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BUSINESS WITH PERSONALITY

PLUS CA CHANGE DAVID BUIK ON HOW THE CITY’S EVOLVED SINCE 1962 P22

CORBYN’S RED BREXIT

MONDAY 26 FEBRUARY 2018

TECH AND TAXES SHOULD GLOBAL GIANTS BE TAXED ON SALES? P21

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PLAYING DUMB Retail boss stays silent on sale of fashion empire

LABOUR BACKS CUSTOMS UNION BUT WANTS FREEDOM TO NATIONALISE CORE INDUSTRIES HELEN CAHILL @HelCahill JEREMY Corbyn will today outline how a Labour government would seek a Brexit deal that allowed it to nationalise swathes of the British economy while maintaining a “strong relationship” with the Single Market. In a speech this morning, the Labour leader will make the case for a bespoke Brexit deal “that includes tarifffree access and a floor under existing rights, standards and protections”. However, he will say Labour also seeks to secure “protections, clarifications or exemptions” to the Single Market directives relating to privatisation, public service competition, state aid and procurement. The new relationship would allow his party to deliver on its promise to nationalise key parts of British industry, including the rail, water, and energy providers. Corbyn’s intervention follows his shadow Brexit secretary Keir Starmer’s pledge to negotiate a new

customs union with the EU. Speaking to the BBC yesterday, Starmer said the UK should not seek to secure its own trade deals after Brexit, because it would be more advantageous to negotiate deals alongside European partners. Starmer’s comments put Labour policy in direct conflict with the postBrexit strategy set out by trade secretary Liam Fox, who has pledged to start negotiating trade deals with non-EU countries as soon as the UK leaves the bloc in March 2019. Trade expert Shanker Singham, director of economic policy at the Legatum Institute, said Labour’s strategy would prevent the UK forming an independent trade policy after Brexit. “It would mean no agreement with other countries, it means no changes to the domestic regulatory environment to improve the domestic environment,” he said. “It totally takes your Labour leader Jeremy Corbyn

trade policy off the table, you would have no trade policy... The UK’s position would not be taken seriously, because the UK’s position would be Brussels’ position.” Labour is outlining its new Brexit policy as the government finalises its own position this week, ahead of trade negotiations with the EU. Theresa May convened her Brexit sub-committee at Chequers last Thursday to talk through the government’s Brexit blueprint, and will outline what was agreed in a speech on Friday. The Prime Minister is expected to back a strategy of “managed divergence” from the EU, with the UK taking control of regulations but remaining aligned with the EU on key areas to protect jobs and businesses. Meanwhile, May will face a challenge from Tory rebels, who have pledged to vote on an amendment keeping the UK inside a customs union with the EU. Conservative MP Anna Soubry has proposed the move in an amendment to the government’s Trade Bill, which has been backed by Treasury Select Committee chair Nicky Morgan.

HELEN CAHILL @HelCahill BILLIONAIRE retail boss Sir Philip Green has refused to be drawn on suggestions that he is plotting a sale of his fashion empire. Green met HSBC chief executive Ian Stuart and managing director David Barraclough in February 2016 to discuss the sale of Arcadia Group, according to emails leaked to the Sunday Times. However, asked yesterday whether reports of the meeting were true, Green said: “What allegations? I am not going to engage with the press, have a nice day.”

Green’s evasive response comes after he flatly denied reports claiming he was in talks with Chinese textiles giant Shandong Ruyi about a sale of the Arcadia brands, which include Topshop, Dorothy Perkins and Evans. A sale of Arcadia would be controversial with the MPs who locked horns with the mogul following his sale of BHS to serial bankrupt Dominic Chappell, who had no experience in the retail industry. When BHS went into administration, Green was forced to contribute £363m to the firm’s pension deficit to fend off action by The Pensions Regulator.

Animatronic Arnie adds £3bn to British banks’ PPI compensation costs JASPER JOLLY @jjpjolly THE TERMINATOR has inflicted a £3bn hit on Britain’s biggest banks after a national advertising campaign forced them to raise their estimates of the hit from the payment protection insurance (PPI) scandal.

UK lenders have now said hasta la vista to £44.2bn in total, according to figures from think tank New City Agenda, with adverts from the Financial Conduct Authority (FCA) – starring an animatronic version of Hollywood star Arnold Schwarzenegger – forcing banks to re-evaluate the likely size of future payouts.

