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The Daily Telegraph Business - April 17, 2018

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Business
**
Tuesday 17 April 2018
telegraph.co.uk
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Market report page 9. Questor page 8
Devil is in
the details
When it
comes to
trade data,
you can
never have
too much
information
Juliet
Samuel
Exit
strategy
Sir Martin
Sorrell’s
departure
could see
interested
parties
carve WPP
into many
parts
Page 2
Page 3
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Page 9
Page 9
Germany on alert over recession risk
Dusseldorf think tank says
danger of downturn in the
country has ‘increased
markedly’ to 32.4pc
By Ambrose Evans-Pritchard
THE economic outlook in Germany is
deteriorating with alarming speed and
any mistake by policymakers may push
the country into a full-blown slump, a
leading economic institute has warned.
“The danger of recession has increased markedly. It is a notably more
critical picture than a month ago,” said
the Macroeconomic Policy Institute
(IMK) in Düsseldorf.
The IMK’s early warning indicator
said the recession risk over the next
three months has jumped to 32.4pc as
trade tensions mount and liquidity
ebbs away in the financial system. This
is higher than in March 2008 when the
pre-Lehman storm clouds were gathering and the country was already sliding
into slump, unbeknown to Berlin at the
time. It may be a false alarm, but it
clearly indicates that global growth is
weaker than widely assumed just
weeks ago. “What we have seen lately
is a typical late-cycle constellation,
with uncertainty from the financial
markets having a self-reinforcing spillover into the real economy. It is not yet
clear whether such a downward spiral
has already begun. Everything must be
done to avoid intensifying the uncertainty,” it said.
Germany is heavily reliant on world
trade and is therefore a bellwether for
the broader health of the global
economy. Its industrial sector lurched
abruptly from boom to bust early in the
last downturn and proved to be a leading indicator for the Great Recession.
JP Morgan’s instant “Nowcast”
tracker of eurozone growth in the first
quarter has dropped to 1.5pc, half the
torrid pace of late 2017. Germany is the
‘Uncertainty from the
financial markets is having
a self-reinforcing spillover
into the real economy’
chief supplier of machine tools and
engineering equipment to China. The
weakening data dovetails with signs
that the Chinese economy has come off
the boil since the Communist Party
conclave last November. The delayed
effect of credit curbs is biting. Beijing is
trying to get a grip on its fiscal deficit,
now 12pc of GDP. Proxy measures put
together by Capital Economics suggest
that the true rate of economic growth
in China has dropped to near 4.5pc, a
“growth recession” in Chinese terms
and a far cry from the “smoothed”
official figure of 6.6pc.
The IMK said a confluence of USChina trade jitters, a decline in German
industrial output and a 7pc fall in the
DAX index of equities since midJanuary – led by bank stocks – were all
feeding off each other.
The recession indicator was briefly
higher in the Chinese currency crisis in
early 2016. That storm passed for two
key reasons: the US Federal Reserve
backed away from monetary tightening, which eased pressure on the yuan
and rescued China; and oil prices were
then crashing due to a surge in supply,
generating a $2 trillion windfall
stimulus for global consumers.
The picture is very different today.
The Fed is on the warpath. Joint
production cuts by Opec and Russia
have cleared the global oil glut. Brent
crude prices are back to $72 a barrel.
Crucially, the global money is slowing as quantitative easing goes into
reverse, and as the Fed lifts global borrowing costs. Three-month Libor rates
have jumped 60 basis points this year,
hitting $9 trillion of floating contracts
worldwide.
Simon
Ward,
from
Continued on Page 3
£1.1bn US boost for UK
technology start-ups
By James Titcomb
GEOFF PUGH FOR THE TELEGRAPH
SILICON VALLEY investors
put a record £1.1bn into
British technology start-ups
last year, boosting claims
that the UK is spreading its
wings as a global tech hub.
The figures, revealed in a
report from law firm
Penningtons
Manches,
appear to knock back claims
that international investors
would turn their backs on
the UK’s technology companies after the Brexit vote.
West Coast investment
into UK tech companies rose
by 47pc last year to £1.08bn,
according to the report, and
is up from just £213m in 2011.
Power couple Formula 1 Powerboat Racing is returning to London in June for the first time in 33 years as part of
London Tech Week 2018. Top drivers Philippe Chiappe and Marit Stromoy, above, launched the event on the Thames.
Sterling hits post-Brexit vote high
against dollar ahead of pay data
By Tom Rees
THE pound capped off a
seven-day winning streak by
climbing to a post-Brexit
vote high against the dollar
as attention on currency
markets turned to the pay
squeeze on UK households
finally ending.
Forex analysts pinned the
pound’s jump above $1.43
against the dollar for only
the second time since the EU
referendum on expectations
that wage growth would
finally nudge past inflation
in figures due tomorrow.
After 13 months of
negative real wage growth,
economists forecast that pay
hit 3pc in February, surging
past inflation at 2.7pc.
The benchmark rate for
sterling at the end of trading
in London had jumped 0.6pc
against the dollar to $1.4328,
while against the euro it had
hit an 11-month high.
The pound threatened its
post-referendum intraday
high of $1.4347 reached in
January before easing back.
Analysts also said that the
dollar’s safe haven appeal
was waning as tensions
cooled in the Middle East,
which also helped sterling
strengthen
against
the
greenback.
With the pound’s Brexit
jitters
allayed
by
the
agreement of a transition
deal, ING’s Viraj Patel argued that traders were back
to “good old-fashioned data
watching” ahead of the Bank
of England’s May meeting.
JD Wetherspoon closes
down social media sites
By Sophie Christie
PUB chain JD Wetherspoon
deleted all of its social media
profiles yesterday, with Tim
Martin, the chairman, citing
the “current bad publicity
surrounding social media,
including the trolling of MPs
and others” as one of the reasons behind the move.
The
company
closed
down its Twitter and Facebook accounts, which had
44,000 and 100,000 followers respectively, as well as its
Instagram feed, for all of its
900 pubs and head office.
The boss of the British discount pub chain said it was
“going against conventional
wisdom that these platforms
are a vital component of a
successful business”.
He and the company’s
pub managers do not believe
that closing the accounts
will have any affect on
the business “whatsoever”,
he added.
Analysis: Page 4
47pc
The rise in Silicon Valley
investment into UK tech
companies last year
The number of deals has also
risen significantly, climbing
from 21 in 2011 to 74 in 2017.
The report, made using
figures from the UK start-up
database Beauhurst, said
that a third of all investments
in 2017 were now by North
American investors. Those
from West Coast investors
account for just under 5pc of
the total, while investment
from the US East Coast is
similarly at a record high, at
£1.3bn.
The backing included a
$30m (£21m) investment in
Onfido, a background-checking company that works with
the likes of Uber, from investors including Microsoft and
Salesforce; the venture fund
Andreessen Horowitz backing the simulation experts
Improbable;
and
Union
Square Ventures investing in
fintech firm Funding Circle.
High valuations and an increasingly overcrowded field
mean more US investors are
looking overseas for deals,
while UK start-ups often see
Continued on Page 4
2
Tuesday 17 April 2018 The Daily Telegraph
**
Business comment
I
rreplaceable is an over-used word in
business, as in most other walks of life. In
truth, most of us, no matter how talented or
hard working we might be, can usually be
substituted by someone just as good with
only a little effort. But if anyone merited that
adjective in British industry, it was surely Sir
Martin Sorrell. After three decades of building the
WPP advertising, public relations and marketing
empire up from nothing, he had become the glue
that held the whole thing together.
With Sir Martin’s ignominious departure over
the weekend, the challenge facing his successor
will be a huge one. Not only will they have to fill
an enormous pair of shoes, but they will have to
reinvent a business that looks past its sell-by date.
No one expected Sir Martin’s three-decade
reign at WPP to end so suddenly, or in quite such
painful circumstances. Sure, the share price has
been under pressure, dropping from £17 to £11 in
the last year. And yet, once allegations emerged
about his personal use of company funds, the
board clearly decided it had had enough.
In a terse statement late on Saturday night,
Sorrell announced his resignation. Roberto
Quarta, the chairman, is taking over day-to-day
control for now, and the search is already under
way for a long-term successor.
The trouble is, WPP was very much Sir
Martin’s personal creation. After leaving Saatchi
& Saatchi, where he had been finance director,
he took control of a tiny shell business and
stitched together the world’s biggest marketing
conglomerate, deal by deal. With 400 agencies
and 200,000 staff across 112 countries, it was a
sprawling empire, and often the only real thing
that linked them all up was that Sorrell had
acquired each business.
With a forensic attention to detail, one of the
best contacts books in the world, and a relentless
capacity for hard work, Sorrell managed to make
the whole thing work. But it will be very hard for
anyone else to perform the same alchemy.
Even worse, its business model looks
increasingly antiquated. WPP was created in the
era when huge multinational conglomerates
built global brands using mass media to solidify
their lock on consumers. Its agencies were the
experts in that, and could charge handsomely for
delivering the sales. And yet, that world is fast
disappearing. Traditional commercials don’t
have much impact any more – no one ever
watched an ad on Netflix – and need to be
replaced by social media campaigns that are far
more localised, and often created in-house. At
the same time, even the
brands are changing – the
rise of artisan, specialist
products means that there
are far fewer mega-selling
things than there used to be.
Mass markets have been
replaced by endless niche
ones, but they are far harder
for a global conglomerate
like WPP to manage.
The result? The new chief
executive will not only have
to replace Sorrell’s personal day-to-day
management, and replicate his intimate
knowledge of every unit, they will have to
reinvent the company at the same time.
It is a big challenge. So where should WPP’s
board start? There are three things to prioritise.
First, bring in an outsider. There is already lots
of speculation about possible successors. Mark
Read, the head of its Wunderman unit, has
already been appointed joint chief operating
officer alongside Andrew Scott. Those two men
look like the front-runners, and within its 400
units there are plenty of big personalities who
will no doubt have spent Sunday thinking about
throwing their hat into the ring. It might sound
tough, given how well qualified some of them
are, but the board should ignore all of them.
At this point in its history, WPP needs an
outsider. Only someone from a different
background can bring the fresh eyes, and the
new ideas, that the business now desperately
needs. And only a clean pair of hands can remain
neutral between its competing fiefdoms.
Next, it needs to be slimmed down. An auction
of its units might well yield a lot of cash, and it’s
possible a bid might emerge. That would be a
shame, because there are, as Sorrell always
insisted, genuine synergies between its different
units. There is a big difference between a
break-up and a rationalisation, however, and it is
hard to escape the suspicion that Sir Martin
bought a lot of companies simply because he
liked doing a deal. Right now, WPP has too many
businesses. Many can be sold off, leaving a more
manageable core.
Finally, it should move aggressively into
content. The world of mass media that it was
created for is not going to come back.
Increasingly, marketeers will have to embed
messages into the content itself, or into social
media feeds. That would be a lot easier if they are
involved in the creating the things that people
are watching or listening to. WPP has already
invested in a range of content companies, such
as 88rising, but as the lines between marketing
and media are increasingly blurred, it should
make a big move into the content itself. How
about buying a stake in Spotify, for example, now
that the company is listed? Or taking stakes in
sports teams so that logo and sponsorship deals
are under its control? That will take courage and
money, and potentially a lot of both.
WPP should still have plenty to look ahead to.
There are still huge brands out there, and they
need to find a way of selling their products
globally. Indeed, as markets get more
fragmented, and consumers more flighty, there
may well be even more of a role for a global
marketing conglomerate than there has been
before. But after being run by the same person
for three decades, the company needs radical
reinvention. Steadying the ship, and keeping
clients on board, will be fine for the next few
months. But beyond that the new CEO will have
to be as bold and ambitious as Sorrell himself was
30 years ago if the business is to have a real
future ahead of it.
‘The new
CEO will
have to be
as bold and
ambitious
as Sorrell
himself’
JULIET SAMUEL
MUEL
H
ow much champagne
did Britain export last
year? If you know your
EU rules, under which
only the champagne
region of France is
allowed to produce the drink, you’d
probably guess that the correct answer
is zero. But according to official UK
data, that’s wrong. HMRC’s overseas
trade statistics state that Britain
exported £19m worth of champagne in
2016, £1.1m of which went to France.
The truth, of course, is that Britain
is a conduit for many products, which
travel here before going on to their
next destinations. In cases like
champagne, the value added in Britain
is very small, consisting probably of
some packaging and travel costs. But
often, in trade statistics, the value of
the whole product gets counted
towards our exports, even if most of
the value was created in, say, France.
The Office for National Statistics
launched a whole new suite of tools
for trade data yesterday, having put
substantial resources to improving the
information available over the last
year. The Brexit vote sent demand for
good trade data through the roof and
the ONS quickly realised there was a
lot it couldn’t do.
So, in the last 12 months, it has
become possible to find out not only
how much of a particular good Britain
exports, or what our total goods
exports to a particular country are, but
how much of each good we export to
which country. Rather surprisingly,
this function simply didn’t exist in the
official statistics a year ago.
The work is a step forwards, but the
overall picture is still astonishingly
uncertain. Anomalies pop up from
even a cursory glance at the data. One
example was instantly pointed out by
an attendee at the ONS’s briefing on its
new data toys yesterday.
According to the official statistics,
Britain exports around £2.7bn worth
Business
Insight
Volkswagen
Group
V
olkswagen Group
began its first week
under a new chief
executive yesterday, after
Matthias Mueller handed
the wheel over to
Herbert Diess, writes
Alan Tovey.
The change at the top
came at the same time as
structural changes to
how the 12-brand
business operates. The
company will run as
three divisions:
“Volume”, likely to
include marques such as
Volkswagen, SEAT and
Skoda; “Premium”,
expected to cover Audi
and Porsche; and the
“Super Premium” brands
of Bentley, Bugatti and
Lamborghini.
What lies in store for
of those exports was only £270bn.
This shouldn’t be too surprising. The
value in an iPhone is in its design and
technology more than its assembly.
Despite the flaws in the headline
trade numbers, governments often use
them with abandon and they have realworld impacts. Our priorities for Brexit
could well be significantly affected by
public usage of numbers that don’t
show the whole picture. It’s now easy
to find ONS services trade data broken
down by country and industry, for
instance (though not by UK region).
But only if you read the notes
accompanying this new data do you
see that it only covers about half of UK
services trade and that you have to
look elsewhere to include major
industries like banking and finance,
legal services, travel, transport, higher
education and charities. The ONS has
put the disclosure there, as it should,
but how many politicians, wonks and
journalists will notice it?
Trade data are being used to decide
all sorts of government policies, from
our negotiating position over
agricultural tariffs in the World Trade
Organisation to the pros and cons of
staying in the customs union. When
the House of Lords votes this week
and tries to bind the Government into
seeking a customs union with the EU,
will their lords and ladyships be
looking at the right figures?
When the Government designs new
trade policy to improve links with the
Commonwealth, whose heads of
government are gathered in London
this week, what services data will it
use? And when Donald Trump
decides to start a trade war with China,
will he be looking at gross exports or
value added?
This isn’t to say that the imperfect
data we have now is useless. Clearly, it
can give us the broad outlines. The EU
is a massively important trading
partner for us. China’s exports to the
US have been booming. These facts
are backed up by the data and highly
likely to be true.
But we are still surprisingly far from
understanding the full picture. So the
next time I see a headline saying that
Britain’s exports are up or down, my
first question won’t be “Why?”, but
“Does that include gold?”.
BLOOMBERG
Sorrell can be
replaced at
WPP, but only
by an outsider
To make informed decisions on
policy we need better trade data
of services to Ireland each quarter, or
£10.8bn per year. Subject that to a
common sense check. Ireland has a
population of 4.8m. Does it really seem
realistic that each Irish man, woman
and child is buying over £2,200 worth
of British services each year? Of
course not. What might be going on is
that thousands of corporates are
transferring services between their
British and Irish entities in order to
take advantage of its ultra-low
corporation tax. But the trade data
don’t know the difference.
The data boffins at the ONS are
trying to get a handle on this stuff. For
example, it publishes trade data for
goods both including and excluding
gold, because the movement of gold
between vaults in London and
Switzerland can have an enormously
distorting effect on headline trade
figures. Much of the supposed fall in
capital investment and “rebalancing”
in Britain’s trade after the referendum,
which had been attributed to
uncertainty and the lower value for
sterling, was actually accounted for by
gold being moved between banks.
The numbers are also full of odd
anomalies or “asymmetries”. Different
countries record their trade numbers
from different sources, using different
methods and definitions. The result for
trade data can be substantial. British
and American figures agree on our
trade in goods, but disagree totally on
our trade in services. Bizarrely, both
the UK and the US record that we have
surpluses in services exports to one
another. In 2014, our figures for UK-US
exports differed by £35.5bn and for
UK-US imports by £22.6bn. They
cannot both be right.
