Centrica boss Iain Conn to step down as energy firm posts first-half losses

(qlmbusinessnews.com via theguardian.com – – Wed, 31st July, 2019) London, Uk – –

Owner of British gas cuts dividend as it announces Iain Conn will leave next year

Iain Conn has agreed to step down as chief executive of Centrica, the owner of British Gas, after the energy company swung to a loss for the first half of the year and slashed shareholder payouts.

The embattled energy boss said he would retire from the board by next year’s annual general meeting, five years after taking the reins of the company in 2015.

The former BP executive has faced increasing pressure to step down after a steady decline in the company’s market value, which is now a quarter of what it was when Conn took the top job.

Since then Britain’s biggest energy supplier has lost over 1m customer accounts and made thousands of job cuts as part of a plan to steady the company.

Conn said he had “agreed with the board that this is the right thing to do” after “months of talks” over the company’s future.

He announced his departure alongside worse-than-expected financial results for the first half of the year, and a “deeply regrettable” dividend cut for investors.

Centrica’s shareholders, which include about 600,000 individual investors, will receive less than half the expected return after the company slashed its interim dividend by 58% to 1.5p a share. It said the full-year dividend total will also be cut by 58%, from 12p to 5p a share.

The company’s share share price plunged 19% on Tuesday to 77p, the lowest in more than 20 years, making it the biggest faller on the FTSE 100.

The company announced its lowest dividend in 15 years less than four months after revealing it had handed Conn a 44% pay rise for 2018 to £2.4m. The hike in pay angered trade unions and was awarded despite a difficult year in which the company imposed two bill increases, warned on profits and announced 4,000 job cuts.Advertisement

Conn said he had reinvested most of his bonus payouts in the company while he worked to shift Centrica’s traditional energy business towards selling energy services and devices.

Many City analysts are unconvinced that the plan can bear fruit after a series of disappointing financial results for Centrica in recent years.

The company posted a pretax loss of £569m for the six months to 30 June compared with a profit of £415m last year.

Centrica blamed an “exceptionally challenging” environment in the first half of 2019, including the government price cap on standard energy tariffs and additional pension contributions.

The swing to a pretax loss is the latest blow to the owner of Britain’s biggest energy supplier which was already planning to sell its nuclear, oil and gas business units to pay off debts and cut thousands of jobs from its shrinking workforce.

“It has been an exceptionally challenging first half with some really difficult circumstances,” Conn said. “Our results were weak.”

The group took a pretax charge of £346m in the first half. This included £257m of restructuring costs, £64m one-off pension costs and asset writedowns of nearly £90m, partly due to the fall in near-term gas prices.

But Conn said the company “has momentum” which should see a return to growth in the second half of the year and into 2020.

Although British Gas lost 178,000 UK home energy supply accounts in the first half, the figures mark a slowdown in losses compared with recent years because its prices are more competitive and its brand remains strong, Conn said.

He said Centrica’s new deal with Ford to provide electric vehicle tariffs and charge points was an example of “where we are moving to” in the future.

By Jillian Ambrose and Julia Kollewe

Greggs bakery chain to trial late-night opening hours

(qlmbusinessnews.com via bbc.co.uk – – Wed, 31st July 2019) London, Uk – –

Greggs is to launch a pilot of extended opening hours in a selection of its shops across the UK.

Some branches already stay open late, with one in Westminster closing at 23:00 and another in Newcastle opening until 20:30 or 21:00.

The bakery chain's announcement came as it reported a strong rise in sales and profits, partly due to the popularity of its new vegan sausage roll.

Profits in the first half of the year jumped to £36.7m from £24.1m.

Total sales rose 15% to £546m, while like-for-like sales – which strip out the impact of store openings and closures – in company-managed shops were up 10.5%.

‘Food-on-the-go' brand

Greggs said its new vegan sausage roll had proved extremely popular and was already one of its top sellers.

Traditional bakery favourites have continued to sell well, alongside a growth in Fairtrade coffee, breakfast and new hot food options. The firm has also trialled click and collect services and delivery.

Chief executive Roger Whiteside told the Today Programme: “We've converted ourselves from a traditional bakery business to a modern food-on-the-go brand with new shops, extended seating, extended trading hours, wi-fi, better products, better value and we're more in touch with where the customers are today.”

The company has been opening about 100 new shops a year and hopes to open store number 2,000 in the next few weeks.

It is aiming for 2,500 shops, but new ones are more likely to be in transport hubs and office parks, rather than High Streets.

A total of 38% of its shops now serve catchment areas away from traditional shopping locations and the aim is to increase this figure to more than 50% in the long term.

In its results statement, Mr Whiteside also said that the chain was preparing for Brexit given “the potential impact that a disorderly exit might have on supply chains, tariffs, exchange rates and consumer demand”.

“As disclosed at the time of our preliminary results in March, we are building stocks of key ingredients and equipment that could be affected by disruption to the flow of goods into the UK.”

Airbnb host fined £100,000 for letting council flat to tourists

(qlmbusinessnews.com via bbc.co.uk – – Tue, 30th July 2019) London, Uk – –

An Airbnb host who rented out his central London council flat to tourists has been fined £100,000 and evicted.

Council tenant Toby Harman, 37, created the fake identity “Lara” on Airbnb to rent out his studio apartment.

The flat, in Victoria, had been advertised since 2013 and received more than 300 reviews, Westminster City Council said.

