The ‘Big Four’ leading accounting UK firms all failed audit quality test – Watchdog

(qlmbusinessnews.com via uk.reuters.com — Wed, 10th July 2019) London, UK —

LONDON (Reuters) – All of Britain’s leading accounting firms have failed to hit quality targets set by their regulator for auditing company books for the second year in a row, with Grant Thornton and PwC singled out to join KPMG under tougher supervision.

The damning review from the Financial Reporting Council (FRC) will pile pressure on the government to implement a proposed sector shake-up prompted by corporate failures at builder Carillion, retailer BHS and an accounting scandal at cafe chain Patisserie Valerie.

The FRC said EY, KPMG, Deloitte and PwC, known as the Big Four, and BDO, Grant Thornton and Mazars from the next tier down, all failed to hit a target that 90% of audits reviewed by the regulator were good or required only limited improvements.

Only 75% of the sample of audits from among Britain’s 350 top listed companies for the year ending December 2017 met the 90% target overall as accountants failed to challenge information clients gave to them, the FRC said.

There was no overall improvement on last year’s findings when all audits reviewed failed to meet the 90% target.

“At a time when the future of the audit sector is under the microscope, the latest audit quality results are not acceptable,” said Stephen Haddrill, the FRC’s chief executive.

Radical reform of the sector was proposed last December to rebuild public trust in audit, including replacing the FRC, described by lawmakers as toothless, with a more powerful watchdog.

Haddrill and his chair Win Bischoff are being replaced.

The bulk of the top 350 listed firms would have two auditors in a bid to improve audit quality, but this depends on Grant Thornton, BDO and Mazars winning the confidence of blue chip companies.

The timing of reform is unclear given it needs legislation to implement and parliament is focused on Britain’s protracted departure from the European Union.

The ICAEW, a professional accounting body, said audit faces a “watershed moment” and the government should implement reform without delay.

The new watchdog should apply “fresh thinking” to improving audit quality and not be constrained by targets and methods bequeathed to it by the FRC, the ICAEW said.

British Business Minister Greg Clark told a parliamentary committee last month there would be a public consultation on a “proportionate package of reforms” to improve audit quality and maintain Britain’s global status as a center of audit expertise.

FAILING TO CHALLENGE

The FRC said it found cases in all seven firms where auditors failed to challenge management sufficiently, a “recurring finding” for several years.

The watchdog said it would raise its target to 100% from 90% for reviews of audits starting from June 2019 financial statement year-ends as having any below standard audits was unacceptable.

Only half of Grant Thornton’s sample audits were assessed as good, down from 75% in 2018, the FRC said. More than a quarter of its audits reviewed in the past five years needed significant improvement.

“The FRC has therefore increased its scrutiny of Grant Thornton,” the watchdog said. It will review a larger number of the firm’s audits in the coming year.

Both Grant Thornton, which audited Patisserie Valerie, and PwC, auditor of BHS, had already announced steps to bolster audit activities in anticipation of the FRC findings.

Grant Thornton said the FRC report showed that the entire profession must improve the quality of its work and that Grant Thornton is no exception.

The deterioration from 84% to 65% in PwC’s results was also “unsatisfactory” and the FRC will “scrutinize closely” how PwC implements its improvement plan.

“While results at KPMG have improved, the firm remains subject to increased FRC scrutiny,” the watchdog said. This will continue until KPMG, which audited Carillion, has demonstrated a sustained improvement in audit quality.Slideshow (2 Images)

The FRC said 84% of Deloitte’s audits met the required standard, up from 76% last year, with EY at 78%, up from 67% in 2018.

But 40% of Mazars’ reviewed audits failed to meet the target, worse than in 2018, while 12.5% of BDO’s sample audits were below the acceptable standard, unchanged from last year.

Reporting by Huw Jones

Superdry founder Julian Dunkerton promises revival after £85m loss

(qlmbusinessnews.com via bbc.co.uk – – Wed, 10th July 2019) London, Uk – –

Superdry founder Julian Dunkerton says he is trying to “steady the ship” after the fashion retailer reported an £85m annual loss.

Mr Dunkerton returned to the firm in April, after a lengthy campaign against the previous management, who he said had a “misguided” strategy.

As well as reporting a steep loss for last year, Superdry warned that sales could fall in the current financial year.

In 2018 it reported profits of £65.3m.

“My first priority on returning to Superdry has been to steady the ship and get the culture of the business back to the one which drove its original success,” Mr Dunkerton said.

He said he planned to return the brand to its “design-led roots”, paving the way for a return to profitability over the next three years.

Customers will be offered greater choice in stores and online, he said.

There will be less discounting, a website redesign and a change in marketing strategy as part of the new strategy.

The firm will aim to renegotiate better terms with landlords, as a large proportion of its leases come up for renewal over the next two years, he added.

However there could also be a “minimal” number of store closures in the UK and the US.

Superdry, which started out as a market stall in Cheltenham 16 years ago, was set up by by Mr Dunkerton and James Holder, and went on to enjoy huge commercial success.

