BANKING & INSURANCEScottish banks may be 50% public-owned
THE Westminster government could own about half of Scotland's two remaining banks under its dramatic rescue plan, analysts claimed last night (
Scotsman). Royal Bank of Scotland is believed to be in line for the lion's share of the potential £25 billion Treasury bail-out to shore up the ailing high-street institutions, while it is thought that HBOS – the subject of a controversial takeover bid by Lloyds TSB – may need £5 billion. The figures from analysts Sanford C Bernstein were released as the FTSE 100 tumbled again, closing 1.21 per cent down, showing the £500 billion bail-out had done little to restore market confidence. But leading banks made gains. HBOS was up 31.20 per cent to 154p, Lloyds increased 0.83 per cent to 212p and RBS showed gains of 5.84 per cent to 96p
Read all today's banking news from scotsman.comECONOMY
Alliance Trust wins backing of leading analystsMuch-criticised Dundee-based Alliance Trust was yesterday added to the "buy" lists of two influential analysts as they backed its cautious approach and the strategy of new chief executive Katherine Garrett-Cox (
Scotsman). Alan Brierley of Collins Stewart and Simon Elliot at Winterflood Securities are recommending the stock as a defensive home for investors' cash during the current market turmoil, but other Scottish-run trusts have fallen out of favour. The FTSE-100 company, which runs £2.5bn of assets, has faced intense criticism in recent years as previous chief Alan Harden's focus on new investment areas such as property and private equity and the spin-out of investment companies coincided with a period of poor performance. But the appointment of Garrett-Cox to the top job in August, with a commitment to boosting performance of the company's core portfolios of shares, has sparked fresh interest in the company, as has an astute decision to cash in some equities before the recent market dips.
Read all today's economics news from scotsman.comFOOD, DRINK & AGRICULTUREPratt pays the price as Magners sales go flatMAURICE Pratt, the head of cider maker C&C, has announced he is to stand down after failing to turn the business around in the face of "clear trading difficulties" (http://business.scotsman.com/fooddrinkagriculture/Pratt-pays-the-price-as.4578744.jp). Pratt – who has been chief executive for seven years – said his revival plans "had not met the expectations he had set for the business" over the past two years as the group reported a further plunge in sales. The Dublin-based company posted a 12 per cent fall in cider sales in the six months to 31 August, with interim group underlying operating profits down 0.7 per cent at 66.5 million (£52.9m). C&C warned that it expected a "material drop" in second-half earnings as it said the poor trading had continued in Ireland and Great Britain. But shares rose more than 9 per cent yesterday on news that Pratt is to quit, paving the way for a successor to lead a new recovery plan. The firm closed almost 6 per cent higher at 1.43.
Read all today's food, drink and agriculture news from scotsman.comINDUSTRYMinerals unit helps Weir lift profit forecastsA BULLISH Weir Group yesterday boasted that its full-year profits would be higher than expected after an improved performance and a resurgent dollar (
Scotsman). In an interim statement the Glasgow-based engineering services firm predicted that pre-tax profits would be closer to £170 million, up from August estimates of £165.4m. The group's bullish outlook was partly accounted for by positive foreign currency effects – most notably the dollar position against the pound – which boosted the company's bottom line by £3m in the latest quarter. But the company also pointed to improved performance in its minerals division, which would add £2m to the group's bottom line. "We picked our sectors very carefully. These long-cycle sectors are least exposed to short-term consumer cycles," said Mark Selway, chief executive. "Power generation, mining and oil and gas are three areas where population growth, the industrialisation of China and beyond that India require that these commodities are going to continue to be in absolute demand." In the past six months Weir's share price fell by more than 36 per cent to a low of 478.75p, although it has shown good signs of recovery, with analysts saying they now expect the shares to go "nicely better".
Read all today's industry news from scotsman.comRETAILFiver-a-time shoppers keep WH Smith profits risingWH SMITH became the surprise star of the high street yesterday as a continuing turnaround by cost-cutting chief executive Kate Swann produced bumper full-year profits (
Scotsman). Shares in the 215-year-old group jumped as much as 10 per cent on news of the £76 million underlying profit, ahead of the £74m expected in the City and last year's £66m profit haul. Since joining the firm in 2003, Swann has focused on improving margins by shifting the mix of products, better sourcing and better control of markdowns, rather than driving top-line sales. Despite that, shares in the newspaper, books and stationery retailer have lost about a fifth of their value over the past year on fears it will struggle amid a consumer spending slowdown. The group, which established itself in the Scottish market in the late 1990s with the acquisition of John Menzies' retail arm, is expecting a strong line-up of new book releases to boost Christmas sales. The annual results were lifted by strong performances at the group's motorway, airport and railway station stores. Total sales rose 4 per cent to £1.35 billion, but on a like-for-like basis, stripping out the impact of new store openings, they were down by 2 per cent. Underlying sales at the core high street business fell while those at the travel division rose.
Read all today's retail news from scotsman.comTRANSPORTClyde ferry service to be saved A 500-year-old ferry service on the River Clyde looks set to be maintained, after plans to replace it with a bridge were deemed too expensive (
BBC). The Renfrew to Yoker ferries typically carry four passengers per journey at a subsidy of £2.77 per head.
A study found that replacing the two boats with a bridge could cost £15m. Strathclyde Partnership for Transport board members will meet later to consider plans to replace the existing ferries with one smaller vessel. The Renfrew Rose and the Yoker Swan have ferried passengers across the Clyde for 24 years.
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