Most disconcerting of all is the
“value added” issue highlighted by the
champagne example. What we should
really be measuring when we record
trade is how much value a country’s
economic activity has added to a good
or service before it is sold abroad. If we
are importing everything at great
expense before adding a sliver of value
and then re-exporting it, that clearly
has implications for trade policy and
the balance of payments, yet often, it’s
simply not reflected in the trade data.
Again, these differences can be
substantial and they are very hard to
measure. The OECD is trying to do so.
Its current figures suggest that, for
2011 (the latest year available), China’s
gross exports to the US were worth
£413bn. But the domestic value added
Containers wait
to be loaded at
Southampton dock.
Britain remains a
conduit for many
products, which
are transported
here before going
on to their final
destinations
‘The ONS
has put the
disclosure
there, as it
should, but
how many
politicians,
wonks and
journalists
will notice it?’
the Ducati motorbike arm
is unknown. However, its
MAN and Scania
commercial vehicle units
look set to be separated
and some analysts think
this division could be
worth €30bn (£26bn).
Mr Diess will no doubt
continue the drive to make
VW a leading force in
electric (and self-driving
cars) by 2025, having
Herbert Diess
Chief executive
regained the title of the
world’s largest car group.
However, the company
continues to labour under
its unusual shareholder
structure, with almost
90pc of the voting shares
controlled by just three
investors, a situation that
continues to raise
concerns about VW’s
corporate governance.
BLOOMBERG
Matthew
Lynn
The Volkswagen AG headquarters in Wolfsburg, Germany
Strengths
Threats
 Strong international
presence
 Respected engineering
brand
 Owns a range of
marques that cater to
different budgets
 Continued reputation
damage and costs from
emissions scandal
 Rising materials costs
 Governance structure
limits ability to make
radical changes
Weaknesses
Opportunities
 Structural change
in the global automotive
industry
 Not as efficient and
profitable as rivals
 Weak position in the
US market
 Huge R&D budget
delivering new
technology
 Using huge scale to
drive down costs
 Alliances with other
manufacturers
Turn away from protectionism and growth will come
KALLUM
PICKERING
I
n one fundamental respect, the field
of economics has not changed
much in the past three centuries.
When Scottish-born Adam Smith
published An Inquiry into the Nature
and Causes of the Wealth of Nations in
1776 he asked what is still the most
important question: “What drives
economic progress?”
Of course, in a world of hashtags we
now have to settle for the much more
trivial-sounding “productivity puzzle”.
But the essence of the problem
remains the same. Consider the
following: living standards that rise at
2pc per year will double roughly every
35 years. For living standards that rise
at 1pc per year, it will take 70 years.
In the West, the experience of the
post-war period is that growth bounces
back strongly after a downturn. In a
normal cyclical recovery, strong
investment increases capital per
worker, and, in turn, productivity.
Frustratingly, productivity growth
has underperformed enormously so
far throughout the post-Lehman
upswing. While major advanced
economies, including the UK,
currently enjoy a record number of
jobs, the average worker does not
produce much more than a decade
ago. Because worker output has
languished, headline GDP growth has
been around a third lower than
normal. Real wages and revenues have
increased more slowly. Confidence
and the appetite for risk-taking have
been depressed. Meanwhile, the
growth impulse from economic
policies designed to speed up the
recovery has disappointed. Austerity
and balance sheet repair has gone on
longer than expected.
The consequences extend well
beyond the measurable economic
effects. Much of the creeping political
disenfranchisement of recent times
can be attributed to stagnating living
standards and the risk that future
generations could find themselves
worse off than their parents.
Political and economic systems that
do not enable people to get on will
struggle to last. This is quite possibly
the most pressing economic and
political issue of our time.
What is going on? Are we
collectively out of ideas that could
push us forward? Anecdotal evidence
suggests the opposite is true. Rates of
innovation in energy, artificial
intelligence and robotics seem to be
accelerating. Each on its own has the
power to boost productivity.
People often identify the current
productivity weakness as a postfinancial crisis phenomenon. This is
wrong. Growth rates in worker output
per hour had already started to slow in
the mid-2000s as Western economies,
enticed by excess short-run returns,
started over-investing in real estate
with borrowed money. Households
then took out extra credit against their
rising home values to finance higher
spending. Major capital misallocation,
disguised as proper growth, meant
major economies underinvested in the
essential capital and equipment that
could have raised output and worker
productivity in a sustainable way.
When the bubble finally popped it
had lasting negative effects. Burdened
with high debt and unproductive
assets, advanced economies had to go
through a long period of balance sheet
repair that is not yet fully complete.
Weak productivity growth during
the last decade is the price we have
paid. In the coming years things
should improve modestly if the right
policies are followed and some crucial
mistakes are avoided.
Last year marked the partial return
to normal cyclical dynamics. In the US,
the UK and Germany, where the
economic cycle is the most advanced
and unemployment is low, continued
strong demand will put increasing
strain on available resources. Firms
will need to decide whether to raise
productive capacities through capital
investment or simply raise prices.
So far the signs are mostly good. US
firms are responding positively to the
Trump fiscal stimulus and tax reform
with higher investment spending. In
Germany, firms are investing more as
they encounter labour supply
constraints. Even in the UK, where
Brexit uncertainty clouds the
economic outlook, investment is
expanding nicely. In a world where
demand is growing, UK firms seem
‘With luck,
demand
growth
should
translate
into a
broad-based
upswing in
investment
and
productivity’
more concerned about losing market
share than a hard Brexit.
Meanwhile, inflation across the
advanced world remains close to the
2pc rate that major central banks see
as desirable. Central banks can exit
their stimulative monetary policies
slowly, keeping the cost of capital low.
With luck, healthy demand growth
should translate into a broad-based
upswing in investment and
productivity in the coming years.
The risks to this optimistic outlook
are obvious. Confidence remains
fragile. Firms and financiers
remember the pain of the financial
crisis. In addition, central banks and
governments are not well prepared to
deal with the next downturn.
The major risk is a Trump-led trade
war. While the current planned US and
China tariffs will only have a small
measurable effect on global output
and inflation, the risk that uncertainty
weighs on firms’ production and
investment is significant.
Sentiment in Europe has already
softened due to the trade skirmishes.
If the current tit-for-tat between the
US and China does not de-escalate
soon, the pick-up in investment
growth could be spoiled before it
builds any serious momentum.
After much of the hard work in
fixing the problems that led to the
crisis is done, it would be a pity if the
long-awaited good times were spoilt
by misguided economic policies.
Kallum Pickering is senior economist
at Berenberg
The Daily Telegraph Tuesday 17 April 2018
***
Business
BP to cap greenhouse gas emissions
Energy giant pledges
‘aggressive action’ to tackle
climate change, but activist
groups say it isn’t enough
By Jillian Ambrose
BP HAS taken its first clear steps in the
battle to tackle climate change by
vowing to cap its greenhouse gas
emissions until 2025 as pressure grows
on Big Oil to clean up its act.
The super-major will hope to see off
a rebellion from worried shareholders
and activist investors at next month’s
AGM with a fresh plan to cut 3.5 million
tons of carbon from its operations
every year. This will enable the group
to grow its fossil fuel business without
increasing its overall emissions in the
decade from 2015 when global governments agreed to tackle climate change
through the Paris Climate Accord.
Bob Dudley, BP’s chief executive,
unveiled the new strategy in London,
saying the FTSE 100 energy giant
would take “aggressive action” across
all its business areas to make “real,
measurable and transparent progress”.
“As our business grows, our net
emissions will not,” he said.
Mr Dudley is under pressure to kickstart BP’s growth after almost a decade
weathering the financially crippling
fallout of the Deepwater Horizon oil
spill and a brutal oil market downturn.
The group increased its annual production of oil and gas by 12pc last year,
but the energy giant’s return to growth
has coincided with rising pressure
from world governments to help reduce the emissions which are linked to
dangerous levels of global warming.
“As the world demands more energy
it also demands that it be produced and
delivered in new ways, with fewer
emissions,” said Mr Dudley. “To deliver
significantly lower emissions every
type of energy needs to be cleaner and
better. That’s why we are making bold
changes across our entire business.”
The group plans to tighten up the
emissions from its oil and gas activities
by running its rigs with technology
which can stem the leak of methane, a
powerful greenhouse gas, from its oil
and gas projects into the atmosphere.
It is already replacing its “high
bleed” rig controllers across US onshore oilfields and will put an end to
routine gas flaring by the end of the
next decade.
It also plans to shift its investment
from oil to lower carbon gas, and has
earmarked around $500m (£350m) a
year to its investments in low-carbon
power such biofuels and renewables.
Where these steps fall short of its bid
to keep carbon in check, BP will compensate for the impact of fossil fuel
production on the environment by
continuing to work on green “carbonoffsetting” projects.
But green groups were left cold by
the plan which they say does not go far
enough. The targets are below the
more ambitious goals set out by its
Anglo-Dutch rival Royal Dutch Shell,
which has promised to cut its carbon
footprint by 20pc by 2035 and halve its
carbon dioxide emissions by 2050.
“Improvements in BP’s operational
emissions, while welcome, are too
small to move the needle to prevent
runaway climate change or reduce BP’s
exposure to carbon risk,” Luke
Sussams, of think tank Carbon Tracker,
said. “Similarly, while BP’s investments
in low-carbon technologies are needed,
it remains just 3pc of its annual capital
spend and so does not make up a
significant part of BP’s business, as this
report suggests.”
Takeda takes
a back seat as
Shire offloads
cancer unit
By Ayesha Javed
‘Given that oncology is a
small part of Shire, the deal
shouldn’t severely impact the
decision to make an offer’
not core to Shire’s longer-term strategy”, adding that the drug maker could
make further “selective disposals of
non-strategic assets”.
Emmanuel Papadakis, an analyst at
Barclays, said that the deal was “likely to
obfuscate the probability of Takeda’s
current approach”.
Meanwhile, Peter Welford, an analyst
at Jefferies, said that the deal “should
also boost Shire’s negotiating position
on asking price in the current offer period with Takeda”, but he added that
there could be “incremental risks” to an
acquisition due to the “ongoing complex integration” of Baxalta, the former
bioscience business of Baxter that Shire
merged with in 2016.
Shares in Shire fell 1.3pc to £35.59.
PA
DRUG maker Shire has agreed to sell its
oncology business to a French rival,
putting into question whether a bid for
the FTSE 100 firm from Japanese suitor
Takeda will emerge.
Shire is selling the oncology business
to Servier, a pharmaceutical company
governed by a non-profit foundation,
for $2.4bn (£1.7bn).
The deal comes as Takeda chief
executive Christophe Weber is understood to be lining up meetings with its
major holders ahead of making a
potential £35bn offer for Shire. Its biggest investors include US-based Blackrock, Capital Group and JP Morgan.
The oncology unit sale is expected to
close in the second or third quarter of
the year and Shire boss Flemming Ornskov said the firm would “consider
returning the proceeds of the sale to
shareholders through a shareholder-approved share buyback after the current
offer period regarding Takeda’s possible
offer for Shire concludes”.
Oncology was an area Takeda had
identified as a driver for its potential
takeover bid. It said that any deal would
strengthen its core therapeutic areas of
developing medicines for cancer, gastroenterology and neuroscience.
Last year the oncology business made
$262m of revenue and Mr Ornskov said
the company had “concluded that it is
Bottle bank Ivan Menezes, chief executive of drinks giant Diageo, at its headquarters in Edinburgh, where he announced a
£150m investment over three years which, it is hoped, will “transform” its Scotch whisky visitor experiences.
Vauxhall says no jobs will be lost as it terminates dealerships
By Alan Tovey
VAUXHALL is terminating the contracts of all its 326 dealerships in Britain as the company battles to deal with
plunging sales and a changing market.
The marque is ending all dealer
contracts in the UK – a move also
happening with sister brand Opel
across Europe – as the entire sales
network is reorganised.
Some 1,600 dealers across the panEuropean network will be given two
years’ notice from April 30 that the
manufacturer is ending its relationship
with them, and proposing a new contract with about two-thirds of them.
About 12,000 staff are employed in
franchisees’ UK dealerships but Stephen Norman, Vauxhall’s UK boss,
insisted that staff would not lose their
jobs as a “direct result” of Vauxhall’s
decision to refranchise the network.
“Based on 42 years experience in the
industry and having been through four
of these network refranchisings, I do
not expect jobs to be threatened,” he
said. “I don’t want to ‘de-dramatise’ it,
but refranchising is not something that
doesn’t happen at regular intervals in
the motor industry. Nobody is being
sacked. The vast majority of franchises
will continue as before.
“We do not expect a reduction in the
number of retail dealer outlets as a
result of this action. People will find
work in other franchises,” he added,
insisting that “simple” facts about
demand for cars in the UK indicated
they would be able to find employment
“perhaps
with
other
dealers”.
Mr Norman said that Vauxhall – which
was bought along with Opel last year for
£1.9bn by France’s PSA Group from GM
– would still be Britain’s second-largest
dealer network after the restructuring,
but would be “go from being the second
largest after Ford to closer to the third
largest”. This suggests about 200
dealerships will remain.
Sales of Vauxhall cars have been falling for some time but the decline accelerated last year, dropping 22pc – more
than three times the 5.7pc fall seen
across the wider UK market. Last year
Vauxhall sold 195,000 cars in the UK.
risk
Buyers circle WPP as the media empire is open Germany’s
of recession
to a break-up without its founder at the helm grows as ECB
Sir Martin Sorrell’s exit
leaves the company under
pressure to sell off many of
its assets, says Lucy Burton
B
arely 24 hours since Sir
Martin Sorrell abruptly left
the media empire he built
from scratch and bets are
on as to which of the
businesses he acquired
will go first. Bankers and private
equity giants are set to start circling
WPP’s market research, public
relations and health divisions as Sir
Martin’s exit finally leaves the world’s
largest advertising group open to a
break-up.
Senior industry figures said a split is
now inevitable as WPP begins life
without its 73-year-old founder, who
transformed a tiny manufacturer of
shopping baskets into a £20bn media
group made up of 400 separate
companies including Ogilvy & Mather.
“The company is no longer growing,
so how do you reboot shareholder
value and get investors back on side
again? All you can really do is
crystallise value by disposing of
assets,” said Alex DeGroote, a media
analyst at Cenkos Securities. “In terms
of probability I’d say it’s 100pc, the
question is the timeline.”
The firm’s market research assets,
such as London-based Kantar, are
deemed as the most saleable in the
short-term, with City analysts
expecting a Kantar sale to raise up to
£3.5bn. DeGroote said its roster of PR
companies such as Buchanan and
Finsbury could also be sold, but he
estimates that it would only fetch up to
£1bn in total, while private equity
giants are likely to be eyeing up WPP’s
health firms such as Sudler &
Hennessey.
“What everyone wants in media at
the moment is data, people are
absolutely obsessed. Healthcare lends
itself to that,” said DeGroote. “PR on
the other hand has less data, it’s not
growing, it’s less of an international
story. PR tends to target quite a
localised market, research tends to
work across borders.”
Be Heard Group founder Peter
Scott, who started his career at Ogilvy
& Mather, said the era of mammoth
holding companies running the
industry is coming to its end, and Sir
Martin’s exit is synonymous with that.
“If you go back one step and you
look at the way these holding
companies have evolved, you ask
yourself the question – for whose
benefit did they grow? Was it for
clients, staff or shareholders?” he said.
“The growth of holding companies
[such as WPP, Publicis and Omnicom]
really came about from the Eighties
when media buying was taken away
from the agencies. They saw it as an
opportunity to consolidate all their
media companies into large power
points. That era is now coming to an
end. If you take the competing groups
in [WPP] such as Grey and Ogilvy,
they’re all fighting each other.”
That’s also likely to have been the
case in WPP’s boardroom in recent
weeks. City analysts believe there was
a disagreement between Sir Martin
and the rest of the board over strategy
while sources told The Telegraph he
left after growing “fed up and p*****d
off ” with the board’s handling of an
internal probe into alleged
misconduct, of which WPP has
refused to disclose any details. Sir
Martin, who has denied wrongdoing,
told staff the ad giant “will always be
my baby” after he retired on Saturday.
“This story is a tragedy because
you’re deconstructing what Sorrell has
constructed,” said DeGroote. “The
company will now be run in more of a
shareholder way. What I mean by that
is there will potentially be some
special dividends off the back of some
disposals. [It will become] a smaller,
leaner group with a bit more focus and
a lot of M&A activity.”
For the investors who have been
questioning Sir Martin’s advertising
empire in recent months, that more
nimble model is exactly what they
want. WPP’s shares have steadily
fallen in the last year as it has
struggled to grow amid drops in
advertising spend, the growth of social
media platforms and fresh competition
from consultants such as Accenture.
