HSBC profits fall below expectations in fourth quarter

(qlmbusinessnews.com via cityam.com – – Tue, 19th Feb, 2019) London, Uk – –

HSBC posted a 16 per cent annual profit rise but fell below expectations as market volatility hurt the bank in the final quarter.

Shares in the bank fell 3.3 per cent in early trading – the FTSE 100's sharpest faller – as it remained cautious on its outlook for 2019 due to Brexit uncertainty and the ongoing US-China trade war.

The figures

Pre-tax profit rose 16 per cent to $19.9bn (£15.4bn) for the full year, but was lower than analysts’ expectations of $22bn.

HSBC said revenue climbed to $53.8bn, a five per cent increase compared to 2017, driven by a rise in deposit revenue across its global businesses but particularly in Asia.

Return on tangible equity for shareholders rose to 8.6 per cent from 6.8 per cent the previous year.

But the bank’s adjusted jaws – a ratio measuring revenue against costs – was in the negative at -1.2 per cent.

Achieving positive jaws is seen as important for investors and banks as it shows that revenue growth is outpacing costs rates.

Why it’s interesting

HSBC blamed its failure to achieve “positive jaws” on market weakness in the fourth quarter – revenue fell eight per cent over the final three months of 2018 compared with the previous year.

The bank said: “Positive jaws remains an important discipline in delivering our financial targets and we remain committed to it in 2019.”

The world’s major banks have all so far been impacted by the volatility seen across global markets at the end of last year.

What HSBC said

Chief executive John Flint said: “These are good results that demonstrate progress against the plan that I outlined in June 2018.

“Profits and revenue were both up despite a challenging fourth quarter, and our return on tangible equity is significantly higher than in 2017.

“This is an encouraging first step towards meeting our return on tangible equity target of more than 11% by 2020.”

What analysts said

Head of markets at interactive investor, Richard Hunter said: “A tough fourth quarter took its toll on some of the numbers, while a slowing Chinese economy, partially fuelled by the ongoing trade spat with the US, has yet fully to wash through.

“As such, 2019 could begin to see some real impact in an Asian region whose reported profits contribute almost 90% of the group total.”

Steve Clayton, manager of Hargreaves Lansdown's select UK income shares fund, which holds a position in HSBC, said the results were “disappointing.”

He said: “HSBC has always been a bank built around facilitating international trade between Asia and the rest of the World.

“Today’s tariff spats between the US and China are hardly helpful and could begin to hurt the group’s customers in Asia and beyond.

He added: “These results are disappointing, but a bank that has just reported underlying annual profits of almost $22bn and grown income, controlled costs and raised its return on equity can hardly be described as in crisis.”

By Callum Keown

Honda to close Swindon plant with the loss of about 3,500 jobs in 2022

(qlmbusinessnews.com via theguardian.com – – Tue, 19th Feb 2019) London, Uk – –

Denials by the North Swindon Tory MP will not save May from the burden of this decision

We told you so. That will be the reaction of Britain’s leading business groups to the news that Honda is to close its Swindon plant with the loss of about 3,500 jobs in 2022.

For at least a year, bodies such as the CBI, the EEF and the British Chambers of Commerce have been telling ministers that the uncertainty caused by Brexit would have serious consequences. The Honda announcement – with its knock-on consequences for its UK supply chain – will make the employers organisations even more insistent that a no-deal outcome should be ruled out.

Brexit was not the only factor involved. Honda production in Swindon never fully recovered from the deep global recession of 2008-09. Before the financial crisis, the plant produced 230,000 cars a year, but that is now down to 161,000. Of the three models once made in Swindon, two – the Jazz and the CR-V – have been moved elsewhere, leaving just the Civic.

Global factors have not helped either. There has been a sharp decline in demand for diesel vehicles. Japanese companies have a tendency to pull production back home when the world economy looks shaky. What’s more, Donald Trump’s threat of import tariffs on European-made cars may make the export of Swindon’s Civics to the US more expensive.

Honda’s original investment in Swindon in 1985 was motivated by a desire to have a plant inside the EU and so avoid paying the tariff – currently 10% – on imported vehicles. But that tariff will be phased out as a result of a new free trade deal between the EU and Japan which came into force at the start of this month.

Justin Tomlinson, who as Conservative MP for North Swindon represents many of the Honda workforce, said he had been told by the company and the business secretary, Greg Clark, that the decision was down to global market trends and not related to Brexit.