Anti-fraud software had found Harman's first name in reviews and connected the listing to him.

Harman's bank statements showed he had been receiving payments from Airbnb for a number of years.

He had been taken to court and, after a failed appeal, evicted and ordered to pay £100,974 in unlawful profits, the Times reported.

Airbnb told BBC News the council property listing had been removed from its website earlier this year.

“We regularly remind hosts to check and follow local rules – including on subsidised housing – and we take action on issues brought to our attention,” said a spokeswoman.

“Airbnb is the only platform that works with London to limit how often hosts can share their space and we support proposals from the mayor of London for a registration system to help local authorities regulate short-term lets and ensure rules are applied equally to hosts on all platforms in the capital.”

Westminster Council said it was currently investigating at least 1,500 properties in the borough for short-term letting.

“Social housing is there to provide much-needed homes for our residents, not to generate illicit profits for dishonest tenants,” the council's Andrew Smith said.

“It's illegal for council tenants to sublet their homes and we carry out tenancy checks, as well as monitoring short-term letting websites for any potential illegal sublets.

“Along with a six-figure unlawful profit order, by getting a possession order, we can now reallocate the property to someone in genuine need of a home.

“We're also pressing government to introduce a national registration scheme to make it far easier for us to take action against anyone who breaks the rules on short term letting.”

London's Airbnb market has quadrupled since 2015, from 20,000 to 80,000 listings.

One of the most popular areas for Airbnb listings in the country is Shoreditch, particularly the area around Brick Lane.

Barclays and RBS among five banks facing £1bn forex rigging allegation lawsuit

(qlmbusinessnews.com via news.sky.com– Tue, 30th July 2019) London, Uk – –

The class action suit follows the EU fining banks a total over €1bn in May for taking part in foreign exchange trading cartels.

Barclays and RBS are among five banks being sued in the UK over allegations of rigging the foreign exchange market.

The banks are facing a class action claim by investors understood to be in excess of £1bn, alongside US giants JP Morgan and Citigroup and the Swiss Bank UBS.

The suit was filed on Monday with the UK's Competition Appeal Tribunal (CAT), alleging that the five banks broke competition laws by unlawfully manipulating the foreign exchange market between 2007 and 2013.

It is being led by Michael O'Higgins, former chairman of the Pensions Regulator, and is being funded by litigation finance group Therium.

Mr O'Higgins told Reuters the total value of the claim would depend on the number of foreign exchange trades executed in London and the proportional impact of the rate rigging.

Given the size of London's “forex” market, Mr O'Higgins said the total value was likely to exceed £1bn.

He said: “Even on a relatively conservative assumption it's certainly billion pounds and possibly several.

“Markets should be fair as well as free and in this case the markets weren't fair.”

David Scott of the law firm Scott+Scott which is bringing the action said it was a “perfect” case to be brought as a so-called “opt-out” collective class action for breaches of UK or European Union competition law.

He added: “It is a very difficult case to put together individual damages which are significant enough.”

Opt-out class actions for breaches of British or EU competition law were introduced under the UK Consumer Rights Act (CRA) in 2015.

In a ruling designed to offer a more effective route to compensation for consumers and businesses who fall victim to anti-competitive behaviour, UK-based members of a defined group are automatically bound into a legal action – unless they opt out.

Overseas-based claimants must still actively sign up.

The class action suit comes after all of the banks except one were fined a total of €1.07bn (£936m) in May, for taking part in foreign exchange trading cartels dubbed “Three Way Banana Split” and “Essex Express”.

The European Commission handed out the penalties relating to collusion over trading in 11 currencies dating back more than a decade.

UBS was named in the investigation but avoided punishment after it blew the whistle on the cartels.

The commission said the traders involved exchanged sensitive information and trading plans and occasionally coordinated trading activities through chatrooms.Sponsored Links

Chief executive of Vauxhall-owner – PSA says ‘could move Astra production from UK’

(qlmbusinessnews.com via bbc.co.uk – – Mon, 29th July 2019) London, Uk – –

The chief executive of Vauxhall-owner PSA says it could move all production from its Ellesmere Port factory if Brexit makes it unprofitable.

Carlos Tavares told the Financial Times that the carmaker has alternatives to the plant which it could use.

The move would probably lead to the closure of the site, the FT said, threatening 1,000 jobs.

That would leave Vauxhall's Luton-based van plant as its last presence in the UK.

“Frankly I would prefer to put it [the Astra car] in Ellesmere Port, but if the conditions are bad and I cannot make it profitable, then I have to protect the rest of the company and I will not do it,” Mr Tavares told the paper.

“We have an alternative to Ellesmere Port.”

In June, the carmaker announced plans to manufacture the next generation of the Astra, its best selling car, in Ellesmere Port and another factory in Germany. At the time, it warned that its decision would depend on the final Brexit terms.

However, Mr Tavares has now gone further, indicating that the firm has another plant in mind should the UK leave the EU without a deal.

‘Catastrophic'

In an official statement on Monday, PSA confirmed the group was still looking to manufacture the next-generation Astra at Russelsheim and Ellesmere Port.

But it warned that the final decision on the role of the Ellesmere Port plant would be conditional on the “final terms of the UK's exit from the European Union”.

“PSA Groupe has put in to place a comprehensive ‘no-deal' contingency plan that covers human resources, taxation, customs, logistics, production, regulation, supply chain and IT,” it added.

