Alcatel-Lucent SA Awarded contract with China Mobile worth €700M to convert broadband network to all-IP ultra broadband
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BN 03/27 09:32 *ROLLS-ROYCE SELECTED TO PROVIDE TRENT ENGINES WORTH $1.1BN BN 03/27 09:31 *ROLLS-ROYCE SELECTED BY ANA
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*ROLLS-ROYCE SELECTED TO PROVIDE TRENT ENGINES WORTH $1.1BN 2014-03-27 09:34:40.184 GMT
See {NSN N339583HBS3K <GO>} for the RNS Newswire press release.
See {RR/ LN Equity CN <GO>} for company news.
-0- Mar/27/2014 09:34 GMT
Greater China is down but not out.
That’s the message from luxury watch brands heading into the Baselworld fair, the watch industry’s most important annual gathering, which is set to run in Basel, Switzerland, today through April 3.
All eyes are on Hong Kong and China, the number-one and number-three markets for Swiss timepieces, respectively, where demand for watches fell sharply last year owing to an economic slowdown and a government crackdown on official gift-giving.
As a result, Swiss watch exports rose just 1.9 percent in 2013 after a 10.9 percent increase in 2012, according to the Federation of the Swiss Watch Industry.
Most analysts expect the sector will see a slight rebound this year. Swiss private bank Vontobel forecasts Swiss watch exports will rise 6 percent in 2014 to a record 23.1 billion Swiss francs, or $26.5 billion at current exchange, with growth in all major markets.
“The main reason for the growth acceleration compared to 2013 is a normalization in Greater China, where we expect low-single-digit growth,” Vontobel Equity Research said in a recent report.
And the World Watch Report, released by Geneva-based Digital Luxury Group on the eve of the fair, shows Chinese consumers have not lost their appetite for luxury watches. Total Internet searches for haute horlogerie timepieces were up 59 percent in China last year, with Omega, Cartier and Rolex the most sought-after brands.
“The euphoria of the last two or three years [among exhibitors] is gone,” said Baselworld director Sylvie Ritter. “But everyone is very confident, and all those I have met expect it to be a good edition of Baselworld, and they don’t think we’re going to see a sharp slowdown.”
New arrivals at the fair include diamond specialist Graff, which is taking over the space previously occupied by Harry Winston, now housed with the other Swatch Group brands on the ground floor of the main hall. Meanwhile, Fossil Group Inc. will be present with an expanded portfolio including Emporio Armani Swiss Made, Burberry, Skagen and Fossil, which celebrates its 30th anniversary this year.
Nick Hayek, chief executive officer of Swatch Group, the world’s largest watchmaker, forecasts the Swiss watch industry will grow 5 to 10 percent in 2014. But he warned that volatile currencies could severely dent revenues in Swiss francs.
“If you are talking in terms of growth in local currencies, then I see things going really well. If I look at our exchange rates, every day they are tumbling — the world looks slightly different,” he said at the group’s annual media conference last week in Plan-les-Ouates on the outskirts of Geneva.
Swatch Group is banking on its midpriced brands, including Tissot and Longines, to deliver continued growth as China’s middle class expands. François Thiébaud, president of Tissot, said the brand posted double-digit growth in 2013, selling more than 4 million watches.
“On the one hand, we are less affected by the anticorruption campaign than higher-end watch brands,” he said. “On the other, we are benefiting from the growth in the number of people whose purchasing power is rising and who suddenly want a Swiss watch, because they believe Swiss watches have something extra.”
Among Tissot’s introductions this year is the T-Touch Expert Solar, which it is billing as the first touch-screen watch powered by solar energy.
Thiébaud emphasized that China was not the only focus of the brand, which has a network of around 14,000 points of sale worldwide. Although Tissot plans to continue streamlining its distribution this year, it will open a store in Zurich in April and another on New York’s Fifth Avenue in August.
Jean-Claude Biver, president of the watches division at LVMH Moët Hennessy Louis Vuitton, said he sees overall Swiss watch exports rising by 4 to 5 percent this year.
“I am relatively optimistic, and I am not the only one,” said the executive, who oversees the Tag Heuer, Hublot and Zenith brands. “The situation in China has changed, it’s true, but not permanently.”
In its latest “Income and Expenditure: China” report, Euromonitor International predicts massive increases in the number of people earning higher salaries. Between 2014 and 2030, it forecasts the population with income of $20,001 to $30,000 will rise by 647 percent, and the proportion of those earning $30,001 to $40,000 will increase by 795 percent.