Last week Royal Bank of Scotland (RBS), Lloyds, Barclays and HSBC all announced hefty charges in their 2017 annual results, in part because of the rise in complaints following a television campaign. Schwarzenegger’s head starred in the TV advert

The FCA announced last August that the final deadline for compensation claims for people mis-sold PPI will be 29 August 2019. The bill, which takes into account the billions already paid out as well as

provisions for payments over the next year and a half, has mounted after the banks underestimated the amount people would claim. RBS was the last of the big UK retail banks to report results last week, announcing an extra £175m in provisions on Friday. £ CONTINUES ON P4

FTSE 100▼ 7,244.41 -7.98 FTSE 250▲ 19,801.05 +64.99 DOW▲ 25,309.99 +347.51 NASDAQ▲ 7,337.39 +127.30 £/$▲ 1.397 +0.002 £/€▲ 1.137 +0.006 €/$▼ 1.228 -0.005


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MONDAY 26 FEBRUARY 2018

THE BIG CHILL Londoners braced for a week of freezing conditions as Siberian winds threaten transport links to the City

THE CITY VIEW

Corbyn’s Brexit policy is a messy compromise

T

HOSE who know Jeremy Corbyn know that he’s for Leave. His vision of a largely state-owned, state-run economy is not compatible with membership of the Single Market. It never has been. Corbyn’s euroscepticism has its roots in the honourable left-wing critique of a corporatist club run in the interests of capital, not labour. (Looking at youth unemployment rates in bailed-out southern states, who could disagree?) The challenge for Corbyn, now that he finds himself leader of Her Majesty’s Opposition, is that when it comes to Labour MPs, hard-left criticism of the EU is a position of the few, not the many. The vast majority of Labour MPs backed Remain, and continue to advocate the closest possible ties with the bloc. Leaving aside the fact that almost nine in 10 Labour constituencies voted Leave, Corbyn has to lead a party that seeks to define itself against the idea of a “hard, Tory Brexit”. Enter, Sir Keir Starmer – shadow Brexit secretary and MP for a decidedly pro-Remain central London seat. Starmer has been pulling Corbyn towards a “softer” Brexit for months, and as the government inches towards a coherent Brexit policy, Corbyn must slide off the fence and pick a side. So today we will be treated to that rarest of things: a speech on Brexit by the leader of the opposition. We know that he will reiterate Starmer’s Sunday morning TV pledges to stay in a customs union. This is a big deal, because doing so would mean the UK remained hitched to the EU as far as trade is concerned, unable to have an independent trade policy and forever a passenger on whichever direction the EU decides to take. Staying in a customs union with the EU amounts to staying in the EU, and advocates of such a policy should be honest enough to say so. Corbyn’s new position on customs union membership should placate Labour’s moderate MPs, while a pledge to secure concessions from the EU on rules concerning state aid and competition would allow him to nationalise what he doesn’t subsidise. It’s an unworkable and absurd mash of policies masquerading as a coherent strategy. But this isn’t a pitch to EU negotiators, it’s a pitch to unify the two wings of his party – and put pressure on Theresa May. In that, it may well work.

This isn’t a pitch to EU negotiators, it’s a pitch to the two wings of his party

Follow us on Twitter @cityam FINANCIAL TIMES

FIAT CHRYSLER TO KILL OFF DIESEL IN ALL CARS BY 2022

Fiat Chrysler will ditch diesel from all of its passenger vehicles by 2022 amid a collapse in demand and spiralling costs in the latest blow to the scandal-tainted fuel source. Under a four-year plan to be unveiled on 1 June, the ItalianAmerican car-maker will say it intends to phase out the fuel type from the cars across its brands, according to people familiar with the strategy. FCA, which owns the Jeep, Ram, Dodge, Chrysler, Maserati, Alfa Romeo and Fiat marques, declined to comment.

EU STANDS FIRM OVER NORTHERN IRELAND BORDER The political truce over Northern

WHAT THE OTHER PAPERS SAY THIS MORNING

Ireland’s post-Brexit status threatens to be shattered this week, as the EU publishes a draft withdrawal agreement that leaves out crucial compromise language secured by Theresa May.

EXCEPTIONALLY cold easterly winds will hit Britain during the early part of this week, with temperatures dropping below freezing in the capital. The Met Office has said gusts of Siberian air will make temperatures feel as low as minus 15 degrees celsius. Later in the week the south of England could be hit by “significant snowfall”, potentially causing disruption on train lines into London.

