European Movers: BHP Billiton, EADS, Deutsche Post
SAINSBURY Down GBP0.15 to GBP3.75... Shares down on outlook Numis downgrades to reduce from hold with a target price of GBP3.40. Seymour Pierce upgrades to buy from hold, with a target price of GBP4.30. Co. reports sales (inc VAT) of GBP19.287bn, +5.8% (Easter adj LFL inc fuel +4.4%, LFL ex fuel +3.9%); total u/l op profit of GBP535m, +24.1%; PTP of GBP479m, +0.4%; net profit of GBP329m, +1.5% and u/l EPS of 19.6p, + 33.3%. Management notes that 3 year targets have been exceeded but that market remains competitive.
BRADFORD & BINGLEY Down GBP0.16 to GBP1.43... GBP300m rights issue, dividend in shares - Co. is to launch a GBP300m 16-for-25 rights issue at GBP0.82, a 48% discount to yesterday's closing price. Revises target Tier 1 capital ratio range to between 8% and 10% from a pro-forma Tier 1 ratio of 10.1% and a pro-forma Core Tier 1 ratio of 9.2% as at 31 December 2007. To pay 2008 interim dividend, due in October, in shares. Targets underlying dividend cover of between 2.0 to 2.5x underlying earnings over the medium term. Overall says trading continues in line.
BHP BILLITON Up GBP0.91 to GBP21.11... Talk of Chinese stake boost shares - Stock rove overnight in Australia on talk of a Chinese stake building. Co. is to focus on tier 1, low-cost and long-life assets, as well as high margin commodities both in its current production profile and future development pipeline. Expects CAGR between 2007 and 2012, to be 6.9% on a copper equivalent volume basis. Calculates on a comparable basis, Rio Tinto is expected to deliver a CAGR of around 6%.
ALLIANCE & LEICESTER Down GBP0.13 to GBP4.46... Brokers lower numbers on write-down fears - Citigroup cuts target to GBP3.50 from GBP4.0, reiterates sell. Lowers u/l EPS by 44% in 2009, and reduces DPS by 50% in 2008. Lehman cuts target to GBP3.16 from GBP3.55. Keeps underweight. Says future risks include additional treasury write-downs and commercial loan quality. ABN Amro reduces target to GBP3.70. Maintains sell. Says there could be more write downs to come. Deutsche Bank cuts target to GBP3.35 from GBP4.10. Maintains sell recommendation. UBS lowers target to GBP4.50 from GBP4.75. Keeps neutral recommendation. Exane cuts target by 8% to GBP6, underperform. S&P Equity Research cuts target to GBP4.60 from GBP5.00. Dresner lowers target to GBP4.80 from GBP5.00; keeps sell.
FIRST GROUP Down GBP0.38 to GBP5.62... Dresdner cuts target to GBP8.60 from GBP9.00; retains buy. Co. announces is to place up to 43.7m new ordinary shares, equivalent to up to 10% of the current issued share capital, to be used to refinance an element of the debt incurred in respect of the Laidlaw acquisition. Posts FY revenues of GBP4.71bn, adjusted EBITDA of GBP560.8m, and DPS of 17.05p. Says it saw record results across all divisions including a significant contribution from Laidlaw since 1 October 2007.
BNP-PARIBAS Up EUR 3.28 to EUR 70.78... 1Q not as bad as feared / Reiterates SocGen stance to EUR 1.981bn, though not as bad as generally feared. Gross operating profit slipped a higher-than-expected 23% to EUR 2.79bn. Co. says its quarterly results show resilience. In further news, Co. CEO Baudouin Prot says in a video on his bank's website that Co. still does not believe the conditions are met for a shareholder value-enhancing takeover of SocGen. Prot emphasises that 'personalities have never been a factor' in Co.'s position and that recent management changes at SocGen do not change Co.'s position.
EADS Up EUR 0.92 to EUR 16.64... 1Q core earnings top expectations - coming in at EUR 769m, up from EUR 88m for the same period a year ago. Confirms 2008 financial targets.
