose out on Equiniti flotation: The Sussex-based Equiniti, which administers shares and pensions for around 70 blue-chip businesses, including Marks & Spencer and Royal Mail, was recently described by its Chief Executive Guy Wakeley as “kind of a hidden gem”.
BP says thousands of jobs will go as low oil price savages profits: BP has warned of further job cuts as it revealed a 40% dive in third quarter profits and announced plans to slash costs to deal with the prolonged oil price slump. Announcing the profit plunge to $1.8 billion (£1.2 billion), the BP Chief Executive Bob Dudley warned that the crude price was unlikely to exceed $60 a barrel for the next two years. Oil is trading around $47, compared with $90 a year ago and $115 a barrel last summer, as slowing demand from China and a surge in supply from the U.S. has created a glut in supply.
Financial Times
Deutsche drops dividend for two years: Deutsche Bank will pay no dividend for the next two years, as new co-Chief Executive John Cryan fights to strengthen the German lender’s balance sheet.
http://www.ft.com/intl/cms/s/0/cfa75ee4-7db8-11e5-a1fe-567b37f80b64.html#axzz3pqwEODtx
Barclays spins out resources buyout arm: Barclay has spun out its natural resources private equity investment arm to Managers, ending another legacy of the Bob Diamond era as the British bank’s new Chief Executive takes the helm.
http://www.ft.com/intl/cms/s/0/6313e15e-7d5d-11e5-98fb-5a6d4728f74e.html#axzz3pqwEODtx
Goldman fined over employee’s theft of intelligence from NY Fed: New York’s state banking regulator has slapped a $50 million fine on Goldman Sachs and ordered it to suspend consulting activities for three years after an employee stole secret supervisory information from the Federal Reserve Bank of New York.
http://www.ft.com/intl/cms/s/0/66a62f80-7d98-11e5-a1fe-567b37f80b64.html#axzz3pqwEODtx
HIV drugs and vaccines help GSK beat forecasts: GlaxoSmithKline has urged shareholders to keep faith with its turnround efforts as the struggling U.K. drugmaker said it was on course for a return to “significant earnings growth” next year. Sir Andrew Witty, Chief Executive, said restructuring measures were ahead of schedule and new products were gaining momentum after announcing third quarter results which came in ahead of analysts’ expectations.
http://www.ft.com/intl/cms/s/0/3623e3dc-7d72-11e5-93c6-bba4b4b36134.html#axzz3pvHGvFiP
AB InBev confirms it has financing for £68 billion SABMiller takeover: Anheuser-Busch InBev sought to reassure investors that its £68 billion takeover of smaller rival SABMiller was on track on Wednesday, despite needing another week of talks, by confirming it had financing for the deal.
http://www.ft.com/cms/s/0/dbe8bb04-7d4e-11e5-a1fe-567b37f80b64.html#axzz3pvIiCTGb
Lex:
AIG/Icahn: Carl Icahn is a decade too late. A break-up of the giant insurer American International Group would have made sense 10 years ago. Investors might have been spared AIG’s reckless foray into credit default swaps, which necessitated a $182 billion bailout commitment from the U.S. government. But Mr Icahn is calling for a separation in late-2015. In an open letter addressed to AIG Chief Peter Hancock, published on Wednesday, he calls for the creation of three new companies, focused on property and casualty, life, and mortgage insurance.
http://www.ft.com/intl/cms/s/3/1bdf43ac-7d92-11e5-98fb-5a6d4728f74e.html#axzz3pqwEODtx
Volkswagen: smog from China: Even before Volkswagen had been exposed as an emissions-test cheater, it had lost €42 billion in market value from its peak in March of this year, as the global car market turned. It has lost another €21 billion since the scandal broke. Judging by share prices, then, rank dishonesty (it prefers to say “software irregularities”) is not the biggest source of pressure on the company’s value. It is not even close.