The firm said it would closely monitor political developments and engage with politicians to understand the various potential Brexit outcomes.

At the weekend, Michael Gove, who has been charged by Prime Minister Boris Johnson to prepare for leaving the EU with no deal, said the government was now “working on the assumption” of a no-deal Brexit.

Mr Gove said his team still aimed to come to an agreement with Brussels, but writing in the Sunday Times, he added: “No deal is now a very real prospect.”

Steve Turner, assistant general secretary of Unite, said the union and PSA had been in positive discussions about a new vehicle agreement and securing new models for the Ellesmere Port plant.

“All that hard work is now hanging by a thread as Boris Johnson and his government of hard Brexiteers play no-deal roulette with the livelihoods of thousands of Vauxhall workers and their colleagues in the supply chain,” he added.

“A no-deal Brexit, or a deal that throws up barriers and tariffs, would be catastrophic for Vauxhall's Ellesmere Port workers and the UK car industry and make plants inefficient, components less attractive and cars built in the UK more expensive for export.”

Analysis:

By Theo Leggett, BBC business correspondent

This isn't the first time Carlos Tavares has warned about the impact of a no-deal Brexit on Vauxhall, but it is the most explicit threat he's made so far.

Last year, for example, he told me there could be “dramatic consequences” for the firm's UK plants, but refused to specify what those consequences might be.

Now he is being specific. Production of the next generation Vauxhall Astra could be moved from Ellesmere Port to another plant in southern Europe.

Yet it is only a month since PSA Group first unveiled its plans to build the new car in Cheshire. So what's changed?

In a word, nothing. That decision was always contingent on a suitable Brexit arrangement being reached to safeguard frictionless trade across the Channel. At the time, company insiders said no-deal was not an option.

Now, with a new Prime Minister in office, Mr Tavares is offering him a clear-cut choice. Get a deal, and the future of the plant could be secured. Go for no-deal and – he says – the work will go elsewhere.

‘Not an option'

The Confederation of British Industry has warned the government that neither the UK or EU is ready for a no-deal Brexit.

And the car industry lobby group, the Society of Motor Manufacturers and Traders warned on Friday that “no-deal Brexit is simply not an option.”

Car production has been falling in the UK over the past year, amid increasing pleas from the industry for a Brexit deal.

The UK's automotive industry has received a series of blows in recent months, with Honda announcing it will close its Swindon plant in 2021.

Ford also said its Bridgend engine plant in south Wales would close in September 2020 with the loss of 1,700 jobs.

Japanese car producers, including Nissan, have said that Brexit uncertainty is not helping them “plan for the future”.

Earlier this year, Nissan opted to build the next X-Trail model in Japan, rather than in Sunderland.

UK firm Just Eat agrees £9bn merger with Takeaway.com

(qlmbusinessnews.com via theguardian.com – – Mon,29th July 2019) London, Uk – –

British firm joins Dutch rival to form one of the world’s biggest online food delivery companies

Just Eat is merging with its Dutch rival Takeaway.com in a £9bn deal that will create one of the world’s biggest online food delivery companies.

The two companies have reached an agreement in principle on the key terms of an all-share deal in which the Amsterdam-based company will acquire Just Eat at 731p a share, valuing the British firm at £5bn.

The combined group had 360m orders worth €7.3bn (£6.6bn) in 2018 and strong positions in the UK, Germany, the Netherlands and Canada.

Shares in Just Eat jumped 25% to 794.28p on the news.

Just Eat shareholders will receive 0.09744 Takaway.com shares for each Just Eat share and will own 52.2% of the combined group. It will be headquartered in Amsterdam and listed on the London Stock Exchange, with a “significant part of its operations” in the UK.

Takeaway.com’s boss, Jitse Groen, is to become chief executive of the new company. It will be chaired by the Just Eat chairman, Mike Evans, while the Takeaway.com chairman, Adriaan Nühn, becomes vice-chairman. The Just Eat chief financial officer, Paul Harrison, will take on the same role for the combined group, and its interim chief executive, Peter Duffy, will leave.

Groen has described the UK as one of the best three markets in Europe, along with the Netherlands and Poland. Takeaway.com was founded in 2000 and operates in 10 European countries as well as Israel and Vietnam but does not have a presence in the UK. The two companies have little geographical overlap apart from Switzerland.

Analysts at Barclays said: “Just Eat shareholders would be getting the best operator in the space to run the business – a notable shift from missed execution from management in the last few years.”

There has been a flurry of deals in the fast-growing online food delivery market, with competition heating up from Uber Eats and Deliveroo. Just Eat bought UK firm HungryHouse in January 2018, and in December Takeaway.com acquired Delivery Hero’s food delivery business in Germany.

The Canaccord analyst Nigel Parson said: “It is a possibility that Delivery Hero could table a rival bid.”

Just Eat has come under pressure from its activist shareholder Cat Rock Capital to merge with Takeaway.com, in which the US hedge fund also holds a stake.

Just Eat gained more than 4 million customers last year across Europe, Canada, Brazil, Australia and New Zealand. Its revenues are expected to top £1bn this year. It made a pretax profit of £101.7m last year, following a £76m loss in 2017. It will publish first-half results on Wednesday.

In 2018, Just Eat had 26.3m customers while Takeaway.com had 14.1m, Just Eat had 221m orders versus Takeaway.com’s 94m; Just Eat’s revenue was £780m versus Takeaway.com’s €232m; and Just Eat’s underlying profit (Ebitda) was £180m versus an adjusted loss of €11m for Takeaway.com.