Services sector stands on ‘firm footing’ of growth JASPER JOLLY

@jjpjolly THE UK’s dominant services sector has started the year on a “firm footing” as profits growth accelerated for the first time in two years, but firms braced for turbulence in the coming months are holding back investment, according to a survey to be published today. The poll of big services firms by the Confederation of British Industry (CBI) will find the balance of companies reporting increased profits swung to eight per cent, a positive reading for the first time since November 2015. The balance reporting business volume growth rose to 14 per cent, the highest reading since August 2015, and a steep rise from the one per cent reading recorded last quarter. Rain Newton-Smith, CBI chief econ-

THE TIMES

EMBATTLED UNIVERSITIES FACE LIMITS ON POWERS

Universities will be forced to act on high pay, grade inflation and support for disadvantaged students under regulations that will challenge their fiercely guarded independence for the first time in history. The new Office for Students will tackle not only management issues such as vicechancellors’ salaries and governance but also academic matters, including the increase in first-class degrees and the number of contact hours that students have with staff. Dropout rates, teaching quality and the financial stability of institutions will also be tightly monitored, according to documents seen by the Times.

omist, said: “Despite feeling the pinch from high inflation, business volumes have bloomed, profits have grown for the first time in over two years and hiring is on the up.” However, she pointed to the “telling signs” of challenges ahead from lower investment prospects. Both business and professional services and consumer services firms expect to cut back spending on buildings or land. The UK economy has struggled to pick up momentum over the last year. Revised government data showed output increased by only 0.4 per cent in the fourth quarter, dragging the UK to its slowest annual expansion since 2012 – although financial and business services provided a bright spot, with growth in the sector, which covers much of the City, revised upwards from 0.8 per cent to 0.9 per cent. Weaker readings from the production industries were the biggest drags

THE DAILY TELEGRAPH

TREASURY SET FOR £15BN WINDFALL ON GROWTH LIFT

The Office for Budget Responsibility is set for a U-turn as it prepares to dramatically hike forecasts for UK growth just months after they were suddenly downgraded. Strong numbers mean economists expect the watchdog to reverse some of that gloom, a move that would shrink the deficit and deliver a £15bn windfall to the chancellor.

GOOGLE’S UK TAX COULD JUMP SEVEN-FOLD

Tech giants could see their UK tax bills multiply by hundreds of millions of pounds a year if the government follows French proposals to introduce a digital levy on revenues.

on total UK output, although economists expect the latest health check from manufacturers to show the subsector continued to enjoy relatively strong expansion. The purchasing managers’ index (PMI) for manufacturers is expected to dip to 55.1 points in February figures to be released on Thursday. That would be the third consecutive monthly fall from the peak above 58 seen in November, and the lowest reading since June 2017 – although still far above the 50 mark which indicates no change, to continue the strong period for manufacturers. On the other hand, the construction sector has struggled far more, with activity falling during two periods in the past two years. However, economists expect the sector to gain some momentum in February, with activity predicted to accelerate from a reading of 50.2 to 50.7 in Friday’s data release.

THE WALL STREET JOURNAL

BLACK PANTHER AGAIN SHOWS ITS STRENGTH

Black Panther scored one of the best second weekends ever with an estimated $108m (£77m) in ticket sales, putting it on track to rank among the highest-grossing blockbusters ever. It is only the fourth film to earn $100m in its second weekend.

FIRMS PURSUE UPGRADED ONLINE ACCESS ON PLANES

Airbus, Delta Air Lines, Sprint and two US satellite-services providers have kicked off an initiative to enhance Internet access on airliners, inviting other companies to join voluntary efforts to upgrade global standards for airborne connectivity.


MONDAY 26 FEBRUARY 2018

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Carillion finance China sets the stage for President Xi Jinping to stay in office indefinitely chief slammed for share ‘dump’ BEN BLANCHARD

OLIVER GILL

@ojngill MPs HAVE singled out Carillion’s former long-serving finance chief, accusing him of “dumping” over £750,000 of shares just weeks before the contractor started to spiral towards failure. Richard Adam, who was Carillion’s finance director between April 2007 and December 2016, sold a slew of shares between 1 March 2017 and 8 May 2017. “Mr Adam presided over Carillion’s finances for a decade. He, more than anyone else, ought to know the merits of Carillion shares as a long-term investment in the light of his lengthy and lucrative tenure,” said Frank Field, the chair of one of two committees holding a joint inquiry into Carillon’s failure in mid-January. He continued: “His assessment? Dumping the last of his shares at the first possible moment because he is – with his own money at least – ‘risk averse’. What conclusions are we to draw from that?”