“That is a huge potential,” observed Biver, adding that even though Swiss watch exports to Mainland China fell 12.5 percent in 2013, there was a marked increase in watch purchases by Chinese travelers to South Korea, Switzerland and France, for example. “In the medium term, China will remain an El Dorado. Perhaps [growth] will not be as flamboyant as it was initially, because you can’t post 50 percent growth every year, but you should certainly not underestimate [the country’s potential]. The death knell has not sounded for China — very far from it.”
Within the LVMH brand stable, Biver expects Hublot and Zenith to outperform the rest of the sector. “These two brands have yet to reach their cruising speed,” he asserted.
Hublot hopes to capitalize on the fever surrounding the upcoming FIFA World Cup in Brazil — for which it is the official watch and timekeeper — with the limited-edition Big Bang Unico Bi-Retrograde Chrono, aka the Soccer Bang, which has a display built around the timing of one half of a soccer match.
Meanwhile, Jean-Frédéric Dufour, ceo of Zenith, forecast the maker of El Primero and Pilot watches would post growth of 9 to 10 percent this year, after an increase of 7 to 8 percent in 2013. Greater China (Hong Kong, Taiwan and Mainland China) accounts for 35 percent of volume.
“Today, we have an average sellout that’s higher in China and Hong Kong than in the U.S., for example,” he noted. “It means people are still keen to consume watches, but we see a turn with political changes that the Chinese are buying fewer gold watches and more steel watches than they used to. In volume, we’re selling more, but the average selling price is decreasing a little bit.”
Accordingly, the brand has revised the entry price for its timepieces to 3,300 euros, or about $4,600 at current exchange, slightly below the 2013 level of 3,500 euros, or $4,900. Dufour predicted the drop in demand for higher-priced timepieces would lead consumers to reject models that lack a strong selling point.
“The watches that are suffering are more the watches that were just made with the intention of selling them expensive. You know, like the umpteenth perpetual calendar or tourbillon that everyone carries — this is becoming more difficult to sell,” he noted.
Zenith’s key launch this year is the Synopsis, an addition to its El Primero family featuring an opening on the dial that reveals the watch mechanism. Prices range from $6,000 for a steel version to $15,300 for a rose gold model, both of which come with a brown alligator strap.
At Hermès, sales of watches were down 3.2 percent in reported terms in 2013. At constant exchange rates, the segment reported a 1 percent sales increase.
Luc Perramond, ceo of La Montre Hermès, expects the division to post sales growth in 2014: “Hopefully the situation in China will stabilize even if, due to the price difference between China and the rest of the world, a growing percentage of our Chinese customers buy abroad. The key question is whether the drop in sales we are registering in China is being compensated overseas.”
Vontobel noted in its report that besides Customs duties of 11 percent and value-added tax of 17.5 percent, China imposes a 20 percent luxury tax on watches worth more than 10,000 yuan ($1,625 at current exchange).
Looking to the rest of the world, Perramond said he was positive on prospects for Japan, Hong Kong, Taiwan and Europe, but the outlook for the U.S. was still uncertain.
“Even if there are encouraging macroeconomic signals in North America, it is not being reflected fully in the sellout. When you look at the numbers from Saks Fifth Avenue, Neiman Marcus and the like, you can see there is a certain gloominess,” he said.
Hermès is putting the accent on women’s watches this year with the return of the Nantucket in a new silver alloy that is resistant to oxidation.
“Another advantage of silver is that it is a less expensive metal than gold, even if it’s still precious. That allows us to offer pieces priced below 3,000 euros [$4,100], in other words, to reinforce our offer in more accessible price segments, which is very important, given the economic context and our strategy,” he said.
On the acquisitions front, makers of watch components remain a target after the Swiss Federal Competition Commission, or Comco, last year approved a deal allowing Swatch Group to gradually reduce deliveries of mechanical movements to rival brands.
“The trend toward consolidation is likely to continue, although the pace will depend on the decisions made by the owners,” Vontobel reported.
“There are still some family-owned watch component companies, for instance, among the hand and dial manufacturers. But some independent subcontractor groups also own some watch component producers,” it noted.
Among recent deals, Swatch Group in November took control of Rivoli Investments LLC, a Dubai-based operator of more than 360 retail businesses in the Middle East, mainly in the watch segment. Germany’s CGI Management Consulting last month acquired Swiss-German watch brand Hanhart.