This, though, is overegging things. The hit to global demand was far more severe in 2008-09 than it is at present. Trump may simply be sabre-rattling. The 10% tariff on cars imported into the EU will not be fully phased out until 2027, five years after the Swindon plant is due to close. In 2022 it will still be more than 6%.

So while Honda’s decision is not simply about Brexit, uncertainty caused by Brexit played its part. Japanese policy makers – from the prime minister, Shinzo Abe, down – have been pressing for a soft Brexit ever since the referendum, initially privately but recently more openly.

Politically, therefore, the Honda decision will add to the already considerable pressure on Theresa May.

“The threat of Brexit is already having a damaging impact on investment decisions in the UK,” said Rachel Reeves, the Labour chair of the Commons business committee. “The PM now needs to rule out no deal immediately and keep us in the single market and customs union rather than risk further fatal damage to our car industry.”

By Larry Elliott

UK cyber-security chiefs, say Huawei risk can be managed

(qlmbusinessnews.com via bbc.co.uk – – Mon, 18th Feb 2019) London, Uk – –

Any risk posed by involving the Chinese technology giant Huawei in UK telecoms projects can be managed, cyber-security chiefs have determined.

The UK's National Cyber Security Centre's decision undermines US efforts to persuade its allies to ban the firm from 5G communications networks.

The Chinese government is accused of using Huawei as a proxy so it can spy on rival nations.

But Huawei has said it gives nothing to Beijing, aside from taxes.

Australia and New Zealand have blocked or banned Huawei from supplying equipment for their future fifth-generation mobile broadband networks.

The US has restricted federal funding to buy Huawei equipment, while Canada is reviewing whether the company's products present a serious security threat.

Most of the UK's mobile companies – Vodafone, EE and Three – have been working with Huawei on developing their 5G networks.

They are awaiting on a government review, due in March or April, that will decide whether they can use Huawei technology.

As first reported by the Financial Times, the conclusion by the National Cyber Security Centre – part of the intelligence agency GCHQ – will feed into the review.

The decision has not yet been made public, but the security agency said in a statement it had “a unique oversight and understanding of Huawei engineering and cyber security”.

BBC business correspondent Rob Young said the National Cyber Security Centre's conclusion “will carry weight”, but said the review could still rule against Huawei.

In an interview, Huawei's cyber security chief John Suffolk told the BBC: “We are probably the most open and transparent organisation in the world. We are probably the most poked and prodded organisation too.”

The former UK chief information officer added: “We don't say ‘believe us' we say ‘come and check for yourself', come and do your own testing and come and do your own verification.

“The more people looking, the more people touching, they can provide their own assurance without listening to what Huawei has to say.”

Analysis

Rory Cellan-Jones, technology correspondent

If anybody knows just how Huawei works and the threat it might pose to the UK's security, it is the National Cyber Security Centre.

This arm of GCHQ has been in charge of an annual examination of the Chinese telecoms giant's equipment, and expressed concerns in its most recent report – not about secret backdoors, but sloppy cyber-security practices.

The NCSC has also been giving advice to UK mobile operators as they order the equipment for the rollout of their 5G networks later this year.

They feel they have been given the same cautious nod the agency appears to have given the government's Supply Chain Review: keep Huawei out of the core of your 5G networks, but you are OK to use its equipment at phone masts as part of the mix of suppliers.

Australia and New Zealand have taken a very different view by taking a far harder line against Huawei.

That isn't because they know something about the Chinese firm which the NCSC has missed.

Their decisions were probably based on an assessment of the political as well as security risk of ignoring the urging from the US to shut Huawei out.

And whatever the NCSC's advice, similar factors will determine the UK government's final decision.

A spokesperson for the Department of Culture, Media and Sport, which is leading the review into the future of the telecoms industry, said its analysis was “ongoing”.

“No decisions have been taken and any suggestion to the contrary is inaccurate,” they said in a statement.

Last year, BT confirmed that it was removing Huawei's equipment from the EE core network that it owns.

The network provides a communication system being developed for the UK's emergency services.

Fifth-generation mobile broadband is coming to the UK over the next year or so, promising download and browsing speeds 10 to 20 times faster than those 4G networks can offer.

The US argues Huawei could use malign software updates to spy on those using 5G.

It points to China's National Intelligence Law passed in 2017 that says organisations must “support, co-operate with and collaborate in national intelligence work”.