Launched by five Danish entrepreneurs in 2001, Just Eat originally linked customers to restaurants that handled their own deliveries. Its former chief executive Peter Plumb, who left suddenly in January, upgraded its technology and launched its own delivery service but he came under fire from Cat Rock and other shareholders after his investment drive slowed earnings growth.

By Julia Kollewe

How College Dropout Kendra Scott Created a Jewelry Empire Now Worth 1Billion-Dollars

Source: CBS

Jewelry designer Kendra Scott believes she's living the American dream. She is a college dropout who became an entrepreneur. Sixteen years later, that business is worth a billion dollars. Gayle King spoke with the mom of three at her headquarters in Austin.

Japan’s Town With No Waste

Source: Great Big Story

The village of Kamikatsu in Japan has taken their commitment to sustainability to a new level. While the rest of the country has a recycling rate of around 20 percent, Kamikatsu surpasses its neighbors with a staggering 80 percent. After becoming aware of the dangers of carbon monoxide associated with burning garbage, the town instated the Zero Waste Declaration with the goal of being completely waste-free by 2020.

Meet The Woman Behind A $42 Million Ohio Based Ice Cream Empire

Source: CNBC

Jeni Britton Bauer started Jeni's Splendid Ice Cream in a small stall in Columbus nearly 25 years ago. Today, Jeni's Splendid Ice Cream has 36 scoop shops around the country and sells 2 million pints of ice cream annually. After nearly 25 years in the business, making and selling ice cream has been hardwired into her very essence. And that's due, in part, to her upbringing. “I grew up loving ice cream because I'm from the Midwest,” Britton Bauer, tells CNBC Make It.

Monaco – The True Secrets of A Luxury Stay

Source: Luxe.TV

The Principality of Monaco and its famous Rock have something to dream about and it is real. The prestige and reputation of this attractive territory extends well beyond its borders. For the moment, we drop our luggage and enter one of the flagship hotels of the Société Bains des Mer, the Hotel Hermitage Monte Carlo. It is one of the most intimate palaces of the Principality.

Sports Direct ‘still finalising’ financial results expected for release early Friday morning

(qlmbusinessnews.com via bbc.co.uk – – Fri 26th July 2019) London, Uk – –

Mike Ashley's Sports Direct has said it is “still finalising” its financial results, which were due to be released early on Friday morning.

It is extremely unusual for a firm to delay results in this way, with one analyst calling events “an utter shambles” after a results presentation was postponed at the last minute.

The firm said it expected its results would still be published on Friday.

The retailer had previously delayed publishing annual results on 15 July.

At the time it cited uncertainty in trading at its House of Fraser chain and increased scrutiny of its auditor as the reasons for the delay. It had also indicated that it might not achieve its profits forecast.

In a statement released on Friday morning, Sports Direct said: “Unfortunately we are still finalising preliminary results.

“We anticipate that our annual results will still be released today, with a presentation to follow, and will update again at midday.

“Apologies for any inconvenience.”

Neil Wilson, chief market analyst for Markets.com, said the events were “a total and utter shambles” that “betrays a number of problems at the business after [Mr] Ashley embarked on his rather random acquisition spree.”

“Above all it betrays a total disregard for shareholders,” he said.

On Wednesday, the firm had said it would be publishing its results on Friday.

UK-listed companies normally publish their results at or close to 07:00, before the London markets open at 08:00.

Sports Direct shares fell about 3% in early trading on the London stock market.

The firm had been due to give a presentation to investors and media at 09:00, but this was cancelled at the last minute.

Mothercare battles to turn around its fortunes proves tougher than expected as it plots UK spin-off

(qlmbusinessnews.com via bbc.co.uk – – Fri, 26th July 2019) London, Uk – –

The babycare retailer said sales fell 3.2% and warned that fragile UK consumer confidence was holding back its recovery plans.

Mothercare has revealed its battle to turn around its fortunes is proving tougher than expected as it confirmed plans for “evolving and optimising” the ownership of its UK business.

The beleaguered retailer reported a 3.2% fall in first quarter like-for-like sales amid an “uncertain and volatile” market and “fragile consumer confidence”.

It said that against this backdrop and the need for continued discounting, profit margin improvements were “expected to take longer than previously anticipated” and annual profitability was set to show no improvement on the previous year – when it reported a pre-tax loss of £66.6m.

Shares fell 11% in early trading.

The update came hours after Sky News revealed that Mothercare was in talks to sell or separate its UK store operations.

Chief executive Mark Newton-Jones said: “Our immediate priority is to complete the transformation of the business with a near-term focus on evolving and optimising the ownership, structure and model for UK retail operations as an independent franchise.”

Mothercare has been struggling to improve its fortunes amid a brutal retail environment, shutting 55 British stores last year after a company voluntary arrangement (CVA) deal with creditors.

The babycare retailer – which traces its roots back to its first outlet in Surrey in 1961 – now has just 79 shops in the UK, representing the only national franchise now owned by the company.

Elsewhere it has been transforming itself into an international franchising group and now trades from roughly 1,000 stores in about 50 countries.

Mothercare's UK same-store sales performance in the 15 weeks to 13 July was an improvement on the previous couple of quarters, when they were down by 11.4% and 8.8%.

