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From left to right: Evangelos Venizoles, Greek minister for finance, Lucas Papademos, Greek prime minister and Wolfgang Schäuble, German finance minister, at the Eurogroup meeting, Brussels, Feb 20, 2012. The wheelchair bound Schäuble had provoked an angry rebuke from the Greek president last week.
Food group Kerry today reported adjusted pre-tax profits of €449.1m
for the year to the end of December, a 10.8% rise on the €405.4m reported the
Revenues climbed by 6.4% to €5.302bn from €4.960bn in a year of a continuing
global food commodity boom but also weak consumer confidence in many
markets and significant raw material and input cost inflation.
Commenting on the results Kerry Group chief executive Stan McCarthy said:"Kerry delivered good profitable growth in 2011 despite weak consumer
confidence in many markets and significant raw material & input cost inflation.
The Group performed well across developed and developing markets while
continuing to build our capabilities and positioning for the future. Trading
profit reached a milestone level of €501m in 2011. We are confident of achieving
our strategic growth objectives for 2012 and expect to achieve seven to ten per
cent growth in adjusted earnings per share to a range of 228 to 235 cent per
share (2011: 213.4 cent)".
Liam Igoe, analyst at Goodbody comments
- - "Kerry
Group today reported FY11 eps up 11.1% were towards the top end of its guidance
range (+8-12%) at 213.3c. Growth in earnings was driven, as expected, by robust
lfl sales and, to a lesser extent, acquisition activity in the latter part of
the year. Lfl volumes of 3.3% were in-line with our forecasts. Within this
Ingredients volume increased by 4%, while Kerry Foods saw volume growth of 1.1%.
The differing performance between the divisions was even more marked in Q4, when
Ingredients lfl volumes increased by 4.5%, but Foods declined (due to declines
in Ireland, with UK sales still increasing). In terms of margins, overall
margins fell 10bps, which was broadly as expected. Divisionally, foods fell
30bps, while Ingredients fell 10bps. In H2, Ingredients saw a 20bps rise in
margin, with Foods down 20bps.
Kerry is guiding an eps range of 228c to 235c for
FY12, which compares with our current eps forecast of 226.1c. At first glance we
are likely to nudge our forecasts up slightly. As we had already noted, FY12
forecasts are being impacted by some front loading of Kerryconnect costs, with
spending here expected to rise from €65m in FY11 to €80m in 2012, resulting in
the sub 10% guidance for growth."
Economic View; €130bn bailout agreed for Greece:
economist at Goodbody comments -- "Confidence that a second bailout
package for Greece in less than two years would be approved at last night's
Eurogroup meeting was well founded. Following weeks of negotiations with the
European authorities, the ECB, the IMF and private investors European finance
ministers finally agreed to the €130bn aid package that will stave an imminent
disorderly Greek default that would have threatened the stability of the euro
Agreement on Private Sector Involvement (PSI) proved more complicated as
it became apparent that the original estimates of a 50% haircut would not see
the debt/GDP level reach the target level 120.5% by 2020. Instead the debt swap
offer will result in an estimated 53.5% write-down. The ECB will also play a
part, with profits from its bond purchase programme being distributed to the
national central banks. With Greece having a history of not meeting its deficit
targets, a permanent monitoring of the implementation of the austerity measures
has also been agreed. In addition, an escrow account is being set up to
ring-fence the bailout money. Whether the Greek politicians can keep their side
of the agreement remains to be seen. History would suggest not.
With the debt/GDP levels in Ireland set to reach 124% in 2014, which is at the
very edge of sustainability, the Irish government will have been watching the
unfolding developments in Greece closely. As the poster child of European
austerity, Ireland will doubtlessly now increase the pressure on its European
partners for some movement in reducing the debt burden, particularly that
assumed in support of the domestic and indeed Eurozone banking system."
Greece funding package finally agreed: Conall Mac Coille, chief economist at
Davy comments - - "The meeting of EU finance ministers that began yesterday
afternoon concluded close to 03.00 this morning with a new funding package for
Greece finally approved. The surprise development was that private sector
creditors accepted further write-downs on their holdings of Greek debt — 53.5%
relative to the 50% cut previously agreed, representing 70% of the net present
This means that Greek debt is now expected to fall to 120% of GDP, with
additional funds secured through an effective debt buy-back scheme, reflecting
national central banks' past purchases of Greek debt below par as part of the
ECB's Securities Markets Programme (SMP). Luxembourg prime minister, Jean-Claude
Junker, also predicted that the March 1st-2nd summit will lead to agreement on a
further expansion of the euro area's emergency funds to €750bn from the planned
limit of €500bn.