http://www.ft.com/intl/cms/s/3/f2e0310c-7d62-11e5-a1fe-567b37f80b64.html#axzz3pqwEODtx
Saipem: leaving home: In Italy, a good son sticks around, living at his parents’ house until the time is right to move out. Saipem, the Italian oil services group, has wanted to flee the nest of state oil producer Eni for some time. The latter holds 43 per cent of Saipem’s shares and much of its debt. But Saipem is now packing its bags. On Wednesday, it announced a €3.5 billion rights issue that will help pay back the money it owes to its parent company. Meanwhile, Eni has begun to sell down its Saipem shareholding, to the Italian sovereign wealth fund Fondo Strategico Italiano.
http://www.ft.com/intl/cms/s/3/4ce99cc2-7d74-11e5-a1fe-567b37f80b64.html#axzz3pqwEODtx
Lombard:
Teflon Dom has written a costly chapter in Lloyds’ history: Is António Horta-Osório the most expensive Chief Executive currently running a U.K. bank? The issue is not the remuneration of Lloyds Banking Group’s Chief Executive, a lofty £11.5 million in 2014. It is a whopping compensation bill for mis-sold payment protection insurance. The bank topped up provisions for these soaring costs by £500 million to £13.9 billion on Wednesday.
http://www.ft.com/intl/cms/s/0/c2fdc094-7d67-11e5-98fb-5a6d4728f74e.html#axzz3pqwEODtx
Ladies’ day: A female FT columnist had planned to riff on Lord Davies’ outgoing report on women in the boardroom. Lombard only secured the assignment by elbowing her out of the way and reminding a senior colleague that I fagged for him at public school. Such time-honoured means of male advancement are losing traction in business, though. The proportion of women on FTSE 100 boards has more than doubled to 26% over five years.
http://www.ft.com/intl/cms/s/0/c2fdc094-7d67-11e5-98fb-5a6d4728f74e.html#axzz3pqwEODtx
Clear as mud: What matters? It is one of those eternal questions that philosophers like Socrates have grappled with alongside “which album rocks hardest – Metallica’s Ride the Lightning or Slayer’s Reign in Blood?” Thankfully, the International Accounting Standards Board has pinned down an answer to the first teaser in an exposure draft, as follows: “Materiality is an entity-specific aspect of relevance based on the nature and magnitude, or both, of the items to which the information relates in the context of an individual entity’s financial report.”
http://www.ft.com/intl/cms/s/0/c2fdc094-7d67-11e5-98fb-5a6d4728f74e.html#axzz3pqwEODtx
The Daily Telegraph
ITV attacks BBC for spending licence fee on 42 series of Bargain Hunt: The BBC has been accused by ITV of breaking promises it would not chase ratings and failing to justify its £3.7 billion in public funding by relying on jaded formats such as Bargain Hunt. Britain’s biggest commercial broadcaster has waded into the debate over the future of the licence with a fierce attack on BBC One’s alleged lack of distinctiveness and growing dependence on returning series.
Give a third of all boardroom positions to women, British firms told: British companies should appoint women to at least a third of all boardroom positions, a key report will urge. Lord Davies will use his final Women on Boards review to call for a rise in the level of female representation at board level from the current 25% to 33% by the end of the decade.
Britons have more money in their pockets than ever before: Median household disposable income stood at £25,600 for the 2014-15 financial year, according to the Office for National Statistics. This is slightly above its pre-downturn level of £25,400 and 6.5% above its post-crisis low.
Dong Energy to build world’s biggest wind farm off U.K. coast: Danish utility Dong Energy is to build a 660-megawatt wind farm in the Irish Sea. Project will deliver electricity to more than 460,000 U.K. homes.
Heathrow Boss remains coy on restrictions on third runway: The Boss of Heathrow has refused to commit to measures limiting air pollution and noise caused by a £17.6 billion third runway, even though the Airports Commission outlined the restrictions four months ago.