DEXIA Down EUR 0.17 to EUR 16.74... Net profit in 1Q misses estimates - Posts 1Q u/l income of EUR 1.833bn, +4.1%; u/l net att profit of EUR 539m; u/l gross op income EUR 891m, +6.2%. Says reported net att profit was EUR 289m, down 59.9% and reported EPS fell 59.8% to EUR 0.25. Says some transactions in the US resulted into losses far exceeding historic loss expectations. Adds this is not threatening either Co.
or FSA's financial strengths.
ARKEMA Up EUR 3.59 to EUR 41.60... 1Q net profit jumps 64% - Announces 1Q net profit of EUR 72m, +64%; EBITDA of EUR 159m, +19%; EBITDA margin 10.7%; sales EUR 1.492bn, +0.3%; average sale price up 6%. Confirms target of EBITDA margin of 10% for FY, implying a EUR 80m increase in EBITDA.
E.ON Up EUR 0.67 to EUR 129.82... Confirms outlook, 1Q profit misses - Co. reports 1Q adjusted EBIT (ex-items) of EUR 3.3bn and adjusted net profit of EUR 1.8bn, both missing consensus. 1Q sales come in at EUR 22.8bn. Co. confirms its outlook.
DEUTSCHE POST Up EUR 0.46 to EUR 20.82... 1Q core earnings shy of expectations - with EBIT slipping 15% y/y to EUR 851m. Co. reiterates that it expects EBIT before non-recurring effects of around EUR 4.2bn for 2008 and PTP of around EUR 3.2bn. It is still aiming for EBIT of EUR 4.7bn in 2009, it says.
THYSSEN KRUPP Up EUR 0.80 to EUR 45.39... Reports 2Q PTP of EUR 742 - excluding EUR 42m in one-off costs. This is up from EUR 572m a year ago but a touch below expectations. Confirms its mid-term and long-term sales and earnings targets.
MEDIASET Down EUR 0.10 to EUR 6.16... Credit Suisse downgrades to underperform from neutral and cuts target to EUR 5.30 from EUR 8.30 to reflect: a weak economy; in last 6 mths the stock has outperformed its broadcaster peers by 26% & Media sector by 8%, boosted by re-election of Silvio Berlusconi and reduced regulatory risk; Co.'s audience share will increasingly come under pressure; the p/y comparisons for growth in Italian advertising get progressively tougher; stock is expensive. Co. has unveiled that its 1Q net profit fell 2.8% to EUR 121m compared to the same time last year, due to the drop on charges linked to its purchase of Endemol and Medusa in 2H07. Says that net revenues came in at EUR 1.0989bn while operating profit was at EUR 255.8m.
ENEL Up EUR 0.10 to EUR 7.01... Posts 1Q core profit of EUR 3.445bn - Co. has disclosed 1Q core profit of EUR 3.445bn, up 47.7% from 1Q07 while said that net profit rose 6.5% to EUR 1.004bn. Adds that net debt came in at EUR 57.072bn, up from EUR 55.8bn at the end of 1Q07.
BP MILANO Down EUR 0.07 to EUR 7.65... Brokers cut targets post 1Q results - Ubs reduces target to EUR 8.40 from EUR 8.70. Says has fine-tuned EPS forecasts to take into account of 1Q08 results. Says new EPS estimates are 5% lower in FY08 and 1% lower in FY09 reflecting lower trading and fees and slightly better cost control.Keeps neutral rating. Merrill Lynch cuts target to EUR 10 from EUR 10.5. Says that net profit of EUR 62m is in line with broker's and consensus. Still, cuts EPS estimates by 7%, embedding the negative 1Q trading results and to a lower extent the lagged impact of the ongoing negative AM momentum on fees. This leaves broker with 15% EPS growth in FY09. Keeps buy recommendation. Co. has disclosed that 1Q net profit fell 45% to EUR 62.1m on lower investment banking revenue. Says that total assets under management increased 5.9% to EUR 32bn while operating revenue came in 13.4% lower to EUR 401.9m.
