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Thursday's news and tips

Created:

24 July 2008

Written by:

Tanya Malick

• B&Q owner Kingfisher saw sales in the last ten weeks rise by 4.4%, but were down 1.5% on a like for like basis, a slight improvement on earlier in the year. (IC COMMENT)

• Shares in Alizyme were looking sickly Thursday morning after the drug developer announced disappointing test results for its COLAL-PRED drug. (IC COMMENT)

• GlaxoSmithKline's second quarter results were "bang in line" with JP Morgan's forecast and 7% ahead of consensus, but the broker kept its 'underweight' rating and 1,050p price target. (IC COMMENT)

• Easyjet said overall capacity growth for winter has been reduced and added that the rise in fuel price will reduce margins for the year. (IC COMMENT)

• News that two of its key licences may be invalid has come as a surprise to Cadogan Petroleum and broker UBS which recently managed the oil company's £½bn London listing. (IC COMMENT)

Continues below...

• Engineering and construction firm Balfour Beatty has been awarded a contract worth $410m by the US department of the air force.

• High prices, better volumes and increased liquefied gas margins helped BG more than double second quarter earnings.

• JJB Sports sales slowed in the last 12 weeks, with the sportswear and health club group cautious about the outlook for the remainder of 2008 in view of the difficult retail environment.

• Scottish and Southern Energy hinted that it could raise prices for its domestic customers as it continues to battle increasing energy prices.

• Engine maker Rolls Royce saw profits increase slightly in the first half despite increases in costs as service revenues surged ahead.

• Imperial Tobacco said overall performance for the tobacco giant remains in-line with expectations, with cigarette volumes up 45% in the year.

• Yell posted lower first quarter profits and cautioned it expects further pressure on revenue over the rest of the year, though the shares rallied as it indicated it would still meet its earnings guidance.

• Outsource giant Capita saw first-half pre-tax profits rise 16% and said the second half has also started strongly with a further £187m of new and renewed contracts secured in July.

• Durex and Scholl owner SSL International said trading in the first quarter was in-line with the board's expectations.

• Financial software group Misys reported a jump in full-year pre-tax profit and said it is confident in its ability to continue to perform.

FOR A SUMMARY OF LATEST MOVEMENTS IN EQUITY, COMMODITY AND CURRENCY MARKETS, SEE THE 'MARKETS' PAGE

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NEWSPAPER SHARE TIPS (24 JULY)

Full round-up of newspaper share tips (sourced from Sharecast)

PRESS SUMMARY:

EDF is edging closer to clinching an £11 billion takeover of British Energy as it emerged last night that Centrica had resumed talks with the French company to buy a stake of up to 25% if the deal proceeds.

Advisers said that the discussions between EDF and British Energy were much more positive and expressed growing optimism that the deal would be done, despite continued wrangling over price, writes the Times.

The Russian billionaires fighting BP for control of their joint venture, TNK-BP, have turned up the heat on its chief executive, Robert Dudley, accusing him of breaching his duties and warning they may seek damages running into hundreds of millions of pounds. In a letter to Mr Dudley, seen by The Daily Telegraph, the Russians claim Mr Dudley approved investments despite their opposition, and so they "reserve the right to seek all available remedies against you personally...because you have failed to act in the best interests of all shareholders".

Bradford & Bingley has raised £2.5bn of much-needed funding by successfully completing its first securitisation of the year. The struggling lender packaged up £2.5bn of buy-to-let and self-certification mortgages qualified AAA by the credit rating agencies Moody's, Standard & Poor's, and Fitch. A further £400m of mortgages, rated BB and BBB, have been securitised but will remain with the bank, reports the Telegraph.

Top accountancy firm Ernst & Young has told some university leavers who were promised jobs in September that they may have to wait until next spring to join.Ernst & Young blamed "current market conditions" and said other groups are likely to be considering similar measures in an attempt to cut costs, reports the Telegraph.

UK financial investigators will on Thursday launch an insider dealing prosecution against a veteran former Cazenove partner in a riposte to critics who say they lack the will to threaten traders with jail sentences. The latest case is against Malcolm Calvert, a 63-year-old former trader at Cazenove. The alleged dealings at the heart of the FSA's prosecution are relatively small-scale and do not relate to activity at Cazenove, one person with knowledge of the case said, reports the FT

Parents whose children download music and films illegally will be blacklisted and have their internet access curbed under government reforms to fight online piracy. Households that ignore warnings will be subjected to online surveillance and their internet speeds will be reduced, making it very difficult for them to download large files. The measures, the first of their kind in the world, will be announced today by Baroness Vadera, who brokered the deal between internet service providers and Ofcom, the telecoms body, reports the Times.

Northern Rock will pay Gary Hoffman, its new chief executive, £1.1m a year plus a bonus for his first three years in the job, after luring him from Barclays. The nationalised bank said Mr Hoffman would receive a salary of £700,000 a year plus three yearly payments of £400,000 to compensate him for leaving Barclays' long-term incentive plans. The deal will make him the country's best-paid public servant, reports the Independent.

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