But the impact of its store closure programme meant that total UK sales were down 23.2%, including a 12.1% fall for online – while there appeared to be little benefit for the stores that remained open of sales transferring to them.

Mothercare's overseas business also had a tough time, with sales down 2.1%.

Mr Newton-Jones said: “The UK retail market remains challenging and though the rate of decline in LFL sales moderated, margin investment in promotional activity has been necessary to stimulate sales, both in our stores and online.

“The impact of this has negated much of the margin benefits we had expected to materialise.

“Furthermore, we have observed a lower than expected transfer of sales following the CVA store closure programme which completed in early April 2019.”

By John-Paul Ford Rojas, business reporter

Pay rise of Major UK employers’ hold at 2.5% in second quarter: XpertHR

(qlmbusinessnews.com via uk.reuters.com — Thur, 25th July 2019) London, UK —

LONDON (Reuters) – Major British employers gave average pay rises of 2.5% to their staff in the three months to June, unchanged from the first quarter of the year, data from industry consultants XpertHR showed on Thursday.

“The current run of pay awards at 2.5% looks set to continue as we head into the quieter months of the pay bargaining year,” XpertHR analyst Sheila Attwood said.

Until about a year ago annual pay settlements in Britain averaged around 2%, but they have risen as employers found it harder to recruit staff.

Average weekly earnings – an official statistic that also includes pay rises from promotions and job changes – rose at their fastest annual rate in more than a decade at 3.6% in the three months to May.

Consumer price inflation, Britain’s main inflation benchmark, held at 2% in June.

XpertHR’s data showed that over the past year, median pay deals in the private sector were 2.5% while public sector pay rises averaged 2.3%.

On Monday, Britain’s finance ministry said it planned to offer pay rises of more than 2% to teachers, senior doctors, police, prison guards and the military this year.

After the financial crisis, public sector pay rises were generally capped at 1% until 2017.

Reporting by David Milliken

Facebook to pay $5bn fine over Cambridge Analytica scandal

(qlmbusinessnews.com via theguardian.com – – Thur, 25th July 2019) London, Uk – –

Penalty by US government reflects scale of breach, first reported by the Observer

Facebook will pay a record $5bn (£4bn) penalty in the US for “deceiving” users about their ability to keep personal information private, after a year-long investigation into the Cambridge Analytica data breach.

The Federal Trade Commission (FTC), the US consumer regulator, also announced a lawsuit against Cambridge Analytica and proposed settlements with the data analysis firm’s former chief executive Alexander Nix and its app developer Aleksandr Kogan.

The $5bn fine for Facebook dwarfs the previous record for the largest fine handed down by the FTC for violation of consumers’ privacy, which was a $275m penalty for consumer credit agency Equifax.

It is also one of the largest regulatory penalties ever imposed by the US government on any company, reflecting the scale of the breach, first reported by the Observer.

The fine did not, however, appease all of the FTC’s members. The two Democrats on the five member commission called the fine insufficient and said it would do little to change the company’s behavior.

“The settlement imposes no meaningful changes to the company’s structure or financial incentives, which led to these violations,” commissioner Rohit Chopra said in a statement. “Nor does it include any restrictions on the company’s mass surveillance or advertising tactics.”

“Rather than accepting this settlement, I believe we should have initiated litigation against Facebook and its CEO Mark Zuckerberg,” said commissioner Rebecca Kelly Slaughter.

The social network will submit to new restrictions on how it operates and a modified corporate structure to ensure executives are more accountable for users’ privacy.

“Despite repeated promises to its billions of users worldwide that they could control how their personal information is shared, Facebook undermined consumers’ choices,” the FTC chairman, Joe Simons, said.

“The magnitude of the $5bn penalty and sweeping conduct relief are unprecedented in the history of the FTC.”

Simons said changes to Facebook’s corporate structure would make executives more accountable for protecting the privacy of the 185 million people in the US and Canada who use Facebook each day.

He said this was intended to “change Facebook’s entire privacy culture to decrease the likelihood of continued violations”.

In a post on his own Facebook page, the social network site’s founder and chief executive, Mark Zuckerberg, said the company had transformed the way it handles users’ information.

“We’ve agreed to pay a historic fine, but even more important, we’re going to make some major structural changes to how we build products and run this company,” he wrote.

“We have a responsibility to protect people’s privacy. We already work hard to live up to this responsibility, but now we’re going to set a completely new standard for our industry.

“Overall, these changes go beyond anything required under US law today. The reason I support them is that I believe they will reduce the number of mistakes we make and help us deliver stronger privacy protections for everyone.”

Separately the Securities and Exchange Commission (SEC) announced on Wednesday that it had reached a settlement with Facebook over claims that it had misled investors about the risk of misuse of users’ data. The settlement includes a $100m fine.

According to the SEC, the US’s top financial watchdog, Facebook discovered the misuse of its users’ information by Cambridge Analytica in 2015, but did not correct its existing disclosure for more than two years.

“Instead, Facebook continued to tell investors that ‘our users’ data may be improperly accessed, used or disclosed,” according to the SEC complaint. “Facebook reinforced this false impression when it told news reporters who were investigating Cambridge Analytica’s use of Facebook user data that it had discovered no evidence of wrongdoing. When the company finally did disclose the incident in March 2018, its stock price dropped.”

“As alleged in our complaint, Facebook presented the risk of misuse of user data as hypothetical when they knew user data had in fact been misused,” said Stephanie Avakian, co-director of the SEC’s enforcement division.