Adam sold shares that would be worthless less than a year later for £775,921. Earlier this month, members from the work and pensions and business committees grilled Adam and other former top Carillion execs. It was Adam’s successor – Zafar Khan – who endured the roughest ride, being “asleep at the wheel” during his eight months as Carillion’s CFO. Khan insisted it was Carillion’s debt pile, which “had grown over the past few years”, was one of the major factors in the firm’s collapse. He argued his tenure as finance chief was cut short after having “spooked” the board by revealing a £845m contract black hole had grown. Field said: “The other directors appear keen to set up the hapless Zafar Khan as the fall guy for the collapse. It is not lost on us, however, that he inherited Carillion’s mountain of debt.” Khan left his job as CFO after eight months as Carillion losses topped more than £1bn. He was replaced by Emma Mercer, who appeared to contradict Khan during MP questioning.

TECH TRIUMPH Deliveroo creates 250 new jobs in London to keep up with growth

DELIVEROO will create hundreds of new tech jobs in London. Some 250 data scientists, software engineers and cyber security experts are being recruited in the capital. The firm said the expansion is “a vote of confidence in the UK economy”.

Challenger bank Revolut broke even for first time in December LUCY WHITE @LucyGJWhite FINTECH firm Revolut broke even for the first time in December, after rapidly growing customer numbers and launching new products. The challenger bank has increased its monthly transaction volume by more than 700 per cent over the last 12 months, to $1.5bn (£1.1bn). However, Revolut’s founder Nikolay Storonsky said that expansion, rather than profitability,

was the current priority. “Instead of becoming a bank from day one, we chose to focus our time and resources on product development and customer acquisition,” he said. “This strategy is clearly paying off as we have now firmly positioned ourselves as the market leader in Europe and soon the world.” Revolut, which has seen its customer numbers expand from 1m to 1.5m in the past two months, said it is now signing between 6,000 and 8,000 new customers per day.

CHINA’S ruling Communist Party yesterday set the stage for President Xi Jinping to stay in office indefinitely, with a proposal to remove a constitutional clause limiting presidential service to just two terms in office. Since taking office more than five years ago, Xi has overseen a radical shake-up of the party, including

taking down top leaders once thought untouchable as part of his popular war on deep-rooted corruption. Yesterday’s announcement, carried by state news agency Xinhua, gave few details. It said the proposal had been made by the party’s central committee, the largest of its elite ruling bodies. The proposal also covers the vice president position. Xi, 64, is currently required by

China’s constitution to step down as president after two five-year terms. Nearing the end of his first term, he will be formally elected to a second at the annual meeting of China’s parliament opening on 5 March. There is no limit on his tenure as the party and military chief, though a maximum 10-year term is the norm. He began his second term as head of the party and military in October at Reuters the end of a party congress.


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MONDAY 26 FEBRUARY 2018

Banks nervously eye further rises in complaints damaging bottom line CONTINUED FROM FRONT PAGE Lloyds last week announced it had raised provisions by £1.7bn in 2017, pushing its tally to £18.8bn overall. Lloyds said the move reflects “increased complaint levels including the impact of the first FCA advertising campaign”, with other banks echoing its reasons for the increased costs.

If the FCA says “I’ll be back” with further advertising campaigns the toll on banks could rise further. For instance, RBS expects another 429,000 claims before the end of August 2019, on top of almost 2.4m thus far, but if its estimates are five per cent out it faces another £30m hit. If Barclays complaints estimates are out by nine per cent, the bank faces a further £100m in pain.

ABERDEEN HEADS TO DUBLIN Fund giant picks Ireland for its new EU base

COST OF PPI SCANDAL BANK Lloyds Banking Group Barclays RBS HSBC Yorkshire bank/Clydesdale Bank of America (MBNA) Santander

COST £18.8 billion £9.3 billion £5.1 billion £3.4 billion £1.8 billion £1.5 billion £1.5 billion

Source: New City Agenda

ABERDEEN Standard Investments (ASI) is to set up a new investment and distribution business in Dublin, City A.M. can reveal. The new EU headquarters will allow ASI to service the needs of customers after Britain leaves the union.