Overnight, Asian stocks responded positively to the agreement of the new
Greek rescue package. So, European markets are likely to rise when they open
this morning. Indeed, the recovery in stock indices since the beginning of the
year reflects increased confidence from markets in European policymakers'
responses to the sovereign debt crisis. However, thus far, a similar rebound in
consumer and business confidence has not been evident. And the contraction in
euro area GDP by 0.3% in Q4 surely reflected households and companies postponing
spending given uncertainty about economic prospects. So markets will look to
today's European consumer confidence survey for any evidence of improving
sentiment from households."
LinkedIn Co-Founder: Future of Social Media:
US markets were closed
Monday for the Presidents' Day holiday.
The MSCI Asia
Pacific Index slipped 0.3% Tuesday.
Nikkei 225 fell 0.23%; China’s Shanghai Composite
Index added 0.75%. South
Korea's Kospi index advanced 0.07%. Australia's S&P/ASX 200 climbed 0.82% and
the Bombay Stock Exchange Sensex 30 index in Mumbai rose 0.92%.
the Dow Jones Stoxx Europe 600 is down 0.20% in early trading Tuesday.
The ISEQ is
off 0.17% in Dublin.
Dragon Oil is up 1.33% and FBD is up
Dragon Oil (Buy, Closing Price £5.64); FY11 First Glance: In
line statement: Gerry Hennigan, analyst at Goodbody, comments on today's
results announcement: "The FY11 results statement from Dragon this
morning is very much in line with expectations with little in the way of
incremental newsflow beyond that provided in the Trading Statement and Reserves
Update outlined on January 23rd. Not surprisingly, there is no further
commentary regarding the indication of an interest, albeit preliminary, in
UK-listed Bowleven. As such, reference to diversification efforts are confined
to Dragon’s recent entry into the Bargou Licence offshore Tunisia, the recent
appointment of an Exploration Director and a decision to relinquish the legacy
10% interest in Block 35 in Yemen.
The latter, however, is immaterial to valuation accounting
for just 0.3p of our total risked NAV of 817.1p. Looking ahead, guidance in
terms of infrastructure capex ($1bn over the period 2012 - 2015) and development
wells (13-15 in 2012, 15-20 wells annually over the period 2013-2015) is in line
with our expectation. Average annual production growth (10%-15%) over the period
2012-2015 and the stated target of 100 kbopd by 2015 has also been maintained.
In terms of the results, revenue for the year amounted to
$1.15bn, with PBT of $871.7m and adj. EPS of 125.6c compared to our estimate of
124.7c. Variances largely relate to a lower cost of sales, but also lower
interest charges. A final year dividend of 11c has been declared resulting in a
full year payout of 20c, slightly below our expectation of 22.5c. At first
glance, given that we upgraded as recently as January 24th, we are likely to
defer further adjustments to forecasts, while acknowledging the recent spike in
oil prices, clearly points to a positive upward bias to current year estimates.
Incremental newsflow, aside from the above, largely relates to commentary
regarding efforts to commercialise its gas reserves (1.5 TCF). Discussions with
the Turkmen government continue, with the emphasis remaining on pursuing a dual
strategy towards realising value from associated field gas. While the long term
objective remains to secure a gas sales agreement, the near term emphasis is on
extraction of the condensate."
The skyscrapers and
immaculate beaches of Singapore's seaport look out on one of the world’s largest
parking lots: mile after mile of empty cargo ships, as far as the eye can see.
Similar fleets bob at anchor,
with empty cargo holds, off the coasts of southeast Malaysia and Hong Kong. And
dozens of newly built ships float empty near the giant shipyards of South Korea
and China, their owners from all over the world reluctant to accept delivery
during one of the worst markets ever for the global shipping industry.
As recently as six weeks ago
large freighters that can carry bulk commodities like iron ore or grain were
fetching charter rates of $15,000 a day. Now, brokers and owners say, the going
rate is $6,000 a day. If any customers can even be found.
between the US benchmark WTI (West Texas Intermediate) used on the New York
Mercantile Exchange and Brent is over $17 - - The Globe and Mail says that for
the past 10 months, Canadian producers - - whose prices are tied to WTI - - have
been taking steep discounts for their oil compared with international crude
prices that are benchmarked against North Sea Brent, which can be shipped more
readily. In the past, WTI tended to trade at a small premium to Brent, because
it is easier to refine.
hit a peak of $28.08 (US) on Oct. 14, but has fallen dramatically since then.
After plans for more pipeline capacity at Cushing, Oklahoma, the differential