M&S reported the largest decline in clothing sales in 8 years

M&S reported the largest decline in clothing sales in 8 years

Britain’s retailer Marks & Spencer Group reported the biggest drop in clothing sales in eight years after the new CEO Steve Rowe changed the pricing policy of the company at a time when consumer confidence is weakening, writes Bloomberg.

CEO Steve Rowe faces big challenges

Sales in stores that were open for at least a year fell by 8.9 percent in the 13 weeks which ended on July 2, said the London-based company. The result was worse than the expected by analysts 5 percent drop. About 5 percentage points of this decline is due to the shrinking number of promotional offers and deposition of sales, said Rowe.

He commented that these are not the data he wanted to see, but they are, however, what he expected.

The decline in sales is a new signal for the challenges that Rowe is facing as he tries to stabilize the shrinking share of the cost of the clothing retailer. At the same time, he must decide the future of the troubled international division as well based on the shops in the UK. Rowe succeeded Mark Boland in April and took on the task to cope with the decline in sales of clothes.

The price of shares in Marks & Spencer shrank by 2.6 percent to 286.5 pence at 8:29 pm local times in London, increasing its decline this year to 37%.

“Just when you thought things couldn’t get worse for M&S, they did,” said the director of the consultant Retail Vision John Ibbotson. “Despite his best intentions, Rowe has not been able to stop the rot.”

According to Rowe’s words, consumer confidence has reported a fall immediately after the Brexit vote and “remains fragile”.

The CEO said he was encouraged by the reaction of customers to the change in pricing, while he himself is trying to help the company to compete more effectively with the low-cost proposals of Primark for an example.

This year M & S reduces the number of sales from nine to six, and next year will reduce them to four During the quarter the company has shrunk permanently the prices of around 1000 products, as the average reduction is about 3 percent, he said.

The subdivision for foodstuff, however, has a 4% jump in sales during the reported period, although revenues of stores that were open for at least a year dropped by 0.9 percent.

M&S retains its annual forecasts.

 

Instagram attacks Snapchat by launching a new feature

Mobile photo app Instagram, which now has over 500 million monthly active users is attacking Snapchat.

Social network search, which was acquired in April 2012 by Facebook for 1 billion dollars, presented its new function Stories. It allows users to share videos and photos in a kind of gallery that can only be seen within 24 hours, the company said on its site. All this functionality is very similar to the competitor Snapchat.

Emojis, drawings, filters, and texts – all this will allow users of Instagram Stories to be more creative and decorate their photos and videos. The shots will not appear in your own profile and newsfeed but in a specially designed function. They will be visible in appearing at the top of the application list.

If а user presses the plus sign, they can create a new “story”. If there is a new “story” of a friend, the profile picture of the friend is marked with a colored circle. To see the gallery, the user must click on the profile picture.

Pressing the right or left frame of the image means paging forward or backward. For now Instagram Stories, however, can not be commented as opposed to the other content on the Web.

It is expected the application to generate 1.53 billion dollars in revenue in 2016, or 15 percent of the total advertising revenue of Facebook, according to data from Emarketer.

Competitor Snapchat already has a feature that allows its over 150 million users to publish videos and photos that are automatically deleted after 24 hours.

Lancom closed all stores in Hong Kong on Wednesday

Lancom closed all stores in Hong Kong on Wednesday-

Lancom protestsThe manufacturer of luxury cosmetics Lancom closed all of its stores in Hong Kong on Wednesday after protesters accused the brand owned by L’Oreal that is bowing to pressure from Beijing, after canceling its promotional event with artist activist. Early in the week the cosmetic giant was the subject of fierce criticism in Hong Kong after canceling concert of singer Denise Ho, known for its support for pro-democracy movement in Hong Kong and the rights in Tibet. Both causes are very sensitive issues for the Communist leadership of China.

The decision of Lancom is probably in response to criticism from the newspaper Global Times, which calls for a boycott of the brand in Mainland China. On Wednesday, several dozen protesters entered the shopping mall in Hong Kong, where there stand of Lancom, but without staff and put buckthorn with flyers with accusations of self-censorship and bowing to pressure from Beijing. Moreover, activists called for a boycott of products.

It is unclear whether Lancom stores will open on Thursday, when Hong Kong is an official holiday. Also it is unclear how this will develop.

Lancom and the parent company – L’Oreal, have not yet responded to requests for comment. The shops at least four other brand of L’Oreal, including Khiel’s and The Body Shop, also were closed.