Biver said that Tag Heuer, one of the brands that stood to be hit hard by the Comco ruling, had invested so much in guaranteeing alternative supplies that by 2019, it would no longer be reliant on Swatch Group.
For the time being, LVMH has scaled down its acquisitions plan, Biver added. “There was a time when we were hunting for acquisitions,” he said. “Today, that is no longer the case.”
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BN 03/27 08:31 *PERNOD SAYS SEEING BETTER RESILIENCE OUTSIDE CHINA IN ASIA BN 03/27 08:31 *PERNOD: ORG. WHISKY SALES OVER CHINESE NEW YR ROSE 1% IN CHINA BN 03/27 08:30 *PERNOD: ORG. MARTELL SALES OVER CHINESE NEW YR ROSE 1% IN CHINA BN 03/27 08:29 *PERNOD: ORGANIC CHINESE NEW YEAR SALES FELL 13% IN CHINA BN 03/27 08:27 *PERNOD COMMENTS IN SLIDES ON WEBSITE AHEAD OF PRESENTATION BN 03/27 08:27 *PERNOD CITES ASIA MACRO SLOWDOWN, CHINA EXTRAVAGANCE MEASURES BN 03/27 08:27 *PERNOD REPORTED 1H ORGANIC OP. PROFIT DOWN 4% BN 03/27 08:27 *PERNOD SEES ASIA ORGANIC OP. PROFIT FALLING `LOW SINGLE-DIGIT'
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Pernod Sees Asia Organic Op. Profit Falling ‘Low Single-Digit’ 2014-03-27 08:32:02.682 GMT
By Clementine Fletcher and Cormac Mullen March 27 (Bloomberg) -- Pernod comments in slides on website ahead of presentation. * Cites Asia macro slowdown, China extravagance measures * Says organic Chinese New Year sales fell 13% in China; org. whiskey sales rose 1% * Seeing better resilience outside China in Asia
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To contact the editor responsible for this story: Cormac Mullen at +353-1-523-9526 or cmullen9@bloomberg.net
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*ALSTOM SAID TO FACE WIDER BRIBE PROBE AS U.S. SEEKS RECORD FINE 2014-03-27 08:15:00.2 GMT
--SARA FORDEN
-0- Mar/27/2014 08:15 GMT
Babcock buys €2bn Avincis helicopter group as it broadens reach
Babcock International, the UK engineering group whose services include decommissioning Royal Navy submarines, has agreed to buy Avincis, a provider of search and rescue helicopters.
The company, sold by private equity groups Investindustrial and KKR, is valued at about €2bn including debt, Babcock said in a statement on Thursday. Babcock and Avincis said in November they had entered exclusive talks.
The transaction will broaden Babcock’s geographical scope and its range of products. The deal is subject to Babcock’s general meeting approval, scheduled next month.
Avincis, which operates in 10 countries, is one of the world’s largest providers of helicopters for emergency missions, surveillance work and support to facilities such as offshore oil and gas rigs. Babcock’s acquisition price represents about 14 times the company’s 2013 earnings before interest, tax, depreciation and amortisation of about €143m.
Investindustrial, the Italian-based investor that owns a stake in Aston Martin, invested €70m in 2005 to buy Avincis, then a helicopter operator based in Alicante, Spain. It added acquisitions in Italy, France, Australia, Scandinavia and the UK.
KKR bought a 49.9 per cent stake from Investindustrial in 2010 in a deal that valued the company at about €700m including debt. Avincis later moved its headquarters to the UK as its owners considered a London initial public offering among exit options.
Investindustrial is making more than six times its investment in the company, while KKR is more than doubling it, but the price is lower than what the private equity groups were expecting to achieve in an IPO, according to people with knowledge of the talks.
Buyout fund managers typically prefer a clean and entire sale of their stakes than going through the lengthy process of listing portfolio companies, which only allows a partial disposal. But buoyant equity markets have lately made that decision more difficult.
Babcock earns more than half of sales from the UK’s ministry of defence. Its most recent large deal was its £1.4bn takeover of VT Group three years ago, which helped to propel it into the FTSE 100. The company has a market capitalisation of about £4.9bn.