But its shares have lost nearly 70% over the past year against a tough retail backdrop and in March the company announced it would cut up to 200 jobs.

Mr Dunkerton is leading the company while it searches for a new permanent chief executive.

Pound Sterling hits six-month low as Brexit and economic gloom deepens

This image has an empty alt attribute; its file name is QLM.png

(qlmbusinessnews.com via news.sky.com– Tue, 9th July 2019) London, Uk – –

Sterling has weakened further just at the time when many UK holidaymakers are preparing to exchange their pounds.

The pound has slipped to a fresh six-month low against the dollar as sustained worries over Brexit and the UK economy weigh on the currency.

Sterling was half a cent down, at less than $1.25, taking it to its weakest point since a “flash crash” in January and not far off its lowest level since early 2017.

It was also lower versus the euro, slipping close to €1.11 – close to six-month lows – and adding to anxieties for UK holidaymakers preparing to travel abroad over the summer.

Britons will find their pound does not stretch as far compared with the same time last year, when it was trading at around $1.33 versus the dollar and €1.13 against the euro.

The latest fall against the dollar extends two weeks of declines for the pound amid concerns about the weakening economic outlook, prompting speculation about lower interest rates.

A recent gloomy speech by Bank of England governor Mark Carney was taken by some as a hint that the policy makers may strike a more dovish tone on rates.

Business surveys have indicated that the UK economy probably shrank in the second quarter of 2019, leaving it potentially on the verge of recession – as a potential no-deal Brexit looms on 31 October.

Sentiment was further dampened on Tuesday as Ireland's finance ministers said it now thinks there is a significant risk of a disorderly departure of the UK from the EU and that it was taking measures to protect itself from any legal consequences.

Meanwhile, the British Retail Consortium reported the worst June decline in sales since its records began in 1995, pointing to a “bleak” picture as consumers put off non-essential purchases due to Brexit uncertainty.

Trading was also impacted on Tuesday by the strength of the dollar as traders reassessed their expectations about US interest rates.

Stronger than expected jobs data last week has prompted investors to question expectations about how much the US Federal Reserve will cut rates later this month.

The pound's latest weakness also comes ahead of official monthly growth figures on Wednesday and the Bank of England's Financial Stability Report on Thursday.

By John-Paul Ford Rojas, business reporter

Ocado hi-tech warehouse fire cost over £100m

(qlmbusinessnews.com via theguardian.com – – Tue, 9th July 2019) London, Uk – –

Online grocer reports loss of £143m for first half but expects compensation from insurer

Ocado has said the fire at its hi-tech warehouse earlier this year cost it more than £100m.

The online grocer fell to a headline loss of £143m on sales of £882m in the six months to 2 June, dragged down by more than £100m of one-off costs relating to the fire that destroyed its distribution centre in Andover, Hampshire.

Ocado said the closure of the site – which had provided about a tenth of the company’s delivery capacity – knocked 2% off its 9.7% retail sales growth rate during the half.

The company made an underlying profit of £18.1m, down from £34.3m a year ago. Ocado said Andover-related disruption would punch a £15m hole in annual profits, but its finance director, Duncan Tatton-Brown, said it expected to be fully compensated by its insurer.

As part of its plans to maintain service for shoppers, Ocado has signed a deal with its client Morrisons, which allows the delivery firm to take back 30% of the space for two years at its new centre in Erith, south-east London. Andover is being rebuilt and Ocado also announced plans to build a new warehouse in Purfleet, Essex.

The fire put a dampener on Ocado’s plans for expansion as it prepares to embark on a new relationship with Marks & Spencer, which replaces an existing deal with Waitrose from next autumn. M&S is paying £750m for a 50% share of Ocado’s retail arm.

Investors shrugged off the Andover setback, sending Ocado shares up by more than 5%, to £12.34.

Bernstein analyst Bruno Monteyne said the company’s performance was in line with his expectations and questioned whether the “numbers even matter” given Ocado’s recent recent run of success selling its grocery-picking technology to foreign retail chains, including the US supermarket giant Kroger.

“Ocado’s valuation is driven by the solutions business,” he said.

By Zoe Wood

British Airways face record £183m fine for security systems data breach

(qlmbusinessnews.com via bbc.co.uk – – Mon, 8th July 2019) London, Uk – –

British Airways is facing a record fine of £183m for last year's breach of its security systems.

The airline, owned by IAG, says it was “surprised and disappointed” by the penalty from the Information Commissioner's Office (ICO).

At the time, BA said hackers had carried out a “sophisticated, malicious criminal attack” on its website.

The ICO said it was the biggest penalty it had ever handed out and the first to be made public under new rules.

What happened?

The ICO said the incident took place after users of British Airways' website were diverted to a fraudulent site. Through this false site, details of around 500,000 customers were harvested by the attackers, the ICO said.

Information Commissioner Elizabeth Denham said: “People's personal data is just that – personal. When an organisation fails to protect it from loss, damage or theft, it is more than an inconvenience.