The Chinese market is of great importance for Lancom and many other foreign brands, which complicates efforts to balance between profits and principles. For L’Oreal China has become the second largest market after USA.

Credit Suisse reinforces its rate of savings

Credit Suisse reinforces its rate of savings-

Credit SuisseCredit Suisse reinforces its rate of savings in the commercial division, attempting to save another 800 million CHF. According to the restructuring plans of the bank, the investment division should shrink and cut more than 2000 jobs. The measure should help meeting the target to cut costs with at least 4.3 billion CHF until 2018, as so far Credit Suisse has managed to save 3.5 billion CHF. The business of investment division suffered from the reticence of customers to carry out investments difficult market situation and high costs, which led to disappointing results.

“We leave those activities that do not fit our strategy”, said the bank. “Risk-weighted assets in this division have until the end of the year to fall to 60 billion USD from the previously planned 85 billion USD”, adds the statement.

The second-largest Swiss bank posted net loss of 2.94 billion CHF in 2015, which is much worse than the median estimate of the finance analysts of a loss of 2.12 billion CHF. As noted, the bank set aside 3.8 billion CHF to write off in the fourth quarter as a result of the new strategic direction, which business management focused on wealth management. The write-off is mainly related to the acquisition of Donaldson, Lufkin & Jenrette in 2000.

In October Credit Suisse started the big restructuring program and attracted 6 billion CHF from investors, reinforce business wealth management, investment banking and limit cut jobs. A little more than four months after the announcement of the strategy many analysts still not sure how Credit Suisse will achieve its objectives for growth, including an increase in profit before tax in the Asia-Pacific region more than doubled.

Henkel reported 50% profit growth in Q4 2015

Henkel reported 50% profit growth in Q4 2015

HenkelGerman manufacturer of consumer goods Henkel reported 50% yoy profit growth in Q4 2015 to 446 million EUR, supported by sustained increases in all business segments. The company succeeded to increase sharply profit mostly due to stable revenues and profits respectively from sales of cosmetics, household goods and adhesives. The company revenues for Q4 2015 amounted to 4.4 billion EUR, representing an increase of 6.8% yoy. Also the year-on-year growth of the net profit is significantly based on high restructuring and impairments cost in Q4 2014. The revenues of Henkel for Q4 2015 amounted to 4.4 billion EUR, representing an increase of 6.8% yoy.

“Despite of the difficult economic environment, we had strong financial performance, we continued to successfully implement its strategy and laid the solid foundation for future”, said the CEO of Henkel, Kasper Rorsted.

In 2015, Henkel reported 19% profit growth to 1.9 billion EUR, as revenues amount to 18 billion EUR. In 2016, the company reduced the sales growth between 2% and 4%.

Google abandons Project Ara

Google suspended its Project Ara – the ambitious project to build a modular smartphone with interchangeable components as part of its wider efforts to focus on the hardware activities of the company, according to sources familiar with the matter, cited by Reuters.

The move marks a complete change of direction for the technology company, which announced the partners with who sit’s working on Project Ara at its developer conference in May. Then the company announced that in the fall will begin selling a prototype aimed at developers.

The company’s goal was to create a phone that users can customize on the fly, adding an extra battery, camera, headphones and other components.

Google spokesman declined to comment on the matter.

Although Google will not let the smartphone itself on the market, the company can work with partners for the provision of the technology behind Project Ara to the market, possibly through licensing agreements, says a source familiar with the matter

Giving up Project Ara is one of the first steps to Google in the creation of a campaign to unify the different hardware efforts of the company, ranging from Chromebook laptops and ending with Nexus smartphones. The former president of the Motorola Rick Osterloh joined Google earlier this year to take care of this whole process. Google sold Motorola Mobility to Lenovo Group in 2014.

The modular smartphones sparked excitement in the tech community because of the possibility of extending battery life and reducing electronic waste. But the devices are difficult to bring to the market because their interchangeable parts make them bulky and expensive to manufacture, said analyst Bob O’Donnell of TECHnalysis Research, adding that he was not surprised that Google disclaims the project.

 

Citigroup reported better-than-expected profit in Q1 2016

Citigroup reported better-than-expected profit in Q1 2016

CitigroupCitigroup Inc reported better-than-expected profit in Q1 2016 and succeeded to reduced costs stronger than planned. The net profit for the quarter declined by 27% yoy to 3.5 billion USD, or 1.10 USD per share. Citigroup revenues from financial instruments trading fell by 13%, due to growth of loans and deposits during the quarter and reduced costs. The operating costs of Citigroup fell by 3% to 10.5 billion USD, which is a better result than the median forecast of analysts. The bank’s revenue dropped by 11% to 17.6 billion USD.

