LONDON (Alliance News) - The following is a summary of top news stories Friday.
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COMPANIES
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Outsourcer G4S said it has secured a USD187.0 million contract to provide security services to Basra Gas Co in Iraq and to the UK Foreign and Commonwealth Office in Afghanistan. G4S said the Basra contract will start in January 2016 and includes a two-year extension option which would increase the total value of the deal to USD270.0 million. In addition, the company has renewed a contract to supply security services to the UK's Foreign and Commonwealth Office in Afghanistan. Including the two-year extension option on the deal, the contract is worth a total of GBP100.0 million.
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Aerospace and engineering group Rolls-Royce Holdings said it has won a contract from French airplane maker Airbus to provide Trent 700 engines and TotalCare engine service support for five Beluga XL air transporter aircraft. Rolls-Royce said the deal is worth USD700.0 million and will replace the current Airbus Beluga fleet, which is powered by engines from a different manufacturer.
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The European Commission said it has approved the acquisition of the Nimenrix and Mencevax vaccines businesses belonging to GlaxoSmithKline by an Irish subsidiary of Pfizer of the US, under the EU Merger Regulation. Both vaccines protect against meningitis A, C, W and Y. GSK committed to divest the vaccines to gain the Commission's clearance of its transaction with Novartis in January 2015.
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Anglo-Australian mining giant BHP Billiton and Saskatchewan-based electricity provider SaskPower announced a partnership to accelerate the global development of carbon capture and storage or CCS technology by sharing access to the data, information and lessons learned from SaskPower's Boundary Dam facility - the world's first full chain power sector CCS project. BHP Billiton will contribute to the establishment of a global knowledge centre to help promote research and reduce the cost and risk associated with new CCS projects.
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Discount fashion retailer Primark, owned by Associated British Foods, opened its new flagship store in Boston on Thursday, the first store the retailer has opened in the US. The Times, reporting on the opening, said large crowds gathered prior to the doors being opened and the staff at the store broke into a rendition of Neil Diamond's 'Sweet Caroline', a song traditionally sung by fans of the Boston Red Sox baseball team. The new store is situated in the Burnham Building in the Downtown Crossing neighbourhood, which used to be home to US department store Filene's. It spans four floors across 77,000 square feet of selling space.
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JD Wetherspoon reported a drop in pretax profit in its recently-ended financial year, despite growth in revenue, as it took a hit to its profit margin due to higher staff and utilities costs, and as it warned about the financial pressure pubs will feel due to the soon-to-be imposed UK living wage. The pub company reported a 2% fall in pretax profit in the year ended July 26 to GBP77.8 million from GBP79.4 million the year before, although revenue rose 7.4% to GBP1.51 billion from GBP1.41 billion. Operating margin before exceptional items decreased to 7.4% from 8.3% which Wetherspoons said was due to lower gross margin and increases in staff costs, utilities and depreciation, which put pressure on profit.
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Great Portland Estates said it has pre-let all the office space in its development at Rathbone Square in London to social media giant Facebook. The company said Facebook has agreed to lease 227,324 square feet of office space, all of the consented office space at Rathbone Square. Facebook will occupy the building on a 15-year term without break from practical completion to shell and core condition, scheduled for February 2017, and will pay an initial rent of GBP16.9 million after receiving 30 months rent free from completion of the offices and a capital contribution to fit out the building to a Category A condition.
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Construction company Galliford Try said it has won two contracts with the University of Leeds worth a total of GBP37.8 million. The first deal will see Galliford refurbish the Engineering Building on the university's main Woodhouse campus. The GBP22.5 million contract will involve refurbishing the third, fourth and fifth levels of the building and completing the maintenance backlog on the rest of the building. Galliford will also take on the GBP15.3 million refurbishment of the Edward Boyle Library. That deal will include fully refurbishing the study areas and replacing the engineering systems and roof.
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MARKETS
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UK indices traded mixed with the FTSE 100 supported by mining stocks rebounding following the losses suffered on Thursday when the sector was hit by more poor economic data from China.