“That's why the law is clear – when you are entrusted with personal data, you must look after it. Those that don't will face scrutiny from my office to check they have taken appropriate steps to protect fundamental privacy rights.”

The incident was first disclosed on 6 September 2018 and BA had initially said approximately 380,000 transactions were affected, but the stolen data did not include travel or passport details.

What information was stolen?

The ICO said the incident was believed to have begun in June 2018.

The watchdog said a variety of information was “compromised” by poor security arrangements at the company, including log in, payment card, and travel booking details as well name and address information.

BA initially said information included names, email addresses, credit card information such as credit card numbers, expiry dates and the three-digit CVV code found on the back of credit cards, although BA has said it did not store CVV numbers.

The watchdog said BA had co-operated with its investigation and made improvements to its security arrangements.

What are the new rules?

The General Data Protection Regulation (GDPR) came into force last year and was the biggest shake-up to data privacy in 20 years.

The penalty imposed on BA is the first one to be made public since those rules were introduced, which make it mandatory to report data security breaches to the information commissioner.

It also increased the maximum penalty to 4% of turnover. The BA penalty amounts to 1.5% of its worldwide turnover in 2017, less than the possible maximum.

Until now, the biggest penalty was £500,000, imposed on Facebook for its role in the Cambridge Analytica data scandal. That was the maximum allowed under the old data protection rules that applied before GDPR.


‘Sending a shiver down the spine'

By Rory Cellan-Jones

I imagine that many people's first reaction to the £183m fine that the Information Commissioner plans to levy on British Airways will have mirrored mine – surely the decimal point must be in the wrong place?

After all the proposed penalty is roughly 367 times as high as the previous record fine, the £500,000 imposed on Facebook over the Cambridge Analytica scandal.

The difference, of course, is that the law has changed between the two incidents, with the arrival of a new law mirroring Europe's GDPR. This allows fines of up to 4% of annual turnover.

Now you might have expected the data regulator to be somewhat cautious at first in wielding this powerful new weapon but today's news will send a shiver down the spine of anyone responsible for cybersecurity at a major corporation.

The message is clear – if you don't treat your customers' data with the utmost care expect severe punishment when things go wrong.

British Airways certainly appears to be stunned. But then again it could have been worse: the full 4% of turnover would have meant a fine approaching £500m.


What happens next?

BA has 28 days to appeal. Willie Walsh, chief executive of IAG, said British Airways would be making representations to the ICO.

“We intend to take all appropriate steps to defend the airline's position vigorously, including making any necessary appeals,” he said.

Alex Cruz, British Airways' chairman and chief executive, said the airline was “surprised and disappointed” in the ICO's initial finding.

“British Airways responded quickly to a criminal act to steal customers' data. We have found no evidence of fraud/fraudulent activity on accounts linked to the theft.

“We apologise to our customers for any inconvenience this event caused.”

Where does the money go?

The penalty is divided up between the other European data authorities, while the money that comes to the ICO goes directly to the Treasury.

It is up to individuals to claim money from BA, which provided no information on whether any compensation had been paid.

Under the regulations, authorities in the EU whose residents have been affected will also have the chance to comment on the ICO's findings.

Boeing $5.9bn setback after Saudi airline scraps order for 737 MAX planes

(qlmbusinessnews.com via news.sky.com– Mon, 8th July 2019) London, Uk – –

After two deadly crashes involving Boeing 737 MAXs, budget airline flyadeal will take delivery of a fleet of 30 Airbus A320 jets.

US plane maker Boeing has suffered a fresh setback after a Saudi budget airline chose not to go through with a $5.9bn (£4.7bn) order for 30 of its 737 MAX aircraft.

The decision by flyadeal comes after two 737 MAXs were involved in deadly crashes in 2018 and earlier this year.

A total of 346 people were killed in the Lion Air disaster in Indonesia last October and the Ethiopian Airlines tragedy near Addis Ababa in March, which led to all such aircraft being grounded and billions of dollars being wiped off the company's value.

Flyadeal has now had a rethink about the provisional Boeing order and decided instead to take delivery of a fleet of 30 rival Airbus A320neo jets.

The Saudi airline said: “This order will result in flyadeal operating an all-Airbus A320 fleet in the future.”

Flyadeal, which has operated leased A320 jets since launching in September 2017, will take delivery of the new Airbus aircraft from 2021.

The announcement comes just weeks after International Airlines Group – the owner of British Airways – signed a letter of intent to order 200 Boeing 737 MAX jets.

IAG – which also owns Spain's Iberia and Ireland's Aer Lingus – said it had every confidence in Boeing and expected the MAX to return to service in coming months.

The deal – worth more than $24bn (£19.1bn) at list prices though likely to have been reduced in negotiations between the two companies – would see the aircraft delivered between 2023 and 2027.

However, Oman Air warned in June it would hold talks with Airbus if Boeing did not provide support and recovery for the MAX.