Facebook neither admitted nor denied the SEC claims.

By Rob Davies in London and Dominic Rushe in New York

Aston Martin UK luxury carmaker shares fall by 22% as uncertainty hits sales

(qlmbusinessnews.com via news.sky.com– Wed, 24th July 2019) London, Uk – –

The UK luxury carmaker said wholesale car sales fell by 22% in the UK in the second quarter and cut its full-year outlook.

Shares in Aston Martin have plunged as it cut sales and profit forecasts blaming macroeconomic uncertainty and weak markets in the UK and Europe.

The British luxury carmaker said it was taking immediate action to improve efficiency and cut costs as it issued the trading update ahead of half-year results next week.

It said wholesale car sales fell 22% in the UK and by 28% in Europe, the Middle East and Africa in the second quarter of the year, though there was strong growth in other parts of the world.

The company said the “challenging external environment” it had first flagged in May had worsened, as had “macro-economic uncertainties”.

“We anticipate that this softness will continue for the remainder of the year and are planning prudently for 2020,” it added.

The company's chief executive Andy Palmer has previously warned of the damaging impact a no-deal Brexit could have on carmakers.

Shares fell 22% in early trading, taking the shares down to about £8 – less than half of the £19 price which valued the company at £4.3bn when it first floated last October.

Aston Martin said retail sales grew by 26% in the first six months of the year but the weak performance in wholesale – which grew by only 6% – prompted a downgrading of full-year financial expectations.

It now expects wholesale volumes of 6,300 to 6,500 vehicles for the full year, down from 7,100 to 7,300 forecast at the time of annual results in February.

Profit margins are also expected to be lower than previously forecast and investment spending trimmed.

Mr Palmer said: “Whilst retails have grown by 26% year-to-date, our wholesale performance is adversely impacted by macroeconomic uncertainty and enduring weakness in UK and European markets.

“We are disappointed that short-term wholesales have fallen short of our original expectations, but we are committed to maintaining quality of sales and protecting our brand position first and foremost.”

By John-Paul Ford Rojas, business reporter





Technology giants’ power to be probed by US Justice Department

(qlmbusinessnews.com via bbc.co.uk – – Wed, 24th July 2019) London, Uk – –

The US Justice Department has announced an investigation into leading online platforms, examining whether they are unfairly restricting competition.

The DoJ did not name any firms, but companies such as Facebook, Google, Amazon and Apple are likely to be scrutinised in the wide-ranging probe.

It was sparked by “widespread concerns” about “search, social media, and some retail services online,” the DoJ said.

It marks the latest scrutiny of tech firms' power over the US economy.

The DoJ has sweeping powers to investigate firms it suspects of breaching competition laws, and it can even break up companies that it thinks are too dominant.

The US Federal Trade Commission is already looking into similar concerns, while there are also investigations taking place in the European Union.

Last month, the Justice Department was reported to be preparing an investigation of Google to determine whether the search engine giant had broken anti-trust law.

The US Department of Justice said its anti-trust review would consider “whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation or otherwise harmed consumers”.

It is likely to examine issues including how the largest tech firms have grown in size and power, and expanded into additional businesses, as well as how they have used the powers that come with having very large networks of users.

“Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands,” Assistant Attorney General Makan Delrahim, who heads the Anti-trust Division, said in a statement.

“The department's anti-trust review will explore these important issues.”


Analysis
David Lee

The Department of Justice hasn't said specifically which companies are under investigation, but it can be safely assumed Apple, Amazon, Facebook and Google will be the focus of their attention.

The broad question is whether newcomers are truly able to compete against the scale and riches of the Silicon Valley giants. What will make these firms nervous is that the DoJ isn't looking at any specific allegation, but instead embarking on a look at how the companies came to power, and what they've done to remain there.

This latest investigation is in addition to an ongoing probe by the US Federal Trade Commission into similar concerns, as well as investigations taking place in the European Union.

The tech companies insist they have viable competition, and warn that breaking up big American firms might pave the way for foreign competitors, particularly out of China.


Google and Facebook now dominate online advertising as consumers use their smartphones to order food, watch films and socialise online.

Meanwhile the growing popularity of online shopping has boosted the fortunes of firms such as Amazon.

Daniel Ives, an analyst at research firm Wedbush Securities, said the DoJ investigation was a “major shot across the bows” of big tech companies.

However, he said the end result was likely to result in “business model tweaks” or in a worst-case scenario potential fines rather than forced break-ups of the underlying businesses.

Technology companies are facing a growing global backlash, driven by concerns that they have too much power and are harming users and business rivals.

Google and Apple declined to comment, while Facebook and Amazon did not immediately comment.

Uk supermarket overall sales falls for the first time in three years

(qlmbusinessnews.com via news.sky.com– Tue, 23rd July 2019) London, Uk – –

Shares in Tesco, Sainsbury's and Morrisons fell after industry data showed the market shrank for the first time in three years.

Supermarket sales have fallen for the first time in three years as shoppers' appetite for beer, cider and ice cream fell in comparison with a period last year buoyed by hot weather and the World Cup.

Shares in Tesco, Sainsbury's and Morrisons fell after industry data from Kantar showed the market shrank by 0.5% in the 12 weeks to 14 July – the first decline since June 2016.

The report said households had been taking one fewer grocery shopping trip during the period while stores are also being squeezed by a slowdown in price growth.

However it anticipated that the market would return to growth once the comparatives with last year's summer period pass.