Critics of Huawei also highlight that its founder Ren Zhengfei was a former engineer in the country's army and joined the Communist Party in 1978.

Huawei recently attracted attention when its chief financial officer, Meng Wanzhou, was arrested and accused of breaking American sanctions on Iran.

The Rail Delivery Group expect some prices to rise and others to fall under ticketing reconstruction

(qlmbusinessnews.com via news.sky.com– Mon, 18th Feb 2019) London, Uk – –

The Rail Delivery Group says some prices would rise and others would fall under the plan to set fares “more flexibly”.

Train operators are calling for a major shake-up of fares that would throw out current rules governing peak and off-peak pricing and also end the need for so-called split-ticketing.

The Rail Delivery Group (RDG) says it wants to simplify the system under the principle that customers “only pay for what they need and are always charged the best value fare”.

It said some fares would go up and some would go down under the plan though claimed that overall it would be “revenue neutral”.

The RDG said updating regulations on peak and off-peak travel “would mean ticket prices could be set more flexibly, spreading demand for a better customer experience”.

It said current rules resulted in under-used and more expensive services at natural peak times and overcrowded trains at the “shoulder peak” – immediately before and after the peak time.

The body, which represents Britain's train operating companies, said however that it recognised concerns about protecting “affordable access to the walk-up railway” and was proposing for some services to have a cap on the overall level of revenue that can be raised.

It said its plan for passengers to always be charged the best value fare would also remove the need for “split ticketing”

That is where savvy travellers have worked out that they can save money by paying for multiple tickets for different sections of the same journey.

For example, the £150 cost of a journey from Manchester to Edinburgh would currently be reduced to £92.20 by buying two tickets: one from Manchester to York, and a second from York to Edinburgh.

Another part of the RDG plan would see commuters benefit from the kind of weekly capping system currently available for journeys within London.

Pay-as-you-go pricing and a “tap-in, tap-out” system would allow those who currently buy weekly season tickets to save money when they travel fewer than five days or are able to travel off-peak.

That could benefit the increasing numbers of people who work part-time.

RDG chief executive Paul Plummer said: “Reconfiguring a decades-old system originally designed in an analogue era isn't simple, but this plan offers a route to get there quickly.

“Ultimately, it is up to governments to pull the levers of change.

“So this report is a call on them to work with us to update the necessary regulations and subsequently the system of fares.”

The “easier fares for all” plan has been submitted to the government's Williams Review, which is evaluating all aspects of the rail network.

Lilian Greenwood MP, chair of the Commons transport select committee, said the proposals showed a “welcome recognition that things need to change”.

But she added: “The devil will be in the detail, and my committee… will be keeping a close eye on this work to ensure it develops in ways that are fair, transparent, recognise the needs of passengers, and take account of the vital contribution that the railway makes to our society and economy.

“In the meantime, passengers still require reassuring that enough trains will turn up – on time and fit to run – particularly after the timetabling chaos in May 2018.”

By John-Paul Ford Rojas


Ritz – The inventor behind the famous luxurious modern hotel business

Source: wocomoTRAVEL

This is the first and only filmed biography about Cesar Ritz, inventor of modern hotel business. It is the story of a peasant boy in a remote mountain area and thus starts there, in the place he grew up in, Niederwald. The film follows Ritz’ way to Paris, Cannes, Rome and London. Finally, the film ends in the clinic where Ritz spent his last days, back in Switzerland. The film features interviews with family, friends and experts: the directors of the Ritz in Paris and Rome, a follower of the chef Escoffier, and Jacques Tardi, an artist specializing in the “Commune de Paris” and thus knowing the Paris of the Ritz period particularly well.

15 Things To Consider If You Get Rich All of a Sudden

Source: Alux.com

In this video we'll try to answer the following questions: What should you do if you gen rich all of a sudden? What do to if you inherit money? How to manage a large sum of money? What should you do if you get rich? What do to if you win the loto? How to manage wealth? How to get wealthy? How to maintain being rich? How to keep your wealth? How not to lose money? Why do people go broke after they went rich? How do people lose money? What if you inherit a fortune? I just inherited a million dollars, what do I do? How to you being investing money? What you should know about money?

RBS reports second successive year of profits as dividend soars

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(qlmbusinessnews.com via telegraph.co.uk – – Fri, 15th Feb 2019) London, Uk – –

Royal Bank of Scotland has reported its second successive year of profits and a higher than expected dividend, resulting in a near £1bn windfall for the taxpayer.