Meanwhile, Emirati carrier flydubai said in April it could order A320s as replacements for the MAX jets.

A Boeing spokesperson said: “We understand that flyadeal will not finalise its commitment to the 737 MAX at this time given the airline's schedule requirements.”

After the two crashes, US investigators reportedly found a new potential flaw in the 737 MAX software update that was designed to improve safety.

The company has been working on a software fix to try to return the jets to service by the end of the year.

The 737 MAX remains grounded worldwide and regulators must approve the fix and new pilot training before the jets can fly again.

A Day in the Life of Property Magnets – Grant and Elena Cardone

Source: Grant Cardone

Here's a day in the life of me and my wife Elena Cardone. A private plane from Miami to Houston, real estate shopping, then a trip to Las Vegas to speak at Thrive. How do you build an empire? You're either creating or destroying something every day! If you don't want to do something, but know you should, do it anyway. No matter how you feel. That's how you fast track your way to success .

With The 4% Rule, This Ambitious And Aggressive Plan Could Allow You To Retire Early

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At any age, it's daunting to think about retirement, much less about retiring early. There are, however, growing communities of people making ambitious and aggressive retirement plans that get them out of the daily grind in as little as ten years. Good Money, explains how you can retire early, or, if you want something more traditional, a little farther down the road.

Dan Pena From $820 To Billionaire

Source: WingsLikeEagles

“Find something you love, and find something that can change a billion lives.”

Dan Peña is by far one of the most eccentric American businessmen. Dwelling in the 550 year old Guthrie Castle in Scotland, Dan was originally known for turning $820 into $450 million in the oil business in the 1980s. Since then he has taken a break from the business world to focus on mentoring elite executives and boasts a net worth creation of $50 billion. As Ripley used to say, “Believe it, or not.”

The Most Expensive House In The World

Source: Mr.Luxury

Inside Antilia, the $2 billion home.

Living in the most expensive of areas in a never ending mansion replete with all the amenities you can dream of; surrounded by a staff running to cater to each of our whim. Wake up, the bubble of your impeccable imagination just burst! Welcome back to the reality, that’s not your home but such a place, actually exists. Don’t believe us? Allow us to guide you towards a peep into Antilia, the mesmerizing abode of the richest man of India!

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Jaguar Land Rover to invest hundred of millions of pounds to build a range of electric vehicles

(qlmbusinessnews.com via bbc.co.uk – – Fri, 5th July 2019) London, Uk – –

Jaguar Land Rover (JLR) is investing hundreds of millions of pounds to build a range of electric vehicles at its Castle Bromwich plant in Birmingham.

Initially the plant will produce an electric version of the Jaguar XJ.

JLR says the move will help secure the jobs of 2,700 workers at the plant.

The news follows January's announcement, when the firm said it would cut 4,500 jobs, with the majority coming from the UK. That followed 1,500 jobs lost in 2018.

“The future of mobility is electric and, as a visionary British company, we are committed to making our next generation of zero-emission vehicles in the UK,” said Prof Ralf Speth, JLR's chief executive.

JLR has not announced when it will launch the battery version of the XJ, but it will replace the petrol and diesel versions which have been made since 1968.

The decision appears to contradict previous warnings by JLR that investment in the UK would be threatened by Brexit, and in particular a no-deal scenario.

However, industry experts say that JLR could not wait to see the outcome of the Brexit, as it needed to update its range of vehicles.

“Given where it is in its product lifecycle it [JLR] has to make this decision. The capacity is at Castle Bromwich and there's research and development nearby as well, so they've basically run out of time on this decision,” David Bailey, a professor of business economics at Birmingham Business School, told the BBC's Today programme.

He added that without the new investment the Castle Bromwich plant would “effectively be dead”.

The plant also produces the Jaguar XF, XE and F-Type.

Business Secretary Greg Clark said: “Today's announcement is a vote of confidence in the UK automotive industry – protecting thousands of skilled jobs.

“It reflects our determination for the UK to be at the forefront of the development and manufacturing of the next generation of electric vehicles.”

In January, JLR announced that its new battery making facilities would be located in the Midlands. It said the plant would be the most “technologically advanced” in the UK.

Investment in the UK car industry fell 47% last year from 2017 and the country is attracting a tiny fraction of the global investment in electric cars.

VW alone is investing £70bn in Europe, the US and China.

A no-deal Brexit would see new tariffs imposed on components and parts moving between the EU and the UK.

Vauxhall's parent company said that without a deal it would not make the next generation Astra at Ellesmere Port.

‘Confusing policies'

JLR's announcement comes a day after a report showed that in June sales of low emission cars had fallen for the first time in more than two years.

The Society of Motor Manufacturers and Traders said the fall in alternatively fuelled cars, such as hybrid electric vehicles, was “a grave concern”.

It said efforts to sell such cars were being undermined by confusing policies and “premature” removal of subsidies.

In response, the government said its focus on zero emission models had been a success, with registrations of battery electric vehicles up over 60% this year compared with the same period in 2018.

