Car dealership Lookers (LOOK) reported impressive interim results on Wednesday as the UK car market improves, The Telegraph's Questor column pointed out. While it operates 126 dealerships, selling new and used cars, it is the sales of spare parts that generate 60 per cent of profit. Lookers' vehicle sales unit produced a record result at the interim stage which looks set to continue after the Society of Motor Manufacturers and Traders raised its forecast for 2013 new car registrations last week. Profitability at its independent parts division, however, has been hit by the slowdown in vehicle sales over the past few years. Yet the company said there was "progress" on this front, too. The shares are trading on a 2013 earnings multiple of 16.1, falling to 15.1 next year, and this looks about right for now. After recent gains, the rating is hold (Last IC rating: Hold, 14 Aug).
It is hard not to wonder why things seem to be going so swimmingly for Interserve (IRV) and so badly for Balfour Beatty as both are in the same sector - support services with construction thrown in, according to The Times' Tempus column. The difference is that Interserve is focused in areas of British construction where it is possible to make a decent margin, and elsewhere in oil and gas services in the Middle East that are still growing. So most of the measures in its halfway report are going in the right direction. Pre-tax profits were up by 7.6 per cent at £36.8m and the halfway dividend is raised from 6.4p to 6.8p. Interserve has indicated that it hopes to double earnings per share between 2010 and 2015. This will not be achievable by means of organic growth alone but will require a degree of further merger and acquisition activity (Last IC rating: Hold, 14 Aug).
Apple (NSQ: AAPL) does not like being told what to do, the Financial Times' Lex column noted. For example the gadget maker's had a defiant stance when testifying about its tax shell games before the US Senate this year. So leave it to Carl Icahn, possibly the only man who could chasten the company, to take Apple on. He has reportedly taken a $1.0bn stake in the company and has asked that it return another $150bn to shareholders. What makes this gambit provocative is that Apple's existing capital return plan seems to be working well. His busy calendar - Dell, Herbalife - should excuse Icahn for being late to the Apple-should-return-cash party. Icahn seems most interested in financial engineering, rather than product engineering. Given that nuts and bolts are not always the forte of activists his indifference is a relief. So Apple investors enjoy your Icahn bump but hope that boss Tim Cook is meeting with his designers and not his Chief Financial Officer today (Last IC rating: Buy, 24 Jul).
Business press headlines:
Top economists expect the Bank of England to take further action to ensure interest rates remain low say it and could relaunch quantitative easing within months if markets do not move into line, The Telegraph reported.
Two former JPMorgan bankers face up to 25 years in prison after US prosecutors filed criminal charges over their role in the $6.2bn "London Whale" trading scandal, The Times revealed.
China has widened its investigation into drug pricing and corruption in the healthcare sector, the Financial Times said.
AOL Chief Executive Tim Armstrong has apologised to his entire staff for publicly sacking an employee in front of 1,000 colleagues during a company conference call, according to The Guardian.
Kazakhstan miner Eurasian Natural Resources Corp. delivered poor half-way figures on Thursday ahead of being taken private, The Independent noted.
The Serious Fraud Office has brought charges for the first time under the toughened anti-bribery laws, against three businessmen in connection with an alleged £23m biofuel scam, The Times unveiled.
Energy giant npower could axe hundreds of jobs after it announced a plunge in profits and a cost-cutting drive, The Mirror said.