The lender, still 62% owned by the Government, said annual pre-tax profits more than doubled to £1.62bn, while pre-tax operating profit rose 50% to £3.4bn.

It marks the bank's second year in the black following a decade-long run of stinging losses, during a period marred by crisis-era legacy and conduct charges.

The Government will also pocket £977m as RBS paid only the second dividend since its £45bn bailout a decade ago.

The cash will be given to UK Government Investments, which manages the taxpayer's stake in the lender.

The bank on Friday paid out a 3.5p final dividend and a 7.5p special dividend, taking the total to 13p – 60pc higher than expected. It will return a total of £1.6bn to shareholders in the year.

Chief executive Ross McEwan said: “This is a good performance in the face of economic and political uncertainty, with bottom line profits more than double what we achieved the previous year.

“We are also announcing an intention to pay back more capital to shareholders and almost £1bn is set to be returned to UK taxpayers for 2018.

“With strong capital and liquidity levels, we are well positioned to support the UK economy. Our total lending to business and commercial customers reached over £100bn at the end of 2018.”

RBS begun paying dividends since August, when it reached a $4.9bn (£3.7bn) settlement with US authorities over claims that it mis-sold mortgages in the run-up to the financial crisis.

Friday's figures take into account conduct and litigation costs of £1.28bn.

The RBS annual report, published alongside the results, showed that Mr McEwan's total pay package rose by £100,000 to £3.6m last year. Bonuses to staff will total £335m.

Accounts show that RBS stripped out £278m in costs last year, and aims to slash another £300m this year.

The stellar figures will prompt the Government to consider when to recommence the next round of share sales.

Last week the lender gained shareholder approval that allows it to buy back up to £1.5bn worth of shares from the Treasury.

The move, which aims to speed up its privatisation and deploy excess capital, permits RBS to purchase up to 4.99% of the Government's stake in any one year.

RBS has been majority taxpayer owned since 2008, when it received a £45bn bailout at the height of the financial crisis.

The Treasury plans to sell its stake by 2024 but is expected to lose billions in the process.

The bank's shares have rallied since December and rose 1pc to 244p on Friday, but that remains less than half the bailout price of 502p a share.

By Associated Press

Hotel chain attribute shortage of workers due to Brexit uncertainty for fall in profits

(qlmbusinessnews.com via bbc.co.uk – – Fri, 15th Feb 2019) London, Uk – –

Millennium & Copthorne Hotels has blamed a shortage of workers due to Brexit uncertainty for contributing to falling profits.

The hotel chain reported a 28% fall in pre-tax profits to £106m for the 12 months to 31 December 2018, compared with the same period in 2017.

It said Brexit concerns had affected its UK hotels, particularly in London.

The hotel chain also blamed the US-China trade war, minimum wage and competition from Airbnb for its woes.

For the fourth quarter of 2018, pre-tax profits dropped 76% to £7m.

In particular, revenue per available room in London dropped 7.4%, partly due to the closure of its Mayfair hotel for refurbishment.

“Concerns about Brexit have affected the Group's UK hotels especially in London, where the hotels started to face difficulties in recruiting EU workers which currently comprise more than half of the London workforce,” it said in a statement.

The hotel chain also said that it had been affected by the increase in the minimum wage, which came into force last year.

“The shortage of talent-from rank and file to senior management-is intensifying with many new hotels being built around the world, not to mention the growth of Airbnb and serviced apartments,” said chairman Kwek Leng Beng.

He stressed that all hospitality businesses would “need to evolve and embrace” changes in the industry in order to remain relevant and profitable.

Airbus to halt A380 production blaming weak sales

(qlmbusinessnews.com via news.sky.com– Thur, 14th Feb 2019) London, Uk – –

UK jobs are threatened as Airbus says there was too little love in the airline sector for the A380's future to be viable.

Airbus has blamed weak sales for its decision to scrap production of the A380 superjumbo – the world's largest airliner.

The European aerospace giant confirmed on Thursday it would deliver the final aircraft, with its two decks of cabins and room for 544 passengers, in 2021.

Following months of speculation over the plane's future, Airbus said it had taken the decision after Emirates scaled back an order for A380s – choosing instead to focus on smaller planes.

Airbus chief executive Tom Enders said: “As a result of this decision we have no substantial A380 backlog and hence no basis to sustain production, despite all our sales efforts with other airlines in recent years.