By Simon Jack

Amazon’s Deliveroo investment attracts scrutiny from Uk competition watchdog

(qlmbusinessnews.com via news.sky.com– Fri, 5th July 2019) London, Uk – –

A regulator has the power to block Amazon's investment if it judges that competition in the food delivery sector may be hurt.

An investment in food delivery app Deliveroo by Amazon, worth hundreds of millions of pounds, could be blocked by the competition regulator.

The Competition and Markets Authority (CMA) said it was looking into any potential breaches of competition rules arising from a fund-raising – first revealed by Sky News – in May.

UK-based Deliveroo then sought £450m from investors to fund its expansion plans as it battles rivals, including Uber Eats and Just Eat, for market share in the fast-growing restaurant delivery sector.

The exact sum of Amazon's investment, which gave it a stake in Deliveroo for the first time, was not disclosed.

Existing investors T Rowe Price, Fidelity Management and Research Company, and Greenoaks also took part.

The company said the latest funding – valuing Deliveroo at around £3bn – would enable investment in its London-based tech team, expansion to reach new customers and development of its delivery-only super kitchens, Editions.

But the CMA said it had “reasonable grounds for suspecting that it is or may be the case” that the deal could “result in Amazon and Deliveroo ceasing to be distinct”.

Its so-called phase one investigation means any merger plans the pair may have must be placed on hold.

There is widespread speculation Amazon is interested in buying Deliveroo after its own foray in the sector, Amazon Restaurants UK, was shut down amid tough competition.

The CMA has the ultimate power to block the deal – as it did when Sainsbury's and Asda sought a tie-up – if it determines consumers could have less choice.

The US company said on Friday its investment would allow more UK consumers to benefit from food deliveries through Deliveroo's expansion plans.

Deliveroo said of the investigation: “Deliveroo and Amazon have been working closely with regulators to obtain regulatory approvals.

“There are a number of major companies within the restaurant food delivery sector and this investment will enable Deliveroo to expand, innovate and, we believe, will enhance competition.

“This investment will help create jobs, help restaurants to grow their businesses and will improve choice for consumers.”

By James Sillars, business reporter

William Hill to close 700 betting shops across the UK

(qlmbusinessnews.com via uk.reuters.com — Thur, 4th July 2019) London, UK —

The cut in the maximum stake to 2 pounds ($2.62) followed complaints that the machines, which had allowed gamblers to bet up to 100 pounds every 20 seconds, were highly addictive and allowed players to rapidly lose large sums of money.

William Hill, which last year warned that about 900 shops could be shut as a result, said on Thursday it had suffered a significant fall in gaming machine revenues since the change was introduced in April, adding that the closures were likely to begin before the end of the year.

The British government had rejected industry suggestions when it brought in the stake cut that such a big reduction in the maximum stake could cost thousands of jobs.

Rival GVC Holdings (GVC.L) has warned the restrictions would lead to the closure of up to a 1,000 shops and cut its 2019 core profit by about 135 million pounds ($170 million).

William Hill’s retail business has about 2,300 licensed betting shops and is its largest division, generating 56% of its net revenue in 2018 and employing around 12,500 people in Britain, which accounts for about 90% of its business.

The company said in January that it would remodel its retail business after performance at it was hit by tighter regulations, particularly on lucrative FOBTs.

In May William Hill, which has betting shops, sports books and online and mobile channels in eight countries, said that UK retail gaming net revenue was down 15%.

William Hill’s Chief Executive Officer Philip Bowcock had earlier said that the introduction of the 2 pound stake limit was in line with expectations and that the company was confident in its plan to manage the change.

Reporting by Sangameswaran S and Shashwat Awasthi




Sainsbury’s sales fall for third straight quarter

(qlmbusinessnews.com via uk.reuters.com — Wed, 3rd July 2019) London, UK —

LONDON (Reuters) – Sainsbury’s (SBRY.L) sales fell for a third straight quarter as demand for clothes and general merchandise cooled, and the British supermarket group warned investors against expecting an upturn any time soon with Brexit looming.

After the company’s 7.3 billion pound ($9.2 billion) bid for rival Asda was blocked by Britain’s competition regulator, and with its shares down 37% over the last year, CEO Mike Coupe is under pressure to show Sainsbury’s can prosper on its own.

But he indicated on Wednesday that in a highly competitive and promotional market, and with the consumer outlook uncertain, investors would have to be patient for a return to sales growth.

“I’m not going to make myself a hostage to fortune by predicting the future,” he told reporters. “There are lots of things – we talked about Brexit as an example – that could significantly disrupt our business and our industry.”

Echoing recent comments from market leader Tesco (TSCO.L), Coupe said the Oct. 31 departure date for Britain to leave the European Union – pushed back from the original deadline of March 29 – was “not far off the worst day that you could possibly choose” due to the proximity of Halloween, Black Friday and Christmas, warning of a possible impact on fresh food and toy imports if trade flows are disrupted.