BoE dove jumps on bandwagon for hiking rates JASPER JOLLY

@jjpjolly ONE OF the Bank of England’s most dovish rate-setters has decided that signs of firmer wage growth mean interest rates need to rise more quickly, according to comments reported yesterday. Sir Dave Ramsden, the Bank’s deputy governor, said that “relative to where I was, I see the case for rates rising somewhat sooner rather than somewhat later”, in an interview with the Sunday Times. Ramsden’s intervention is the latest sign that the Bank is preparing markets to raise interest rates before November this year, after governor Mark Carney said at the start of the month that market pricing was lagging behind data. Ramsden joined the monetary policy committee (MPC) in September, and was one of Sir Dave Ramsden joined the MPC back in September

only two rebels on the nine-member panel to vote against the first rate hike in a decade at the start of November. Yet the turnaround in his assessment of the monetary policy trade-off marks yet another sign the Bank will hike interest rates in May. Last week the Bank’s chief economist, Andy Haldane, said wage data in the coming months is “key” to the interest rate path, and that pay will break an annual rate of three per cent in the first quarter. “There does seem to me more impetus on wages,” Ramsden said, adding he will “keep a close eye on what happens through the early part of this year”. However, he also said that productivity continues to lag, dragging down the UK economy’s potential growth rate, with the Brexit process a “reinforcing” influence. Slower wage growth also has a “Brexit element”, he added, although he believes the UK still retains a “global comparative advantage” in forex and derivatives.

Open banking will provide £1bn boost to economy, says study LUCY WHITE @LucyGJWhite THE UK’S new open banking initiative could provide a £1bn boost to the country’s economy, research indicates. Since customers can now make their financial data available to third parties such as challenger banks, this should increase competition in the marketplace according to a new study from the Centre for Economics and Business Research (Cebr) and Trustpilot.

In turn, since banks will have a better picture of credit risk and be forced to compete, this will push them to reduce the risk premium currently charged on interest rates linked to products like mortgages. Such improved lending practices will unlock more than £1bn in additional annual UK GDP on an annual basis. However, the research noted a recent survey from Accenture which found 69 per cent of people may not be willing to share their data, and added that banks must earn trust.


MONDAY 26 FEBRUARY 2018

CITYAM.COM

Investors object to Unilever shift from London HQ LUCY WHITE

@LucyGJWhite TOP SHAREHOLDERS in Marmite maker Unilever have hinted that they may object to a possible relocation of the company’s headquarters from London. Directors of the Anglo-Dutch group are expected to vote in the coming weeks on where Unilever should maintain its base, after the company promised last year to simplify its corporate structure in the wake of Kraft Heinz’s failed £115bn hostile bid. But key investors have said that ditching Unilever’s joint London head office for Rotterdam could be part of an underhand plan to make the company less attractive to foreign buyers, the Sunday Times first reported yesterday. Holland’s legal system is often perceived to be less facilitative of hostile foreign takeovers of companies, as US firm PPG found last year when it attempted to buy Dutch Dulux manufacturer AkzoNobel. A company can, for example, create

a legal entity called a “stichting” which has the right to veto any proposed hostile takeover. But shareholders have said that a relocation to take advantage of this system would not necessarily be in investors’ best interests. Last week it was revealed that UK officials were in talks with Unilever to convince the consumer goods giant to remain in London. The company did promise last year to maintain a stock market listing in London as well as Amsterdam, after shareholders threatened a revolt otherwise, but delayed making a decision on the location of the headquarters due to “political turbulence”. Currently, Unilever operates under a dual-headed legal structure, with incorporated firms in both the UK and Holland which must each be treated as separate companies with separate annual general meetings. As part of the Kraft Heinz-prompted shake-up last year, Unilever also announced a £4.3bn share buyback, a dividend hike and the £6bn sale of its spreads business.

Shareholders gear up to vote on Tesco-Booker merger this week HELEN CAHILL @HelCahill SHAREHOLDERS are set to vote on Tesco’s £3.7bn takeover of Booker this week, with Tesco CEO Dave Lewis hoping investors will back his bid to create the UK’s largest food business. Advisory groups are split over whether investors should back the deal, with some saying Tesco is seeking to buy Booker “on the cheap”. Influential advisory firm Glass Lewis told Booker investors that Tesco’s proposed premium for Booker

“clearly lags regional trends”. Tesco has offered a 12.1 per cent premium to Booker’s share price of 183.1p on the day before it unveiled the deal. However, with Booker’s shares now trading at around 223p, this premium has been eroded. Laith Khalaf, senior analyst at Hargreaves Lansdown, said while Booker’s share price has exceeded the price of Tesco’s offer, shareholders were likely to approve the deal. “The sector as a whole is under pressure and in this instance there is strength in numbers,” he said.