“This leads to the end of A380 deliveries in 2021. The consequences of this decision are largely embedded in our 2018 full-year results.”

They showed losses of £788m from the A380 programme, with the hugely delayed A400M military transporter plane also putting a dent in profits.

Nevertheless, Airbus said it made £2.7bn in overall net profits – a jump of 29% on the previous year.

Shares jumped by 6% in early deals following the announcements.

Mr Enders said the A380 decision marked “the end of the large four-engine aircraft” in global aviation.

The company said it planned talks with unions over the potential for harm to up to 3,500 jobs connected to the superjumbo, which is assembled in France.

The Unite union said it was seeking assurances over any impact on the UK workforce, which Mr Enders told reporters was yet to be evaluated.

Airbus makes wings for the A380 in the UK – employing 6,000 staff at Broughton and 3,000 at Filton.

The firm said an increase in production of its A320 model would offer “a significant number of internal mobility opportunities” – but Brexit could also form part of the decision-making process.

The chief executive warned last month in a company video it could move operations abroad in the event of hard Brexit “madness”.

The company later admitted to Sky News that Downing Street had asked it to make clear the impact of a no-deal scenario.

The A380 was first launched 14 years ago as a challenger to fierce rival Boeing's 747 jumbo jet but its popularity has struggled to take off.

Emirates said it was “disappointed” to give up its order – citing new plane and engine technology – leaving just 14 superjumbos in the production pipeline for the Middle East carrier as it opted to pick up a total of 70 of the smaller A350 and A330neo models instead.

The airline said it planned to keep flying the A380 well into the 2030s and Airbus confirmed the planes would continue to be supported.

Just one other airline has A380s on order, with Japan's ANA due to have three delivered.

Air industry expert, Professor Andreas Wittmer from the University of St. Gallen, commented: “From our research we know that A380 was well perceived by passengers.

“Furthermore, its fuel consumption per pax (person) was low.

“But based on its whole weight and the four engines it was not efficient enough.

“New engines and a lighter version of the A380 would have been needed. But the A380 was not break even taking into account the whole planning and production set up costs.”

By James Sillars, business reporter

Barclays apologise to customers for online banking outage

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(qlmbusinessnews.com via cityam.com – – Thur, 14th Feb 2019) London, Uk – –

Banking giant Barclays has apologised to customers after an online outage left many unable to access their accounts today.

Customers said they were prevented from accessing the Barclays mobile banking app and other online services for much of the morning.

The bank received a flurry of complaints and apologised for what it said was an “unplanned outage” as its tech team rushed to fix the problem.

Despite proclaiming services were up and running at 9am, many complained they were still unable to get into their accounts.

Barclays said on Twitter the problem affected “a number of customers” and it was investigating the causes.

Earlier this week Barclays customers were prevented from accessing their account online, by phone, or through the app as part of planned work to upgrade systems on Sunday.

The banking giant suffered a major outage in September last year, as online, telephone and branch services went down for several hours.

High street retail banks have been plagued with IT problems over the past 18 months as many attempt to upgrade systems.

Last month thousands of Lloyds Bank customers were unable to make payments as the bank was hit by an outage, which also affected Halifax and Bank of Scotland.

TSB confirmed earlier this month that a move away from its IT systems last year cost the challenger bank £330m.

The chaos prevented up to 1.9m people accessing their accounts and around 80,000 customers ended up leaving the bank last year.

By Callum Keown

UK inflation in January fell to 1.8%, the lowest in two years

(qlmbusinessnews.com via bbc.co.uk – – Wed, 13th Feb 2019) London, Uk – –

UK inflation fell to 1.8% in January, the lowest in two years, the Office for National Statistics said.

This is down from 2.1% the previous month.

A fall in electricity, gas and other fuels drove the decline, the ONS said.

Head of Inflation Mike Hardie said: “The fall in inflation is due mainly to cheaper gas, electricity and petrol, partly offset by rising ferry ticket prices and air fares falling more slowly than this time last year”.

It means that rises in pay are now now outpacing inflation.

The rate of inflation is now below the Bank of England's 2% target and has fallen from the five-year peak of 3.1% in November 2017 in the wake of the Brexit referendum vote.

Energy prices fell because of Ofgem's energy price cap which came into effect from 1 January 2019, the ONS said.

