PRESS DIGEST – Financial Times – April 13

Financial Times

EASTER BOOSTS SALES BUT CAUTION REMAINS

The British Retail Consortium said total retail sales in
March increased by their fastest rate since April 2006 but that
consumers were buying cautiously. The BRC attributed the March
sales growth to the fact that Easter was early this year, and
said the figures would have been only half as strong without the
effect. Helen Dickinson, head of retail at KPMG, said concern
over the future “continues to weigh on consumers’ minds and the
outlook for spending remains uncertain”. Meanwhile, a separate
survey by the Royal Institution of Chartered Surveyors confirmed
UK house prices were rising but by slimmer margins than in
recent months. RICS said recent house price rises had encouraged
a rise in new instructions to sell but it was not being matched
with rising interest from buyers.

DOMINANT BOSSES HURTING RECOVERY

The Chartered Management Institute has said Britain’s
economic recovery could be hampered by managers adopting a
“dominant” style of leadership. After conducting a survey of 500
employees, the CMI found only one in ten workers believed their
managers were accessible, with most describing them as
authoritarian, bureaucratic and secretive. CMI chief executive
Ruth Spellman cautioned bosses that “goodwill and engagement
among employees doesn’t only improve people’s working lives but
it adds to the bottom line — in productivity, retention rates
and customer loyalty”.

RETAILER FAILURES PLUNGE IN FIRST QUARTER

Research from business advisory group Deloitte shows the
number of retail companies put into administration in the first
quarter of 2010 was down 65 percent on the same period last
year. The 44 administrations seen in the first quarter is the
lowest number in any quarter of the last four years. While
noting that it was unsurprising to see a drop, as the first
quarter of 2009 saw “exceptionally high levels of retail
administrations”, Lee Manning, reorganisations partner at
Deloitte, pointed out the fact that companies had taken steps to
better equip themselves for tougher trading conditions. Manning
also said retailers had been increasingly making use of
restructuring tools such as company voluntary arrangements.

LATE WINTER COOLS REVENUES AT CARR’S MILLING

Overcapacity in flour milling and a late winter have reduced
sales at animal feeds, fertiliser and flour group Carr’s Milling
Industries, but a fall in costs has increased demand for its
fertiliser products. Pre-tax profits for the six months to
February 27 rose one percent to 5.3 million pounds, with revenue
falling eight percent to 161 million pounds. Chief executive
Chris Holmes said that bad weather in February and March would
compensate for the earlier fall in demand for cattle feed
products. Shares in Carr’s rose 45 pence to 530 pence on Monday.

QINETIQ SEEKS TO AVERT STAFF BATTLE

Former government defence research group Qinetiq (QQ.L: ) will
meet representatives of trade union Prospect on Tuesday after
announcing plans to terminate all collective agreements
including current redundancy terms. Prospect, which represents
2,000 of Qinetiq’s 6,500 UK employees, called the move “a
hostile act” and said it had received “authoritative legal
advice” that the group’s actions could be challenged in law.
Qinetiq has expressed confidence that its proposals, part of a
restructuring plan being implemented by new chief executive Leo
Quinn, are “entirely legal”. About half of Qinetiq’s UK staff
are entitled to public sector-type terms and conditions.

PROSPECT OF FRESH TAKEOVER BATTLE FOR ARSENAL.

The likelihood of a renewed takeover battle for Arsenal
Football Club increased on Monday night, after the Premiership
club’s fourth-biggest shareholder put her stake up for sale. It
is understood that Lady Nina Bracewell-Smith has hired bankers
at private equity group Blackstone to find a buyer for her 15.9
percent stake. U.S. sports franchise owner Stan Kroenke has been
vying with Russian steel magnate Alisher Usmanov for control of
the club and, should either party bid for Bracewell-Smith’s
stake, it would take their holding above 29.9 percent. This
figure is the threshold above which, under stock market rules,
they would be required to make a formal bid.

ICG FUND TO INVEST IN DEBT-LADEN EQUITY DEALS

London-listed mezzanine lender Intermediate Capital Group
(ICP.L: ) has raised 746 million pounds for a new recovery fund
which will invest in European private equity deals that have too
much debt or require fresh capital. The financial downturn has
caused credit markets to dry up and the group, which currently
has 12 billion euros of assets under management and last month
unveiled a management shake-up and strategic rethink, believes
there is an opportunity to support the debt-laden acquisitions
made by private equity groups during the market bubble. Recovery
fund manger Benoit Durteste has said the company will have 1.5
billion euros to invest in recovery opportunities.

SHELL DEFENDS ATHABASCA PLAN

In a regulatory filing on Monday, Royal Dutch Shell (RDSa.L: )
defended its decision to expand its stake in Canada’s Athabasca
oil sands. The oil giant has also recommended that its
shareholders vote against a resolution, tabled by campaign group
FairPensions, which would require increased disclosure about its
activities there. FairPensions has called on both Shell and its
rival BP (BP.L: ) to disclose assumptions it made before deciding
to proceed with the project, arguing that the investment is
environmentally damaging and financially risky. Shareholders
will vote on the resolution at Shell’s annual meeting, which
will be held on Thursday.

Stock Market Trading

Prepared for Reuters by Durrants

PRESS DIGEST – Financial Times – April 13