The Questor Column:
GSK shares jump as results beat expectations: GlaxoSmithKline investors are glad the firm did not sell its HIV drugs business earlier this year, after strong sales, combined with a good performance from vaccines, helped the group beat market expectations. ViiV Healthcare, the HIV drugs business in which it owns an 80% stake, was nearly floated in May. However, the company shelved plans on the signs of encouraging growth. That paid off, with sales up 65% in the third quarter. GSK also completed a £13 billion asset swap with Novartis earlier this year, handing over its cancer business in return for the Swiss group’s vaccines and consumer healthcare business. These, combined with GSK’s prescription drugs portfolio, form the core focus for the British pharma group. GSK’s results for the third quarter showed some promise, with sales rising 9% to £6.13 billion, above the £6.08 billion expected by the market. Core earnings per share, which include one-off costs, were down 18% to 23p per share, as sales of lower margin products ate into profits. There are still the same old problems for the FTSE 100 group as it relies heavily on declining sales of legacy treatments. The main problem for GSK is with generic versions of Advair, its asthma treatment. Sales of Advair were £4.2 billion last year, out of a group total of £23 billion. Sir Andrew Witty, the company’s Chief Executive, expects this to fall to as little as £300 million within five years as the patent runs out, allowing cheap copycat versions by rivals to come on to the market. GlaxoSmithKline at £14.20½ +53p. Questor says “Buy”.
British American Tobacco remains a top dividend income stock: British American Tobacco may be suffering from falling revenues, but an ability to increase prices steadily is ensuring that full year profits remain on track. That means the chunky 4.1% dividend income is safe. Sales fell 6.5% in the nine months to the end of September, largely because of currency movements. Adjusting for foreign currency fluctuations, revenue increased 4.2% in the period, well ahead of market expectations for growth of 3.5%. Investors cheered the results and sent the shares almost 3% higher. Brands such as Dunhill, Kent, Rothmans and Lucky Strike increased sales by 10% in the third quarter, an acceleration on the first half, and brought total growth to 7.2% during the nine months to the end of September. BAT has a solid record of raising prices to offset falling sales of cigarettes across the developed world. This is why revenue fell by £2.1 billion over the past two years but pretax profits remained relatively flat. This steady profit performance enables the company to churn out dividend payments. BAT is expected to pay 156p in dividends this year, offering a prospective yield of 4.1%. The payout is expected to rise by 5% a year, which protects shareholders’ income from the effect of inflation. The company has tidied up its structure this year, with £1.7 billion spent buying out the 25% share in its Brazilian subsidiary Souza Cruz that it did not already own. This comes after the £3 billion spent earlier in the year to maintain a 42% stake in Reynolds, in the wake of that company’s mega-merger with Lorillard. BAT has problems. Its Canadian subsidiary was ordered by a court to pay a deposit of £380 million while it appeals against a ruling ordering it to pay £5.5 billion in damages to about one million claimants who say they were never warned about the health risks associated with smoking. However, the price reflects what investors are willing to pay for the steady performance and dividend income, which remains attractive over the long term. British American Tobacco at £38.93 +99.5p. Questor says “Hold”.
Hold Bloomsbury as Potter powers sales: Harry Potter publisher Bloomsbury reported a solid set of interim results, and is looking forward to strong Christmas sales driven by new illustrated editions of the boy wizard books and a biography of spy novelist John le Carré. Book sales were up 11.6%, to £52.7 million, in the six months to the end of August, as they were boosted by 180% growth in the new editions of the Harry Potter titles. Children’s and educational titles increased revenue by 45%, to £16.3 million, in the first half, with adjusting operating profits increasing to £1.6 million, from £1 million last year. Sales of adult books were down 11% across the first six months of the year, after there were fewer blockbuster titles to drive sales. Bloomsbury acquired military history publisher Osprey in December last year, and when these sales are included in the total, then adult revenue increased 6% to £20.4 million. For the group as a whole, the adjusted pretax profits edged higher, to £1.9 million in the first half, from £1.7 million a year earlier. Full year pretax profits are expected to increase to £13.1 million, on revenue up to £118 million, giving about 14.1p in earnings per share. Bloomsbury Publishing at 163p -3¼p. Questor says “Hold”.
