News & Financial Advice

The French energy group GDF Suez is interested in acquiring sites for storing gas sold by Exxon Mobil and Shell and recovered approximately one billion euros, Le Figaro reported Saturday.

Citing a source close to GDF Suez, the daily wrote that the French group is competing in this issue with the infrastructure management subsidiaries of Deutsche Bank, Axa and Prudential.

GDF Suez declined to comment, saying it fails to confirm or invalidate this information.

Shell and Exxon have sold their joint ventures German gas storage BEB Erdgas and Erdoel last June.

While GDF Suez already has 600 million cubic feet of storage in Germany, the company chaired by Gerard Mestrallet will see its capacity increased to approximately 1.5 billion cubic meters if she can buy the two sites Uelsen Harsefeld and north-west of the country, "said Le Figaro.

Germany is the third market of the French group in terms of gas supply.

The source quoted by the newspaper also reported that GDF Suez continued interest in the Polish energy market and remained in contention for the redemption of Enea, the third power in Poland.

Enel has announced plans to launch the initial public offering (IPO) of its affiliate company specialized in renewable energies over the last two weeks of October.

The Italian group of community service, the actor in the sector the most indebted in Europe, hopes to raise between three and four billion euros in bringing to market a minority stake in Enel Green Power, which could be the largest such operation in Europe this year.

"The IPO will take place in the second half of October," said a spokesman for Enel Friday.

The banks involved in the operation on Friday met Chief Financial Officer of Enel, Luigi Ferraris, to discuss the case, said the spokesman, adding that the company continued with its parallel search for a buyer for participation .

This dual approach (dual track) means that in theory, Enel could abandon at the last minute to rate its subsidiary if the sale of OTC was a realistic alternative to public offerings.

"At the meeting with the banks this morning, the focus has been on the IPO, but this does not mean that the company abandoned its dual-track approach," said the spokesman.

Sources have told Reuters that the international coordinators of the IPO were Mediobanca, Goldman Sachs, Credit Suisse and Intesa Sanpaolo.

The leaders of the transaction are JP Morgan, Bank of America, Morgan Stanley, Barclays, BBVA and Unicredit.

Nippon Steel, the fourth largest producer of steel, has experienced an improvement in its results for the fifth consecutive quarter, but reported lower than expected given the market slowdown in growth in China.

The Japanese group has announced a recurring earnings, before taxes and exceptional items, of 61.9 billion yen (541 million euros) for the period April to June, against a loss of 56.7 billion yen a year earlier .

Its sales jumped 30% to 970.6 billion yen.

The steelmaker Nippon nevertheless intends to realize an annual profit of 250 billion yen, while the Thomson Reuters consensus I / B / E / S expects 316 billion yen.

Nippon Steel and ArcelorMittal joins said he expects a sharp drop in its third quarter results, in the grip of a slowdown in economic growth in China, a seasonal decline in activity and an increase prices of raw materials.

The sharp drop in prices in China have led steelmakers to cut production and the market could find itself in a situation of excess supply even while Beijing hardened its policy and reduced exports.

The Japanese group also announced Wednesday it would form a technical alliance with Australian BlueScope Steel for reinforced steel products for construction markets to boost sales abroad.

After the results, the title of Nippon Steel closed up 3.73%, to 306 yen.

Luxottica, the world leader in eyewear, has announced a 30% increase in net income and an increase of 13.8% of its turnover in the second quarter and said it was confident for the second half.

The Milanese group, which owns brands including Ray Ban and Oakley, said in a statement that its wholesale division has achieved the best performance in its history, its operating margin reaching 24.1% against 22.5% a a year ago.

"These results provide an excellent base to look with confidence towards the second half of the year," said in a statement the CEO Andrea Guerra.

Luxottica has made the quarter April-June net profit of 150.1 million euros, exceeding the consensus estimate of analysts Thomson Reuters I / B / E / S, which gave 145.3 million.

He said that sales were particularly strong in emerging markets and the U.S., its largest market.

In a presentation accompanying the results, Luxottica said track to achieve its annual targets. In April, he had said it expects growth of about 5% of its annual turnover.

Ericsson, the world leader in mobile network equipment, reported second-quarter results below analysts' expectations, the Swedish group, suggesting a difficult market including the continued reluctance of operators to invest.