Its forecast of no growth for 2018
despite this year’s Winter Olympics
and football World Cup, which should
boost sales, disappointed shareholders
further.
“They’ve had substantial investor
Sir Martin Sorrell: WPP’s 73-year-old
founder resigned on Saturday
pressure. Whereas Martin was saying
it’s all very difficult [in WPP’s latest
results], Publicis came out and said
here’s a three year plan, here’s a
solution,” noted one senior industry
figure. “The old story that scale and
volume is everything is changing –
clients no longer see that as a benefit.”
But while a change in strategy is
inevitable, crucial questions remain
unanswered which could distract the
business from moving forward. Sir
Vince Cable, the Liberal Democrat
leader, is among those piling pressure
onto WPP to disclose the details of the
allegations Sir Martin has been
accused of, with many angry that the
claims are still shrouded in secrecy.
Then there is the tricky issue of
finding a replacement for one of the
most famous businessmen in the
world just as the company tries
reorganise itself. Mark Read, the boss
of WPP Digital and digital marketing
agency Wunderman, has just been
made joint chief operating officer and
is seen as a likely internal candidate.
But some have suggested a big
external name, perhaps Jeremy
Darroch at Sky or Jerry Buhlmann at
Dentsu, might be favoured by the City.
Or even nobody at all.
“People keep going on about
successors but he’s not your typical
man to replace because he sits at the
same table as [Donald] Trump and
CEOs like Bill Gates. Who are they
going to get with the same profile?
Nobody,” added DeGroote. “[Roberto]
Quarta being made executive
chairman indicates there won’t be a
replacement, no real succession plan
and nobody they’ve got their eye on.
Quarta’s background is largely in
private equity, he’s very well versed in
restructuring.”
policy tightens
Continued from Page 1
Janus Henderson, said the global economic slowdown was baked into the
pie months ago when the money supply began to falter. His key indicator –
six-month real M1 money – touched a
nine-year low of 1pc in February.
Early data suggest a slight pick-up in
March. This signal tends to lead the
economy by around six months, suggesting that the global economy may
remain trapped in the doldrums
through the second and third quarters.
The monetary figures for the eurozone buckled last year. What is most
striking is that the growth rate of real
M1 deposits in France has dropped to
2.4pc from 7.3pc in September, and in
Spain to 2.7pc from 6pc. Such falls do
not in themselves imply a recession but
they warrant caution.
The European Central Bank faces a
treacherous task as it prepares to phase
out QE altogether this year. The risk is
that the ECB could tighten too hard and
cause the current soft patch to metastasise into a full-blown downturn.
Monetarists argue that the US liquidity squeeze is already having powerful
effects. The Fed has pencilled in four
rate rises this year. It is currently
shrinking its balance sheet by $30bn
(£21bn) a month. The pace of quantitative tightening (QT) will rise to $50bn a
month in the fourth quarter.
The picture is fluid. Opinions differ
widely, with most analysts still predicting healthy global growth this year.
Some expect a blow-off boom as the
stimulus from Donald Trump’s tax
cuts feed through into fresh
spending. What is clear is that the
voices of dissent are growing louder
and more numerous.
3
4
Tuesday 17 April 2018 The Daily Telegraph
**
Technology Intelligence
Unlockd suspends IPO as it takes Google to court over ban on app
By James Titcomb
AN AUSTRALIAN technology company
backed by Lachlan Murdoch is taking
legal action against Google in the UK
after it was banned by the internet
giant.
Unlockd, an app that rewards smartphone users for viewing adverts when
they unlock their phone, said it had applied for a High Court injunction against
Google after being told it would be removed from the company’s Android operating system. The row threatens to
installed. Google has now told Unlockd
that it will be removed from the Play
Store, the portal used for downloading
new apps on Android phones, and will
be banned from the AdMob network
used to run adverts inside apps.
Unlockd said it had been forced to
suspended an initial public offering
(IPO) and that Google’s actions “represent an abuse of its dominant position”.
“Unlockd... confirms that it has applied for an injunction with the UK
High Court to prevent Google from
disabling AdMob generated advertis-
resurrect the Murdochs’ long-running
feud with Google after years of Rupert
Murdoch, Lachlan’s father, attacking
the company over its growing share of
the advertising market.
Unlockd has raised more than £32m
and says it was planning to go public in
a move that would have solidified its
position as one of Australia’s most
promising tech firms.
The company licences its app to
other businesses such as Tesco’s mobile network arm, which lets customers knock £3 off their bills for having it
ing content and removing Unlockd
apps from the Google Play Store,” a
spokesman said.
“Unlockd’s legal counsel has
confidence that the threats made by
Google to withdraw access and the
supply of services in respect of Google
Play and AdMob represent an abuse of
its dominant position and breach of
competition rules.
“It is particularly striking that Google’s warnings emerged at a time of
speculation around an Unlockd IPO in
mid-April 2018. Google’s anti-competi-
tive conduct is preventing Unlockd
from raising capital to continue its
rapid expansion and innovation, and
therefore protecting Google from a
growing and potential competitor.”
Google is believed to have banned
Unlockd for four separate violations of
its policies. Android’s rules forbid apps
from “interfering with device functionality”, while AdMob’s rules ban
apps being made up largely of adverts.
A spokesman said: “Our publicly
available AdMob and Google Play policies clearly set out how our products
may be used, and are designed to
protect the interests of advertisers,
publishers and phone users.
“We explained our concerns to
Unlockd, outlined how they could fix
the problems or use alternatives, and
gave them time to make changes.
“And despite having agreed at the
outset to comply with our product
policies, their app remains in
infringement today.”
Google is yet to remove Unlockd or
its partners, although this is believed to
be imminent.
Moral stand, PR stunt
or taking complaints
out of the public
domain, closing its
social media profiles
is a brave strategy,
writes Sophie Christie
I
n 2018, it is unusual to find a
business without a social media
presence, and JD Wetherspoon’s
decision yesterday to delete its
social media profiles goes, as
chairman Tim Martin suggested,
“against conventional wisdom that
these platforms are a vital component
of a successful business”.
The outspoken pub boss, however,
said he did not believe that closing
down the Twitter and Facebook
accounts, which had 44,000 and
100,000 followers respectively,
would have any affect on the
business “whatsoever”.
He added that recent concerns
regarding the misuse of personal data
following the Facebook scandal and
the addictive nature of social media
had influenced its decision, citing the
“current bad publicity surrounding
social media, including the trolling of
MPs and others” as one of the reasons
behind the move.
Companies use social media for a
variety of reasons: advertising,
customer engagement, brand
awareness and loyalty. It can prove to
be a cost-effective marketing tool, as it
allows them to better understand who
their customers are through the use of
social listening tools.
Leanne Forshaw Jones, a
communications consultant, believes
social media has evolved into an
integral part of any business’s
communications strategy, and that
Wetherspoon, operating within the
business-to-customer sphere, will
struggle without a social media
presence. “Customers want to engage
with brands online, be that to express
discontent in a public forum, or to
reach out with queries,” she says. “It’s
an expectation of most consumers that
they’ll be able to engage with brands
that way.
“And when brands aren’t there to
respond it can dent their reputation.
Whether you’re on social or not, your
customers are. And your customers
can exercise their right to have a
conversation about you whether
you’re listening in or not.”
With Twitter now used largely as a
customer service channel for brands,
some observers suspect that
Wetherspoon’s decision has more to
do with taking complaints out of the
public domain.
Simon Heyes, of marketing agency
8 Million Stories, says that the chain is
“taking back control of the
communication they have with their
audience and customers, through their
newsletter, website and mobile app”.
“This closes down the two-way
conversation, and instead allows them
to push content out to their audience
and customers, without repercussions
that can be viewed in public,” he says.
Many argue that Instagram and
Facebook offer more attractive
opportunities for companies, thanks to
advertising deals that can be more
cost-effective than traditional methods
such as television and newspaper
advertising. Together, the two social
media platforms have almost three
billion users, so the potential reach for
a business is huge.
Brands can monitor the success of
their social media posts by analysing
metrics such as the number of clicks
through to their website, how many
new customers a post has reached, or
how many products are sold.
Matt Phillips, a communications
consultant and founder of PPR
Consulting, doesn’t believe that social
media is essential for established
brands that already have a loyal
customer base. “If marketing is about
raising awareness of your brand, or
GARETH FULLER/PA
JD Wetherspoon’s
move is one way to
take back control
of communication
Customers enjoy jD Wetherspoon’s Royal Victoria Pavilion in Ramsgate, Kent. While they may check their social media during their visit, the bar chain will not be doing likewise
trying to encourage a direct sale at the
point of purchase, what value does
Wetherspoon get from being on social
media?” he asks.
“Most people know Wetherspoon,
so I expect it’s gained relatively little
value from Facebook compared to
mainstream media like TV,
newspapers or billboards – proven
channels with trusted audiences
that are, pound for pound, more
effective than social media in reaching
a large audience.”
Marie Page, co-founder of digital
marketing consultancy The Digerati,
says that for large companies like
Wetherspoon, social media is “a
massive time suck”. She says:
“Managing those channels on that
scale takes a battalion of skilled staff,
24/7 attention with the majority of the
time spent firefighting complaints
corporately that relate to a local
outlet.”
It should be noted that this is not
the first time Wetherspoon has
shunned digital marketing. Last year it
deleted its entire database of customer
Wetherspoons calls time on social media
while Tesla exits Facebook
emails after suffering a data breach in
2015. It reportedly had some 656,000
customer details at the time of the
breach. It told customers last year that
it would no longer use emails to
promote itself, dubbing the approach
“intrusive”, and said it would post
offers on its website instead.
There is also another suspicion: that
Martin, a man unafraid to court
publicity, thinks his contrarian stance
will generate a handful of positive
headlines. A vocal anti-EU campaigner,
he has in the past printed beer mats
promoting a pro-Brexit agenda, and
uses his company’s quarterly updates
and blog to berate business groups,
rival executives and journalists he
doesn’t agree with.
Wetherspoon is not the only
company to remove itself from a social
media platform. As part of a call to
#DeleteFacebook after the Cambridge
Analytica scandal, Playboy deactivated
its account on the social network,
which had amassed around 25 million
likes. Elon Musk also removed
Facebook pages for Tesla and SpaceX.
PR agency Wildfire notes that every
month 100,000 people search “how to
delete Facebook”, while 330,000
people are expected to leave Twitter
each month. Separate data from the
Pew Research Centre show that social
media user growth is plateauing
across the biggest platforms in the
US – Facebook, Twitter, LinkedIn
and Pinterest – with Instagram the
only network registering user growth
last year.
Nick Lee, professor of marketing at
Warwick Business School, points out
that companies were productive for a
long time before social media, and
many are very successful without it
even now. While it can be a vital part
of a growing business, it is by no
means essential. “Poor use of social
media is probably worse than none,”
he says.
Alibaba-backed Prenetics in $10m swoop for London-based specialist in home DNA tests
A LONDON-BASED company has
cashed in on the boom in DNA-testing
kits by selling itself to a Hong Kong
firm backed by Alibaba.
Prenetics, which the Chinese internet retail behemoth invested in last
year, has paid $10m (£7m) to acquire
DNAFit, a five-year-old company that
sells tests designed to determine a
person’s suitability to different diets
and exercise regimes. The company
sells the tests online and through
employee benefits schemes for up to
£249, and has sold tens of thousands of
the kits.
Avi Lasarow, DNAFit’s chief executive, owns just under half of the
company and will lead Prenetics’ international operations after the deal.
Demand for at-home DNA testing
kits has boomed in recent years and
is expected to become a $50bn market
by
2026.
Companies
including
23andMe have seen sales boom, backed
by hundreds of millions in venture
capital funding.
Mr Lasarow said he had previously
turned down offers for outside funding
or acquisitions, having relied entirely
on early investments from friends and
family, but that Prenetics, which has
become the market leader in southeast Asia, was the “right partner” for
the company. He insisted the current
swell in sales of testing kits did not represent a bubble.
“The bubble is not going to burst; it’s
not the dotcom, it’s precision medicine. This market is just beginning,” he
said. Mr Lasarow predicts that sales of
his kits, currently in 22 countries, will
hit up to £15m this year worldwide,
from around £2m over the last year.
“The likes of Fitbit have educated
the market; because of that aggressive
marketing it’s now encouraging
consumers to think: ‘What’s the next
thing?’” DNA testing kits have been
under scrutiny for questionable
results and fears over the security of
their data, but Mr Lasarow said
DNAFit had been backed up by clinical
studies into exercise guided by the
results of its tests.
“We never oversell the science. We
don’t believe genetics is everything,”
he said. The firm also says it adheres to
a strict ethical code of practice. Prenet-
ics raised $40m last year in a funding
round led by the Alibaba Hong Kong
Entrepreneurs Fund, an arm of the
Chinese shopping giant focused on
investments in the City. It says it has
already sold genetic tests to hundreds
of thousands of people.
Its chief executive, Danny Yeung,
said: “DNAFit is a pioneer in direct
to consumer genetic testing and
has developed a strong reputation in
the industry.”
Netflix shares pop
as it hits 125 million
global subscribers
Brexit has made no
difference, say US
investors in the UK
By Hannah Boland
Continued from Page 1
an investment from abroad as a stepping stone to entering a market.
Just over half of investors surveyed
said the Brexit vote had not dampened
their enthusiasm for investing in the
UK. While 45pc said it had made an
investment less likely, 46pc said it had
not made a difference and 9pc said it
had made them more likely to invest.
They cited skills as the biggest
reason to invest, along with proven
science, a common language and lower
valuations. While the majority of the
£2.8bn invested since 2011 has been in
software companies, life sciences startups have also raised £472m from
Silicon Valley in the last seven years.
“Over recent years we have noticed
an increase in the levels of US interest
and investment in the UK, which has a
particularly strong footprint in finance,
retail and the creative industries,” said
Penningtons Manches’ James Klein.
The biggest single West Coast
investor was 500 Startups, an earlystage Silicon Valley fund. “Great companies come from everywhere so it’s
important to get out of the Valley,” the
company’s Matt Lerner said.
The report said that 79pc of all US investment into UK tech companies went
into those based in the so-called
“Golden Triangle”, the cluster formed
by London, Oxford and Cambridge.
NETFLIX’S share price surge showed
no sign of letting up last night, after it
revealed a further seven million people
had signed up to its streaming service
in the first three months of 2018, breezing past already lofty expectations.
Netflix has seen its share price rocket
in the year-to-date, up more than 60pc
at the close of play yesterday, prompting some concern that it could be in for
a heavy fall should the results disappoint.
However, Netflix ticked up more
than 8pc after the close yesterday, taking its value above $140bn (£97bn) in
after-hours trading, as it said more people continued to sign up to its service.
It now has 125 million subscribers
globally, despite it having hiked prices
for most of its customers late last year.
The bulk of the subscriber growth in
the three months to the end of March
came from its international segment,
where it added 5.46 million subscribers, compared to a market forecast of
4.9 million.
In the US, it signed up 1.96 million
more people in the three month period, ahead of the 1.45 million forecast.
This, combined with the 14pc rise in
average selling price of its memberships, pushed its revenue up 40pc year
on year, to $3.7bn.
DAVID RYDER/BLOOMBERG
By Margi Murphy
Game faces Fans watch the final between Tox and Splyce at the Halo
World Championship in Seattle on Sunday. E-sports revenue is expected
to rise at a 32pc average annual rate in 2016-20 to $1.5bn (£1.1bn) in 2020.
The Daily Telegraph Tuesday 17 April 2018
***
Business
By Anna Isaac
US PRESIDENT Donald Trump took a
swing at the Russian and Chinese regimes on Twitter yesterday, in his latest statement on rising trade tensions.
Mr Trump said that there was a deliberate attempt by these countries to
devalue their currencies at a time of
rising interest rates in America, suggesting the nations were deliberately
attempting to derail the US economy.
This follows the sharp devaluation of
the Russian rouble in the wake of the
announcement of swingeing US
sanctions. Mr Trump said: “Russia and
China are playing the Currency
Devaluation game as the US keeps
raising interest rates. Not acceptable!”
The deputy Russian finance minister
claimed yesterday that the country and
its G20 and Brics allies were discussing
the dominance of the US dollar as a
reserve currency, according to Russian
state news agency RIA.
It is unlikely that there has been a
deliberate effort by these countries to
devalue their own currencies in response to US foreign policy. A range of
factors, including the global dominance of the dollar, rising US interest
rates and planned tariffs against China
and sanctions against Russia, have
combined to result in devaluations.
Ben May of Oxford Economics said:
“Economic theory would suggest that if
you raise your interest rates that it is
likely to lead to a stronger currency. But
to a certain degree you can’t explain
currency movements with one side of
an argument. More often than not it’s
going to be a combination of events.”
