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European Business News 96-07-26
From: The European Business News Server at <http://www.ebn.co.uk/>
Page last updated July 25 2:30 CET
CONTENTS
[01] BAe wins £2bn Nimrod contract
[02] Philips cuts 6000 jobs in wake of poor results
[03] Dollar drops as Bundesbank leaves repo rate unchanged
[04] IBM outperforms analysts' forecasts
[05] Daimler's Dasa in aircraft talks with BAe
[06] Morton set to step down from Eurotunnel
[07] BT posts profit decline
[08] EU budget ministers to propose sharp cuts
[09] Commerzbank profits jump 48%
[10] Germany's SAP posts 61% profit jump
[01] BAe wins £2bn Nimrod contract
British Aerospace has won the UK governments £2bn order
for its new Nimrod maritime reconassaince aircraft.
The engines for the new planes will be built by Rolls Royce,
whilst Boeing and GEC will share the
electrical systems work and the radar will be produced by Racal.
The £700m contract for the cruise missile system has also
been won by British Aerospace with its partner Matra.
[02] Philips cuts 6000 jobs in wake of poor results
The Dutch electronics giant, Philips, is to cut its workforce
by 6,000 over the next year and a
half. The downsizing will cost 800m guilders. The news came
during a press conference which followed the announcement of a 48% drop in
Phillip's first half net profit.
The figure came in at 681 million guilders ($400m) - around half
the amount analysts had forecast.
[03] Dollar drops as Bundesbank leaves repo rate unchanged
Germany's Bundesbank left interest rates unchanged Thursday in the last
council meeting before a four-week summer break, and within minutes of the
announcement the already falling dollar dropped a pfennig against the
German mark. German bonds and futures also tumbled when it became clear
there would be no change in the securities repurchase (repo) rate,
fixed at 3.3 percent since February.
The strong mark has hurt Germany's export-dependent economy by making
its products more expensive abroad, and Bundesbank officials have been
trying to talk up the dollar's value while resisting pressure to lower
interest rates to make the mark less attractive.
Three minutes after the announcement that there would be no rate changes,
the dollar fell to 1.4788 marks, down from 1.4887 marks just before the
announcement. It recovered slightly, but was expected to be volatile
throughout the day.
[04] IBM outperforms analysts' forecasts
International Business Machines has posted a 21% drop in second
quarter net income to $1.3 bn dollars, or $2.5 a share.
Though the earnings were down, they outperformed analysts
expectations. Sales rose 3.7% to 18 billion dollars. The
unexpectedly strong performance is expected to bolster the Dow
Jones Industrials today, along with high
tech stocks. But analysts warn that the market's performance hinges
on what IBM says to analysts later in
the day.
[05] Daimler's Dasa in aircraft talks with BAe
Daimler-Benz aerospace unit Dasa has confirmed that it's been
in talks with British Aerospace on
military aircraft cooperation. An alliance between the
two companies would follow the current trend of consolidation
in Europe's aerospace industry.
British Aerospace is already planning to merge its missile
operations with those of France's Matra.
[06] Morton set to step down from Eurotunnel
Alistair Morton, the controversial co-chairman of
Eurotunnel, is to be replaced by Robert Malpas, chairman of the
Cookson industrial material company.
Sir Alistair is expected to step down once the Anglo-French operator
of the tunnel has agreed a refinancing plan with banks.
The group has been in talks with its
225 banks since September when it suspended interest payments on
£8.4 bn of debt.
[07] BT posts profit decline
British Telecommunications has posted a slight decline in pretax
profit for the first half to £869 m ($1.3 bn).
The telecom attributed the slip to costs related to layoffs.
Those charges more than doubled to £52
m in the period. Revenue gained 4%, primarily
because of a rise in sales of mobile phones and growth in its
overseas operations.
[08] EU budget ministers to propose sharp cuts
European Union budget ministers will propose a controversial
plan to slash the union's budget by more
than $2.5bn. The bulk of the cuts would come
from spending on agriculture and structural aid for the EU's
poorer regions. Agricultural spending
represents roughly half of the budget. The budget talks are more
critical than usual, because 1997 is the year in which countries
will be judged on whether or not they
meet the criteria for joining the planned single European currency.
[09] Commerzbank profits jump 48%
Germany's third largest bank, Commerzbank has reported a 48% jump in first
half operating profit.
It came in at 1.3bn DM ($885m), which is
much higher than analysts had expected. In the same period, net
commission income was up 27%.
[10] Germany's SAP posts 61% profit jump
The German business software maker SAP has posted a 61% jump
in first-half operating profit to 374m DM ($253m).
Sales rose 38%. SAP said it expects the remainder of the
year to develop positively.
From the European Business News (EBN) Server at http://www.ebn.co.uk/
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