Coupe, who was paid 3.9 million pounds in 2018-19, will face investors on Thursday at the group’s annual shareholder meeting.

Sainsbury’s is cutting prices on daily essentials while investing in stores, technology and online services to meet the challenges of a fast-changing industry, where customers are shopping more frequently, demanding more convenience, buying more online and also flocking to discount stores.

So far prices have been cut on over 1,000 own brand products including dairy, meat, fish, poultry and fresh fruit and vegetables – adding to the competitive pressure in the sector.

Data on Wednesday showed British shop prices in June fell for the first time since October.

“We think we’ve done a pretty good job in our added value food ranges, where we have a challenge is in commodities. We’ve started to address that issue and actually we’re pleased with the progress we’ve made,” said Coupe.

He pointed to “market leading” prices on items such as a 250g pack of strawberries cut from 1.50 pound to 1 pound, and a 640g pack of chicken breast fillets cut to 3.60 pounds from 4.30 pounds, which have boosted sales volumes.

SALES FALL GETTING WORSE

Sainsbury’s said its like-for-like sales, excluding fuel, fell 1.6% in the 16 weeks to June 29, its fiscal first quarter. That compared with analysts’ forecasts for a fall of 1.1% to 2% and a drop of 0.9% in the previous quarter.

While total grocery sales fell 0.5%, general merchandise sales dropped 3.1% and clothing sales were down 4.5%.

Shares in Sainsbury’s reversed initial losses to trade up in early morning trade.

“There might be some relief that things aren’t getting worse in grocery,” said Bernstein analyst Bruno Monteyne.

Despite the sales declines, Sainsbury’s said its premium “Taste the Difference” own-brand food range gained market share, as did clothing and key general merchandise categories such as consumer electronics, technology, furniture and toys.

Recent official data and updates from peers, including Tesco, had already painted a gloomy picture for retailers, reflecting political and economic uncertainty and a tough comparison with the same quarter last year when Britain enjoyed a heatwave and major events including a royal wedding and the men’s soccer World Cup.

Sainsbury’s finance chief Kevin O’Byrne said he was comfortable about analysts’ consensus profit forecast for the 2019-20 financial year, which currently stands at 632 million pounds, just below the 635 million made in 2018-19.

Reporting by James Davey

Nike pulls sneakers after Kaepernick objection, as racist row intensifies

(qlmbusinessnews.com via bbc.co.uk – – Wed, 3rd July 2019) London, Uk – –

Arizona has pulled a $1m grant to help Nike build a new factory in a dispute over the firm's withdrawal of a trainer allegedly featuring racist symbolism.

The state's governor had condemned Nike's decision, which was prompted by complaints about its use of an old US flag embraced by white nationalists.

Nike-sponsored sportsman Colin Kaepernick had criticised the trainers, now selling on websites for $1,500.

But governor Doug Ducey said Nike had bowed to political correctness.

The special edition Air Max 1 Quick Strike Fourth of July trainer features the Betsy Ross flag.

With a circle of 13 stars representing the first US colonies, the flag was created during the American Revolution. Although opinion is divided over its origins, the flag was later adopted for use by the American Nazi party.

Nike said it withdrew the trainers “based on concerns that it could unintentionally offend and detract from the nation's patriotic holiday”.

On Tuesday the trainers were selling for well over $1,500 on StockX, the online marketplace for trainers.

Earlier, Mr Kaepernick, a former NFL star, reportedly told Nike that he found the flag offensive because of its connection to the era of slavery. Other critics also raised concerns with Nike.

Last year, he became the face of Nike's advertisement marking the 30th anniversary of the company's “Just Do It” slogan.

The former American football quarterback had previously sparked a furore by kneeling during the national anthem before games to protest against police violence against African-Americans.

But the decision sparked fury.

Doug Ducey, the Republican governor of Arizona, said in a series of tweets: “Words cannot express my disappointment at this terrible decision. I am embarrassed for Nike.

“Instead of celebrating American history the week of our nation's independence, Nike has apparently decided that Betsy Ross is unworthy, and has bowed to the current onslaught of political correctness and historical revisionism,” he said.

Later, the governor's office confirmed that the $1m from the Arizona Commerce Authority' Competes Fund had been withdrawn. The fund is designed to attract, expand or retain businesses to the state. The factory was expected to generate about 500 jobs.

Nike said in a statement it remained committed to making “a significant investment in an additional manufacturing centre which will create 500 new jobs”. It did not mention the Arizona plant by name.

Instead of celebrating American history the week of our nation’s independence, Nike has apparently decided that Betsy Ross is unworthy, and has bowed to the current onslaught of political correctness and historical revisionism.

Georgia Lord, the mayor of the city of Goodyear in Arizona where Nike is building the new factory, said the city “had found itself in the middle of a difficult situation”.

She said the Goodyear City Council had recently “unanimously approved a job creation agreement with Nike”.

“This deal is expected to bring more than 500 jobs and a significant investment to the city. We will honor the commitment we made in our agreement,” she added.

