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Business - Need to Know

Morning Edition

Good morning. Hope you enjoyed the long weekend.

Last year, Ryanair launched its ‘Always Getting Better’ plan and promised to be nicer to its customers. One thing definitely getting better is the low-cost airline’s profits as it celebrates its 30th birthday.

Ryanair has reported a 66 per cent jump in net profit for the year to March to €867 million, boosted by an 11 per cent jump in passenger numbers to 90.6 million - nearly three times the 4 per cent growth it had targeted.

Ryanair said the rise in passengers was down to its improved customer service that has brought in lower fees, flexible tickets for business travellers and a move away from small regional airports that are miles away from where you actually want to be.

"Thanks to our lowest fares, our growth into primary airports and the remarkable impact of our 'Year 1 Always Getting Better' programme, we continue to experience strong demand and forward booking momentum," Michael O'Leary, chief executive, said.

We’ll have a full story shortly on www.thetimes.co.uk/business.

We also have a trading update from Cineworld, which shows revenue jumped 26.8 per cent in the 19 weeks to May 19, while insurer Brit has announced it will delist from the London Stock Exchange by June 23 after it agreed to a £1.2 billion takeover by Canada’s Fairfax.

On the economics front we get the CBI Industrial Trends Survey for March at 11.00am. Britain’s retail sales are expected to have grown to a balance of 17 in May, up from +12 the previous month. We’ll find out at 11am and you can follow it live, along with market reaction on our new look Business Now live blog, which now pops out.

Over in the US, we get durable goods data for April and May, and May's consumer confidence numbers at 1.30pm (UK time). Expectation is for a 0.3 per cent rise in consumer spending, unchanged from the revised March number, while consumer confidence is expected to slip back slightly to 95 from 95.2.

Finally, this week's Business podcast sees Andrew Clark, our Deputy Business Editor, Philip Aldrick, Economics Editor, and Kathryn Hopkins, Property Correspondent, discuss next week's Queen's Speech and G7 summit. Click here to listen or download it from Soundcloud and iTunes.

Don't forget you can follow me on Twitter for regular updates throughout the day - @becclancy.

Have a great day.

Rebecca Clancy
Breaking News Editor, Business
The Times
rebecca.clancy@thetimes.co.uk

Brazil warned of a coming crunch as the government said its GDP would drop 1.2 per cent this year, or nearly a quarter in dollar terms because of a weakening of its currency, the real, and a deepening recession. That would mark its worst contraction in 25 years.

David Cameron should not delay calling a referendum over Britain’s continuing membership of the European Union but should hold a poll by the end of next year at the latest, according to one of Britain’s leading employers’ confederations. Amid signs that the business community is facing up to the implications of a possible “Brexit”, the EEF manufacturers’ organisation says that an early vote is needed to end the “creeping uncertainty” that now exists for business and industry. Miles Costello and Martin Waller have the full story here.

The long-awaited arrival of Crossrail will deliver fare cuts of up to 40 per cent from next weekend for London’s commuters. Though not fully open through the new central London tunnels until 2019, the first leg of the Crossrail train concession from the City to Essex transfers to MTR, its Hong Kong-based operator, from next Sunday. Robert Lea has the details.

‘History, they say, is written by the winners. When it comes to** financial wrongdoing**, though, the most telling accounts often come from those who dissent from the “winner’s” official version of events.’ Read today’s column by Alexandra Frean, our US business editor, here.

The Nikkei 225 has closed up 0.12 per cent this morning at 20,437.48. The FTSE 100 is expected to open four points higher at 7,035 when trading begins shortly.

The UK’s blue-chip index increased steadily over the week as continued fears over the eurozone failed to dent investor confidence, leaving the market up 1.13 per cent for the five-day period. Vodafone, which closed on Friday at a 14-year high amid rumours of a takeover bid, pushed the FTSE 100 up 0.26 per cent on Friday to close at 7,031.72. The broader FTSE 250 gained 0.21 per cent on Friday or 38 points to close at 18,192.69, up 1.13 per cent for the week.

Wall Street ended on a down note as Janet Yellen, chairwoman of the Federal Reserve, said the US would likely begin raising interest rates later this year, causing leading indices to dip. The S&P 500 ended Friday’s trading session down 0.22 per cent at 2,126.06, though it was up 0.2 per cent for the week. The Dow Jones Industrial Average fell slightly harder and closed down 0.29 per cent on Friday -leaving it 0.24 per cent lower for the week at 18,232.02.

The strengthening dollar and fears of a supply glut saw Brent crude for July settlement settle at $65.37, down $1.17 a barrel.

