BSkyB Sees Full-Year Profit Up 9% To £1.33bn

BSkyB, the owner of Sky News, has announced a 9% rise in full-year operating profit to £1.33bn.

Revenue for the entertainment and home communications company was up 7% to £7.235bn.

The company saw paid-for product growth of 3.3 million, taking the total to 31.6 million subscriptions, as customers increasingly add products including broadband, HD TV and Sky Go Extra.

It also saw a 170% rise year-on-year in the number of connected Sky+HD boxes - which give access to on-demand television - to 2.7 million units.

There was a fivefold increase in On Demand downloads and a 200% growth in Sky Store video rentals.

BSkyB has reaffirmed a commitment to original content

The broadcaster also unveiled a budget £9.99 Now TV box, which wirelessly connects a TV to a broadband connection, giving contract-free access to BBC iPlayer, Demand 5, Sky News and Now TV.

Through Now TV, viewers can also pay to watch Sky Sports and Sky Movies. It also allows people to catch up on previously-broadcast programmes.

BSkyB said it now has 10.42 million pay TV subscribers and 4.9 million broadband customers.

The company has also announced a £500m share buyback and an 18% increase in the dividend.

Chief executive Jeremy Darroch told Sky News: "We are delighted with the results today."

"The economy is a challenge and it is providing head-winds for all consumer businesses."

Team Sky rider Chris Froome won this year's Tour de France

Mr Darroch said: "Against that backdrop, we have a strong set of plans that will extend our leadership in core areas - onscreen, in home communications, and in front-line service delivery; accelerate growth in new services; and improve efficiency to build a bigger, more profitable business for shareholders."

He added: "On the back of this performance, we are increasing returns to shareholders with the ninth consecutive rise in the ordinary dividend and we intend to seek approval for a further £500m of share repurchases."

BSkyB said it will continue to expand its plans for original content, including a big step up in commissioned drama.

The number of entertainment shows with an audience of more than 1 million has risen 200% during the last two years.

The company also has an ongoing commitment to British Cycling, taking the partnership up to and including the 2016 Olympics.

Team Sky won back-to-back Tour de France cycling races, in 2012 and 2013.

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£2bn Lloyds Profit Triggers Stake Sale Talks

The agency which manages taxpayers' £19bn stake in Lloyds Banking Group is expected to hold talks with City investors this week about a quick-fire sale of shares as Britain's biggest high street lender unveils a £2bn half-year profit.

Sky News understands that UK Financial Investments (UKFI) and the Treasury will discuss in the coming days the prospect of an accelerated placing of shares in Lloyds with major institutional investors on or around the day that Lloyds announces half-year results on Thursday.

Treasury sources said that the results would show a “stellar” first-half performance from the bank, which owns the Halifax brand and is in the process of spinning TSB off into a separately-listed company.

Lloyds, they said, would report a statutory profit of approximately £2bn - in line with the consensus forecast of analysts - and also provide further positive news in the form of better-than-expected cost reductions and a stronger-than-anticipated capital position.

The move into the black would contrast with a loss of more than £400m at the half-year stage in 2012.

"The stars are aligned for us to start selling shares now," said one Whitehall insider.

The Government is understood to believe that it has a window of a few days beginning on the day of Lloyds' results to place a chunk of stock before the markets slow down too far for the summer to make such a substantial transaction more difficult.

Lord Davies is assembling a consortium keen to buy part of Lloyds

If the discussions do not point to sufficient demand for an institutional placing of shares, the Government would postpone any attempt to begin selling its 39% stake in the bank until September at the earliest.

A Treasury spokesman said that no timetable for the sale of shares had been set and refused to comment on the prospect of a sale next week.

Earlier this month, UKFI hired JP Morgan Cazenove, the investment bank, to advise on its privatisation strategy for Lloyds and Royal Bank of Scotland, in which taxpayers hold an 82% stake.

The agency also appointed a roster of other banks to execute deals in the capital markets to sell down the shares in the two banks during the coming years.

One banker said on Saturday that a report suggesting that Lloyds was priming City investors for a sale was inaccurate, arguing that the deal would be orchestrated by UKFI rather than the bank itself.