Fraser McKevitt, head of retail and consumer insight at Kantar, said it was a “challenging 12 weeks” with sales declining or growth slowing at all the major grocers except Ocado.

He added: “Last year people shopped more frequently and closer to home as they topped up the cupboards while enjoying the sunshine and the men's football World Cup.

“This year households are making one fewer trip, which may not sound like much but is enough to tip the market into decline.

“In addition, like-for-like grocery inflation fell marginally to 0.9%, which is good news for consumers but has made it harder for retailers to achieve value growth.”

Kantar said consumers spent £75m less on alcohol this year with beer down 11% and cider down 13% while soft drink sales fell by £56m and ice cream by £55m.

Chocolate sales did better, rising by 15% with shoppers apparently happier to buy a treat without fear of it melting in the hot weather.

Among the big supermarkets, Tesco sales fell 2%, Sainsbury's by 2.3% and Asda by 2%, while Morrisons slipped 2.6%.

Discounters Aldi and Lidl grew by 6.7% and 7% while online retailer Ocado saw sales grow by 11.9%.

The report sent shares in UK-listed supermarket groups lower, with Tesco down more than 2% while Sainsbury's and Morrisons each lost about 1%.

By John-Paul Ford Rojas, business reporter

WeWork property company secures ‘financial inducement’ of £55.7m in Brexit windfall

(qlmbusinessnews.com via theguardian.com – – Tue, 23rd July 2019) London, Uk – –

Property company makes deal as a result of European Medicines Agency’s move to Amsterdam

A US firm run by two billionaire entrepreneurs is being paid €62m (£55.7m) in “financial inducements” as part of the Brexit-enforced relocation of the European Medicines Agency from London to Amsterdam.

WeWork, a $47bn (£37.7bn) property company founded by Adam Neumann and Miguel McKelvey, secured the cash from British and European taxpayers as part of a deal in which it will sublet the agency’s former headquarters, EU documents reveal.

All UK-based EU agencies have had to be relocated to other member states as a result of the UK’s decision to leave the bloc. The Netherlands won the right to host the EMA while Paris secured the European Banking Authority. But before its move to the Netherlands, the EMA failed in its bid to break its 25-year lease with its landlord, the Canary Wharf Group.Advertisement

The EU agency had been facing £500m in costs, including an annual rent of €16m, on 26,000 sq metres (280,000 sq ft) of office space at 30 Churchill Place in Canary Wharf in London that it was unable to use.

The subletting deal with WeWork recoups an undisclosed amount of those costs but EU budget documents record that at least €62m has been paid to the US firm in an attempt to make the deal attractive. The sum covers the costs for 2019-20.

The EMA’s efforts to sublet the property had faced rising competition in London’s commercial subletting market as a result of businesses reducing their footprint in the capital in the light of the Brexit vote.

But the attraction of the Canary Wharf location was made clear by the company when it announced the lease agreement, describing it as a “desirable location for our member businesses who are rapidly scaling as well as the large enterprise companies who now represent 40% of our global membership”.

A spokesman for the Department for Exiting the European Union declined to comment on the costs to the Treasury from the relocation of the London-based agencies.

The EU’s budget documents for 2020 suggest that the payment to WeWork will add €6.5m to the forecasted outgoings to be met by the 28 member states.

Nine years after co-founding WeWork, Neumann, 40, its chief executive, and 45-year-old McKelvey, as chief culture officer, are reportedly worth $7bn between them. The company leases large office spaces, divides them up and rents them out out in smaller portions to businesses offering perks such as free coffee and beer.

Neumann once said the objective of his company was to “to elevate the world’s consciousness”.

WeWork, which operates in 27 countries and is preparing for a stock market flotation this year, is second only to the British government as an occupier of London offices, with more than 275,000 sq metres of space in the capital.

The EMA is currently in a temporary building in Amsterdam until completion of the construction of its new premises at the end of the year.

The agency’s latest management board meeting heard that that the EMA expected at least one in four of its staff to stop working for it by the time of the final move as a result of the relocation. Of the 776 members of staff, 312 are “teleworking” from London due to “personal circumstances”.

A spokesman for the EMA said of the payments: “This is standard practice in the London commercial property market and these inducements are typically used by the tenant to fit out the building to their specifications. EMA received similar financial inducements when we entered into the original lease. The financial inducements are being funded from the EU budget.”

By Daniel Boffey in Brussels

Whirlpool executive apologise for dangerous tumble dryers

(qlmbusinessnews.com via bbc.co.uk – – Mon, 22nd July 2019) London, Uk – –

A senior Whirlpool executive has apologised to customers affected by the saga of dangerous tumble dryers sold for 11 years in the UK.

Whirlpool is now launching a full recall of any remaining fire-prone dryers, nearly four years after first alerting people to the safety issue.

Speaking to the BBC, its vice-president Jeff Noel defended a decision not to recall dryers when the fault emerged.

Many cases had been dealt with “faster and sooner” by a safety fix, he said.

Engineers have been adding a fix to machines, but Mr Noel accepted that “expanded” efforts now needed to be made, adding that “we apologise for putting our customers through hardship”.

What should owners do now?

More than five million affected machines were sold in the UK, under the Hotpoint, Indesit, Creda, Swan and Proline brands, between April 2004 and September 2015.