UK government backs investigation of Facebook and Google dominance

(qlmbusinessnews.com via theguardian.com – – Wed, 13th Feb 2019) London, Uk – –

UK government backs investigation into dominance of Facebook and Google

Facebook and Google could be forced to open up their businesses and share details of how their advertising model works, after the government backed an investigation into concerns that their dominance of the online advertising business is hurting news publishers.

News outlets have long complained that Facebook and Google, which together account for the vast majority of digital advertising in the UK, have sucked out billions of pounds of revenue that previously supported the cost of journalism.

The culture secretary, Jeremy Wright, told the House of Commons on Tuesday that he had asked the Competition and Markets Authority to launch a study of the “largely opaque and extremely complex” world of online advertising.

The study could lead to a full-blown investigation, which would allow the competition regulator to use its legal powers to obtain information from the secretive technology companies.

The recommendation to launch the inquiry was included in Dame Frances Cairncross’s report on the future of the press, which was released on Monday.Advertisement

News outlets have struggled to compete with the scale and targeted advertising offered by the technology companies, which have an enormous amount of data about their users.

Wright, who has previously insisted he does read newspapers, also said he had asked the Charity Commission to investigate Cairncross’s recommendation for a form of charitable status for news outlets that focus on local and investigative journalism.

The cabinet minister told the Commons that civil servants in his department would also conduct a separate investigation into the regulation of the wider online advertising market, which posed “social and economic challenges” in its current state.

This Whitehall investigation could result in a regulator being given new powers to oversee the online advertising marketplace, in line with the government’s wider policy of ensuring the rules and regulations that apply to offline institutions also apply to their internet equivalents.

Wright also said he would ask the media regulator, Ofcom, to examine whether the BBC was harming for-profit local newspapers by invading their turf and publishing material for free.

However, he appeared to be less enthusiastic about Cairncross’s recommendation that the government should establish an institute for public interest news to promote investigative and local journalism, which would distribute money from the state and other donors to support local reporting.

Labour broadly welcomed Wright’s announcements, although the shadow culture secretary, Tom Watson, urged the government to avoid targeting the BBC as part of its overhaul, suggesting that in some communities the public broadcaster was the only outlet that still employs journalists to do basic reporting of local politics.

Watson also told the Commons he was tired with the reluctance of the major technology companies to submit themselves to parliamentary scrutiny.

“Even in these dark days of Brexit and increasing division in politics, there is one man who is uniting this house: Mark Zuckerberg,” the Labour MP said. “He insulted us all when he refused to attend the [Department for Digital, Culture, Media and Sport] select committee. He may think the UK market and our institutions are not a priority for him. But I hope he knows there is now a new resolve that transcends our party differences to deal with the abuses by his company and others.”

Several Conservative MPs criticised Facebook and Google, with the former cabinet minister Iain Duncan Smith calling for the “monopoly cartels” to be broken up because they were “damaging to people as individuals, and damaging to the functioning democratic society”.

However, the National Union of Journalists general secretary, Michelle Stanistreet, pointed out that many local newspaper cuts were a result of publishers slashing costs to maintain their profit margins.

By Jim Waterson

Debenhams secures £40 million lifeline from lenders

(qlmbusinessnews.com via uk.reuters.com — Tue, 12th Feb 2019) London, UK —

(Reuters) – Shares in Debenhams surged by a third in value on Tuesday after the embattled UK retail chain secured £40 million ($52 million) in extra funding from some of its lenders, giving it more time to secure its longer-term future.

Once Britain’s biggest department store chain, Debenhams has been struggling with net debts of almost 300 million pounds and plans to close 50 underperforming stores, putting about 4,000 jobs at risk, after it failed to keep pace with consumers moving online and to cheaper outlets.

It said the new loan, agreed for a period of 12 months, would act as a bridge to “facilitate a broader refinancing and recapitalisation”, adding it was still talking to its stakeholders and would conclude a “comprehensive refinancing”.

The retailer, which is striving to avoid the fate of collapsed rivals BHS and House of Fraser, also said it had signed an agreement with Hong Kong-listed supply chain solutions firm Li & Fung to develop a strategic sourcing partnership.

Shares in Debenhams, which lost more than 85 percent of their value in 2018, were up 33.9 percent at 4.23 pence by 0820 GMT. That lifted the company’s market value to 52 million pounds, although some analysts questioned whether the extra funding would be enough or whether Debenhams might yet take up an offer of financing help from Mike Ashley’s Sports Direct, its biggest shareholder.