The Guardian
VW Chief promises ‘ruthless’ crackdown on culprits of emissions scandal: Volkswagen Boss Matthias Müller has vowed to be “ruthless in punishing those involved” in the emissions-rigging scandal, which pushed the German carmaker €3.5 billion into the red, its first quarterly loss in 15 years.
EU caves in to auto industry pressure for weak emissions limits: Carmakers have won delays to a more stringent “real driving emissions” test, which will allow them to belch out more than twice the legal limit of deadly nitrogen oxides (NOx) from 2019 and up to 50% more from 2021.
Steelworkers march on parliament as Prime Minister promises compensation: David Cameron has pledged to award backdated compensation for high energy costs to struggling British steel producers as soon as the government gets clearance from Brussels.
Soaring pensions lift U.K. living standards to pre-recession levels: Living standards in Britain have finally returned to pre-recession levels because of the rising incomes of the nation’s retirees, the Office for National Statistics (ONS) has said.
Daily Mail
British American Tobacco sells 487 billion cigarettes in first nine months of year – equivalent of nearly 90m packets of 20 a day: Lucky Strike Owner British American Tobacco said it sold 487 billion cigarettes in the first nine months of the year – the equivalent of nearly 90m packets of 20 a day. But that was down 1.8% on the same period last year as demand was hit by ‘the slower than expected recovery in the global economy’ and pressure on disposable incomes.
Crisis at Globo deepens after Financial Conduct Authority launches investigation into mobile software firm over claims it falsified sales: The crisis at Globo deepened after the financial watchdog launched an investigation into the mobile software firm over claims it falsified sales.
Daily Express
EU told – Britain gives you billions so help our steel industry before it collapses: Britain will ask the European Union why its billions of pounds invested every year are not being spent to help the nation’s struggling steel industry.
G&T lovers despair: Britain could be soon gripped by a gin shortage: Scottish gin could soon be in short supply as juniper faces being wiped out by a deadly disease.
Frosty reception for £12.5 billionn BT-EE deal: Rivals have been left “concerned” and “disappointed” after BT’s merger with mobile network EE was provisionally approved by the competition watchdog.
The Scottish Herald
Clydesdale Bank Boss highlights staff excitement about February flotation: The Chief Executive of Clydesdale Bank has said staffs are excited at the prospect of an independent future and outlined how the branch network will remain a core part of its offering. David Duffy, who joined Clydesdale at the start of June, is confident a stock market flotation will take place in early February next year.
Standard Life makes progress amid volatile markets: Standard Life has enjoyed strong growth in the latest quarter amid volatile market conditions as pension reforms in the U.K. boosted demand for its products. The Edinburgh-based life and pensions giant grew total assets under management by £2.4 billion in the three months to September helped by winning business in the U.K. and overseas.
C&C issues profits warning as drink-drink change hits trade: C&C GROUP, the Owner of Tennent’s Lager, has highlighted the continuing impact of Scotland’s tougher drink-driving laws as its first-half profits slumped by 9.5%. And the brewer warned that the lower drink-drive limit, alongside other factors such as poor weather and the integration of the former Wallaces Express wholesale business in Scotland, would hit full year profits by €10 million in its current financial year.
Scottish Chambers: ‘Amber warning light’ on economy: Scottish Chambers of Commerce has declared that its latest economic survey, which shows much weaker manufacturing growth and declining confidence among services firms, is an “amber warning light” for the U.K. and Scottish Governments.
Aberdeen oil services firm makes record profit despite crude price slump: Plexus Holdings, the well technology firm, has achieved record profits in a year when the oil and gas industry was rocked by the plunge in the crude price. Aberdeen-based Plexus made £5.9 million pretax profit in the year to June compared with £5.4 million in the preceding year.
Maven hails return for investors after XPD8 sale to John Crane: Maven Capital Partners, the Glasgow-based private equity house, has sold energy services business XPD8 Solutions to John Crane Group. The value of the deal was not disclosed, but Maven said the sale of Aberdeen-based XPD8 to John Crane, a division of the FTSE-100 listed Smiths Group, had delivered an “attractive” return for investors on their original investment.