Mounting political tensions will
have made safe haven currencies more
attractive, but Mr May said, “Russia is
clearly not a safe haven in this context.”
Mr Trump’s social media post may
also be a thinly veiled critique of
Jerome Powell, the head of the Federal
Reserve and top interest rate-setter,
who said that the US government was
not on a “sustainable fiscal path”.
The tweet also comes after Japan
lent its support to free trade, following
Trade with EU
drives services
sector exports
By Anna Isaac
UK SERVICES firms have
reaped the rewards of the
widespread global economic
upturn, a close examination
of the country’s international trading has revealed.
Overall,
UK
exports
increased from £39.3bn to
£43.3bn, a growth rate of
10.1pc, in the final three
months of 2017, according
to the Office for National
Statistics.
The EU drove the bulk of
the £3.9bn increase in UK
exports. Exports to the bloc
grew by 8.7pc and made up
3.3 percentage points of the
10.1pc total growth.
For the whole of 2017,
UK services exports are
estimated to have been
worth £158bn, excluding
areas such as banking and
travel, compared to £78bn of
imports.
On a country-by-country
basis, the US remains the
single largest export market
for UK services firms.
Ireland replaced Germany in
second place, as it fell to
fourth. The Netherlands
came in third. Ireland alone
accounted for £3.4bn worth
of services exports in the final three months of last year,
compared to £9bn to the US.
The EU accounted not
only for the largest share of
exports with the UK, but also
for trade in UK imports. The
bloc accounted for 40.3pc of
the UK exporting activity
and 41.8pc of UK imports in
the last three months of 2017.
North America, including
the US, generated around
half as much trade in
services as the EU, with
21.8pc of UK exports and
23.8pc of its imports.
While the EU dominated
the growth in exports, the
biggest growth in imports to
the UK came from Asia.
£43.3bn
UK services sector exports in
the final quarter of 2017, up
10.1pc from £39.3bn
Mike Bell, of JP Morgan,
said the data “highlights and
emphasises the importance
of getting a comprehensive
deal in services [with the EU
post Brexit]. That’s going to
be a challenge given some of
the Government’s red lines”.
David Henig, a former
senior UK trade official and
UK director of the European
Centre for International Political Economy, said the figures showed the importance
of protecting the UK’s
surplus in trade in services. Firms ‘should engage
with untapped talent’
By Rhiannon Curry
COMPANIES should do
more to employ marginalised young adults if they
want to arrest the looming
labour shortage, a new
coalition of major businesses
will say today.
Fears that an exodus of
foreign workers will hit the
construction,
agriculture
and retail industries could
be dealt with by targeting
the nearly 500,000 people
aged 16-24 not currently in
education, employment or
training, the group says.
A new guide launched by
the coalition, which includes
companies such as Marks &
Spencer, BAE Systems and
Berkeley Group, aims to encourage companies to bring
people into full-time work
through specialist schemes
and apprenticeships. The
guide outlines how employers can target people who
might face barriers to work.
Of the half a million young
adults not in work, 40pc live
in a household where no one
is in work, the report found.
Rob Perrins, CEO of the
Berkeley Group and chairman of the Berkeley Foundation, the housebuilder’s
charitable arm, said: “People
ask us, why recruit someone
who might not be an easy fit?
“The answer is, these
young adults bring a whole
new dimension to our
business and we need
different kinds of talent, not
just more of the same.”
Peter Cheese, CEO of the
Chartered
Institute
of
Personnel
Development,
said traditional talent pools
had been “over-fished”.
Rented homes to create
pensioner funding gap
By Anna Isaac
AGEING millennial renters
will present the government
with a major fiscal challenge
in future years, the Resolution Foundation has warned.
Half of millennials will
still be renting in their
forties and a third could still
be renting by the time they
claim their pensions, the
think tank has claimed in a
new report on housing.
Renters
relying
on
pensions to fund their
ongoing
housing
costs,
rather than living in unmortgaged homes, could prove a
major burden for the
government, leading the
amount spent on pensioner
housing benefit to more than
double, reaching as much as
£16bn by 2060.
Projections revealing a
perfect storm of an ageing
population and a higher
proportion of older people
in rented accommodation illustrated how policymakers
must tackle the housing crisis or face footing a massive
future bill, the report said.
highly unusual meetings between Taro
Kono, Japan’s foreign minister, and
Wang Yi, the Chinese government’s
top diplomat.
The meetings, set up to discuss economic interests, were the first of their
kind for seven years and have been
held less than a week before talks between Prime Minister Shinzo Abe and
President Trump later this week.
Mr Kono said: “We have shared understanding that a trade war… would
have a very large impact on the prosperity of the international economy.”
Japan’s backing of China’s bid to
raise support for free trade and the supremacy of the World Trade Organisation in settling disputes, comes amid
rising concerns about the US pressure
for a bilateral Japan-US trade deal.
Mr Trump has raised the possibility
of rejoining the Trans Pacific Partnership, having pulled out of the planned
Asia-Pacific trade pact just last year.
Some believe that the move was an
attempt at turning the screw on Tokyo
ahead of talks this week.
BLOOMBERG
Trump accuses China and
Russia of deliberately
devaluing their currencies
Tunnel vision Visitors at the Hanwha Aqua Planet Jeju in South Korea. Jeju is one of more
than a dozen Asian destinations trying to cash in on China’s appetite for gambling, after the
boom in Macau that turned a Portuguese backwater into the world’s biggest gaming strip.
5
6
***
Tuesday 17 April 2018 The Daily Telegraph
The Daily Telegraph Tuesday 17 April 2018
***
7
8
Tuesday 17 April 2018 The Daily Telegraph
***
Business
Saga may be sailing into
calmer waters after a terrible
year, so the shares are a hold
Questor
Stock Picks
The company is
starting to prove that
it is more than an
embattled insurance
business, while
falling debt is further
good news, says
Russ Mould
FACED by the shares’ shocking
burdening near-term profits and cash
performance since last April, this
flow, to the extent that the chief
column is still kicking itself for not
executive, Lance Batchelor, still
paying more attention to the
expects earnings to fall by 5pc this
competitive threats that face
year after last year’s disappointing
Saga’s insurance business.
flat performance.
Saga
But last week’s full-year
The good news is that
results at least offered
this forecast is no worse
Hold
some reassurance on the
than December’s warning.
group’s financial
Better still, strong travel
performance and strategy,
bookings suggest that the
The stock now
yields 7.2pc and the
so patient investors may
company is starting to
dividend looks
be willing to stick with the
prove the merits of its
affordable
FTSE 250 firm, especially
strategy, and that it is
as debt is falling and the
indeed much more than an
yield looks plump.
insurance business with a few
Last year’s results were not pretty,
ancillary strands tacked on to the end.
scarred as they were by costs
Best of all, healthy cash flow enabled
associated with helping customers
the management to sanction a 6pc rise
who had been stranded by the
in the dividend to 9p. This looks
collapse of the Monarch airline,
affordable, assuming no material
and the challenge posed by price change in trading. There could still be
comparison websites to the
twists in the tale but reassurance on
insurance broking business.
the dividend and the 7.2pc prospective
In addition, the company
yield should help to support the shares.
continues to invest in IT and
Questor says: hold
two new cruise ships,
Ticker: SAGA
costs that are
Share price at close: 125.2p
with buying costs). Operating profit of
£76m plus the £11m non-cash items of
depreciation and amortisation come
to £87m. Take off £17m for tax, £11m
for capital investment and £3m for
interest and that leaves £56m.
The ordinary dividend costs
around £32m so that leaves £24m,
enough for a 7p special (with 341
million shares in issue).
Even paying 5p, to leave some
margin for error and to remove any
need to add debt to fund a special
distribution, would take the total
dividend to 14.3p, enough for a 6pc
yield on the current share price.
That yield, while tempting, does
also remind investors that risks still
lurk, in the form of weak consumer
confidence, the possible impact of any
fresh weakness in the pound and
concerns over whether cards will
simply be replaced by other forms of
(electronic) communication.
Earnings are likely to be flat this
year, after all, although record footfall
in 2018 may ease investors’ worries
about any long-term, structural drops
in demand.
Dangers still abound but a price-toearnings ratio of barely 10 and the fat
yield go some way to reflecting the
risks that patient income seekers are
taking on.
Questor says: hold
Ticker: CARD
Share price at close: 245.8p
Key
numbers
 Market value:
£1.4bn
 Turnover (Jan
2019 estimate):
£981m
 Pre-tax profits
(Jan 2019 est):
£182m
 Yield (Jan
2019 est): 7.2
 Most recent
year’s dividend:
9p
 Net debt (Jan
2018): £220m
 Return on
capital (Jan
2018): 15.8pc
 Cash
conversion ratio
(Jan 2018): 29pc
 p/e ratio (Jan
2019 est): 9.6
Update: Card Factory
Rather like Saga, greetings card and
gift wrap maker Card Factory is
having to redeem itself after a
trading alert and, rather as with
Saga, last week’s full-year figures
offered grounds for optimism
especially as – again, just like Saga –
the firm provided reassurance on
its dividend.
Profits lived down to low
expectations, sliding by 11pc even as
revenues rose by 6pc, mainly thanks
to higher costs from the minimum
wage and the pound’s slide, which
inflated purchasing bills.
But that was no worse than
expected and the chief executive,
Karen Hubbard, and her team nudged
the full-year regular dividend up to
9.3p from 9.1p.
That in itself represents a tidy
3.8pc yield. But the boss also hinted at
plans to pay another special dividend
in 2019.
While it will not reach the 15p a
share of the past three years, Card
Factory is targeting a 5p to 10p
payment. In this column’s view 5p
looks eminently affordable from free
cash flow, assuming no marked
deterioration in daily trading (and the
pound’s rally should now start to help
Russ Mould is investment director at
AJ Bell, the stockbroker
Read Questor’s rules of investment before
you follow our tips: telegraph.co.uk/go/
questorrules. twitter.com/DTquestor
Share prices www.telegraph.co.uk/shares
© 2018 Tradeweb Markets LLC. All rights reserved. The
Tradeweb FTSE Gilt Closing Prices information contained
herein is proprietary to Tradeweb; may not be copied or
re-distributed; is not warranted to be accurate, complete or
timely; and does not constitute investment advice. Tradeweb
is not responsible for any loss or damage that might result
from the use of this information.
52 week
High Low (p) Stock
Price (p) +/- Yld
P/E
-3 1.3 -27.3
1174
676 Oxford Inst
973
5820
3024 Renishaw ●
4840 +22 1.1 34.3
3750
2375 XP Power
3600 -100 2.2 24.3
Electricity -1.20%
368¾
52 week
High Low (p) Stock
Insurance -0.91%
2184
181
— 3.7 18.4
385¼
245⅝ Grainger ●
295
651
+3 3.5
291⅝
188⅞ Intu Props ●
207⅞ -11¾ 6.7
—
411¼
337⅝ DirectLineIns
357* -3⅛ 9.9 11.2
397⅜
289 JPM Gbl Gth & Inc
304
-2 4.0
296
1358
1025 Euromoney ●
1268 -26 2.4 33.4
52338 430⅜ Hammerson ●
487¼* +14¼ 5.2
—
143
120¼ JPM GEMI
124* -1½ 4.0
129
773
631 Informa
723¼ +3⅜ 2.8 19.1
386½
285 Helical
+1 4.6
98
220⅛
141 ITV
143⅞* -⅜ 5.4 14.1
608¼
483⅝ H K Land
494¾* -¾ 2.8
-⅜ 2.2 15.3
773½
542½ Lancashire Hldg ●
589½
279⅞
244¼ Legal & General
268
124.43 -0.19 4.02 1.28
1043
728½ Bodycote ●
917½ +12 1.9 18.0
259⅝
153.80 142.35 Treas 6% 28
143.68 -0.31 4.18 1.53
490
401 Castings
432½ +10½ 3.2 14.5
820
139.53 123.29 Treas 4¼% 32
131.97 -0.37 3.22 1.70
90
363.52 133.71 Treas 4¼% 36
137.81 -0.46 3.08 1.77
1975
157.52 146.14 Treas 4¾% 38
150.76 -0.55 3.15 1.80
775¾
563 Pearson
763*
1217
900¼ Land Secs
948⅛ -6⅞ 4.5
—
1784
1399 RELX
1510 -3½ 2.6 18.4
34½
29¾ Local Shopp REIT
31¼
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42
370⅜
290 BBA Aviation ●
306*
185½ Old Mutual
233⅜* -1⅝ 3.0 12.1
469
310½ JPM Japan Sm Cos
424
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4595
3873 Rightmove ●
4393 +5 1.3 28.0
189⅛
162¼ LondonMetric ●
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2454 Clarkson ●
719 Phoenix ●
773½* -3½ 6.5 -22.6
1225
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1180* -10 1.9 1244
1378
11⅜ Sky
1303* -1½ 1.0 32.1
289
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270
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471 Mucklow A J
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296 Jup UK Gwth IT
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1279½ 1051 St James Place
1072½* -10 4.0 38.6
349⅜ StndrdLifeAber
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1453
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5192⅛ 4291¾ Jardine Mthsn
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91
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975
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2145
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52 week
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310
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950⅛ Anglo Amer
1071
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NAV
1845
1633¾ Keystone Inv Tr
1695 +20 3.5 1921
886¼ -10⅜ 1.8
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549⅞ Law Debenture
576*
272⅜
201½ 3i Infrastructure ● 208¾ +¾ 4.8
209
1590
1430 Lowland Inv
1475* -30 3.4 1593
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125
113½ Aberdeen Diversified 120½
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123
311
270 Majedie
284
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547
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565
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495⅛* -6¾ 3.1 22.4
774
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T-Bonds
3254
1712¾ Smurfit Kappa
3072* +90 2.5 20.1
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6155
5020 Spirax ●
5720 -20 1.5 26.7
927
744½ Bankers Inv ●
836
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Germany
0.46
–
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1320
830 Vitec
1190 +10 2.6 19.4
883½
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666
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2326
1696 Weir ●
2060 -21 2.1
83
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73½*
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1.46
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Food producers -0.78%
393
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2.84
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+2 3.0
643
7.7
Mining -1.71%
315
Price (p) +/- Yld
Yield%
1659⅝* -28⅜ 4.3
9.6
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97⅝
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-8 2.2 22.8
516
393½ BlkRk Throg Tst
504
-2 1.8
561
2777
734⅞ Dignity
929
-6½ 2.6
8.0
217⅝
533½ BAE Systems
598¾ +4¾ 3.6 22.3
375
290 REA Hldgs
295
-5
-8.8
425
307⅛ BlackRock Wld M
366* -5½ 4.3
418
349⅝
145¾ Dixons Carph ●
198¼ -1⅜ 5.7
7.8
132¼
217
162 Chemring
208½* -2 1.4 86.9
796½
522⅝ Tate & Lyle ●
553⅝
-4 5.1 10.0
226
202½ Highbridge MultiStrt 222½ +½
222
760
503 Dunelm ●
558½* +1½ 4.7 13.0
150¼
111⅛ Cobham ●
116¼
150 Findel
322⅞
190¼ Qinetiq ●
223¾ +1½ 2.7 10.4
994½
795½ Rolls-Royce
877¾ +11 1.3
310⅜
205¾ Senior ●
294⅝ +⅝ 2.4 20.5
755
659⅜ British Empire Trust ● 687
-6 1.7
768
251
796
679½ Brunner
+6 2.2
814
1400¼ 1041 Greggs ●
251
+5
—
-3.8
124⅜ Stagecoach ●
86 Thomas Cook ●
1687⅞ 934⅜ TUI AG
1346⅛
953 Wetherspoon ●
3499⅞ Whitbread
1271 +7 2.5 22.5
4333
AIM -0.88%
380½
305⅜ Halfords ●
363¾ +9⅝ 4.9 12.7
—
154
596¾
282 Howden Joinery ●
468¾
7.4
1020
682½
15.5
153¾
-⅜ 7.7 28.0
120⅝
— 0.5
—
83⅛
71⅝ Akzo Nobel €
78⅝
-⅛ 3.2
1.3
1564½ -8 3.6 16.5
97½
77⅛ BMW €
90⅝
-⅝ 4.4
2.6
1162 +10 1.0 22.6
23⅝
15½ Carrefour €
16
+⅛ 2.9
1.4
4218 +283 2.3 18.2
257⅜
186½ Continental AG €
222¼ -2¾ 2.0
3.3
-¼ 2.4 15.7
76½
59 Daimler €
65¼
-⅜ 5.6
2.7
72⅛
61⅞ Danone €
65¼
… 2.9
1.8
947¼
577⅜ Pennon Gp ●
643¼ -8⅜ 5.6 16.2
201
176¾ City Merchants HY
191
+3 5.2
191
369¾
285¼ Kingfisher
302 +1¾ 3.6 13.7
1600
1225 Arbuthnot
— 2.2 33.6
41⅜
30½ Deutsche Post €
36½
… 3.2
1.9
2575
1664 Severn Trent
1855½ -8 4.5 12.7
130⅝
106 City Nat Res H Yld
112
-1¼ 5.0
135
131½
78½ Lookers
90¼
-¾ 4.3
2580
1790 BrooksMacdonald 1887½* +20 2.3 43.9
18⅛
12¾ Deutsche Tele €
13⅞
-⅛ 4.7
0.9
1078
648⅝ Utd Utilities
702⅜ -10 5.6 11.0
444⅝
392 City of Lon ●
413½
-3 4.3
406
397¾
262 Marks & Spen
276⅜ +4⅝ 6.8 38.4
1¼
⅞
-½ 1.7
2.3
498
330¼ Dunedin Ent
376
+2 5.1
439
254⅜
203¼ Morrison (WM)
231¾ +¾ 2.6 17.4
345½
2⅝ Central Asia Met
314½ -11½ 5.2 15.5
786
608 Edinburgh Inv Tr ●
655
-6 4.0
724
137⅛
16
8⅛ Ceres Power
12¼
-¼
541½ Edin Worldwide
762
+2
—
740
5355
3565 Next
5064 +50 4.9 12.2
1270
780 Churchill China
925
-25 2.7 15.8
833
+8
— 1114
603¼
235¾ Ocado ●
510
-7¾ —
—
460
3¼ Cohort
342½
— 2.2 37.7
303
+6 1.7
28
… 5.5
7.6
General financial -0.48%
Banks -0.75%
447¼
318⅞ Ashmore ●
396
+5 4.2 15.8
820
225½
177¼ Barclays
213¾ +½ 3.0 -20.8
399⅜
319⅜ Brewin D ●
353¾
-⅜ 4.2 21.4
2793½ 821¾ ElectraPrivEq
1715
1315 Close Bros ●
1468* -21 4.2 11.4
433
308 Charles Stanley
343
-15 2.0 27.8
331
286 EP Global Opp
798⅝
618 HSBC
671⅞ -13¼ 5.3 20.1
68
68 El Oro
67
— 3.6
1360
1175 European Assets
73⅝
61¾ Lloyds Bk Gp
67⅝
974
825 The Europ InvTr
880
-½ 4.5 15.4
4468
190⅜
2852 +12 1.6 21.3
450¼* -1⅜ 2.1 15.4
4427 Carnival
+⅜ 3.5
2468 -25 1.9 24.5
GKN
158½ +1¾ 3.8
+⅜ 2.3
2077 Coca-Cola HBC
3
139⅛ IBM $
53⅝
3497¾ 2524 Cranswick ●
463¼
2.7
171¾
52¼
2711
1407* +4 3.5 21.3
+⅛ 2.6
7.2
33¼ Intel $
Aerospace & defence +0.82%
Automobiles & parts -0.31%
0.7
21⅞
246½ +18½ 3.8
49⅞ Intl Paper $
333
2218⅝ 1138 Ultra ●
147½ +1⅜ 2.0
17⅛ HP $
185¼ Wincanton
Travel & Leisure +0.50%
151⅜
1127 Murray Intl ●
—
122⅜ Honeywell $
24¾
309
318¾
1314
2675 -20 2.1 3252
165⅛
—
—
8.0
-2¾ 4.2 20.3
-1 1.2 35.7
78
116½
1.4
1.8
558
199
+⅛ 5.4
111⅞ Candover
-⅛ 3.6
174½ +1⅝ 2.4
365 +1⅝ 4.8
367¾ Royal Mail
342⅝ -3⅛ 4.1 12.0
826½
2488 Caledonia ●
13⅜
144¼ Home Depot $
300 Northgate
575
270 Glencore
825
144
12¾ Gen Electric $
207⅝
543½
186⅛ Hochschild Mng ●
728
3020
30½
—
7.1
416⅞
837
-¼ 8.5 23.4
1.6
67
201
140½
-1¾ 3.2
53¾
— 3.4
119¾ Centrica
43½
1623½ +12½ 2.5 21.0
+6 1.7
218
28⅜ Foot Locker $
1449½ -10½ 2.3 20.3
320
-3.8
77⅞
337⅝
450 Merchants Tst
746
—
1600* +26 1.8 20.0
1698⅝ 1050⅜ easyJet
185 BlckRck Inc&Grth Inv 197
3908½ -21 3.2 21.0
—
1765⅞ 1396½ Compass
288 BlckRck Grt Euro
Gas & Water -0.67%
…
514
214
4557½ 3678½ Unilever
23⅜
397¾ -1⅝ 1.6 14.8
346
33.2
9⅝ Fiat Chrysler $
383¾ Safestore ●
143 +5¾ 2.9 18.6
—
25
330⅞ St Modwen ●
2583 -37 1.6 17.0
-1
1.5
3100 +20 2.4 29.7
513
1855⅝ Mercantile InvTr ● 2085* — 2.5 2317
514
—
0.6
+⅞ 3.9
528½
118 Carr’s Grp
—
+½ 2.3
78¾
429⅜
2386 Ass Brit Fds
479¾ Dairy Crest ●
66¾
72⅛ Exxon Mobil $
-9 3.8 17.5
933
154
654
61¼ DowDuPont $
1435 -22¾ 5.0 18.6
3387
P/E
—
77⅛
89¼
-6 3.1 37.8
1662⅜ 1103 BHP Billiton
The share prices, price-earnings ratios and dividend yields
below are supplied by Interactive Data (Europe) Ltd. The
yields are calculated using historic dividend payments divided
by the closing share price multiplied by 100.