Sterling suffered one of its biggest daily falls against the US dollar in nearly a month as the currency markets reacted to Ms Yellen’s remarks with the pound down 1.1 per cent against the dollar at $1.5488, ending the five-day period 1.48 per cent lower. Sterling also fell against the euro to 71.01p per euro. It was still up 2.41 per cent for the week.

The Times
David Cameron should not delay calling a referendum over Britain’s continuing membership of the European Union but should hold a poll by the end of next year at the latest, according to one of Britain’s leading employers’ confederations.
read full update
The Daily Telegraph
The world is sinking under too much debt and an ageing global population means countries’ debt piles are in danger of growing out of control, the head of Goldman Sachs Asset Management in Europe has warned.
read full update
Financial Times
A review by UK policy makers is to conclude that the ban on equity market manipulation should be extended to areas of trading such as foreign exchange, highlighting regulators’ greater willingness to curb City wrongdoing.
read full update
City AM
Thomas Cook is under pressure to review a £10.5m payout to former boss Harriet Green amid mounting criticism over its response to the death of two British children in Corfu.
read full update
Today

The market-rigging trial of a former trader at UBS and Citigroup begins at the Royal Courts of Justice in London. Tom Hayes, 35, is accused by the Serious Fraud Office of manipulating Libor, the London interbank offered rate.

Finals: Ryanair, Tata Motors, Renold, Minds + Machines Group AGM/EGM: Nostrum Oil & Gas, Epwin Group, Cineworld Group, Mi-Pay Group Trading Statement: Micro Focus International, Cineworld Group Economics: 11.00 UK: CBI quarterly distributive trades survey

Tomorrow

Jacob Lew, the US Treasury Secretary, visits London to discuss the state of the economy in Europe, as well as global economic growth with business leaders. In addition, he will participate in a moderated conversation at the London School of Economics. He then travels to Dresden to take part in the meeting of the G7 finance ministers and central bank governors, which runs until May 29.

Interims: Urban&Civic, Fusionex International, Brewin Dolphin Holdings, Arrow Global Group Finals: De La Rue, Caledonia Investments, Scapa Group, McKay Securities, Wizz Air Holdings AGM/EGM: A G Barr, EnQuest, Nahl Group, AcenciA Debt Strategies, Standard Life Investments Property Income Trust Trading Statement: Card Factory, HSS Hire Group

Thursday

The Office for National Statistics publishes the second estimate figures for UK economic growth in the first quarter of the year, after last month’s preliminary estimate of GDP data showed an increase of 0.3 per cent between January and March compared with the previous three months. Final figures are due next month.

Interims: Public Power Corp, Signet Jewelers, Alpha Bank Finals: Gable Holdings, Tate & Lyle, PayPoint, Helical Bar, Infinis Energy, Porta Communications AGM/EGM: Travis Perkins, Powerflute, Trap Oil Group, Metminco, NetPlay TV, Allied Minds, Fair Oaks Income Fund, Electric Word, F&C Commercial Property Trust, Galasys, Kenmare Resources Trading Statement: IG Group Holdings, Kingfisher Ex-dividend: Pacific Assets Trust, Premier Energy & Water Trust, Premier Farnell, Nottingham Building Society, NMC Health, Mincon Group, John Menzies, Matchtech Group, Soco International, Spectris, UTV Media, Whitbread, Focusrite, Tarsus, Town Centre Securities, TLA Worldwide, Tandem Group, Michelmersh Brick Holdings, Manx Telecom, Dillistone Group, Dignity, Ecclesiastical Insurance Office, Capital & Counties Properties, Bellway, Amec Foster Wheeler, Andrews Sykes Group, Avingtrans, Frenkel Topping Group, Graphite Enterprise Trust, Imperial Tobacco Group, Inchcape, Kakuzi, Huntsworth, Hill & Smith Holdings, Graphite Enterprise Trust, Hilton Food Group, Alkane Energy Economics: 09.30 UK: BBA loans for house purchase (Apr); 09.30 UK: GDP (Q1, 2nd rel)

Friday

The US Bureau of Economic Analysis publishes its revised GDP data for the first quarter of this year, after last month’s advance data showed that real gross domestic product had increased at an annual rate of 0.2 per cent. The bureau’s final figures will be published next month.

Finals: OptiBiotix Health AGM/EGM: Tekcapital, Flying Brands, Leyshon Resources, Richland Resources Economics: 00.05 UK: GfK consumer confidence (May); 09.30 UK: Index of Services (Mar); 13.30 US: GDP (Q1, 2nd rel.)

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