IMF confirms staff level agreement with Ukraine on an international bailout package; size seen between $14-18B - financial press for Ukraine
- Unlocks $27B of intl support over two years
- Agreement subject to executive Board approval in April
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Serco Awarded 22-Month U.K. Northern Rail Contract Worth GBP520m 2014-03-27 07:24:05.144 GMT
By Brian Lysaght March 27 (Bloomberg) -- Serco JV with Abellio Group to continue operating Northern Rail franchise for U.K. Dept. Transport. * Serco’s share of rev. ~GBP520m * Interim franchise agreement anticipated to be run at a lower profit margin than the existing franchise; includes a gain share agreement to incentivize performance improvements * New agreement will run until February 2016 when a new long- term franchise will be let * Serco statement:{NSN N332BR3HBS3K <GO>} * DFT statement: {NSN N3326D3HBS3N <go>} Link to Company News:{0165102D NA <Equity> CN <GO>} Link to Company News:{SRP LN <Equity> CN <GO>}
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To contact the editor responsible for this story: Brian Lysaght at +44-20-7330-7908 or blysaght@bloomberg.net
Lundin Petroleum AB Issues drilling update
- Announces that the Johan Sverdrup appraisal wells 16/3-8 S and 16/3-8 S T2, located in the eastern part of PL501, have been successfully completed.
- The well 16/3-8 S encountered an oil filled reservoir consisting of 13 metres of late Jurassic Draupne sandstone with excellent reservoir quality and a very high net to gross ratio. A production test (DST) has been performed in this interval and flowed at a rate of 4,900 bbl/d of oil through a 52/64" choke. The pressure data information has proven exceptional production properties and lateral extension over an extensive area of the Avaldsnes High location. The DST showed that some of the best reservoir quality is found in the central area of the Avaldsnes High with an exceptionally high permeabilty of 65 Darcy and no flow restrictions within 3 to 4 km of radius of investigation. This is the 5th well that has been production tested (DST) in PL501 and the investigated area now covers a majority of the Avaldsnes High area.
- The well 16/3-8 S also encountered 67 metres of Zechstein carbonates with variable, but mostly tight, reservoir quality with oil shows. The oil water contact is interpreted at 1,925 metres below mean sea level (MSL) with oil sampled at 1,924.5 metres below MSL.
You are receiving this email because you have registered for the Tullow Oil plc press release alert service. For more information please visit the Tullow website: www.tullowoil.com
Tullow Oil plc (Tullow) announces the results of a series of recent exploration and appraisal activities conducted by the four rigs currently operating in Blocks 10BB and 13T onshore Kenya.
The Emong-1 exploration well in Block 13T was drilled to test a structure directly across the main basin bounding fault, which is juxtaposed against the material oil accumulation discovered by the Ngamia-1 well, approximately four kilometres to the southeast. The well encountered poorly developed oil bearing reservoir sands at this location. The result suggests that the main basin bounding fault controls the distribution of reservoirs in this area and has no impact on the potential of the Ngamia oil accumulation.
The Weatherford 804 rig drilled Emong-1 to a final depth of 1,394 metres. The rig will now be moved to drill the Ekunyuk-1 wildcat in the east of the licence as a further test of the rift flank play, where discoveries were recently made at Etuko and Ewoi.
The Sakson PR-5 rig is continuing drilling operations on the Twiga South-2 up-dip appraisal well which is expected to be completed in mid-April. This rig will then move to drill a down-dip appraisal of the Amosing discovery, which appears to have high quality reservoir and may be one of the largest discoveries in the basin to date.
Following the successful drill stem test of the Etuko-1 well in Block 10BB, which flowed at a combined rate of 550 boepd, the PR Marriott rig remained on location to drill the Etuko-2 well. This well was designed to evaluate a very shallow reservoir zone penetrated in Etuko-1 but which could not be properly logged due to the wide gauge of the original well. The rig drilled Etuko-2 to a final depth of 650 metres and the well flowed water with oil shows. The rig will now move to drill the Ngamia-2 well to appraise the Ngamia discovery.
The SMP-5 rig, contracted to conduct a series of drill stem tests on the discoveries in northern Kenya, conducted a drill stem test on the Ekales-1 oil discovery well in Block 13T and successfully flowed over 1,000 barrels of oil per day. The rig will now move to conduct a drill stem test on the Agete-1 discovery well, also in Block 13T.
Tullow Operates Blocks 10BB and 13T with 50% equity and is partnered by Africa Oil Corporation, also with 50%.
Angus McCoss, Exploration Director, Tullow Oil plc, commented today:
“The early exploration, appraisal and testing activities onshore Kenya are giving us significant technical and operational insights for further optimising and accelerating the development of the basin. Our focus remains on continuing to explore and appraise our first successful basin, as well as stepping out into several untested basins, which together form a chain of prospective basins that have the potential to become a transformational new oil province.”
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