Price (p) +/- Yld
Transport -0.37%
454 -11½ 4.6
88 JPM Mlti-Ass
438½ JPM Russian
Index Linked Securities
52 week
High Low (p) Stock
2.5
464
448⅝
2.8
1.4
… 1.9
792
609
75¾
+⅝ 2.3
120⅞
—
1860 +40 2.3 22.0
59 Severfield
72¼
83¼ Dr Pepper $
-8
279 Fenner ●
1354 Smiths Gp
67⅞ Colgate Palm $
126⅝
-2 1.1
1510 Goodwin
1697
77⅞
691
624½
88
2440 -23 7.0 16.5
435
561¾
1.1
3956½ 2301 Imp Brands
332 JPM Japanese ●
103½
+⅜ 3.1
36⅛ Coca-Cola Euro $
644 JPM Indian ●
646⅝* -7¼ 3.0 24.6
1.1
41⅝
44¾
462
1817½* -29 2.6 19.5
121⅛ +1¼ 3.7
2.2
786
—
102½ Chevron $
4043* -76 4.8
8.4
—
93 Caterpillar $
133⅞
5643⅝ 3775 Brit Am Tob
-½ 1.9 -23.5
3.0
-¼ 6.4 -10.6
173¼
-3⅛ 5.7
568½ RSA
—
351 +7½ 2.5 10.3
9.3
Tobaccos -1.66%
94 JPM GL Conv
1992½ 1612⅛ Prudential
672½
-1¾ 1.6 16.4
102¾
2128
10-year Government Bonds
371⅝
150 Bloomsbury
132.85 124.02 Treas 5% 25
1684 Mondi
206⅝
500 Daily Mail ‘A’
121.73 -0.08 6.57 0.96
-9.1
190⅛ Vodafone
769
132.43 123.14 Treas 8% 21
0.4
239⅝
192
97¼
152¾ +2½ 2.0
—
171
—
2.0
690* -9¾ 17.5
660 Gt Portland Est ●
329
1505 +21 1.9
330¾ +1½ 2.1
857⅛
+2 2.3
1246* +16 2.7 22.2
3.4
175½ Boeing $
33
157 +1¾ 3.7
1078 Jardine Lloyd ●
-¼ 1.6
1100 +4 4.5
299
1120 Hiscox ●
29½
1035 Telecom Plus ●
146⅝ JPM Eur Inc
1537
2.1
22⅛ BankAmerica $
1342
281¼ JPM Eur Gwth
1468
+½ 1.5
—
178
6.7
P/E
93½
3135 -37 4.3
339
8.2
— 5.7
P/E
Price (p) +/- Yld
3191⅛ 2574 Derwent Ldn ●
251⅞ Capital&Count ●
589½ +4 1.9 30.2
3.6
4291¾* -41 2.6
Price (p) +/- Yld
52 week
High Low (p) Stock
75½ Amer Express $
943
437
P/E
102⅜
-13 1.3
-7 1.2
Price (p) +/- Yld
117¼ -4¼ 3.4 19.2
832
395
52 week
High Low (p) Stock
88⅝ TalkTalk ●
740½ JPM Emerg Mkt ●
334 JPM Eur Sm Cos
P/E
220
935
448
Price (p) +/- Yld
280 +8⅛ 0.5-2800.0
Media -1.18%
1900 -14½ 6.0 16.2
815¾ -10⅝ 5.5
+½ 0.7 34.6
52 week
High Low (p) Stock
326⅛
1766 Admiral
1295½ -15½ 7.1
+1 1.3 19.6
P/E
102
505⅝* -2⅝ 5.4 14.4
1174⅜
79
Price (p) +/- Yld
— 0.3
482¼ Aviva
1554
1437½ — 0.8 28.5
52 week
High Low (p) Stock
100½
429¾ Beazley ●
Flat Rdm
Price (£) +/- Yield Yield
59 Coats Group ●
NAV
98 JPM ElecManCsh
550
52 week
High Low (£) Stock
Engineering / Industrial -0.38%
Price (p) +/- Yld
103
52 week
High Low (p) Stock
-8.2
733 Nat Grid
52 week
High Low (p) Stock
592
Government securities
1350 Cropper J
P/E
303¼ +1⅝ 4.1
218 Drax Group ●
1176½ SSE
Price (p) +/- Yld
1935
1258 Hargreaves L
84
1713 +2 1.8 38.3
322
13 Mothercare
19⅛
+⅛
—
7.5
4.0
878½
Cambria Africa
484¾ Dart Group
1475
1
…
—
0
— -12.2
868½ +2½ 0.6 16.8
39¼
20 Pendragon
1215* — 6.4 1194
213⅞
108 Saga ●
125¼ +¼ 7.2 10.2
4¼
1
-12 2.6
994
339⅞
222⅜ Sainsbury J
254¼ -1¾ 3.8 14.5
56½
40 Elecosoft
54¼*
121½* +2 2.6 17.1
Deltex Medical
1⅜
—
—
-1.5
— 1.1 21.7
91⅜
79⅝ Heineken €
88⅝
282⅞
203¼ LVMH €
282¾ +⅞ 1.8
2.0
60
50⅜ LafargeHolcim SFr
53⅛
-⅛ 3.8
2.7
31¼
15 Lufthansa €
26⅞
+⅜ 3.0
4.8
6
3¾ Nokia OYJ €
4½
… 4.2
1.7
2.6
130⅞
110⅛ Michelin €
118½ -1⅛ 3.0
141⅛
111⅝ Pernod Ricard €
140⅜ +⅝ 1.4
2.3
21
16½ Peugeot €
20¼
-⅛ 2.6
4.1
1.9
304¼
221¾ Ryl Bk Scot
262⅞ -1⅞ —
41.7
868½
511 IG Group ●
819
408¼
352 Fidelity Asian V
390
+3 1.3
396
2347
1635 Smith WH ●
1859 -28 2.7 17.8
122⅞
98¾ Finsbury Food
36⅛
29¼ Philips (Kon) €
31⅞
-¼ 2.5
541¾
387⅛ Santander
466½ +4¼ 3.3 13.6
1204
741½ Intermediate C ●
1050 -11 2.7 14.1
263
187⅞ Fidlty Chna Sp Sits ● 228
-4½ 1.1
258
424⅜
280¼ Sports Direct ●
370⅞ -2¼ —
9.4
62½
21⅝ Futura Medical
33¾
-⅜
— -10.4
133½
99¾ Siemens €
104¼
-⅝ 3.6
1.8
2500
1485¼ Secure Trust Bk
1872½ — 4.2 17.4
649⅜
451¼ Investec ●
556⅜ -8¼ 4.2 11.0
235
193⅞ Fidelity Euro V ●
205* -2½ 2.1
231
236⅞
165⅜ Tesco
233¾ +⅛ 1.3 15.8
15½
5½ Gaming Realms
7¾
—
—
52¼
41⅞ Societe Gen €
44⅜
+¼ 5.0
1.3
864¼
678¾ Standard Ch
727¼* -6¼ 1.1 44.3
158⅜
99¾ IP Group ●
133¾ +1
19.0
160
105 Fidelity Japan V
148
+¼
—
165
Support services -0.40%
336½
250¼ Virgin Money ●
263¾* +⅛ 2.3
620
425 Liontrust
562
+2 2.8 37.1
274
228 Fidelity Sp V
250
-1 1.8
262
42½
7.0
-1 4.0 17.7
—
— 2.6 12.1
778
688⅜ Finsbury Gwth ●
753*
-1 1.9
746
4371
3164 Lon Stock Ex
4216 -54 1.2 28.8
678
553¾ Foreign & Col ●
626*
-5 1.7
641
-5 3.8 16.5
219¼
143⅞ Man Group ●
185⅛ -2⅜ 4.3 17.1
338
299 F&C Cap & Inc
319
-3 3.4
317
High Low (p) Stock
2735½ 2186½ Diageo
2459 -33 2.6 23.2
1018
5⅝ NEX Group ●
991
+1 3.1
2.8
152¼
133⅞ F&C ComProp ●
143⅝* +1⅜ 4.2
140
268
320
252
47
Beverages -1.31%
839
657½ Britvic ●
155½ Stock Spirits
698½
-4 2.8 48.7
Chemicals -0.49%
41 Lon. Fin. & Inv.
52 week
52 week
1030
604 Babcock Intl ●
722¾ -5⅝ 3.9 11.7
-7 1.4 20.4
+¼ 12.6
17
10⅝ Suez Environ €
11⅞
-⅛ 5.5
1.1
139
-5¼ 7.5 13.7
101⅞
83¼ Thales €
101¾ +¼ 1.7
2.7
19 Hornby
24½
—
—
-1.9
49⅜
42¼ Total €
48⅝
… 5.3
1.2
70⅜
51 Inland Homes
65½
+1 2.8
8.4
19¾
15⅛ UBS AG SFr
16⅞
… 3.9
1.3
181½
51¼ IQE
122⅝ -4⅜ —
58.7
191¾
128 Volkswagen €
170⅜ -3⅛ 2.3
2.6
380 James Halstead
395
261
4226½ 2882½ Rio Tinto
3730 -55 5.7 10.9
230
145¼ BCA Marketplace ● 175¼ +1¼ 4.1 33.7
545
981¾
713⅝ -34 5.8 -124.7
2472
1918½ Bunzl
2099
⅞
721
127⅝ Capita ●
144¾ -1⅞ —
228¼
12½ Carillion #
14¼
1895 +10 — 2166
400¼ Paragon ●
486
-1¾ 3.2 11.3
211⅜
176 F&C Mgd G
197
—
—
194
1929
1720 Pantheon ●
75½ Park Group
79
-1¼ 3.7 14.7
146
127 F&C Mgd I
133
— 4.2
130
411⅝
329½ Perpetual Inc & Gr ● 349
686⅜ +1¾ — -10.3
366
307 F&C Priv Eq Ord
355*
+2 4.0
346
41680
38700 Personal Ass ●
-2½ 4.0
392
558½ Vedanta Res ●
Oil & Gas -0.97%
39250* -200 1.4 38859
-2 2.2 22.3
—
—
7.8
37
+3 1.0
556
2402⅞ 312⅛ Provident Fin ●
2053
183
130⅜ Highland Gold
High
92
P/E
739⅝ -6⅜ 3.7 17.8
1476 Ashtead Gp
172 Gattaca
181
NAV
252
Price (p) +/- Yld
638⅝ Aggreko ●
339
Price (p) +/- Yld
234 Pacific Assets
Low Stock
994½
2185
-3.1
½
Kellan Gp
¾
— 3.3 22.4
Recent issues
—
52 week
High Low (p) Stock
—
5.8
+9 1.7 11.0
26.1
183
126 LPA Gp
158
0.5
430
290 M&C Saatchi
387½ -2½ 2.5
—
+1½ 3.2 13.5
4691
3497 Croda
4630 -25 1.7 25.6
2842
2345 Rathbone Bros ●
2412
1420
1241 F&C Glob SmCo ●
1300
-5 1.0 1328
88⅞
81¼ Picton Prop Inc
88¾
+⅛ 3.9
88
536¼
437 BP
496⅜
-8 5.6
—
299
219⅝ Charles Taylor
270 +13 4.1 20.5
46¼
34¾ Miton Group
44*
3511
2681 Johnson Mat
3274 -29 2.3 16.3
2450
1870 S & U
2400 -10 4.4 11.8
108
94½ F&C UKHighIncTst
96*
— 5.1
105
173¾
109 PremierGlblInfra
119½ +1 8.4
138
237
164¼ Cairn Energy ●
219
+4
—
6.9
73
46¼ Communisis
63⅝
-1⅜ 4.2 11.3
222
75 Mpac Group
218½ +11½ —
2772
1826 Victrex ●
2644 +18 2.0 22.7
3784
3043 Schroders
3255* -10 3.5 15.1
109
99 F&C UKRealEstInv
106
+2 4.7
104
2010
1812 RIT Cap Ptnrs ●
1920* +26 1.7 1816
45¼
22½ EnQuest
31½
+½
—
-8.3
711½
461 De La Rue
494½
-3 5.1 12.6
220
153 MS Intl
185
— 4.5 20.3
560⅝
428½ TP ICAP ●
452¾* +¼ 3.7 28.7
305
265 Hend Alt Strat
270
— 1.8
326
242
218⅜ Ruffer Inv Pref
227
— 0.8
224
777
376½ Hunting ●
737½ -29 — -64.4
7762½ 6445 DCC
6695 +40 1.7 27.5
384½
230½ Numis
375
-1 3.2 13.7
97⅝
86⅜ Hend Div Inc Tst
92
+1¼ 4.8
88
383⅛
275⅛ Schroder Asian TR
344*
— 1.4
334
886
4¼ Petrofac ●
558⅜ +3⅜ 4.7 -94.1
588½
405¼ Essentra ●
419⅜* -1¾ 4.9
174
151 Oakley Capital
168*
201½
165 Hend High Inc
176* +1½ 5.4
179
383
336 Scot American
356
— 3.1
341
104½
42¾ Premier Oil
78⅞
-2.3
1708
1428 Experian
1550 +½ 2.1 24.1
45
904
723 Hend Smaller Co
862
+4 2.2
979
973½
771 Scot Invest ●
795*
-2 2.5
875
2579½ 1982½ Royal D Shell A
2362½ -16 5.6 21.4
5722
4427 Ferguson
5276* -28 —
103½
994
— 2.0 1213
479¼
361⅛ Scot Mortgage
445⅜ -2¼ 0.7
435
2617
2037 Royal D Shell B
2404½ -17½ 5.5 21.8
342⅝
233¾ G4S
250¾ +¼ 3.9 16.5
1185 -10 — 1378
177¼
155½ Sec Tst of Scot
160*
-1 3.7
171
150
87⅛ Soco Intl
-3¼ 5.3
206¼
155 Hays ●
1790* +5 2.6 1868
179⅞
167 Seneca Global
171¼ +½ 3.7
168
Pharmaceuticals -1.25%
872
635½ Homeserve ●
147
502
424¼ Stand Life Eq Inc
452
-7½ 4.1
468
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-4 2.5 26.0
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419½ Costain
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Net Asset Values © 2018 Morningstar Estimated at previous
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The Alternative Investment Market is for young and growing
companies. Shares may carry higher risks than those with a full
quotation, and may be difficult to sell.
Bold FTSE100 Stocks
* Ex-dividend
§ Ex-rights
●
FTSE250 Stocks
† Ex-scrip
# Suspended
‡ Ex-all
Cover relates to the previous year’s dividend.
Yields are net of basic rate tax.
Data is provided for information purposes only and is
not intended for trading purposes. Speak with a
financial advisor before using any data to make
transactions.
Americans +0.68%
52 week
High
Low Stock
-⅞ 6.5 12.9
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3¼
The Daily Telegraph Tuesday 17 April 2018
9
**
Business
Russia and WPP weigh on FTSE 100
TOM REES
PORT
MARKET REPORT
Results roundup
Company
Amerisur Resources $
RUSSIAN-LINKED miners Polymetal
and Evraz were hit by a fresh wave of
selling yesterday as the Trump
administration lined up new sanctions
targeting Vladimir Putin’s inner circle
of tycoons.
London-listed stocks controlled by
Russian oligarchs with close ties to
Putin tumbled after US ambassador to
the United Nations Nikki Haley
warned that it would punish Moscow’s
support for the Assad regime.
City analysts at RBC Capital Markets
warned investors that the
deterioration in relations between the
West and Russia had been “a rapid
escalation in risk for companies with
Russian-based assets”.
Companies controlled by Putin
allies suffered sharp share price falls
last week after the White House’s first
round of sanctions.
As investors braced for more
measures, Roman Abramovich-owned
miner Evraz nosedived 27.4p to
365.2p, a 7pc tumble, while Russiafocused Polymetal slipped 64.4p, or
9.6pc, to 611.2p.
Evraz’s fall along with ad giant
WPP’s 6.5pc plunge following the exit
of boss Sir Martin Sorrell weighed
heavily on the FTSE 100. The pound
Pre-tax (£)
Fin 92.5m (47.2m)
Int 1.5m (1.3m)
EPS (p)
DIV (p)
Pay day
XD
630k (-29.3m)
1.04 (-2.40)
n/a (n/a)
–
–
-4.4m (-3.8m)
-5.75 (-5.01)
n/a (n/a)
–
–
Carr’s Group
Int 200.1m (176.8m)
10.6m (8.3m)
9.00 (6.40)
1.075 (0.950)
May 21
Apr 26
Echo Energy
Fin – (–)
-7.4m (-1.5m)
-2.70 (-18.60)
n/a (n/a)
–
–
Immedia Group
Fin 3.5m (2.6m)
-693k (-184k)
-4.89 (-1.38)
n/a (n/a)
–
–
Orosur Mining $
3Q 8.6m (8.8m)
-2.0m (357k)
-2.00 (0.00)
n/a (n/a)
–
–
PureTech Health $
Shanta Gold $
Fin 2.5m (4.4m)
-70.7m (-83.2m)
13.00 (-21.00)
Fin 103.4m (107.1m)
3.5m (-4.3m)
0.61 (-1.47)
n/a (n/a)
–
–
Fin – (–)
-190k (–)
-1.30 (–)
n/a (n/a)
–
–
Spinnaker Opportunities
Zuckerberg to meet with Bank of America results
EU commissioner Ansip lifted by Trump tax cuts
Winners and losers (pc)
Turnover (£)
Avacta Group
BUSINESS BULLETIN
n/a (n/a)
–
0.82
Ç Americans
0.68
Ç Travel & Leisure
0.5
Ç Retailers