Texas Senator Ted Cruz also dismissed Nike's move as unpatriotic, writing on Twitter that the shoe giant “only wants to sell sneakers to people who hate the American flag”. Other Twitter users called for a boycott of Nike products over the move.

However, Nike also received widespread support, with Twitter users pointing out that the flag had been used by white nationalists.

Matt Powell, senior industry adviser at the research and consultancy group NPD, said said Nike would probably find support among its core consumers.

“I think it's important to understand who Nike's core demographic is here. They're really focused on teens and looking at the commentary on Twitter and so forth, I don't see a lot of teens coming out with a negative attitude here,” he said.

Mr Kaepernick has not played in the National Football League (NFL) since the 2016 season, and sued the organisation, arguing team owners deliberately froze him out because of his activism, later settling with the NFL.

Betsy Ross was credited with sewing the first “Stars and Stripes” flag in 1776, although this version of events has been rejected by modern US scholars.

Nike is not the only company to recently face a backlash over products labelled racially insensitive. In December, Prada pulled products accused of depicting blackface.

And on Monday, reality TV star and businesswoman Kim Kardashian said she would rename her Kimono line after people in Japan said her use of the term was disrespectful.

Construction sector output ‘falls at steepest rate since April 2009’

(qlmbusinessnews.com via news.sky.com– Tue, 2nd July 2019) London, Uk – –

Fears are growing the UK economy may have contracted in the second quarter of the year as the latest data misses expectations.

Output in the construction sector fell at its steepest rate since April 2009 in June, according to a close-watched activity survey.

The IHS Markit/CIPS purchasing managers' index (PMI) showed declines across the sector over the month – adding to evidence of a wider economic slowdown in the second quarter of the year.

The index for construction showed a reading of 43.1 in June – down from 48.6 in the previous month and way below the expectations of economists.

Anything above 50 indicates growth.

The PMI findings – based on the responses of purchasing managers – suggested business activity and incoming new work both fell at the fastest pace for just over 10 years.

The slide in construction demand across residential, commercial and civil engineering operations was mainly attributed by survey respondents to “risk aversion among clients in response to heightened political and economic uncertainty.”

Continued fog over the UK's departure from the EU has coincided with a sharp easing in demand across the global economy – largely blamed on the US-China trade war.

The UK economy grew by 0.5% in the first three months of 2019 however much of that growth surge was attributed to Brexit stockpiling ahead of the original deadline of 29 March.

The Office for National Statistics (ONS) figures showed construction had flat-lined during January to March with growth of just 0.06%.

The PMIs suggest construction output will have contracted during the second quarter.

There is little to cheer in the sector as the housing market continues to lose steam and businesses hold back on investment decisions.

Separate figures by Nationwide released on Tuesday showed house price growth at an annual rate of 0.5% in June – with London and surrounding areas continuing to see the largest declines in prices.

Shares in housebuilders fell at the open and declined further when the PMI number emerged.

Persimmon was down by more than 2%.

Dr Howard Archer, chief economic adviser to the EY ITEM Club, said: “With the purchasing managers also reporting that manufacturing activity contracted in June and was at a 76-month low, the dire June construction survey fuels belief that the UK economy highly likely contracted in the second quarter.

“Obviously, the performance of the dominant services sector will be important so there will be appreciable interest in the June services purchasing managers survey out on Wednesday – but while services activity is likely to have avoided contraction in the second quarter, we doubt it will have been sufficient to stop GDP contracting given the likely sharp falling back in manufacturing output.

“Specifically, we currently expect GDP to have contracted 0.2% quarter-on-quarter in the second quarter.”

By James Sillars

Bitcoin falls below $10,000 down 30% from last week

(qlmbusinessnews.com via theguardian.com – – Tue, 2nd July, 2019) London, Uk – –

Cryptocurrency climbed to nearly $14,000 on news social network was launching rival

The price of bitcoin has fallen back below $10,000, down 30% from last week’s peak of nearly $14,000.

Continuing its wild ride, the digital currency dropped to $9,717 on Tuesday, down 8.1% on the day. Last Wednesday, the cryptocurrency shot up to $13,879, breaking through the $12,000 and $13,000 levels in less than two hours.

Bitcoin had languished below $6,000 for months, but was galvanised by Facebook’s plans to create a cryptocurrency called Libra next year.Q&A

What is bitcoin and is it a bad investment?

Other digital currencies have also fallen back. Reports that an investor placed a large short order on Sunday, betting that the bitcoin price would go down in coming days, sparked panic among investors.

Bitcoin has seen wild swings in the past, and some analysts say it could rise back to $20,000 again – or fall as low as $3,000. In late 2017, it rose to close to $20,000, before a spectacular collapse in 2018.

The cryptocurrency’s latest gyrations prompted the US economist Nouriel Roubini, a long-time critic, to say that the bitcoin price would eventually fall to zero. He tweeted: “Its true value is negative, not zero, given its toxic externalities! It will get to zero in due time.”