Anyone who thinks they bought one should call 0800 151 0905 or visit a dedicated website, being set up on Monday, to check if their dryer is affected. If it is on the recall list, they should stop using it and unplug it immediately.

They can then choose:

  • For the first time, a free replacement dryer with no extra charges for collection or disposal of the old machine
  • A free, one-hour modification of the old machine
  • A discounted upgrade to a higher specification model than the free replacement
  • A partial refund of up to £150, with owners of older machines getting less than those with newer ones

There are no plans for any extra measures for those machines which have already been modified, despite cases of some of them catching fire after they had been fixed.

‘Our home burnt down'

Graeme and Sue Garnham's Guildford council home was gutted by fire while they were waiting for an engineer to modify their defective dryer.

“I was stood there in my bare feet, at the bottom of the alleyway, watching it all go up. The windows were popping out,” Mr Garnham said. “I just couldn't talk.”

His wife said: “Thirty years of memories were gone. We don't have any photos of our wedding anymore.”

Mrs Garnham, a healthcare assistant, and her husband, a cleaner, have been re-housed, but had to rely on the generosity of family and friends to replace damaged belongings.

“We had kept on saying we have got to get insurance, but we did not have the money,” Mrs Garnham said.

They have heard nothing from Whirlpool, but Mr Noel told the BBC: “My heart goes out to them. This is not the way I would have wanted to be treated.”

What was the issue?

A fault in Whirlpool machines was blamed for at least 750 fires over an 11-year period, the government has said.

Whirlpool said it had logged 54 fires caused by fluff dropping from a collector by the drum onto the heating element in its tumble dryers in recent years.

Three of the fires were in machines that had been modified.

It argued that two official reviews, including one by the Office of Product Safety and Standards, had found the modification to be effective.

Although more than five million were sold, the company said the majority would have fallen out of use. It said it had resolved 1.7 million cases – a greater success rate than most recalls – and estimated that 500,000 affected dryers could still be in use. When pressed by MPs, it said some estimates had suggested as many as 800,000 remained in homes.

The recall, demanded by the government in an unprecedented move, came after nearly four years of the modification programme.

The official launch of the recall would be supported by a £1m advertising campaign aimed at raising awareness for remaining owners, the company said.

Was this an inherited problem?

The safety concerns emerged after Whirlpool bought Italian white goods giant Indesit, which had manufactured the products, in 2014. Mr Noel said the company had conducted all the appropriate checks before buying Indesit, and had “done the right thing” by voluntarily alerting authorities to the safety problem which became clear after the acquisition.

“We bought the company [Indesit]. We own the company. The customers are ours and our responsibility,” he said.

He said that the company had to accept the resulting scrutiny, and had learned lessons along the way.

Consumer groups said that Whirlpool's ability to deal with the problem had been found wanting.

“Whirlpool has failed to trace hundreds of thousands of fire-risk tumble dryers that could still be in people's homes almost four years after this fault was first discovered, so we have serious doubts about the company's ability to get these machines out of circulation now,” said Caroline Normand, from consumers' association Which?.

It said the recall had only resulted from the threat of government action, and that ministers should keep the company and its campaign under scrutiny.

By Kevin Peachey

Metro Bank confirms talks “regarding the potential sale of a loan portfolio”

(qlmbusinessnews.com via news.sky.com– Mon, 22nd July 2019) London, Uk – –

The potential sale could provide a boost to the embattled lender's capital position after a torrid few months.

Troubled high street lender Metro Bank has confirmed that it is in talks “regarding the potential sale of a loan portfolio” – after details emerged of a possible deal with a major US hedge fund.

The £500m potential deal, first reported by Sky News, would see the lender offload a mortgage portfolio back to Cerberus Capital Management, from which it has bought than £1bn worth of assets in recent years.

A source close to Cerberus said over the weekend that the transaction could be announced as soon as Wednesday, when the bank reports a closely-watched set of half-year financial results.

Metro Bank responded on Monday in a stock market announcement. Shares rose 3% in early trading.

It said: “The company regularly assesses various opportunities in the market and accordingly confirms that discussions regarding the potential sale of a loan portfolio are taking place.

“There can be no certainty at this stage that an agreement will be reached. A further announcement will be made if and when appropriate.”

If confirmed, the sale would provide a boost to Metro Bank's capital position following a torrid few months for the challenger bank.

Sky Views: Metro Bank£350m bombshell shows system is working

Metro raised £375m from the sale of new shares to investors earlier this yearamid deepening concerns about its financial position in the wake of an accounting error.

The lender acquired a £520m buy-to-let portfolio from Cerberus in February 2018 as a way of bolstering its ‎loan-book, having also undertaken a similar transaction the previous year.

The price at which it is disposing of the mortgages back to the hedge fund, or which of the earlier deals is being reversed, was unclear.

Shares in the lender have plummeted since details of its accounting errors emerged, leaving its value more than 80% lower than it was a year ago.

The impact of the mistake was illustrated by quarterly results showing that profits had halved and that it had suffered an exodus of corporate customers.

Metro Bank has about 1.7 million customers and describes itself as “the revolution in British banking”, deploying a model founded on friendly customer service.

Its recent travails, however,‎ have dented its hopes of growing its deposit base by 20% this year.

The bank, which has more than 60 branches, became the first new high street lender for more than a century when it opened its doors in 2010.

Its recent crisis has stoked suggestions that either founder and chairman Vernon ‎Hill, or chief executive Craig Donaldson, would be forced to depart in the near term.