0.05
–
www.theice.com/data
hitting a post-Brexit vote high against
the dollar at the end of play ramped
up the pressure on the index’s
exporters, dragging it to a 66.36-point
loss at 7,198.20.
Amid the recent flurry of deals in
the healthcare sector, a surge in
embattled pharma firm Vectura’s
trading volume reignited longstanding bid rumours in the City as it
soared 10.6p, or 11pc, to 104.5p.
As Vectura’s trading volume hit
eight times its average, City analysts
speculated that Vectura losing some of
its disgruntled shareholders since its
strategy shift may have also relieved
some of the selling pressure on the
struggler. Pharma giants Novartis and
GlaxoSmithKline have been among the
names linked with Vectura, which
slumped to its lowest level since 2012
in March.
Feared activist investor Elliott
Ç Aerospace & defence
Advisors revealing a stake of over 6pc
in Costa Coffee owner Whitbread
over the weekend boosted its shares
283p to £42.18. The Paul Singer-led
hedge fund snapping up a stake stirred
speculation that it could push for a
break-up of the FTSE 100 company.
Smurfit Kappa advanced 90p to
£30.72 after reports surfaced
claiming that investors are putting
pressure on the paper and packaging
giant to hold talks with takeover suitor
International Paper.
Barclays nudged up 0.5p to 213.8p
as Jefferies analysts argued that
activist investor Sherborne taking a
large stake in the banking giant could
propel its shares higher.
Finally, tech giant Sage’s share price
plunge extended into a second session
after JP Morgan analysts piled on the
pain, downgrading it to “neutral” to
knock it 18.6p lower at 598.4p.
È Healthcare
-0.52
È Gas & Water
-0.67
È Banks
-0.75
È Food producers
-0.78
È AIM
-0.88
È Insurance
-0.91
È Oil & Gas
-0.97
È Media
-1.18
È Electricity
-1.20
È Pharmaceuticals
-1.25
È Beverages
-1.31
È Tobaccos
-1.66
È Mining
-1.71
È Information technology
-2.81
Facebook’s Mark Zuckerberg is set to
meet with the European Commission’s
vice president Andrus Ansip today,
ahead of the EU unveiling new
legislation next week. Mr Ansip is
meeting with the Facebook chief during
a two-day visit to San Francisco, where
he will also meet Google chief executive
Sundar Pichai and the general counsels
for Twitter and Netflix.
Bank of America became the latest US
bank to hail the “Trump bump”, with its
net profits having soared 30pc in the
first quarter. BoA said its net interest
income was up 5pc in the period,
helping push its total revenue up 4pc to
$23.1bn (£16.1bn). It follows updates
from Citigroup and JP Morgan Chase
last week in which they said tax reforms
were beginning to boost performances.
WIG hires new non-exec
ahead of TfL Tube bid
Legal & General ramps
up pressure on boards
Wireless Infrastructure Group has hired
Kip Meek, who until recently headed up
BT Group’s regulatory activity, as a
non-executive director. His
appointment comes as WIG prepares
its bid to partner with Transport for
London on the roll-out of wireless
infrastructure across the Tube network,
providing phone signals under ground.
Legal & General Investment voted
against at least one resolution at 59pc of
companies last year, it said. The group,
one of the largest investors in the UK
stock market, said it had opposed the
reappointment of 2,807 directors, up
from 2,362 in 2016. “We’ve seen a focus
on gender diversity, climate change and
governance and culture,” it said.
Betway halts bets on
Bailey as BoE Governor
Punch Taverns names
new chief after takeover
Bets placed on Andrew Bailey, head of
the Financial Conduct Authority, as the
next Governor of Threadneedle Street
have been halted after a sudden influx
of flutters, Betway said. Previously with
odds of 9/1 and listed a likely contender
by The Sunday Telegraph, Mr Bailey has
long been seen as one of the favourites
to fill the position.
Punch Taverns has lured Clive Chesser
from rival Greene King to head up the
pub group. Punch Taverns was last year
bought by Patron Capital, which kept
1,300 of the entity’s pubs but sold 1,900
to Heineken as part of the deal. At the
time, former Punch boss Duncan
Garrood left the firm, with CFO Steve
Dando having been left in charge.
Market data
Unit trusts & open-ended investment companies prices www.telegraph.co.uk/funds
World market indices
Name
Index
Init chge
Mid
Sell
Change
Buy on day
Change
Mid
Change
Buy on day
Mid
Change
Buy on day
Mid
Change
Buy on day
Mid
Change
Buy on day
Discretionary Unit Fund
Multi-Mgr Inc&Gwth A Acc
5.00
*173.7000
…
JPM Global Uncons Eq A Acc 3.00
*1272.0000
-5.0000
Jupiter Emerg Euro Opps
–
198.39
-1.91
M&G Episode Growth A Inc
4.00
60.21
-0.46
Multi-Mgr Inc&Gwth A Inc
5.25
*151.9000
-0.10
JPM Global Uncons Eq A Inc 3.00
*94.4700
-0.3600
Jupiter European
–
2123.91
+2.08
M&G Episode Income A Inc
4.00
*129.26
-0.56
Multi-Mgr Mangd A Acc†
5.00
*272.6000
-0.30
JPM Japan A Acc
3.00
*450.4000
+1.7000
Jupiter Euro Inc Acc
–
78.77
-0.01
M&G Episode Income A Acc
4.00
*169.06
-0.73
Multi-Mgr Mangd A Inc†
5.00
*265.6000
-0.30
JPM Japan A Inc
3.00
*108.4000
+0.4000
Jupiter Euro Inc Inc
–
54.04
-0.01
M&G Global Dividend A Inc
4.00
*198.04
-0.81
Sterling Bond Acc†
4.25 *219.3900 228.8500
…
JPM Multi-Asset Income A Acc 3.00
*94.5700
-0.0400
Jupiter Euro Special Sits
–
405.19
-0.16
M&G Global Dividend A Acc
4.00
*272.04
-1.11
Sterling Bond Inc†
4.25 *64.5000 67.2800
…
JPM Multi-Asset Income A Inc 3.00
*65.2800
-0.0300
Jupiter Fin Opp
–
591.46
-5.85
M&G Glbl Emrgng Mkts A Inc 4.00
255.99
-2.68
Strategic Bond A Inc
4.00
*122.8000
…
JPM Multi-Asset Inc A Mth Inc 3.00
*64.8100
-0.0300
Jupiter Fund Of Inv Trusts
–
248.76
-0.71
M&G Glbl Emrgng Mkts A Acc 4.00
277.11
-2.9
UK Absolute Return A Acc
5.00
157.4000
…
JPM Multi-Man Gwth A Acc
*967.0000
-2.4000
Jupiter Global Emg Acc
–
70.03
-0.31
M&G Glbl High Yld Bd A Inc
3.00
*50.39
+0.07
UK Alpha A Acc†
5.25
149.3000
-0.30
JPM Multi-Man Gwth A Inc
3.00
*884.7000
-2.2000
Jupiter Global Eq Inc Acc
–
*68.78
-0.34
M&G Glbl High Yld Bd A Acc
3.00
*131.84
+0.19
UK & Irish Small Co A Acc
5.00
648.2000
+2.50
JPM Natural Res A Acc
3.00
*595.1000
+2.8000
Jupiter Global Eq Inc Inc
–
*60.17
-0.30
M&G Global Macro Bd A Inc
3.00
80.79
-0.06
UK Equity Income A Inc
5.00
*624.9000
+0.40
JPM Natural Res A Inc
3.00
*41.7100
+0.1900
Jupiter Global Managed Acc
–
*224.87
-0.66
M&G Global Macro Bd A Acc
3.00
121.96
-0.09
UK Index A Acc
–
610.3000
-1.50
JPM Sterling Corp Bd A Grs Acc 3.00
*92.4300
+0.0100
Jupiter Global Managed Inc
–
*216.07
-0.65
M&G Global Themes A Inc
4.00
851.03
+0.21
+0.32
Name
Init chge
Sell
Mid
Change
Buy on day
All Ordinaries
5933.00
+8.30
+0.14pc
No 1, Poultry, London EC2R 8JR. 020 7415 4130
È Brazil
Bovespa
82861.57
-1472.84
-1.75pc
Maitland Discretionary Inc
È China
Shanghai Composite
3110.65
-48.40
-1.53pc
CAC General
5312.96
-2.06
-0.04pc
DAX
12391.41
-50.99
-0.41pc
Hang Seng
30315.59
-492.79
-1.60pc
Ç Australia
È France
È Germany
È Hong Kong
Ç India
S&P CNX500
9311.30
+43.65
+0.47pc
Ç Japan
Nikkei
21835.53
+56.79
+0.26pc
È Russia
RTS
1085.16
-19.35
-1.75pc
3.00
2366.5 2508.74
-7.08
AXA Investment Managers UK
Limited
7 Newgate Street, London, EC1A 7NX
www.axaframlington.com Cust Svs: 0845 777 5511
Fidelity International
Straits Times
3497.19
-4.11
-0.12pc
Amer Gwth Acc
5.25
*567.2
-2.40
È Spain
Madrid SE
992.13
-0.17
-0.02pc
5.50
*165.5
-1.00
È Switzerland
Biotech Acc
SMI Index
8726.54
-49.63
-0.57pc
Ç USA
Dow Jones
24573.04
+212.90
+0.87pc
Emerg Mkts Acc
5.25
265.8
-2.30
130 Tonbridge Road, Tonbridge, Kent TN11 9DZ
Call free: Private Clients 0800 414161
Broker Dealings 0800 414181
Ç USA
Nasdaq
7156.28
+49.63
+0.70pc
European Acc
5.25
866.2
-0.80
Unit Trust
È Singapore
Commodities summary
Price
Ç Gold
per troy oz
È Silver
Change
+0.40
$1345.77
+0.03pc
*1214.0
-6.00
131.9
…
273.6000
-0.80
JPM Sterling Corp Bd A Grs Inc 3.00
*55.4300
…
Jupiter Growth & Inc
–
101.25
-0.21
M&G Global Themes A Acc
4.00
1322.97
957.5000
-8.40
JPM UK Dynamic A Acc
3.00
*200.7000
+0.2000
Jupiter Income
–
550.35
-1.42
M&G Managed Growth A Inc 4.00
108.5
-0.46
JPM UK Dynamic A Inc
3.00
*158.3000
+0.1000
Jupiter India Fd
–
122.27
-0.42
M&G Optimal Income A Inc
3.00
*149.67
+0.02
3.00
*211.49
+0.02
JPM UK Equity Core E Acc
–
*353.3000
-0.8000
Jupiter Int Financials
–
92.10
-1.07
M&G Optimal Income A Acc
JPM UK Equity Core E Inc
–
*60.4600
-0.1400
Jupiter Japan Inc Fd Acc
–
114.46
+0.75
M&G Property Portfolio A Inc
-0.26pc
Japan Acc
5.25
583.2
+2.20
Cash Fd Y Accum.Units
–
100.34
…
JPM UK Equity Gwth A Acc
3.00
*140.5000
+0.2000
Jupiter Japan Inc Fd Inc
–
89.63
+0.59
M&G Recovery A Inc
4.00
138.23
-0.56
-5.35
-0.57pc
Managed Balanced Acc
5.25
379.5
-0.70
JPM UK Equity Gwth A Inc
3.00
*126.1000
+0.3000
Jupiter Merlin Bal Prtfo Acc
–
178.76
-0.27
M&G Recovery A Acc
4.00
323.36
-1.31
-5.90
-0.92pc
Managed Income Inc
5.25
*141.3
+0.20
JPM UK Higher Inc A Acc
3.00
*1062.0000
-2.0000
Jupiter Merlin Bal Prtfo Inc
–
124.87
-0.20
M&G Strategic Corp Bd A Inc 3.00
*75.41
…
JPM UK Higher Inc A Inc
3.00
*552.8000
-0.9000
Jupiter Merlin Conserv Prtfo Acc–
*57.47
-0.05
M&G Strategic Corp Bd A Acc 3.00
*116.63
…
JPM UK Sm Cos A Acc
3.00
484.2000
+1.1000
Jupiter Merlin Conserv Prtfo Inc–
*49.70
-0.04
M&G UK Inc Distribution A Inc 4.00
*767.87
-1.17
Income Funds
per oz
£696.86
+6.72
+0.97pc
£4803.56
+7.11
+0.15pc
Managed Income Acc
5.25
*990.0
+1.40
Enhanced Inc Fd
3.50
105.7
+0.1
high grade
£14710.40
-1.47
-0.01pc
Monthly Inc Inc
5.25
*254.0
-0.20
Extra Income Fd
3.50
27.58
+0.01
£1642.01
+24.83
£2187.37
+9.37
+0.43pc
Monthly Inc Acc
5.25
*616.1
-0.60
Moneybuilder Bal
–
48.48
-0.04
high grade
£1662.25
+65.07
+4.07pc
UK Growth Acc
5.25
295.9
-0.20
Moneybuilder Inc
–
36.41
+0.13
£9909.28
+149.33
+1.53pc
UK Select Opps R Inc
5.25
*1872.0
-3.00
UK Select Opps R Acc
5.25
*3434.0
-5.00
UK Smllr Cos Acc
5.25
303.1
+0.70
È Brent Crude
–
5.00
…
special high grade
Ç Wheat
UK Tracker A Acc
100.02
grade A
Ç Baltic Dry Index*
Sell
–
£637.86
Ç Nickel
Init chge
Cash Fd Y
£936.46
Ç Aluminium
Name
-2.00
È Maples
Ç Lead
Sell
US Growth A Acc
†Available as an ISA
Investment Funds (OEIC)
Init chge
-0.80
-0.56
Ç Zinc
5.25
3.50
Name
104.9
£217.03
È Tin
Global Opp Inc
Wealthbuilder
3.00
Sell
1710.0
È New Sovereign
Ç Copper
-7.00
Init chge
5.25
-0.09pc
Ç Palladium
-7.00
*1376.0
Name
5.50
-0.50pc
-0.82
per oz
*651.3
5.25
Sell
Global Tech
-0.06
£942.04
È Platinum
5.25
Global Opp Acc
Init chge
Health Acc
£11.63
È Krugerrand
per oz
Financial Acc
Name
+1.54pc
1025.00
+11.00
+1.08pc
per tonne
£147.50
+1.00
+0.68pc
Jun settlement
$71.42
-1.16
-1.60pc
*Copyright Baltic Exchange Information Services Ltd.