ALITALIA 1Q Pretax loss rose to EUR 214.8m - Co. has said that its pretax loss increased to EUR 214.8m in 1Q08 from EUR 152.3m in 1Q07 due to a decline in revenues and an increase in fuel costs. Says that revenues fell to EUR 1.057bn from EUR 1.061bn, with sales stemming from air traffic dropping to EUR 954.4m from EUR 997.2m. Says that fuel costs increased by EUR 62.0m while the operating loss increased to EUR 161.0m. Points out that net debt stood at EUR 1.351bn. Co. also said that after the failure to reach an agreement with Air France-KLM, Co. might need to be recapitalised as soon as possible.
ARCELOR-MITTAL (NL) Up EUR 2.58 to EUR 64.71... Reports broadly in-line 1Q numbers - with sales coming in at US$29.8bn, EBITDA at US$5.0bn and net profit at US$2.4bn. Says continues to see strong demand for steel and a healthy pricing environment.
ING GROEP Up EUR 0.95 to EUR 25.44... 1Q in line with estimates - Co.
reports 1Q net profit of EUR 1.54bn, in line with expectations. Underlying net profit is at EUR 1.589bn. EPS is at EUR 0.74 vs an expected EUR 0.77. Insurance u/l PTP is at EUR 722m, lower than expected. Banking u/l PTP is at EUR 1.405bn, higher than the expected EUR 1.057bn. Impairments on pressurised asset classes like subprime and Alt-A is at EUR 55m after tax.
TOMTOM Down EUR 0.18 to EUR 25.85... EC gives unconditional approval on TA deal - Co. receives unconditional approval by the EC to take over Tele Atlas.
MARINE HARVEST Down NOK0.11 to NOK3.06... Poor 1Q despite adjustments - Co. reports 1Q revenues of NOK3.08bn vs a Reuters forecast of NOK3.158bn, operating loss before biomass adjustments of NOK65m vs a profit of NOK125m, pre-tax loss of NOK634m vs a profit of NOK40m, and net loss of NOK488m vs a profit of NOK32m. Books writedown costs of biomass and investory of NOK61m, with a biomass adjustment of NOK-489 distorting PTP and net income. After adjustments both PTP and net income come much worse than forecast. Traders not very weak results from Co.'s operations in Chile, but also poor numbers in Norway and Scotland. The disease rate in Chile remains challenging, but Co. points out the situation has stabilised in the last months. Co. states it will try to avoid the Chile situation having effect on equity.
ASTRAZENECA (SE) Up SEK6.00 to SEK250.00... FDA approves Seroquel for bipolar treatment .
YARA Up NOK17.50 to NOK423.00... Carnegie ups DCF to NOK500 vs NOK465, maintaining its outperform rating. The broker also raises its 2008-2009 EPS estimates by 13-16% to NOK40/NOK45 as strong Urea/CAN markets boost earnings visibility.
CARLSBERG Unchanged at DKK666.00... Plans divestment worth DKK1.1bn - Borsen - Co. is underway divesting its mineral water division and two Finnish soft beverages brands to Coca Cola, with the divestment expected to bring cash of DKK1.1bn, Borsen reports.
TELEFONICA Up EUR 0.14 to EUR 19.32... 1Q08 numbers meet forecasts - Co. reports 1Q08 revenues +1.1% to EUR 13.896bn, OIBDA +5.3% to EUR 5.376bn, OIBDA margin of 38.7% vs 37.1% y/y, and net profit +22.4% to EUR 1.538bn. Numbers meet consensus forecasts. Co. maintains 2008 guidance.
IBERDROLA Up EUR 0.19 to EUR 9.82... CNE proposes 11.3% electricity price hike - The CNE (Spanish energy regulator) has proposed that the Industry Ministry allow an 11.3% increase in electricity tariffs as of July.
ROCHE Up CHF2.10 to CHF173.60... Dresdner upgrades to buy from add - keeping CHF215 target. Broker is also upgrading the EU large cap Pharma sector to overweight from neutral as it thinks emerging markets support future growth for long term investors. Says Co. is a preferred name due to limited patent exposure, potential for significant oncology franchise expansion, a well-differentiated later stage pipeline and a strong balance sheet and dividend potential. Mentions there is considerable nervousness around ASCO surrounding Erbitux and Avastin but thinks post-ASCO is a better entry point.