“This interim solution … shows the ongoing discussions with their lenders are constructive and ensures Debenhams can get through its working capital peak in April,” analysts at brokerage Investec said in a note.

“The strategic announcement with Li & Fung also enables them to consolidate its supplier base more quickly and helps those suppliers which have a credit insurance issue.”

UK media have reported previously that Debenhams had turned down an offer of a similar cash injection from Ashley’s Sports Direct, which already holds almost 30 percent of the company and has snapped up businesses after a number of UK high street collapses.

Other London-based analysts remained downbeat about Debenhams’ prospects.

“While this (refinancing) takes away the immediate pressure and provides a short respite, we believe Debenhams is likely to move forward with a CVA in order to reduce its lease commitments and store numbers, with longer-term financing also likely to be contingent on some form of equity raise,” John Stevenson, retail analyst at Peel Hunt, said in an email.

“The prospect of a CVA and equity raise may well secure the future of Debenhams, but also leaves little equity value for existing shareholders and we reiterate our Sell stance.”

Before Tuesday’s plan was announced, Debenham’s combined credit score – which measures how likely a company is to default in the next year on a scale of 100 (very unlikely) to 1 (highly likely) – was “1”, Refinitiv Eikon data showed.

By Noor Zainab Hussain

Nissan takes $65m Ghosn charge as it downgrades annual profit forecasts

(qlmbusinessnews.com via news.sky.com– Tue, 12 Feb 2019) London, Uk – –

The carmaker downgrades its full-year forecasts as a tougher world economy takes its toll on third quarter profits

Nissan says it has recognised 9.2bn yen (£64.7m) in costs related to scandal-hit Carlos Ghosn while downgrading its annual profit forecasts.

The Japanese carmaker, which sacked Ghosn as its chairman in November after uncovering alleged financial misconduct, said the charge covered compensation and expenses over several years.

He remains in a Tokyo prison cell awaiting trial and denies all the accusations he faces in the country.

Nissan made the announcement while revealing financial results covering the third quarter of its financial year to 31 December which showed a 77% drop in profits to 70bn yen (£740m).

That was despite revenues rising by 6% in the period compared to the same quarter in 2017.

The company pointed to challenging conditions continuing globally but said falling sales in North America – where it had been discounting heavily – and in Europe were propped up by gains in Japan, China, Thailand, the Philippines and Latin America.

Nissan, like rivals, is facing challenges on several fronts from the slowdown in the world economy to the demonisation of diesel – particularly in Europe.

Sky News revealed last month how Nissan had decided to maintain production of its X-Trail model in Japan – despite a previous pledge to create over 700 more jobs in Britain through an expansion of its Sunderland operation.

The company later admitted that Brexit uncertainty had also clouded the investment.

Nissan's financial results showed profits were 45% down on a rolling nine month basis.

It said that as a result of its performance it was revising lower its forecasts for full-year revenues and profits.

The company predicted earnings of 410bn yen (£2.9bn) – a fall on 90bn yen on its earlier expectations.

Christian Stadler, professor of strategic management at Warwick Business School, said: “The departure of Carlos Ghosn, who was such a talismanic figure for Nissan, is likely to have a bigger effect during the year ahead, as the company attempts to address the distribution of power in its relationship with Renault.

“At the moment Nissan is by far the bigger player in terms of sales. It could also be a factor in Nissan's decision to lower its forecasts for the year ahead.

“Mr Ghosn was very much sales driven. In his absence the company may focus more on profits, but that will be difficult.

“The economic downturn will put pressure on car manufacturers to be more competitive with their prices, which makes it harder to maximise profits while sales are falling.

“That could be bad news for British car manufacturing if vehicles are subject to new tariffs after Brexit, as Japan's new deal with the EU could make it cheaper to build cars elsewhere,” he concluded.

By James Sillars

UK economy expanded at its slowest rate in six years in 2018

(qlmbusinessnews.com via bbc.co.uk – – Mon, 11th Feb 2019) London, Uk – –

The UK economy expanded at its slowest rate in six years in 2018.

Growth in the year was 1.4%, down from 1.8% last year and the lowest since 2012, the Office for National Statistics (ONS) said.

It blamed slower factory output and car production for the slowdown, among other factors.

It follows forecasts of even slower growth in 2019 as the UK grapples with Brexit uncertainty and a weaker global economy.

According to the ONS, quarterly growth also slowed, falling to 0.2% in the three months to December – down from 0.6% in the three months to September.