AXA IM Funds www.axa-im.co.uk
Growth & Income Funds
J.P. Morgan Asset Management
60 Victoria Embankment, London, EC4Y 0JP
Clients:0800 204020.Brokerline 0800 727770
£ > € Rate 1.1588 Change +0.30¢ £ > $ Rate 1.4330 Change +0.83¢
Tourist £1= Sterling £1=
1 Euro =
Pan Euro HY Bond Inc
5.25
*32.3
+0.06
Pan Euro HY Bond Acc
5.25
*104.8
+0.20
JPM UK Sm Cos A Inc
3.00
92.4500
+0.2100
Jupiter Merlin Grth Prtfo Acc –
*396.11
-0.55
M&G UK Inc Distribution A Acc 4.00
*6986.21
-10.64
-0.3800
JPM UK Strat Eq Inc A Acc
3.00
*185.6000
…
Jupiter Merlin Grth Prtfo Inc –
*384.97
-0.52
M&G UK Infl Lkd Corp A Inc
3.00
*114.91
+0.07
JPM America Eq A Inc
3.00
84.8900
-0.3900
JPM UK Strat Eq Inc A Inc
3.00
*110.8000
…
Jupiter Merlin Inc Prtfo Acc
–
*291.72
-0.29
M&G UK Infl Lkd Corp A Acc 3.00
*118.53
+0.07
JPM Asia Growth A Acc
3.00
*202.5000
-2.4000
JPM Uncons Bond A Acc
3.00
*72.2700
+0.0300
Jupiter Merlin Inc Prtfo Inc
–
*131.08
-0.98
N.A.A.C.I.F. Inc
–
84.73
-0.18
Jupiter Merlin WW Prtfo Acc –
283.84
-0.49
N.A.A.C.I.F. Acc
–
8347.75
-17.97
248.1
-0.1
JPM Asia Growth A Inc
3.00
*111.6000
-1.3000
JPM Uncons Bond A Inc
3.00
*57.2600
+0.0300
Moneybldr Gwth
–
76.71
-0.12
JPM Div Gth A Net ACC
3.00
260.0000
-0.8000
JPM US A Acc
3.00
*989.0000
-6.0000
1 Dollar =
3592
+3
+0.04
84.9000
3.50
3.50
117.18
3.00
Moneybldr Div
American
117.18
JPM America Eq A Acc
Growth Funds
Exchange rates
–
Jupiter Merlin WW Prtfo Inc –
283.82
-0.50
Jupiter Monthly Inc Acc
–
*114.55
-0.11
Jupiter Monthly Inc Inc
–
*30.48
-0.03
Jupiter N.American Inc Acc
–
142.28
-0.81
†CAR - Net Income reinvested.
Natwest Investment Funds
(RBS Collective Investment Funds Ltd)
PO Box 249, York YO90 1ZY
0117 940 3848
Australia
Amer Sp Sits
3.50
1449
+5
Jupiter N.American Inc Inc
–
118.54
-0.68
Aus $
1.7375
1.8427
1.5902
1.2859
Canada
Can $
1.7105
1.8017
1.5549
1.2573
European
3.50
2171
…
Jupiter Responsible Inc Fd Acc –
*112.86
-0.14
Balanced Inc
5.00
*328.90
Denmark
Krone
8.1782
8.6304
7.4479
6.0226
European Opps
3.50
495.2
-0.4
Jupiter Responsible Inc Fd Inc –
*71.60
-0.09
Balanced Acc
5.00
*422.00
…
Global Special Sits
3.50
3722
-6
Jupiter Strategic Bond Acc
–
97.41
-0.13
Equity Income
5.00
*349.80
…
Japan
3.50
354.7
+1.6
Jupiter Strategic Bond Inc
–
64.55
-0.08
Extra Income
5.00
*108.60
…
Japan Smaller Cos
3.50
312.0
+2.4
Jupiter Strategic Res Acc
–
53.37
-0.03
Growth
5.00
*392.70
…
Global Focus
3.50
1884
+4
Jupiter Strategic Res Inc
–
51.95
-0.03
High Yield
5.00
*126.60
…
104.8500
-0.2600
Jupiter UK Growth
–
321.74
-1.06
Intntl Growth
5.00
*499.60
…
3932
+3
Jupiter UK Smaller Cos
–
362.77
+1.81
-0.28
Euro
€
1.1024
1.1588
…
0.8086
HK $
10.6100
11.2490
9.7076
7.8499
India
Rupee
82.1300
93.8114
80.9573
65.4650
Israel
Shekels
4.5049
5.0509
4.3589
3.5247
Hong Kong
Japan
Kuwait
New Zealand
Yen
145.3500
153.7036
132.6431
107.2600
Dinar
…
0.4296
0.3708
0.2999
NZ $
1.8037
1.9461
1.6795
1.3580
Norway
Krone
10.5800
11.1601
9.6309
7.7879
Pakistan
Rupee
154.9300
165.6119
142.9196
115.5700
Saudi Arabia
Riyal
4.9911
5.3741
4.6377
3.7502
$
1.7420
1.8793
1.6218
1.3115
South Africa
Rand
16.1600
17.3088
14.9372
12.0787
Sweden
Krona
11.5200
12.1074
10.4484
8.4489
Switzerland
Franc
1.3063
1.3757
1.1871
0.9600
Thailand
Baht
39.7700
44.6953
38.5712
31.1900
Dirham
4.9060
5.2636
4.5423
3.6731
Singapore
UAE
UK
£
…
…
0.8630
0.6978
USA
$
1.3593
1.4330
1.2367
…
Tourist rates for indication use only. www.travelex.co.uk
Rates
Inflation
RPI (1987=100)
–
*186.48
Jupiter US Sm&Md Inst I Acc –
68.75
-0.55
Jupiter US Sm&Md Cap Ret Acc –
63.44
-0.52
115.17
-1.29
0%
92.7
+0.06
0%
170.81
-0.44
Target 2020
Insight Eq Inc Booster
0%
126.29
-0.07
†CAR - Net income reinvested
Boston Co US Opp Fund
0%
Insight Corporate Bd
Insight Eq Inc Fund
Target Funds
Liontrust Investment Funds
3.50
64.81
-0.07
PO BOX 23850, Edinburgh EH7 5FY
Dealing and Admin 0330 123 3822
Insight Glob Abs Ret Inc
0%
110.51
-0.14
Glob Income
5.00
152.06
160.39
-0.44
Insight Glob Multi-Strat Fd
0%
*121.85
-0.18
Growth Fd
5.00
409.88
434.05
-0.42
Insight Inflat-Link Corp Bd
0%
*107.35
+0.07
Long-Term Global Equity
0%
241.75
-1.49
Fundsmith LLP
Newton Asian Income
0%
187.92
-0.95
0%
258.06
-0.12
PO Box 10846, Chelmsford, Essex, CM99 2BW.
0330 123 1815
www.fundsmith.co.uk enquiries@fundsmith.co.uk
Marks & Spencer Unit Trust
Management Ltd
Kings Meadow, Chester, CH99 9UT
0870 333 1835
…
60.13
+0.06
Fundsmith Equity T Acc
–
346.28
-0.25
JPM Emg Euro Eq A Acc
Fundsmith Equity T Inc
–
321.5
-0.23
1.5pc
+2.7pc
Money
Bank Rate
0.50pc
Nationwide Base Mortgage Rate
Overnight
0.48pc
US Fed Funds
7 day
0.49pc
US Long Bonds Yld
3.04pc
1 month
0.53pc
European repo rate
1.25pc
3 months
0.79pc
European base rate
0.00pc
6 months
0.90pc
2.50pc
1.50-1.75pc
Major price changes FTSE 100
Name
JPM US Eq Inc £ Hdg A Inc
3.00
*117.4000
-0.4000
UK Select Port Inc
–
340.3
340.3
JPM US Eq Inc A Acc
3.00
*164.1000
-0.8000
UK Selection Port
–
616.7
616.7
-1
Newton Intnl Bond
0%
226.35
-0.18
JPM Emg Markets A Inc
3.00
*92.1700
-1.0400
JPM US Eq Inc A Inc
3.00
*132.7000
-0.6000
UK 100 Co’s Fund Inc
–
*214.2
214.2
+0.2
–
*369.6
369.6
+0.4
Newton Multi-Asset Bal
0%
187.96
-0.37
JPM Emg Mkts Inc A Acc
3.00
*70.8900
-0.5700
JPM US Select A Acc
3.00
*153.8000
-0.5000
UK 100 Co’s Fund Acc
Newton Mult-Asset Div Ret
0%
153.87
-0.09
JPM Emg Mkts Inc A Inc
3.00
*56.6400
-0.4500
JPM US Select A Inc
3.00
*151.8000
-0.5000
W’wide Man Inc
–
491.6
-0.2
Newton Mult-Asset Gwth
0%
805.63
-2.40
JPM Eur Dyn (ex-UK) £ Hg A Acc3.00
*215.4000
-0.3000
JPM US Sm Cos A Acc
3.00
617.1000
-5.2000
W’wide Man Acc
–
788.7
-0.3
Newton Oriental
0%
646.42
-6.82
JPM Euro Dyn (ex-UK) A Acc 3.00
*217.3000
…
JPM US Sm Cos A Inc
3.00
161.6000
-1.4000
Newton Real Return A
0%
111.71
-0.16
Newton UK Equity Fund
0%
843.32
+0.08
Janus Henderson Investors
PO Box 9023 Chelmsford, CM99 2WB
Enquiries: 0800 832 832
Website: www.janushenderson.com
Asian Dividend Income Inc
5.00 103.7000 108.9400
14.64m
276⅜
1.69pc
È Sage Group
9.19m
598⅜
-3.01pc
5.00m
877¾
1.27pc
È Rentokil Initial 13.32m
271⅞
-2.72pc
Ç Next
0.83m
5064
1.00pc
È Randgold Res
0.28m
5644
-2.42pc
Ç Intl Cons Air
6.09m
614⅝
0.92pc
È Fresnillo
0.97m
1254
-2.34pc
Ç BAE Systems
6.99m
598¾
0.81pc
È Just Eat
Ç Easyjet
1.25m
1623½
0.78pc
È HSBC
Ç PaddyPwrBet
0.08m
7165
0.63pc
Ç DCC
0.35m
6695
Ç Kingfisher
7.18m
302
Ç BT Group
23.78m
242¾
0.50pc
È BP
Ç Informa
5.03m
723¼
0.47pc
È Prudential
2.10m
720¾
-2.01pc
32.23m
671⅞
-1.94pc
È AstraZeneca
2.46m
4915½
-1.89pc
0.60pc
È Brit Amer Tob
5.84m
4043
-1.85pc
0.57pc
È Anglo Amer
3.42m
1659⅝
-1.68pc
34.04m
496⅜
-1.58pc
5.79m
1817½
-1.57pc
9.23m
231¾
0.35pc
È BHP Billiton
10.17m
1435
-1.56pc
124.87m
213¾
0.21pc
È Rio Tinto
3.45m
3730
-1.45pc
2.74m
613⅜
0.20pc
È Ass Brit Fds
1.39m
2583
-1.41pc
Ç Mediclinic Intl
1.42m
592⅝
0.17pc
È Utd. Utilities
2.95m
702⅜
-1.40pc
Ç Hargrve Lans
1.00m
1713
0.12pc
È Smith (DS)
4.01m
495⅛
-1.34pc
-0.6
-0.6300
-2.4000
-0.24
Ç Marks & Spen
+0.3
*41.5700
320.25
-3.62pc
258.3
*216.4000
0%
-6.48pc
1252
258.3
3.00
Newton UK Opps
1111
+0.1
–
3.00
5.00
13.53m
113.5
High Income Acc
JPM Emg Markets A Acc
Asia Pac Cap Gwth A Acc
È Micro Focus Intl 3.88m
113.5
-0.8000
Sell
JPM Emg Euro Eq A Inc
-0.01
È WPP
–
*136.9000
-0.65
65.19
7.19pc
High Income Inc
3.00
Init chge
-0.53
0%
3.02pc
Change
Buy on day
JPM US A Inc
Name
270.08
Newton UK Inc
4218
Mid
-2.8000
186.24
-6.98pc
3072
Change
Buy on day
Sell
0%
365¼
2.59m
Mid
*188.2000
0%
6.62m
1.04m
3.00
Newton Glb Inc Stg Inc
È Evraz
Ç Whitbread
Init chge
Newton Glb Opps
Change
Ç Smurfit Kappa
Fallers 79
Jupiter UK Special Sits Inc
-0.3
101.75
Mar 737.50
Ç Experian
-12
283.2
0%
Halifax house price index
Ç G4S
1327
3.50
0%
+2.7pc
Ç Tesco
3.50
UK Select Acc
Newton Glb High Yld Bd
+3.6pc
Ç Segro
South East Asia
Newton Global Dyn Bd
+2.10
+0.40
Ç Barclays
Sterling Income Shares
Newton Cont European
Feb 278.60
Ç Morrison (Wm)
3.50
+3.6pc
Feb 104.90
Ç Rolls Royce
–
Special Sits
+0.80
CPI (2015=100 target 2pc)
Close
Index UK A Acc
BNY Mellon Investment Funds (ICVC)
Year
Feb 278.10
Volume
Investors: 0800 614330 Brokers: 08085 660000
www.bnymellonim.co.uk,
clientservices@bnymellon.com
Change on month
RPIX (Target 2.5pc)
Risers 21
BNY Mellon Fund Managers
Carvetian Capital
Management Limited
Admin: Stuart House, St John’s St,
Peterborough PE1 5DD
Dealing & Enquiries: 0845 850 0255
1065.0000
JPM Euro Dyn (ex-UK) A Inc
3.00
*97.5300
+0.0200
JPM Europe A Acc
3.00
*1430.0000
…
JPM Europe A Inc
3.00
*79.5000
…
…
JPM Euro Smaller Co A Acc
3.00
760.6000
+1.4000
3.00
-6.00
Cautious Managed A Acc
5.00
263.1000
-0.30
JPM Euro Smaller Co A Inc
98.5100
+0.1700
Cautious Managed A Inc
5.00
151.6000
-0.20
JPM Global Bd Opps A Grs Acc –
*54.4200
+0.0600
Jupiter Unit Trust Managers Ltd
China Opps A Acc
5.00
1401.0000
-31.00
JPM Global Bd Opps A Grs Inc –
*49.1500
+0.0500
The Zig Zag Building, 70 Victoria Street, London,
M & G Securities Ltd
SW1E 6SQ
020 3817 1000
Emerg Mkts Opps A Acc
5.00
204.1000
-0.60
JPM Global Bond A Gross Acc 3.00
*262.8000
…
European Growth A Acc†
5.25
228.0000
-0.60
JPM Global Bond A Gross Inc 3.00
*203.9000
…
1602.0000
+1.00
JPM Global Eq Inc £ Hdg A Acc 3.00
*82.3600
-0.2000
Jupiter Abslt Rtn
–
53.60
…
JPM Global Eq Inc £ Hdg A Inc 3.00
*55.3900
-0.1300
Jupiter Asian Fd
–
PO Box 9039, Chelmsford, CM99 2XG
Enq: 0800 390 390. UT Deal: 0800 328 3196
Charibond Inc
–
123.0
-0.03
Charibond Acc
–
3950.56
-0.91
-0.07
Charifund Inc
–
1569.35
-3.01
897.89
-6.05
Charifund Acc
–
24025.05
-45.99
FENIX Balanced Fd
5.00
154.2
-0.2
European Sel Opps A Acc
5.00
Generation Fd
5.00
773.0
…
Fixed Int Mthly Inc A Inc
4.25 *21.8300 22.7700
Consistent Unit Trust
Management Co Ltd
Global Care Growth A Inc
4.50
*279.7000
-1.20
JPM Global Eq Inc Fd A Acc
3.00
*94.0000
-0.2700
Jupiter Asian Inc Fd Acc
–
*125.67
-0.92
M&G Corp Bond A Inc
3.00
*40.22
-0.01
Global Equity Inc A Inc†
5.25
*58.3700
-0.14
JPM Global Eq Inc Fd A Inc
3.00
*76.5700
-0.2200
Jupiter Asian Inc Fd Inc
–
*116.16
-0.86
M&G Corp Bond A Acc
3.00
*69.41
-0.03
Admin: Stuart House, St John’s St,
Peterborough PE1 5DD
Dealing & Client Services 0345 850 8818
Global Growth Acc
4.25 2931.3899 3057.6599
…
JPM Global HiYld Bd A Grs Acc 3.00
*110.5000
-0.7000
Jupiter China Acc
–
*135.86
-1.16
M&G Dividend A Inc
4.00
59.55
-0.12
Global Strategic Cap Acc†
5.00
232.2000
-0.20
JPM Global HiYld Bd A Grs Inc 3.00
*36.9400
-0.2500
Jupiter China Inc
–
*130.54
-1.11
M&G Dividend A Acc
4.00
663.12
-1.36
-0.06
Global Technology A Acc
5.00
1618.0000
-9.00
JPM Global HiYldBdAGrsMthInc3.00
*36.6000
-0.2500
Jupiter Corp Bond Inc
–
*56.51
Unit Tst Inc
5.00
51.01
51.91
+0.03
Multi-Mgr Abs Ret A Acc
5.00
*139.9000
+0.20
JPM Global Macro Bal A Acc
3.00
*72.6300
-0.1400
Jupiter Dstrbtn Acc
–
*101.12
-0.16
JPM Global Macro Bal A Inc
3.00
*63.6600
-0.1300
Jupiter Dstrbtn Inc
–
*58.59
-0.10
Initial charge:
5.35m
250¾
0.08pc
È Diageo
3.74m
2459
-1.32pc
60.65m
233¾
0.04pc
È Shire
3.57m
3559
-1.32pc
Unit Tst Acc
5.00
131.5
133.9
…
Multi-Mgr Active A Acc†
5.00
*218.6000
-0.50
2.34m
1550
0.03pc
È Natl Grid
7.32m
815¾
-1.28pc
Practical Invest Inc
5.00
*229.9
245.9
-0.1
Multi-Mgr Distbn A Inc
5.25
*133.5000
…
JPM Global Macro Opps A Acc 3.00
74.23
-0.36
Jupiter Dstrbtn & Grth Inc
–
*120.18
-0.38
This charge in percentage terms is included in the purchase
price of the units. It is levied by the unit trust manager to cover
administrative costs and commissions.
Volume
Close
Change
È Lon Stock Ex
0.58m
4216
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5.00
*1217
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*84.8600
+0.02
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* Denotes Ex-dividend
…
10
Tuesday 17 April 2018 The Daily Telegraph
***
Business
Whitbread set
to spin Costa
Coffee off from
Premier Inn
Changing face of Whitbread Four of businesses that the one-time brewer no longer owns
Marriott
Hotels
T
he emergence of activist
