London pre-open: Early retreat expected

11th Mar 2010 07:40

It looks like being a gloomy start to trade in London after last night's flat finish on Wall Street, wit stocks pulling back from yesterday's new 18-month high.Futures prices indicate an early 17-point drop for the FTSE 100.In company news, oil giant BP has beefed up its exploration operations with the acquisition of assets in Brazil, Azerbaijan and the Gulf of Mexico for $7bn. It will pay North America-focused oil and gas group Devon Energy $7bn for 10 exploration blocks in Brazil, exploration prospects in the US Gulf of Mexico and an interest in the BP-operated Azeri-Chirag-Gunashli (ACG) development in the Caspian Sea, Azerbaijan. The exploration blocks in Brazil include seven in the exciting Campos basin, which has attracted the attention of other big oil firms. South African insurer Old Mutual has resumed dividend payments following a better second half and is exploring the sale of US Life and a partial IPO of its US asset management business. A US Asset Management deal, which the firm said would bankroll growth, is expected within three years. The company enjoyed positive second half sales momentum, with fourth quarter life APE sales up 29%, the strongest quarter for the Long-Term Savings (LTS) business for at least two years. Adjusted operating profit before tax on an IFRS basis grew 3% to £1.17bn, while the IFRS book value per share rose to 147p from 134p.Drug giant AstraZeneca today announced a license and supply agreement with Indian peer Torrent Pharmaceuticals. Under the deal, Torrent will supply a portfolio of generic medicines for which it already has licenses in a range of countries. Astra said it intends to brand and market these products in many of its emerging markets, where it already has a strong commercial footprint.Supermarket group Wm Morrison saw a sharp jump in profits in the year to 31 January as its value offering continued to attract customers during tough times. Pre-tax profits climbed to £858m from £655m from the same period the previous year, including an exceptional credit of £91m arising from steps taken to strengthen pension schemes. Turnover climbed to £15.4bn from £14.5bn. Like-for-like sales excluding fuel and VAT were up by 6%, lower than the 8.2% growth seen the previous year.JD Wetherspoon reinstated its dividend as the pub group reported half year sales and profits at record levels. Pre-tax profit in the 26 weeks ended 24 January was £36.2m, an increase of 17.5% on a pre-exceptional basis (2009: £30.8m) and a jump of 41.4% (2009: £25.6m) after exceptional items. Like-for-like sales increased marginally, by 0.1%, with total sales, including new pubs, increasing by 4.1% to £488.1m. Trading in the 6 weeks to 7 March 2010 continued on a similar trend to last year, with like-for-like sales down 0.4% and total sales increasing by 3.9%. Argos and Homebase operator Home Retail said benchmark profit before tax for the year will be around £290m, slightly ahead of current market expectations. In the 8 weeks to 27 February, total sales at Argos fell 6.6% to £537m. Like-for-like sales declined by 9.4%, which included the approximate 3% negative impact of the later launch of the Spring/Summer catalogue, as well as an adverse impact of poor weather in this short and low volume period. Total sales at Homebase were held at £205m, though like-for-like sales declined by 0.6%, which included an adverse weather impact. The approximate 425 basis point gross margin decline was driven principally by the anticipated net impact of adverse currency movements. 'This is a good outcome to a challenging year,' said chief executive Terry Duddy.Regional newspaper publisher Johnston Press revealed a sharp decline in full year operating profit but said pressure on advertising revenues had started to improve in 2010. The group which publishes the Scotsman and the Yorkshire Post said operating profit fell to £71.8m for the 53 weeks ended 2 January 2010 from £128.4m the year before. Revenue fell to £428m from £531.9m. Like-for-like advertising fell by 26.5% on 2008 but the rate of decline reduced throughout the period.