FirstGroup moves ahead of schedule
FirstGroup is to give up its First Great Western rail franchise in 2013, three years ahead of schedule. The transport giant has an option to extend the franchise for three more years, but said it would rather bid for a longer-term contract under the new Greater Western franchise which will accompany investment in the region’s network. The move is expected to save the firm more than £800m in payments to the Government.
Comet to close up to 10 stores
Comet’s owner Kesa Electricals is to close up to 10 stores this year after suffering another slide in UK sales. The retailer, which has 248 outlets in the UK, will also shut one of its three warehouses and 12 of its 14 regional service centres, which are used as a base by its engineers who repair and service its products. The company said it expected to make 150 redundancies in the UK, including 40 recent job cuts at Comet’s head office.
Toyota’s earnings crash by 25% in Q1
Toyota’s quarterly profit fell by more than 75 per cent to ¥25.4bn (£189m) after the earthquake and tsunami in March wiped out parts suppliers in north-eastern Japan and severely disrupted car production. The maker of the popular Prius hybrid gave no forecast for this year, citing an uncertain outlook while production remained hampered by shortages of parts, and by the strong yen.
VW to sell electric cars in China
The German car-maker Volkswagen is to launch electric cars in China under a new Kaili brand together with FAW Group, joining other foreign players in the race to develop the fledgling sector in China. Last June, China unveiled a pilot scheme to give subsidies to buyers of fuel-efficient cars as it moves to cut emissions.
Barratt reports 4% rise in private sales
Barratt Developments, Britain’s largest housebuilder by volume, reported a return to normal sales between January and May. Private selling prices rose by 4 per cent as the company switched its focus from apartments to houses. Barratt, which announced a new £1bn debt facility until May 2015, said it expected a big increase in full-year profits, helped by higher margin sites and cost controls.
Bovis expects 15% increase in profits
Bovis Homes echoed its larger rival Barratt Developments yesterday, predicting a rise in profits after a pick-up in sales, although it also warned activity would remain limited by tight mortgage availability. Bovis said visitor numbers were up by 20 per cent and sales rates up marginally. It expects a 15 per cent rise in profits this year.
Pru customers shun equities
Prudential said more of its fund management customers were switching away from equity-based products because of their fear of a stock market correction. It said the proportion going into its M&G share-focused funds fell from 69 per cent at the end of 2010 to 46 per cent in the first quarter.
Wood warns on North Sea taxes
Shares in John Wood fell after the oil services group warned that North Sea tax rises could result in industry projects being delayed as field economics were reassessed. However, the group, which has promised to return at least $1.7bn (£1bn) to shareholders, said it should still meet City expectations.
Trade deficit falls in first quarter
Britain’s trade deficit fell to its lowest level since the fourth quarter of 2009 on a quarterly basis, suggesting net trade still made a decent contribution to first-quarter growth. Exports grew 4.2 per cent on the quarter, while imports slipped 0.6 per cent.
Mario Draghi set to head ECB
The Bank of Italy’s governor, Mario Draghi, is set to be the next president of the European Central Bank after winning the backing of the German Chancellor Angela Merkel. No other candidate has been proposed to succeed Jean-Claude Trichet in November.