Finance Matters

• 11Mar

  Profits at John Lewis rise 9.7%

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  From The BBC:

  Staff at John Lewis will share a £151m bonus after the retail group saw annual pre-tax profits rise 9.7% to £306.6m.The owner of the Waitrose supermarket chain said the bonus amounted to about eight weeks’ salary for each employee. John Lewis chairman Charlie Mayfield said the company emerged from recession “in a stronger competitive position”, but he warned that 2010 would be tough. John Lewis said gross sales rose 6.5% to £7.4bn as it continued to take market share from rivals. The company’s 70,000 staff – or partners, as John Lewis calls them – will share a bonus pot of £151.3m, equivalent to about 15% of their salary. “Today’s results reflect the collective hard work of our partners,” Mr Mayfield said. John Lewis’s co-ownership model, “while not a universal panacea clearly underpins the partnership’s performance”, he said. John Lewis, whose operations include 28 department stores and 225 Waitrose supermarkets, saw profits fall in the first half of the year….

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• 11Mar

  Rail union workers vote to strike

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  From The BBC:

  Network Rail maintenance workers have voted in favour of strikes, bringing about the possibility of action over Easter.The Rail Maritime and Transport (RMT) union said 77% of the members who took part in the ballot backed strikes. The ballot was called over plans to cut up to 1,500 maintenance jobs and change working practices. The union said it would remain available to talk to Network Rail to avert the strikes. “Nobody should be under any illusions about just how determined RMT members are to win this dispute and to stop this reckless gamble with rail safety,” said RMT general secretary Bob Crow….

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• 11Mar

  World airline sector ‘recovering’

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  From The BBC:

  The global airline industry will recover strongly this year, as both passenger and freight numbers improve, the industry’s trade body has said.The International Air Transport Association said the sector would still make a loss, but predicted this would be half its estimate in December. Iata now expects the world’s airlines to make a combined loss of $2.8bn (£1.9bn) in 2010, rather than $5.6bn. But it warned that European and US airlines were still suffering the most. ‘Right direction’Iata said it was “starting to see some blue skies ahead of us”.
  It expects to see global passenger numbers rise by 5.6% in 2010, after falling 2.9% last year. At the same time, it predicts that cargo demand will rise by 10%, after last year’s 11.1% decline. “We are moving in the right direction,” said Iata director general Giovanni Bisignani. “The recovery is strong, but we are still at pre-crisis levels.” However, as the recovery in the airline sector continues, Mr Bisignani said European and US ca…

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• 11Mar

  Red Knights get advisers for bid

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  From The BBC:

  The Red Knights group eyeing a possible bid for Manchester United is to be advised by investment bank Nomura, the Japanese firm has said.The group of financiers has met the football club’s supporters, who have been running a vocal campaign to bring about a change of ownership. Manchester United was bought by the Glazer family for £800m in 2005. The Nomura team will be led by two bankers who advised the Glazer family on its takeover five years ago. “Nomura will work closely with the Red Knights, the Manchester United Supporters’ Trust and other potential investors to co-ordinate and formulate the proposal to be put to the Glazer family,” the financiers said in a statement. “Nomura is beginning its role by contacting the many expressions of financial support the Red Knights have received to date.” The Red Knights group includes Goldman Sachs economist Jim O’Neill, lawyer Mark Rawlinson and financier Keith Harris. The Glazers’ reign has been controversial, with many fans opposed to…

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• 11Mar

  Mexican shakes up world rich list

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  From The BBC:

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  Steve Forbes: “Carlos Slim … has put together quite an empire”
  Mexican telecom giant Carlos Slim has topped Forbes magazine’s billionaire’s list – the first time since 1994 that an American has not led the rankings.Mr Slim’s fortune rose by $18.5bn (£12.4bn) last year to $53.5bn. That beat Microsoft founder Bill Gates ($53bn) into second place, with US investor Warren Buffett ($43bn) third. In 2009 332 names left the list after a tough year, but the total number of billionaires on this year’s list rose from 793 to 1,011, Forbes said. ‘Dominating businesses’A spokesman for Carlos Slim refused to confirm the Forbes estimate of the Mexican tycoon’s wealth, saying they did not “waste their time” on such calculations, but he welcomed the result. “We’re pleased that he has been considered the best businessman of the world,” spokesman Arturo Elias told the BBC. “It means there is trust among the investors.” Forbes magazi…

