London midday: RBS ends banks good run
Footsie is having a tough morning with banks running into profit taking after Royal Bank of Scotland issued what it describes as a ‘poor’ set of numbers.RBS made a Ł15m profit, but bad debts rocketed to Ł7.5bn and it warned results may not “substantially” improve until 2011. Losses attributable to shareholders jumped to Ł1.04bn from Ł827m in 2008. Boss Stephen Hester said the results were “poor” and RBS shares have fallen sharply, but they have soared 50% since the start of July.
Lloyds and HSBC are also in the red, largely due to profit taking ahead of the weekend. Both have been very strong performers in recent weeks.
Miners are out of favour as metal prices ease. Kazakhmys, Rio and Xstrata are down. US non-farm payrolls for July are due out at 1.30pm UK time. About 300,000 jobs are expected to have been lost last month, but some are predicting 275,000, the lowest number since August last year.
Back over here, Logica saw profits surge 85% in the first half and said its cost saving programme will ensure it maintains margin for the year. Lower exceptional items and finance costs helped pre-tax profit for the six months to rise to Ł24m against Ł13m before. Group revenue was in line with guidance at Ł1,876m, up 6% on a reported basis, but down 2% proforma.
Sports Direct's acquisition of 31 stores from rival JJB is to be investigated by the Competition Commission after the sportswear group failed to sell five stores identified by the Office of Fair Trading as a competition concern.
Catlin , the specialty property/casualty insurer and reinsurer, said it produced record profits and net income for the half-year, prompting a 9% increase in dividends. In the six months, profit before tax rose 60% to $240m. Gross premiums written rose 7% to $2,211m.
AIM-listed care provider Claimar Care has received a cash offer from Housing 21 worth 39p per share, more than three times the value of the shares at yesterday's close. Housing 21 owns and manages over 16,000 sheltered and extra care retirement properties throughout England.
Miner African Eagle is “delighted” with the response to its Ł2.14m open offer which was oversubscribed by eager shareholders. The company, which had already raised Ł1.2m from institutional investors, has issued 53.4m shares at 4p each as part of the offer. It will use the money to help kick off a feasibility study at its Dutwa nickel project in Tanzania.
Stamp collector Stanley Gibbons is bullish on full year prospects after lifting profits by 13% in the first six months and making a strong start to the second half. Profit before tax for the six months ended 30 June jumped to Ł1.43m from Ł1.26m in 2008 on sales up 18% to Ł9.6m. Non-executive chairman Martin Bralsford called the half-year performance “remarkable”.
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