Head of GDP at the ONS, Rob Kent-Smith said: “GDP slowed in the last three months of the year with the manufacturing of cars and steel products seeing steep falls and construction also declining.

“However, services continued to grow with the health sector, management consultants and IT all doing well.”

Sports Direct Mike Ashley withdraws Patisserie Valerie bid

(qlmbusinessnews.com via theguardian.com – – Mon, 11th Feb 2019) London, Uk – –

Sports Direct pulls out of battle for beleaguered cake chain claiming to be at ‘disadvantage’

Sports Direct has pulled out of the bidding for Patisserie Valerie, just two days after emerging as a surprise suitor for the stricken cake chain.

Mike Ashley’s sportswear group walked away from talks on Sunday, ending the prospect that Patisserie Valerie could join House of Fraser, Evans Cycles and Sofa.com in the Sports Direct stable.

The approach, made last Friday, was an unexpected twist in the battle to rescue Patisserie Valerie, which fell into administration in January after a £40m black hole was uncovered in its finances.

It is understood that Ashley made a late bid reportedly worth more than £15m for Patisserie Valerie, but was told the offer was too low.

According to the Financial Times, Sports Direct was unhappy about being shut out of the bidding process, saying it “not been allowed access to a data room, any financial information or meetings with management” to allow it to improve its bid.

Sports Direct argued it was “at a serious disadvantage as a bidder” if it was left to rely on financial information in the public arena, which it claimed was “at best unreliable”.

It is understood Sports Direct was given access to the data room after tabling its first offer but the retailer nevertheless withdrew.

Sports Direct had bid for Patisserie Holdings – the parent company of Patisserie Valerie as well as the Druckers Vienna Patisserie, Philpotts, Baker & Spice and Flour Power City brands. The deadline for first-round bids was 1 February, a week before Ashley entered the fray.

Administrators at KPMG, which is running the company, has closed 71 of Patisserie Valerie’s nearly 200 stores and concessions, as it seeks a buyer for the company. Dozens of bids were received, either for the whole company or some of its stores. Around 900 jobs have been lost, with another 2,800 at risk if a buyer can’t be found.

Several parties are understood to be carrying out due diligence before submitting final-round bids to KPMG, but it is not clear when the bidding process will be concluded.

Coffee chain Costa, which is now owned by Coca-Cola, and a number of other parties are thought to have tabled offers for a parcel of stores but it is not clear if any parties want Patisserie Valerie as a going concern.

Patisserie Valerie blamed its financial plight on “very significant manipulation” of its balance sheet and “extensive” misstatement of its accounts. It suspended finance chief Chris Marsh, who subsequently resigned after being arrested and bailed by police.

The company was valued at £450m before the black hole was discovered. Its collapse into administration has wiped out shareholders, including chairman Luke Johnson.

By Sarah Butler

Victoria’s Secret Rise And Fall As Rival Competition Surge In Popularity On Social Media

Source:CNBC

When Victoria's Secret entered the market in the 1980s, it revolutionized the retail of women's undergarments. Previously, women viewed their bras on a binary — strictly functional for day-to-day or fancy for special occasions. Victoria's Secret combined the structure and function of day-to-day bras with the fun prints and feel of fancier bras. But 30 years later, the brand is falling behind the times as consumer priorities shift and younger brands like Aerie and Rihanna's Savage x Fenty adapt.

The lingerie brand, owned by L Brands, has reported negative same-store sales for the past three years now, as women steer clear of its bedazzled bras and underwear for comfortable pieces in cooler colors. That's as a new cohort of start-ups like Adore Me, Third Love, Lively, Cuup and Knix are resonating with younger consumers as they surge in popularity on social media channels like Instagram.

Wall Street analysts and investors alike are unsure if L Brands will be successful in reinventing Victoria's Secret's increasingly obsolete bras business. Even a recent slew of heavy promotions doesn't appear to be moving products off of shelves, according to UBS analyst Jay Sole, who's been tracking promotional activity in stores and online.

Why Whale Poop Can Garner More Than $7,000 A Pound

Source: Business Insider

A small percentage of sperm whales produce ambergris, a clump of squid beaks and fatty secretions that scientists believe exits through the whales’ bowels Ambergris is coveted by the fragrance industry for a chemical it contains called ambrien, which suspends smells in the air, and for its own unique scent Quality pieces of ambergris, which ambergris hunters snatch up as they wash ashore, can garner more than $7,000 a pound.