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• 11Mar

  BP to explore for oil in Brazil

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  From The BBC:

  Oil giant BP has announced a deal that will allow it to begin exploring off the coast of Brazil.It will pay US firm Devon Energy $7bn (£4.7bn) in cash for its Brazilian assets, as well as US deepwater sites in the Gulf of Mexico. The deal includes 10 exploration “blocks” in Brazil, which has some of the world’s largest deepwater oil fields. BP is also selling Devon half its stake in some Canadian oil fields for $500m. “Through our entry into Brazil, BP will add a major position in another attractive deepwater basin,” said Andy Inglis, BP’s head of exploration and production. “It further underlines our global position as the leading deepwater international oil company.” Deepwater generally refers to oil fields in water 300 metres or deeper. Oil companies around the world are exploring deeper and deeper areas around the world as technological developments make it possible to drill in areas previously considered too expensive. The deal will give BP access to fields in Brazil’s Campo…

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• 11Mar

  Morrisons profit up on new stores

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  From The BBC:

  Supermarket group Morrisons has reported a 30% rise in annual profits after it opened more stores.The Bradford-based group said pre-tax profits rose to £858m in the year to 31 January, from £655m the previous year, with revenues up by 6% to £15.4bn. Morrisons opened 45 new stores, two of which were replacements. “In a difficult period for the UK economy and for the consumer, Morrisons has again demonstrated its strength,” chairman Sir Ian Gibson said. The group recently appointed Dalton Philips, a former Wal-Mart executive, to be its new chief executive from 29 March. Its former chief executive, Marc Bolland, left the company in December. Mr Bolland is due to become the new chief executive of Marks and Spencer on 1 May. Morrisons now has a total of 425 stores. “The group has made good progress in its plans to move from being a national presence to a truly nationwide retailer,” it said….

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• 11Mar

  Union to consider BA strike dates

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  From The BBC:

  Union leaders representing British Airways cabin crew will meet later to decide whether to call strike dates.It comes after talks between BA and the Unite union aimed at averting strike action broke down without agreement. The TUC, which has been hosting the discussions, said that no deal had been reached, and no further talks have been scheduled to take place. BA cabin crew voted for strike action last month over jobs, pay and changes to working conditions. BBC business correspondent John Moylan said it looks increasingly likely that strike dates will be announced. If it goes ahead with strike action, the union must announce the strike dates by Monday 15 March – the day when the union’s mandate for industrial action runs out. That follows the ballot of Unite cabin crew members last month, when 81% voted in favour of strikes. Under industrial relations law, the union must give seven days notice of strike action. It has already pledged not to strike over the Easter holidays, so its memb…

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• 11Mar

  Winter insurance claims hit £650m

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  From The BBC:

  Insurers paid out £650m from 335,000 claims made as a result of damage caused by the wintry weather in the UK, figures show.The biggest chunk of the payout was to motorists who damaged vehicles on the slippery roads, the Association of British Insurers (ABI) said. January was the eighth coldest on record and the UK’s worst since 1987. The bad weather hit businesses and consumers with sectors including retail and the housing market suffering. ClaimsThe ABI said that the winter weather cost insurers £650m for claims made in the UK from 18 December to 13 January.
  Homes, vehicles and businesses were all damaged as a result of the winter weather. Specifically, £395m has been paid out to motorists. Many of the 268,400 motor insurance claims were for accidental damage caused to vehicles. They included a claim from David Balfour, of Grangemouth, central Scotland, who suffered two accidents in the space of a few days. The IT engineer, who has completed an advanced driving tes…

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• 10Mar

  Mobile phone that allows boss to snoop

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  From The BBC:

  Researchers have produced a mobile phone that could be a boon for prying bosses wanting to keep tabs on the movements of their staff.Japanese phone giant KDDI Corporation has developed technology that tracks even the tiniest movement of the user and beams the information back to HQ. It works by analysing the movement of accelerometers, found in many handsets. Activities such as walking, climbing stairs or even cleaning can be identified, the researchers say. The company plans to sell the service to clients such as managers, foremen and employment agencies. “Technically, I think this is an incredibly important innovation,” says Philip Sugai, director of the mobile consumer lab at the International University of Japan. “For example, when applied to the issue of telemedicine, or other situations in which remotely monitoring or accessing an individual’s personal movements is vital to that service. “But there will surely be negative consequences when applied to employee tracking or salesfor…

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