Ethical finance hub launches at Heriot-Wattu: An ethical finance hub is being launched in Scotland and will be based at Heriot-Watt University. The Scottish Ethical Finance Hub (SEFH) is receiving up to £50,000 of Scottish Government funding as well as industry support including from the Islamic Finance Council U.K..
The Scotsman
Number of Scottish company insolvencies falls: Scottish corporate insolvencies have fallen in the quarter ending 30 September, and while the news has been welcomed, there are fears that many companies, particularly those in sectors like oil and gas, remain vulnerable. According to statistics released by Scotland’s insolvency service Accountant in Bankruptcy, 180 Scottish-registered businesses became insolvent in the period. That marks a drop of 13.9% from the year-ago quarter and 8.6 from the previous quarter.
Wave power firm calls in administrators: Renewable energy firm Aquamarine Power has called in administrators to manage the business and seek a sale or fresh investment. The move comes just a month after the Edinburgh-based company received an €800,000 (£580,000) cash injection from the EU to improve the performance of its Oyster wave energy converter.
PwC buys former RBS tech innovator’s security start-up: Accounting giant PwC has acquired a forensic data and security start-up co-founded by a former head of technology innovation at Royal Bank of Scotland. David White co-founded London-based Kusiri in 2009, and the business has now been bought by PwC’s deals and forensics practice.
Standard Life assets beat City forecasts: In its third quarter update, the Edinburgh-headquartered company said AuM had edged up 2% to £301.9 billion, compared to £296.6 billion at the beginning of the financial year, despite volatile market conditions.
Clydesdale Bank could be ‘takeover target or acquirer’: The Boss of Clydesdale Bank claimed it could be a target or lead consolidation among U.K. “challenger” lenders after being floated on the stock market early next year by its parent National Australia Bank (NAB).
City A.M.
Fast growing firms say they will look at relocating if Jeremy Corbyn becomes Prime Minister – Leap 100: A majority of fast-growing companies in the U.K. refuse to rule out relocating abroad if Jeremy Corbyn were elected Prime Minister. 46% of the Leap 100 of the U.K.’s fastest-growing businesses, surveyed by City A.M. – said they would consider moving overseas if the Labour leader came into power, while a further 11% said they did not know. Only 43% of respondents definitively said they would not relocate if he were elected.
CBI/AECOM poll: infrastructure is a top concern for businesses trying to invest: Nearly two-thirds of British businesses want the government to speed up delivery of promised infrastructure projects, according to a new poll out from the Confederation of British Industry (CBI) and AECOM, the infrastructure services firm. Almost all – 94 % – of the firms surveyed said that the quality of infrastructure was a “key deciding factor in planning their investments”. But more than half of respondents told the CBI they did not think they would “see necessary upgrades in the next five years”.
New Institute for Economic Affairs poll: most people don’t think politicians make decisions based on what’s best for the country: More than three quarters of British people say they feel they have not very much influence, or no influence at all, on the national government’s decision-making, according to a new ComRes poll for the Institute of Economic Affairs (IEA), a free markets think tank.
Hostelworld does well in first day of trading on London and Irish Stock Exchanges: Hostelworld, the online hostel-booking platform, floated on the London and Irish Stock Exchanges, with shares priced at 185p, and closed up at 197.75p. Well done. The company said the placing of 71.7 million shares at 185p would give it a market capitalisation of £176.8 million, and hoped it would raise £125.4 million.
PayPal share price drops on third quarter results: PayPal’s share price dropped by over six per cent in after hours trading after the company reported its first results since splitting from eBay.
GoPro shares tumble more than 15% as it misses estimates with revenues up 43%: Despite posting revenue up 43% from this time last year, to $400.3 million (£262 million), GoPro, the wearable camera company, fell short of the $433.6 million expected by analysts.
Not so sweet: Cadbury Owner Mondelez posts eighth consecutive quarterly revenue decline: The company’s global revenues fell by 17.8% to $6.85 billion (£4.49 billion), while its European division – its biggest market – saw a 32.4% decline to $2.17 billion, hurt by a strong dollar and falling sales.