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South African regulator orders a further probe into Steinhoff auditor TANISHA HEIBERG SOUTH Africa’s Independent Regulatory Board for Auditors (IRBA) said yesterday that following its initial review of Steinhoff’s auditors Deloitte South Africa it would pursue further lines of investigation. The IRBA said in December it would investigate Steinhoff’s auditor following the retail group’s disclosure of accounting

irregularities. “The Steinhoff case is a multifaceted one which will require significant investigation. Nevertheless, our initial review of the audit files has identified some lines of further investigation which we are pursuing,” the IRBA said in a statement. It did not give further details. In December Steinhoff’s chief executive Markus Jooste quit amid news of the probe.

Steinhoff’s board said that, in consultation with its statutory auditors, it had appointed PwC to launch an independent investigation. Steinhoff advised its shareholders and other investors to “exercise caution when dealing in the securities of the group”, but a panicked sell-off caused the business’s market cap to more than Reuters halve.

SALE £899 Will Booker Group’s shareholders back the deal?

NEWS


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Provident investors set to trawl the figures for probe penalty details OLIVER GILL @ojngill BRITAIN’S biggest sub-prime lender Provident Financial will this week reveal its annual results – with long and short investors likely be poring over them in equal measure. Markets are desperate for an update on two separate investigations by regulators. Although loaned stock quantities

Provident Financial was subject to one of the FTSE 100’s biggest sell-off last year

Interserve says refinancing has not ‘stumbled’ OLIVER GILL

@ojngill TROUBLED support services giant Interserve has come out fighting, insisting crucial talks with banks have not “stumbled”. Interserve is trying to agree new financing terms with its syndicate of lenders after delivering a profit warning last September. In December Interserve agreed a £180m emergency financing package. The funds came after the outsourcer said in October it was in danger of breaching covenants. The short-term funding is due to be repaid in March. It was reported early yesterday that Interserve was “struggling” to strike a deal with lenders, who have been “spooked” by Carillion’s collapse. However, later yesterday an Interserve spokesperson said: “We do not in any way recognise the assertion that our discussions with lenders on long-term financing have stumbled.” Interserve’s plight is pitting the same accountants – EY and PwC – against one another that represented key parties in the run-up to Carillion’s demise. PwC is supporting

the company while EY is representing the eight-bank syndicate. The outsourcer’s business plan – which will underpin any refinancing package – was presented to the banks one day after Carillion failed in midJanuary. Sources familiar with the situation said, contrary to the reports in the Sunday Telegraph, talks were progressing well and with draft banking terms already being shared. The expiry of the short-term refinancing package means terms must be agreed by the end of March. Interserve employs around 25,000 people in the UK and 80,000 people worldwide. Shares hit an all-time low this week with demand from hedge funds outstripping supply. The Interserve spokesperson said: “Discussions remain positive, are proceeding to our planned timeframe and we remain confident of reaching a positive outcome.” Earlier this month it was reported Deloitte has been brought in by the Cabinet Office to advise on the government contracts held by Interserve. “We regularly meet with all of our suppliers,” the government said.

Co-working firm grabs $40m in round led by Shore Capital man LUCY WHITE @LucyGJWhite SHARED workspace business Mixer has just nabbed $40m (£28.6m) of funding in an investment round led by Howard Shore, the founder of investment group Shore Capital. Mixer, based in Israel, is hoping to expand into Europe and the US and has a new site planned in Berlin. Shore will now become chairman of the business, which focuses on the premium end of the co-working market by offering club-style lounges

and business networking opportunities. He led the funding round on behalf of his investment company, Puma Brandenburg, and the Brandenburg Realty co-investment vehicle he set up with US investors. Mixer, with its current two sites in Tel Aviv, already has members including Axa’s fintech incubator Kamet and Microsoft-backed venture capital firm i3 Equity Partners. Shore said he was “excited for the business to grow into a worldwide brand”.

have fallen in recent weeks, nearly all of the shares available to hedge funds to bet against Provident have been borrowed. Subsidiary Vanquis is being probed by the Financial Conduct Authority (FCA) over potential misselling of a popular PPI-style product called repayment option plan (ROP). Meanwhile, its car financing arm Moneybarn is also being investigated over affordability checks. Analysts

have estimated Provident could be slapped with a £300m bill in fines and redress for the Vanquis probe. “Resolving the FCA’s investigation into Vanquis’s repayment option plan product remains the key catalyst for the stock. With discussions underway, a resolution and what may be a material customer redress bill could now be a short-to-medium term hurdle,” said Canaccord analyst Bill Barnard.