The source added that it would be theoretically possible to brief a group of investors the night before the results announcement - making them insiders unable to trade in Lloyds shares - with the objective of announcing a deal alongside on Thursday.

Sky News revealed earlier this month that Lord Davies, the former trade minister, was assembling a consortium of investors keen to buy at least half of the Government's stake in Lloyds.

The half-year results are expected to include a modest new provision for payment protection insurance mis-selling, taking Lloyds' total bill so far to more than £7bn, one insider said.

However, unlike Barclays, the bank is not expected to have to set aside money to compensate small businesses for mis-selling interest rate swaps or customers of CPP, the identity theft insurer.

On Friday, Lloyds shares closed at 68.37p, which if sustained until after next week's results announcement would make a placing at or above 61p viable, banking sources said. Such a deal would be likely to take place at a discount to the prevailing share price.

The 61p figure is significant because Lloyds said in March that it had been notified by the Treasury that that was the average price at which taxpayers' support for Lloyds during the banking crisis had been recorded in the public finances.

Selling above that price would be significant for George Osborne, the Chancellor, because it would allow him to hail the return of funds injected by taxpayers into Lloyds after its initially disastrous merger with HBOS.

It would also be potentially meaningful for Antonio Horta-Osorio, Lloyds' chief executive, whose £1.48m deferred share bonus awarded in March will only vest under certain conditions, one of which is that at least one-third of the Government's shareholding is sold for at least 61p-per-share.

Lloyds declined to comment on Saturday.

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Siemens CEO to leave following profit warning

Peter Loescher, chief executive of German engineering conglomerate Siemens AG addresses the media ahead of the company's annual shareholder meeting in Munich January 23, 2013.

Credit: Reuters/Michael Dalder

MUNICH | Sat Jul 27, 2013 5:16pm EDT

MUNICH (Reuters) - Siemens Chief Executive Peter Loescher is to leave the company, four years before the end of his contract, after the German engineering group this week issued its second profit warning this year.

Siemens said in a statement late on Saturday that at a meeting on July 31, the supervisory board would pass the decision on Loescher's early departure.

"In addition, it will decide on the appointment of a member of the managing board as President and CEO," it added.

Siemens, among Germany's three biggest companies by market value, did not provide further details.

Two people familiar with the matter earlier told Reuters that the majority of Siemens' 20-member supervisory board favored finance chief Joe Kaeser as replacement for Loescher. The company declined to comment.

There have been persistent rumors over the past year that Kaeser, who was already on Siemens' management board when Loescher joined in 2007, had his eye on Loescher's job, though the two have repeatedly said they worked well together.

Late last year, when questioned about the rumors, the CFO said the two complemented each other like "light and dark".

OVERPROMISED, UNDERDELIVERED

When Loescher became CEO six years ago as the first company outsider to take the helm at Siemens, he was presented as a hero who would lead Siemens out of a massive bribery scandal that had tarnished its image and its finances.

But after tackling that task, Loescher started losing credibility as he repeatedly misjudged demand development in its main markets.

A bellwether of Germany's economy whose products range from gas turbines to fast trains and hearing aids, Siemens is suffering from the stuttering global demand that saw German exports fall the most since late 2009 in May.

In addition, Siemens' earnings have been hit repeatedly by one-time charges related to project delays and other issues.

Loescher was forced to put on the back-burner a strategy to increase annual sales by about a third to 100 billion euros last year, announcing instead a plan to save 6 billion euros over two years to compete with rivals such as General Electric Co.

The plan, which unions fear could affect 10,000 jobs, was meant to boost Siemens' core operating profit margin to at least 12 percent from 9.5 percent by 2014.

On Thursday, the company scrapped that target, issuing a brief statement in which it cited lower expectations for how its markets would perform.

Siemens is scheduled to release third-quarter results on Thursday when analysts expect Loescher to elaborate on what prompted the company to scrap its margin target.

(Reporting by Jens Hack.; Writing by Maria Sheahan. Editing by Andreas Cremer and David Evans)

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