PRESS DIGEST – Financial Times – April 16

Financial Times

SMES HIT BY UNPAID DEBTS OF 63 BILLION POUNDS, STUDY SAYS

Research by Natwest and the bank’s parent Royal Bank of
Scotland found 71 percent of small and medium sized companies
have suffered from late payments in the past year, leaving them
burdened with 63 billion pounds in unpaid debt. The Natwest/RBS
study was supported by a separate Barclays survey, which showed
the average amount of bad debt being written off by SMEs doubled
in 12 months to 2,529 pounds. Peter Ibbetson, chairman of
Natwest and RBS small business operations, expressed concern
that “so few are making use of services from their bank to help
alleviate the problem”. Meanwhile, Stephen Alambritis, of the
Federation of Small Businesses, said: “Banks are not loaning and
giving overdrafts, which means small firms feel like banks
themselves.”

WHITE VAN MAN GIVES RECOVERY THE THUMBS-UP

Vehicle remarketing firm British Car Auctions [BCRAU.UL] has
seen a revival in demand for white vans, with used vans
achieving the second highest average prices on record in March,
rebounding from a trough in December 2008. The average price for
a used light commercial vehicle increased to 4,500 pounds in
March, up from 2,772 when prices slumped in December 2008. BCA
spokesman Tim Naylor said small businesses have been significant
buyers in the used commercial market and that the record sales
values suggest “confidence is returning to the small and
medium-sized businesses sector”, supporting the view that the UK
is coming out of recession.

LIFELINE THROWN TO STRUGGLING RADIO STATIONS

Broadcasting regulator Ofcom has announced new rules to
enable radio stations to reduce programming hours to support
regional broadcasters which have suffered from the worst
advertising recession on record. The new deregulation measures,
enabled by the Digital Economy Act, will come into force in June
with permission being granted for rival stations to use the same
buildings and technology to cut costs. Regional broadcasters
have suffered from a 29 percent cumulative fall in revenues
between January 2008 and September 2009. A senior official said
struggling companies have welcomed the relaxation of rules to
“make savings that were literally the difference between being
able to continue trading and not”. Ofcom said it hoped the
changes would encourage competition, choice and “new investment
in programming”.

SALES OF E-BOOKS RISE BUT DIGITAL REVOLUTION STILL SOME WAY
OFF

The Publishers Association has said UK sales of e-books and
other digital products increased 20 percent in 2009 but still
contributed just 4.9 percent of the total 3.1 billion pounds of
sales reported by UK publishers last year. Sales of digital
products in the UK increased to around 150 million pounds in
2009, from between 75 million pounds and 80 million pounds in
2008. Consumer titles contributed only about five million pounds
of digital sales. Publishers Association chief executive Simon
Juden said that the launch of new e-book technology, like the
iPad, would boost future sales.

MONERIS ENTERS THE FRAY FOR RBS’S PAYMENTS OFFSHOOT

Canadian card payments company Moneris Solutions has emerged
as a bidder for the Global Merchant Services division of the
Royal Bank of Scotland (RBS.L: ), as the auction of the business
enters its last stages. The division, which is worth 2.5 billion
pounds and includes the Streamline cards operation that
dominates the UK market, must be sold by RBS under the terms of
a European Commission state aid ruling. The government owns a 70
percent stake in RBS following last year’s bail-out. Other
bidders include UK-based private equity group CVC Capital
Partners.

RIO ISSUES “EXTRA GUIDELINES” FOR CHINA

Mining company Rio Tinto (RIO.L: ) has issued “extra
guidelines” to its employees about “gathering information in
China” following the conviction of four Shanghai-based staff for
stealing commercial secrets. Other companies operating in China
may follow the move. At Rio’s annual general meeting on
Thursday, chief executive Tom Albanese addressed shareholder
concerns about the convictions, saying there were “different
definitions of business secrets in different countries” and
adding that Rio would never knowingly ask employees to act
illegally. Rio chairman Jan du Plessis said: “We examined the
evidence in the court and decided, in light of what happened, to
accept that verdict.”

EXPERIAN BEMOANS UK LENDING RELUCTANCE

Global credit checking group Experian (EXPN.L: ) has said UK
banks are lagging behind their U.S. counterparts in terms of
their willingness to lend to consumers. Shares in the FTSE 100
listed company fell 18.5 pence to 616.5 pence, after it said
that its main business of performing credit checks in developed
economies had put a lid on revenue improvement in the six months
to the end of March. Experian blamed lack of credit and
consolidation in the financial sector for a seven percent fall
in organic revenue at its main credit services operations in the
UK and Ireland, but strong performance in Latin America helped
total group revenue rise three percent in the second half.

PZ CUSSONS TO CLEAN UP IN TOUGH YEAR

PZ Cussons (PZC.L: ) expects to report full year profits which
are in line with City expectations, despite challenging
conditions in some of its markets and rising commodity prices.
The consumer products group, whose brands include Carex soap and
the Charles Worthington range of hair styling products, said
that profits had continued to rise in spite of aggressive
promotions by supermarkets and that it expected the growth to
continue, aided by the launch of new products.

BETTING GROUP TO MOVE UP FROM AIM

Online betting operator Sportingbet (SBT.L: ) has confirmed
plans to leave the Aim market for a main London listing. The
firm, which almost collapsed in 2006 following a U.S. regulatory
clampdown, said the move would raise its profile, increase the
liquidity of its shares and help it attract a wider range of
investors. Shares in the group rose 2.25 pence to 76.25 pence on
Thursday’s trading, giving it a market capitalisation of 381
million pounds, which could place it in the FTSE 250.

EX-MATALAN CHIEF JOINS HUT GROUP’S BOARD AHEAD OF FLOTATION

Former Matalan chief executive Angus Monro has joined the
board of The Hut Group ahead of the fast-growing online
retailer’s flotation next year. To prepare for the flotation the
company has raised 14 million pounds from a host of investors,
including Monro, which will be used to fund acquisitions and
help the group diversify its offering. The other new investors
are technology venture capital group Balderton Capital and fund
managers Artemis and William Currie. In total the new
shareholders have taken a 43 percent stake, valuing Hut Group at
32 million pounds, and Monro will be joined on the board by
Balderton’s Mark Evans and William Currie’s Iain McDonald, who
will become non-executive directors.

Investing Research

Prepared for Reuters by Durrants

PRESS DIGEST – Financial Times – April 16