“These results reflect a difficult macro environment, which was more challenging than we anticipated when we entered the year”, said the CEO of Citigroup, Mike Corbat. “We grew loans and deposits in our core businesses, utilized different tax assets, generated and returned capital to our shareholders and reduced our expenses while absorbing a significant repositioning charge”, added he.

Unlike the other mega-banks though, Citi’s number one credit exposure is transportation and industrial, much of which actually benefits from lower energy prices, so Citi is in good shape here comparatively as it is naturally hedged. At the end of 2007, main exposure was to banks, so indirect exposure to real estate was what brought the bank down.

Mike Corbat arrange the release of the company’s retail banking and sold assets, which do not meet corporate strategy. Earlier this year the bank started job cuts, which are expected to reach at least 2000. This month the CEO will cut about 70 traders and merchants in London.

Eni reported serious loss in 2015

Eni reported serious loss in 2015

EniEni reported serious loss in 2015, due to drop of crude oil prices. The largest Italian oil company reported net loss of 7.79 billion EUR, quite below the profit an year ago. Eni, like its competitors and other companies in the oil industry, is facing a serious challenge to cope with collapse of crude oil prices during the last year and a half. However, Eni is planning further cuts to capital expenditure and is taking additional action to reduce costs, including renegotiating long-term supply contracts. Last year, Eni became the first global oil company, which cut its dividends to 0.38 EUR per share, from the previous 0.50 EUR per share.

During the last year Eni discovered the largest natural gas field in Mediterranean Sea in the offshore zone of Egypt. According to the preliminary estimates the offshore field might container 850 billion cbm on natural gas, equivalent to 5.5 billion barrels of crude oil.

Authorities in Egypt have approved plans of Italian oil company to start drilling at the beginning of the year, but production is planned during the late 2017.

Appointedd lands biggest ever deal with US network

Appointedd lands biggest ever deal with US network-

Online booking specialist Appointedd is to provide digital support to 500,000 customers of one of the world’s largest serviced and virtual office networks.

The deal will see the Edinburgh company power online appointment setting for clients of Alliance Business Centers Network (ABCN) in 700 serviced offices in 52 countries.It is Appointedd’s largest deal to date, worth up to $15-20 million in revenue for the two companies over three years.Appointedd’s disruptive software delivers a comprehensive set of features including online booking, customer relationship management and marketing automation.

ABCN’s chairman and chief executive, Frank Cottle, said:

It was important to us that we found the right solution for our varied customer base, which ranges from freelancers to multi-national corporations, each using a great variety of software and applications.After considerable research, we found that Appointedd is the most rounded online booking platform. Appointedd’s multi-timezone functionality is the only system in the world that would enable our users to book appointments in multiple timezones seamlessly.”

Appointedd’s founder and chief executive Leah Hutcheon, said in addition:

The management team at ABCN have been unrelenting in their search to find the best in class technology platform to run their business on, and we are delighted that Appointedd has been selected.”

Appointedd has attracted investment from a wide range of investors, including Gareth Williams, founder of Skyscanner, and Marie Macklin, founder of Macklin Enterprise Partnerships.The company has been growing steadily month on month since it launched in 2014, and this deal represents a step change in its potential scale.

Deutsche Bank shares plunge 8% after being hit by $14bn fine

Deutsche Bank shares plunge 8% after being hit by $14bn fine

The U.S. Justice Department proposed that Deutsche Bank AG pay $14 billion to settle a set of high-profile mortgage-securities probes stemming from the financial crisis, a number that would rank among the largest of what other banks have paid to resolve similar claims and is well above what investors have been expecting.

The fine  is described by people close to the negotiations between Deutsche Bank and the government as preliminary, and they said it came up in discussions between the bank and government lawyers in recent days. It is also unclear how much of that amount is proposed to be paid in cash, and how much could be in consumer relief, as past deals have been structured.

Deutsche Bank confirmed in a statement that the Justice Department’s opening bid is $14 billion and that the bank has been invited to submit a counterproposal: 

“Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited.The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts.”

Despite the bank’s reassurance that it has no intention to pay a fine of the cited number U.S.-listed shares of Deutsche Bank fell 5% in after-hours trading after the publication of this statement.