London open: Footsie modestly ahead
London's blue chips opened higher after a strong end to trading on Wall Street yesterday and some decent trading updates.
British American Tobacco lifted first quarter profit by 18% to £807m on revenues up 14% to £2.54bn, boosted by the weak pound and good trading generally. Group volumes from subsidiaries were 158bn, an increase of 1%, mainly as a result of the good performances by the four Global Drive Brands. "The year has clearly got off to a great start", chairman Jan Du Plessis added.
No-frills airline Easyjet posted higher first half losses of £48.4m (£41.4m) on revenues up 24% to £892.2m. Fuel costs rose by 24%. "Our load factors remain robust and our forward bookings are slightly ahead of this time last year", chief executive Andy Harrison said, adding "Oil remains the biggest challenge and uncertainty".
Packaging firmi Mondi said underlying profit since the year-end is ahead of the comparable period last year but added there is uncertainty over pricing and demand developments. From the end of December 2007 to the end of April 2008, the group said underlying operating profit has been ahead of prior year, helped by a strong performance from the Europe & International Division and the Bags & Specialties business unit.
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Defence firm BAE Systems said trading between January and May 2008 has been consistant with management expectations. It said for the whole group, a further year of good growth is anticipated for 2008.
International Power is raising €500-€600m from a convertible bond issue to fund the acquisition of an additional 40% shareholding in Turbogas, the Maestrale wind portfolio, the Elecgas investment in Portugal. IP added its outlook is unchanged and 2008 will be another year of growth.
The year has started well for online gaming group 888, with net gaming revenue (NGR) up 38% and further growth at the beginning of the second quarter, driven mainly by casino and bingo. Net gaming revenue leapt to $64m in the first quarter from $47m a year ago, which is 3% better than the previous three month period. Total operating income rose 41% to $66m.
Bingo club operator Rank fell back as a combination of tax changes and the impact of the smoking ban knocked revenue by 8% in the first four months of 2008.