The telecom equipment market begins to show signs of life but the level of customer spending is still very far from what it was before the crisis.

Ericsson, which has made tens of billions of crowns in savings to cope with falling demand, said that reducing costs would continue to be his priority as business conditions remain difficult.

In the second quarter, operating profit excluding joint ventures and excluding restructuring charges, stood at 5.3 billion kronor (564 million euros) against 6.1 billion a year ago and an average forecast of analysts of 5 8000000000.

Revenues fell 8% to 48 billion crowns, while analysts had forecast on 50500000000.

On Thursday, Nokia Siemens Network (NSN), one of his main rivals, posted a decline of 5% of its turnover in the period.

Like NSN, Ericsson said its sales had been affected by supply shortages of certain components.

"We believe (the break) weighed negatively to height of three to four billion kronor on sales for the quarter," the company said in a statement.

Ericsson's gross margin, 39%, came out at a level well above expectations, the group has benefited from the effect of cost reductions and a "mix" positive activities.

The industrial conglomerate 3M reported a 43.2% jump in net profit in the second quarter, above expectations, due to strong demand from emerging markets.

The U.S. company, which manufactures both the Post-It notes, Scotch tape as films used in flat screen displays a profit of $ 1.12 billion or $ 1.54 per share for the period April to June, One result cons of 783 million or $ 1.12 per share in the second Quarter 2009.

Analysts on average forecast EPS of $ 1.48 according to the consensus established by Thomson Reuters I / B / E / S.

Turnover rose 17.7% to 6.73 billion dollars according to the forecast given by the company in late June

For 2010, 3M now expects earnings per share excluding items between $ 5.80 and 5.65 and a growth of between 13% and 15% excluding acquisitions against a previous range of 10% to 12%.

The Minnesota company said however that the decline of the euro against the dollar could weigh on its results in the second half.

The players in the credit market begin the second half hoping to disappear or at least diminish the negative impact of the crisis of sovereign debt in the eurozone, which has largely contributed to the resurgence of risk aversion in the second quarter.

This crisis, which does not seem to have exhausted all its reserves, has hurt all risky assets, starting with the shares losing 7% to 19% since the beginning of the year in Europe.

Corporate bonds (corporate credit) have also suffered, premiums (spreads) having substantially eliminated.But they broadly maintain performance of 3.6% since the beginning of the year, while government bonds from all countries, took 2.4%.

"The second quarter of 2010 defeated the job right the first quarter due to the escalation of the crisis of sovereign debt.Risk aversion has increased rapidly, all assets have suffered (…) Credit spreads have strayed far beyond their level of early 2010, "credit strategists explain the General Society in their quarterly report.

Also taking stock of the quarter, analysts of Raiffeisen Capital Management noted that the credit offers "indisputably positive returns" to the beginning of the year.

But they add that with the sharp decline in bond rates – including German rates that serve as reference in the euro area – linked to the flight to quality stocks, "the potential of absolute return is now very limited."

"The high yield bonds (high yield bonds), the positive fundamentals, seem more attractive," they say.

Groupama Asset Management, as Societe Generale predicts a slowdown of the economy, promote investment grade credit and approach "stock picking" for high yield.

TIGHTENING OF SPREADS

Amund Asset Management, a leading European asset management, which is more optimistic about global growth, also favors the credit.

The sovereign crisis has largely closed the secondary credit market. The primary market, which had started on a flying in January led by financials, has been almost nonexistent from mid-April but has shown signs of lethargy output.

"The market recovered slowly and now spreads are improving.We believe that sovereign issues have less impact on the market and the spreads will be tighter at the end of the year compared to levels earlier this year, "say the strategists of Societe Generale.

After a very active quarter on the primary market, they are reviewing their forecasts down significantly from private bond issues to take into account also the small traditional activity in the third quarter.

They now expect 110 billion on non-financial corporate issues in 2010, or 55% less than in 2009 which was a record year where businesses, faced with tighter bank credit due to financial crisis, have use the market to restore their balance sheets.

They no longer need as use the market given the low investment costs, a lack of mergers and acquisitions and the continued improvement of treasury already abundant.

Societe Generale brings its projected emissions of senior debt of financial companies from 200 to 150 billion euros for 2010, against 152 billion in 2009. For emissions of subordinated debt, the forecast is reduced from 33 to 20 billion euros, against 17 billion in 2009.

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