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FTSE 100: down 0.1% at 6,149.46
FTSE 250: down 0.2% at 16,998.28
AIM ALL-SHARE: up 0.1% at 735.06
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The pound was down against the dollar after UK construction output fell unexpectedly in July.
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GBP: down at USD1.5427
EUR: down at USD1.1265
GOLD: down at USD1107.79 per ounce
OIL (Brent): down at USD47.93 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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UK construction output decreased unexpectedly in July after recovering in the previous month, figures from the Office for National Statistics showed. The volume of construction output fell a seasonally adjusted 1.0% month-over-month in July, reversing a 0.9% increase in June. Economists had expected a 0.5% climb for the month. All new work declined 1.5%, while repair and maintenance showed no growth during July. On an annual basis, construction output dropped 0.7% in July, in contrast to a 2.6% gain in the preceding month. It was expected to increase by 0.9%.
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German consumer price inflation remained stable as initially estimated in August, final data from Destatis showed. The consumer price index rose 0.2% year-on-year, the same as in July. The rate matched the preliminary estimate published on August 28. The measure climbed for a seventh month running. On a monthly basis, consumer prices remained flat in August after rising 0.2% in July. Food prices increased 0.8% and clothing and footwear by 1.4%. Meanwhile, energy prices plunged 7.6%. Meanwhile, Germany's wholesale prices declined at a faster pace in August, figures from Destatis showed. Wholesale prices dropped 1.1% year-over-year in August, following a 0.5% stable rate of decrease in the previous month. The wholesale price index has been falling since July 2013.
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Singaporeans went to the polls Friday following a fiercely contested campaign in which opposition parties sought to break the city-state's unbroken one-party dominance. The People's Action Party, which has governed Singapore since 1959, is expected to win another majority, but opposition parties called for voters to increase their support for more diverse voices as a check on the ruling party.
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Hungary's cabinet will consider declaring a state of emergency to deal with the surge of migrants streaming in from the south, Prime Minister Viktor Orban's chief of staff said. The measure, proposed by the Interior Ministry, will be discussed in a cabinet meeting on Tuesday, Janos Lazar said. Orban, a conservative who has maintained a hostile stance towards migrants, has said that Hungary is unwilling to accept Muslim migrants and ordered the construction of a fence along the country's 175-kilometre border with Serbia.
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An effort to scuttle the international agreement on Iran's nuclear programme failed in the US Senate as President Barack Obama's Democrats blocked a resolution disapproving the deal. The 58-42 vote to advance the legislation fell short of the three-fifths supermajority needed in the 100-member chamber. US lawmakers have until September 17 to weigh in on the Iran deal. The lower House of Representatives is still debating the agreement, but the Senate's action effectively ensures that the deal will stand.
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The US marks 14 years since the September 11, 2001, terrorist attacks with ceremonies Friday including a memorial service at the newly opened visitor centre at the rural Pennsylvania site where one of four hijacked airliners crashed. Moments of silence will be held nationwide to commemorate the deadliest terrorist attacks ever on US soil, which killed 2,977 people.
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The Brazilian government plans to cut back spending even further, Finance Minister Joaquim Levy said, hours after the rating agency Standard & Poor's downgraded the country's bonds to junk. "The government must cut spending and will do so, yes, more than it has done in the past and with smart management and tools," Levy said in an interview with broadcaster TV Globo. "If necessary, we must be willing to make sacrifices so that we can all get the economy to grow again," he said.
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A new round of Yemeni peace talks will be held next week in the region with the participation of the government, Houthi rebels and the General People's Congress, the United Nations said. The talks, for which a date and venue will be announced later, are to focus on forging a cease-fire agreement and resuming a peaceful political transition, according to a statement by Ismail Ould Cheikh Ahmed, UN special envoy on Yemen.
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By Arvind Bhunjun; arvindbhunjun@alliancenews.com; @ArvindBhunjun
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