investors usually brings
with it boardroom scraps,
an acrimonious tit-for-tat
and a battle for
shareholders’ hearts and
minds. Two activist investors now
control a combined 10pc of
Whitbread’s shares, making a splitting
up of the 250-year-old company into
its two constituent parts seem more a
question of “when” rather than “if ”.
Elliott Advisors revealed it had a
£400m stake in the Costa Coffee and
Premier Inn owner at the weekend
after it increased its holding above
5pc, which meant it had to publicly
disclose its interest under City
regulations.
The US hedge fund is known for its
brutal battles, including its skirmish
with Argentina, which saw the South
American nation having
ving to make good
on decades-old debt repayments to
Paul Singer’s fund. And
nd in 2015, it
forced Katherine Garrett-Cox,
rrett-Cox, the
he
chief executive of the
e thenlargest UK investment
nt trust,
Alliance Trust, to step
p aside.
But this time, it seems
ems the
activist – which joined
ed
existing shake-up
specialist Sachem Head
ead
– might not need as
much brute force.
Shares in Whitbread
leapt 7.2pc yesterday
y
to £42.18, the first
trading session
where investors could
ld
express their view
following the
declaration by Elliott. Industry insiders
say Elliott began building its stake in
the Dunstable-based business just
under a year ago and met with senior
staff at Whitbread as long ago as 2016.
An analyst, who did not want to be
identified, said it was understood
Elliott would have kept the size of its
stake under wraps had it been able to,
because the announcement did not
represent a desire to kick-start a
campaign of aggressive activism.
This suggestion is backed up by
comments from Alison Brittain, below,
Whitbread’s boss, who in January said
the company remains “entirely
open-minded about the structure of
the business and is fully committed to
reviewing it on a regular basis at the
board level”.
The former Lloyds executive
believes the company needs to
complete its investment programme
in Costa, which has included
improved kitchen facilities in its
stores, before it gets bogged down in
splitting the £7.2bn parent.
There’s also the added ingredient of
Adam Crozier, the newly installed
chairman, best known for his major
shake-ups at Royal Mail and ITV.
Number crunchers at Credit Suisse
reckon the value of Costa Coffee and
Premier Inn as two separate
businesses would be 40pc higher than
the 13-times earnings rating now
ascribed to Whitbread shares based on
predictions
year.
p
pre
dictions for its 2019 financial
fi
The
T rationale behind splitting the
companies is that tthey can’t be
fused
fu ed more closely together and
fus
that
that it is harder to realise
further
f ther cost savings
fur
fu
saving with them
still
roof.
st under one roo
“We think the
th addition of
Elliott as the group’s
largest shareholder
will
sha
increase the likelihood
of break
break-up, but also
believe
believ there is
much
muc wider
shareholder
sha
support
for
sup
change,”
Credit
chan
Suisse said.
s
This view
is partly
vi
based on the
t assertion
£1bn
2005
£112m
2006
Whitbread
Brewing
£400m
2006
TGI Friday’s
ALAMY; AFP/GETTY; PA
Sources suggest
£3bn of value could
be realised if the
company decides to
break up the two
businesses, reports
Bradley Gerrard
Pizza Hut UK
(50%)
David Lloyd
£70m
2007
that each individual business would be
able to focus more aggressively on its
priorities – such as international
growth – without the unnecessary
bureaucracy of a parent company.
Cutting a centuries-old company
down the middle might ordinarily
prove controversial, but in the past
two decades, one of Whitbread’s most
regular activities has been selling off
businesses it no longer wanted. The
existing cohabitation of its two brands
under the Whitbread roof are, as its
historic portfolio suggests, simply an
anachronistic quirk.
Samuel Whitbread, who founded
the company in 1742, created the first
purpose-built mass-production
brewery in the UK when he moved to
London’s Chiswell Street. The firm
spent more than 200 years in the beer
£925m
2007
business, but in the late Eighties to
early Nineties, the company found
other activities, and went on a
spending spree which included buying
David Lloyd Leisure, Marriott Hotels,
TGI Fridays and Premier Lodge hotels.
This smorgasbord of companies
didn’t last long though. In 2000, it sold
off its brewery business, and over the
following seven years it slowly got rid
of all the companies it owned outright
or had stakes in, leaving it with just
Premier Inn and Costa.
The view of other investors seems
clear too. When Sachem Head’s
presence became known late last year,
one major shareholder said: “We think
now is the time to consider a demerger
of the Costa business. For many many
years we’ve seen [Whitbread] as a good
owner of these businesses and resisted
calls to break it up. But clearly Costa
has not had it as good since. No
shareholder would stick with this status
quo of keeping these two businesses
together forever.” Another leading
shareholder said the stock “would rise
if Sachem Head gets its way”.
Whitbread’s shares have started to
underperform on the broader market.
In the past year, the stock is down
nearly 3.5pc compared to a rise of
roughly the same magnitude by the
broader FTSE 100 index. The tough
conditions on the UK high street have
taken the perk out of Costa’s sales and
led some investors to call for a
slowdown in store openings.
But Costa does now boast a state-ofthe-art £38m roastery in Basildon,
Essex, which can handle 45,000 tons
of coffee beans a year, compared with
11,000 at its old Lambeth site. Its
Express coffee machine business is
also supporting the company’s growth,
and were it go to it alone, it could also
make the decision to bring the second
of two Chinese ventures in-house, just
as it did with one of them last year.
And for Premier Inn, a management
team focused purely on this business
could forge ahead with its expansion
into Germany and potentially seek out
a presence in other countries.
Sources with knowledge of the two
activists suggest the pair expect £3bn
of value could be realised if the
businesses were split, with the cost of
such a move being as little as £20m.
If those sums stack up, it doesn’t
look like Premier Inn and the “nation’s
favourite coffee shop” will be
bedfellows for too much longer.
Noble’s latest rescue plan seeks
to reappoint founder to board
By Jon Yeomans
THE founder of commodities trader
Noble Group could be in line for a
shock return to the board after the
stricken firm revised its rescue plan.
Singapore-listed Noble, which has
been scrambling to pull a restructuring
deal together since the start of the year,
said it would make Richard Elman an
executive director once more, after he
resigned last month.
The company infuriated shareholders earlier this year when it unveiled a
plan that would see a group of its biggest creditors take a 70pc stake in the
group in return for fresh capital.
Under the plan, management would
have been handed a stake worth up to
20pc, leaving existing investors with
just 10pc.
Noble said the new plan would raise
the stake for shareholders to 15pc. It
now has the backing of more than 75pc
of creditors for the restructuring,
which must still go to a vote of shareholders. Mr Elman, the British-born
metals trader who founded Noble in
Hong Kong in 1986, presided over a
rapid expansion in the company but
stepped back from day-to-day management last year after its mounting losses
led to collapse in its share price. Its
market cap once touched $10bn (£7bn)
but now stands closer to $140m.
Mr Elman said the last three years
15pc
Proportion of the new company that will
be owned by shareholders under Noble’s
revised rescue plan, up from 10pc
“have been particularly difficult for
the company and for me personally”
but that the new deal was “fair” to
shareholders.
Paul Brough, chairman, said Mr
Elman’s support was “uniquely important” and his experience and knowledge would “assist New Noble in the
Cala Homes boss steps down
after overseeing sale to L&G
By Rhiannon Curry
THE chief executive of Cala Homes,
one of the country’s largest housebuilders, has announced plans to
retire, a month after he oversaw the
sale of the business to insurer Legal
& General.
Alan Brown joined Cala in 1986 as
development manager, moving up the
ranks to become group managing
director during the grip of the financial
crisis in 2008.
He was appointed as chief executive
in September the following year, and
oversaw L&G’s acquisition of the 52pc
of Cala it did not already own last
month. L&G had initially bought a
stake in the business in 2013.
Cala said that it had already begun
the search for a new chief executive.
Mr Brown will leave his role at the end
of April and will be replaced by Graham Reid, group finance director, on
an interim basis.
Kerrigan Procter, chief executive
officer of Legal & General Capital,
said: “The group is much stronger and
more resilient as a result of [Mr
Brown’s] direction and the board is
confident of achieving continued and
sustainable profitable growth well into
the future.”
Last year, Cala boosted its revenue
by 27pc to £747.9m, while pre-tax profits increased by 14pc to £68.5m.
Mr Brown said he planned to take a
short time out from corporate life in
order to think about what roles he
might wish to pursue in the future.
Alan Brown will leave
the housebuilder at
the end of April. Cala
said it has begun a
search for a new
chief executive
“When I took over as chief executive, the company had significant
challenges and as a team we’ve
worked extremely hard to overcome
those challenges and build a large
and very successful business that
now enjoys the long-term support of
one of the UK’s blue-chip companies,”
he added.
realisation of its potential and,
once again, delivering value to all our
stakeholders”.
The move was labelled a “total joke”
by activist research group Iceberg,
which first flagged problems in Noble’s
accounting in 2015 when it published a
series of bombshell reports.
“With the same management and
same directors, the new Noble looks
awfully like the old Noble,” an Iceberg
spokesman said. “The other shareholders and perpetual [bond holders] are
far from happy.”
Noble started life supplying steelmakers in China with coal from Indonesia, before going on to ship metals,
grains and coffee all over Asia. The rescue plan would see Noble shrink back
to its earlier form.
However Noble’s rescue is by no
means assured. Its plan has been criticised by the Singapore Stock Exchange
over concerns it may be treating shareholders unfairly, while one of its biggest investors, Abu Dhabi-based
Goldilocks, has threatened a lawsuit.
Vedanta poaches
chief executive from
AngloGold Ashanti
By Jon Yeomans
MINING group Vedanta has poached
the boss of AngloGold Ashanti for its
new chief executive, filling a role that
has been vacant for a year.
The FTSE 250 company, which produces commodities such as oil, zinc,
iron ore and copper in India and Africa,
said
Srinivasan
Venkatakrishnan
would take the role from August.
Mr Venkatakrishnan has been with
the Johannesburg-listed gold miner for
18 years, the last five as chief executive.
Anil Agarwal, executive chairman
and Vedanta’s controlling shareholder
with a 69pc stake, hailed Mr Venkatakrishnan’s “strong track record managing a complex portfolio of operating
assets and projects across Africa”.
Mr Agarwal has made no secret of
his desire for Vedanta to compete with
the likes of BHP Billiton and Rio Tinto.
Mr Venkatakrishnan has won plaudits for completing two major mining
projects for AngloGold while attacking
the company’s debt pile. Analysts applauded the appointment, with Investec describing the move as a “good
man leaving for bigger things”.
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