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Friday's news and tips

Created:

3 July 2009

Written by:

ShareCast

■ BHP Billiton has agreed to sell its Yabulu nickel refinery for an undisclosed sum after writing down its value by $675m.

■ Ireland's premier bank, Bank of Ireland, has warned it is facing a squeeze on profit margins in addition to the huge impairment charges it will take this year and next.

■ European Islamic Investment Bank (EIIB), the Sharia compliant investment bank, responded to the recent surge in its share price and admitted that it had received approaches.

■ Paving slab and tile maker Marshalls saw revenue tumble 21% in the first half, in line with trends highlighted when it raised £34m from a rights issue in May.

■ A slowdown at its qualitative research business has prompted Cello to caution like-for-like gross profits are down by around 10% year on year, with operating margins also squeezed.

■ Oil and gas firm Salamander announced the spudding of Phu Kheng-1 exploration well Northeast Thailand.

■ Irish building supplies firm Grafton said the recent tough conditions have impacted its profitability "severely", with revenues down 31% in the first half of the year.

■ Cybit, a provider of vehicle and maritime tracking systems, raced to a seven-month high today as investors welcomed a 27% surge in full-year profit and optimistic outlook.

Continues below...

■ Tesco, Britain's biggest retailer, narrowly survived a shareholder revolt over changes to its share option scheme.

■ Business publisher United Business Media has bought the 48% of RISI it doesn't already own and acquired Iasist for €6.4m (£5.5m) in cash.

■ British Airways carried 3.8% fewer passengers in June but said it will cut spending by 20% to deal with the challenging market conditions.

■ Electronic payment and loyalty card provider Universe Group said operating profits will be down on expectations because of lower sales forecast.

■ Lord Mandelson said the government may provide loans or loan guarantees in order to secure the future of Vauxhall.

■ Shares in Bglobal rallied on news that the energy meter provider secured £15m of financing from Barclays Asset & Sales Finance to fund a further roll-out of its products.

■ John Lewis thinks a 3.7% drop in sales constitutes a "good week" seeing as most of us hung up our shopping bags and headed for the beach.

■ Engineer and construction contractor Balfour Beatty has traded in line with expectations since its previous update in May.

■ Indoor five-a-side football firm Goals Soccer continues to trade in line with expectations despite severe snow in February

■ Foam maker Zotefoams remains on track to meet targets this year despite sales tumbling 20% in the first half of 2009 compared with the previous six months.

■ IT consultancy group Morse said revenue and adjusted earnings before interest and tax (EBIT) will be towards the upper end of analyst expectations for the year.

■ Disinfectant supplier Tristel has raised £1m to part finance the purchase of a portfolio of infection control products for between £2.15m and £2.4m.

■ Offshore safety specialist Cosalt turned into losses for the half-year and warned that it could breach the leverage covenant in its banking facilities.

FOR A SUMMARY OF LATEST MOVEMENTS IN EQUITY, COMMODITY AND CURRENCY MARKETS, SEE FT.COM'S MARKETS PAGE.

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NEWSPAPER SHARE TIPS (03 JULY 2009):

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

PRESS HEADLINES:

The startling spike in oil prices to their highest level this year on Tuesday was caused by a rogue broker who placed a massive bet in the Brent oil market, triggering almost $10m (€7m) of losses for his company. PVM Oil Associates, the world's largest over-the-counter oil brokerage, said on Thursday it had been the "victim of unauthorised trading". The privately owned company said that as a result of the unauthorised trades it had been forced to close substantial volumes of futures contracts at a loss, the FT reports.

Mitchells & Butlers is prepared to head off a potential rebellion by offering its two largest shareholders board representation. Drummond Hall, M&B chairman, is understood to be in talks with Joe Lewis, the Bahamas-based billionaire, and Elpida, the investment vehicle for Irish horseracing tycoons JP McManus and John Magnier, over the appointment of a representative from each camp as non-executive director, the FT reports.

France is being forced to import electricity from Britain to cope with a summer heatwave that has helped to put a third of its nuclear power stations out of action. With temperatures across much of France surging above 30C this week, EDF's reactors are generating the lowest level of electricity in six years, forcing the state-owned utility to turn to Britain for additional capacity, the Times reports.

The worst of the recession and the housing slump is probably over but Britain is set for an "anaemic" recovery with little chance of returning to buoyant growth, the newest member of the Bank of England's rate-setting committee warned yesterday. David Miles, who joined the Bank's Monetary Policy Committee last month and is a former top adviser to the Treasury on the mortgage market, fuelled growing speculation that the plunge in house prices is now coming to an end, the Times reports.

Bankers at Goldman Sachs could be in line for record bonuses as compensation on Wall Street looks set to rebound in spite of problems in the wider economy. Goldman, which continues to attract the very best investment bankers and is chaired by Lloyd Blankfein, is on track to pay staff more than it did in 2007, itself a record year, the Telegraph reports.

The Financial Services Authority is to be restructured, with two new divisions added as part of an overhaul that Hector Sants, the chief executive, says will complete the "radical internal reforms" he initiated. Under changes to take effect on October 1, an international division will be added in a move that the FSA says will "significantly increase" its engagement with counterparts abroad and other foreign bodies. The watchdog's financial stability team will also be hived off into its own division to focus on macro-prudential issues, the Telegraph reports.

Alan Johnson, the Home Secretary, appears to have broken ranks with Cabinet colleagues by suggesting he would welcome a Government climbdown in the row over backdated business rates. Johnson, MP for West Hull and Hessle, wrote to a constituent on June 23 saying he was exploring whether he could "reopen" an issue that threatens to hit port companies with a retrospective tax bill of more than £200m. It would put 1,600 businesses and thousands of jobs at risk, the Telegraph reports.

Virgin Atlantic, which has said it could cut up to 1,200 jobs because of the recession, awarded its senior managers a 40% pay increase last year. Staff have accused Steve Ridgway, the Chief Executive, of a lack of moral leadership after his salary rose from £500,000 to £700,000. The combined pay of the top three directors rose from £1.4m to £2m, according to company accounts the Times reports.

Deutsche Telekom is looking for an asset swap deal with any would-be bidder for T-Mobile UK, its UK unit, to cushion the blow of pulling out of a big market. Two people familiar with the German telecoms operator said that executives saw a swap for an asset in another country as the "preferred option" to either selling the business or merging it with a UK rival, the FT reports.

ESPN and BSkyB are set to launch a joint bid to screen the Scottish Premier League (SPL) from next season, with an announcement expected as early as today. The broadcasting giants are understood to be close to tabling an offer for the rights that the football authority clawed back from Setanta Sports shortly before the Irish group collapsed last month, according to the Independent.