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MONDAY 26 FEBRUARY 2018

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Bank of England to shut off Term Funding Scheme

JASPER JOLLY

@jjpjolly THE BANK of England will this week close a bank funding programme which has kept lending rates artificially low, in a move some economists see as the equivalent of an interest rate hike that will push up mortgage costs. The Term Funding Scheme (TFS) closes on Wednesday, with more than £115.4bn in cheap loans made available so far to British banks, according to Bank of England data up to 21 February. The TFS was brought in by the Bank in August 2016 to make sure its interest rate cut after the Brexit vote was actually passed through to households and businesses. It came as part of a dramatic package of measures following the June 2016 vote in the face of fears the uncertainty could damage the economy. Economists expect the closure of the

scheme to raise costs for borrowers, particularly in the mortgage market as the supply of cheap money to banks dries up. Mortgage rates will rise by about 60 basis points over the next six months, according to Pantheon Macroeconomics, after the recent rise in wholesale rates along with the TFS closure. Pantheon’s chief UK economist, Samuel Tombs, said the effects are “widely under-appreciated”, and that the change will have a similar effect to an interest rate hike. Tej Parikh, senior economist at the Institute of Directors, said that while the effects will be “limited” across the broader economy, loans may become more expensive. “Some lenders may have to eventually raise the interest they charge on loans,” he said. However, Giles Hutson, chief executive of deposit management firm Insignis Cash Solutions, added the closure will boost savers as competition pushes up rates on deposits.

Arbuthnot sets sail with asset based lending LUCY WHITE

London Stock Exchange Group shares have risen by 31 per cent in the last 12 months

London Stock Exchange profits to jump despite boss struggle JASPER JOLLY @jjpjolly THE LONDON Stock Exchange Group will shrug off the activist campaign to oust its chairman at the end of last year to record a rise in profits, according to City analysts’ forecasts. Earnings will jump by 25 per cent to hit £955m in results to be

announced on Friday, according to consensus estimates collected by S&P Global Market Intelligence. The FTSE 100 firm is without a permanent chief executive after Xavier Rolet was forced to resign by the chairman in November, but revenues are still expected to rise to £1.85bn. Investors will eagerly await news on the search for a new boss.

@LucyGJWhite ARBUTHNOT Latham, the historic City private bank, has poached a managing director from Shawbrook Bank to run its new asset-based lending division. Arbuthnot Commercial Asset Based Lending, which launches today headed by Tim Hawkins, will specialise in lending to small and medium-sized enterprises (SMEs) and mid-cap businesses. Confidential invoice discounting will be its core offering, supported by lending against stock, plant and machinery, property, and cash flow. “By filling a gap in the SME and mid-cap lending market, our dedicated team will support businesses across the UK to realise their growth ambitions,” said Arbuthnot Latham’s chief executive Ian Henderson. Hawkins was formerly managing director of the business credit division of challenger bank Shawbrook, after it acquired the firm he co-founded. As well as private and commercial banking, Arbuthnot Latham also offers wealth planning and investment management.

New trains. More seats. Extra comfort. Arrive ready on the new Electrostar.

THE FAMOUS FIVE © 2017, Hodder & Stoughton Limited. All rights reserved. 7,228 more seats on trains from London Paddington to Reading, from 2 Jan 2018. Based on new ‘Electrostar’ Class 387 trains vs ‘Turbos’ Class 165/166 trains between London Paddington and Reading. Correct as of 18 Dec 2017. For more details go to GWR.com


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McCall in ITV debut as boost could come from Southgate’s Three Lions OLIVER GILL @ojngill FORMER Easyjet boss Carolyn McCall has her first chance to impress investors in her new job as ITV chief executive this week. ITV announces its full-year results on Wednesday with analysts predicting a pre-tax profit of £741m. It is expected McCall will forecast £757m for 2018.

