London open: Slow start for Footsie

8th Feb 2011 08:56

As expected, London has made a slow start, with the leading index giving back a handful of points after closing at its highest in almost three weeks last night.In company news, BG Group grew fourth quarter profits by 3% thanks to higher energy prices and a lower exploration charge. Operating profit rose to $1.80bn in the last three months of 2010 from $1.76bn the year before.Mining giant Xstrata enjoyed a sharp surge in profitability in 2010, as the benefits of 2009's restructuring activities kicked in and production volumes soared. Profit before tax rose to $7.11bn, excluding exceptional items, from $1.87bn. The drilling results at Premier Oil's Catcher North Well in the UK Central North Sea have indicated an oil pay at the lower end of the company's expectations. Premier now estimates the overall oil reserves range for the combined Catcher, Catcher North and Catcher East discoveries at between 40 and 80mmbbls.Chancellor George Osborne has increased the government levy on bank profits this year by £800m to £2.5bn. Originally the chancellor said he would phase the tax in, with a lower rate of £1.7bn applicable in 2011 rising to about £2.5bn annually by 2012-13. Lloyds is higher, but the rest of the banks have wavered a little. The political turmoil in Egypt and Tunisia will knock £20m from Thomas Cook's profits this quarter, the travel group warned, disrupting what had been a good start to the year. Revenue in the first quarter rose by 7% to £1.81bn reflecting increased volumes and improved product mix, while the traditional seasonal loss fell to £37.3m.Broadband telephony group TalkTalk is to axe 580 jobs as part of a £25m cost cutting drive after sales and subscriber numbers fell in the third quarter. The cuts are part of a plan to integrate all the firm's technology and IT capabilities and eliminating functional duplication. Specialist insurer and reinsurer Beazley pumped up profit by 59% in 2010 and is in the mood for acquisitions. Profit before tax swelled to $250.8m from $158.1m in 2009, though this year's number was boosted by a one-off foreign exchange gain of $33.7m. McBride, maker of own label products for retailers, met forecasts with a 29.6% drop in first half profit as it battles with rising raw materials prices and a difficult retail environment, particularly in the UK. The group, which supplies supermarkets such as France's Carrefour and Tesco, said revenue for the six months ended 31 December 2010 fell 1% at £407.9m from £412.4m a year earlier. Pre-tax profit fell to £15.5m from £22.5m.