Simon Peters, an analyst at global investment platform eToro, said: “We appear to be in a period of indecision, where the market is figuring out where to go next after its heavy surge and sell-off.”

Investors hope Facebook’s entry into digital currencies will bring greater legitimacy to the sector. Regulators around the world have warned that the move could lead to greater controls and tougher regulation to protect consumers.

Mark Carney, the governor of the Bank of England, cautiously welcomed Libra. He said the central bank would support new entrants into the UK financial system, but warned that Facebook would need to meet the highest regulatory standards.

Bloomberg reported last week that Henry Kravis, the co-founder of the US private equity firm KKR, had become the latest financier to bet on cryptocurrencies. He is investing in a cryptocurrency fund provided by ParaFi Capital. Other high-profile investors include British hedge fund manager Alan Howard, PayPal co-founder Peter Thiel and US hedge fund manager Louis Bacon.

By Julia Kollewe

Markets rally after US and China agreed to restart trade talks

(qlmbusinessnews.com via news.sky.com– Mon, 1st July 2019) London, Uk – –

The FTSE 100 rose by about 1% to reach a two-month high following developments at the G20 summit over the weekend.

Stock markets have rallied after the US and China agreed to restart trade talks, easing fears over the escalation of a damaging dispute between the world's two biggest economies.

The FTSE 100 was around 1% higher, taking the index above the 7,500-mark to its highest level since late April, while European bourses also made strong advances.

That followed gains for Asian markets overnight, after a meeting between Donald Trump and his Chinese counterpart Xi Jinping on the sidelines of the G20 meeting over the weekend.

Mr Trump offered concessions including not imposing any new trade tariffs and easing restrictions on Chinese tech company Huawei – which has recently been placed on a US blacklist.

China agreed to make unspecified new purchases of US farm products and to return to the negotiating table.

The developments helped the FTSE turn higher when trading resumed on Monday, led by industrial group Melrose – up by more than 3% – while Asia-focused financial powerhouses Prudential and HSBC also made gains.

An upturn in the oil price – with Brent crude rising 3% to nearly $67 a barrel – also lifted stocks.

The rise came after OPEC and other oil-producing countries looked set to extend supply cuts at a meeting in Vienna.

That helped boost UK-listed BP, up 2%, and Royal Dutch Shell, more than 1% higher.

In Germany – an exporting giant especially susceptible to global trade tensions – the Dax rose by 1.6% in early trading.

Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “Trump and Xi gave investors what they wanted at the G20 meeting in Osaka this Saturday: hope.

“A deal is not sealed just yet, but the two countries showed mutual willpower to end the deadlock and move on with the talks.”

By John-Paul Ford Rojas, business reporter

Mobile phone customers can now switch providers with one simple text

(qlmbusinessnews.com via bbc.co.uk – – Mon, 1st July 2019) London, Uk – –

Mobile phone customers can now switch providers with a single free text under new rules which have come into effect.

At the moment, customers have to phone their mobile provider when they want to switch to a new firm.

They are then given a porting authorisation code (PAC) to give to a new provider if they want to keep the same phone number.

But watchdog Ofcom says the need to speak to a provider can be one of the main factors stopping people switching.

As part of this process, customers can often find themselves dealing with unwanted attempts by the companies to persuade them to stay.

How to switch by text

  1. Customers who want to switch and keep their existing phone number text “PAC” to 65075 to begin the process
  2. Their existing provider will respond by text within a minute
  3. They will then be sent their switching code (PAC), which will be valid for 30 days
  4. The provider's reply must also include important information about any early termination charges or pay-as-you-go credit balances
  5. The customer then gives the code to their new provider, and this company must arrange for the switch to complete within one working day
  6. While most people want to keep their mobile number when they switch, about one in six do not. These customers can text “STAC” to 75075 to request a “service termination authorisation code”.

Ofcom says the new text-to-switch process will make it quicker and easier for people to leave their mobile company.

It will also give them control over how much contact they have with the firm.

After sending a single free text, customers should be switched within one working day. However, there may be early termination fees if you leave before the notice period of your existing contract.

Lindsey Fussell, Ofcom's consumer group director, told the BBC that the changes were designed to deal with the issues that put people off switching mobile phone providers.

These included the need to pay for both the old and the new service at the same time during an overlap period.

“It really has never been simpler to switch,” she said.

If mobile phone providers did not abide by the new rules, they would be subject to investigations and even fines, Ms Fussell added.

In November last year, Ofcom fined Virgin and EE £13.3m for leaving customers who quit broadband and phone contracts early “out of pocket”.

“We won't hesitate to do the same again if we need to,” said Ms Fussell.

ROBERT KIYOSAKI – Rich Dad, Poor Dad – How To Invest In Yourself

Source: LR

Robert Kiyosaki is an entrepreneur, educator, and investor, best known as the author of Rich Dad Poor Dad—the #1 personal finance book of all time. He has challenged and changed the way tens of millions of people around the world think about money. And he has become a passionate and outspoken advocate for financial education.