Carolyn McCall took over from Adam Crozier as ITV boss in January

Goldman misses out on fees after Standard shun

OLIVER GILL

@ojngill INVESTMENT banking behemoth Goldman Sachs has missed out on a multi-million pound payday after being spurned by Standard Life Aberdeen. On Friday Standard Life Aberdeen sold its insurance arm to zombie specialist Phoenix in a deal worth £3.24bn. Jettisoning its insurance operations completed what Standard Life Aberdeen bosses Martin Gilbert and Keith Skeoch called the firm’s “transformation to a fee-based capital-light investment company”. Goldman and boutique Fenchurch Advisory Partners netted bumper fees for advising on Aberdeen’s £11bn merger with Standard Life last year. But while Fenchurch’s services were retained to advise on the insurance sale, JP Morgan Cazenove was hired instead of Goldman. City sources said fees paid to Fenchurch and JP Morgan could top £20m. Despite falling 2.5 per cent on Friday Standard Life Aberdeen gained almost

five per cent last week after being hit by a big sell-off the week before. Standard Life Aberdeen has been stripped of around fifth of its assets by Lloyds Bank subsidiary Scottish Widows. Some £109bn of investments – which generate around five per cent of Standard Life Aberdeen’s revenue – will be moved elsewhere. Lloyds believes Standard Life’s merger with Aberdeen created a “material competitor” and triggered a contractual clause to sever ties. When the split was announced top Standard Life Aberdeen execs said they were confident some kind of “middle ground” can be found. The firm’s exit from insurance could see a thawing of relations and the fund manager retaining some of its mandates with Lloyds. Standard Life Aberdeen also reported its annual results on Friday. Excluding the Scottish Widows withdrawal, the firm revealed another year of net withdrawals from its funds. Net flows out of Standard Life Aberdeen totalled £31bn, following £36.8bn of withdrawals in 2016.

Lloyds hits back at comparison with RBS GRG before legal case JASPER JOLLY @jjpjolly LLOYDS Banking Group and accountants PwC face a £55m legal battle with a motor dealership which will allege they colluded to force it out of business. Lawyers for Yorkshire-based Premier Motor Auctions will argue Lloyds used its Business Support Unit as a profit centre to extract money from struggling firms, according to the Sunday Telegraph. Premier, led by chief executive

Keith Elliott, went bust following a failed sale of the business in April 2008. The firm will allege it was the victim of a plan to push bank staff to increase profits as the financial crisis hit in a case in April. Lloyds and PwC will dispute the claims, and the bank strongly refuted any comparison between its activities and the actions of the disgraced global restructuring group at Royal Bank of Scotland (RBS GRG). In a statement, Lloyds said: “The Business Support Unit is not a profit centre”.

The broadcaster’s shares have regained some ground over the last few months in the hope of advertising tailwinds 2018. ITV stock is more than 15 per cent up on a November 2017 low. Worrying for some, ITV’s fortunes may be tied to England’s football team. This summer’s Fifa World Cup in Russia is expected to provide ITV with a boost in advertising sales. And a long run by England manager

Gareth Southgate’s men could deliver a viewing figure boost. Advertising revenues are expected to have fallen by mid-single digits in 2017. In 2018 analysts are expecting a two per cent reduction. Dividends are projected to rise from 7.2p per share to 7.83p. ITV paid a 5p special dividend 2016 after rewarding shareholders with bonus payments between 2012 and 2015. However, this trend is expected to stop in 2017.


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MONDAY 26 FEBRUARY 2018

CITYAM.COM GUEST OPINION

Why a trade deal including financial services is essential for both the UK and the EU Miles Celic calls on the EU’s chief Brexit negotiator to consider the idea of mutual regulatory recognition

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OULD you believe me if I told you that Michel Barnier has recently said that “the EU and the UK agree on the overall objectives of sound and resilient banks and financial markets? “It would be nothing short of a disaster if our agreements on broad principles are undermined by the detailed rules and their implementation being just too different. This is why we want to include regulatory cooperation on financial services…” Anyone reading this would think that, contrary to his pre-Christmas statements, Barnier has recognised the mutual benefit of a deal in this area. Or that I’ve doctored the quote. Both are true. I changed one letter. In the original quote, Barnier said “US” and not “UK”. The statement was uttered over three years ago, during the TTIP negotiations.

EU Brexit negotiator Michel Barnier Barnier was, at the time, leading attempts by the EU to get financial services comprehensively covered in an EU/US TTIP deal. The EU feared competition from US banks with looser regulation and lower capital costs.

LESSONS FROM AMERICA

But they also saw the economic advantages for the EU economy of opening up access for European business to greater pools of international capital and expertise, as well as the chance to sell into the large US market. The industry on both sides of the Atlantic supported this position. In the same speech, Barnier also said that “cooperating on regulation is the only way to ensure global financial stability while

The arguments Barnier made about regulatory cooperation were absolutely right maintaining open markets.” Can this be the same man who has declared that financial services have no place in any UK-EU trade agreement? A change in the US administration, as well as other unrelated issues, may have put an end to TTIP for now. But the arguments Barnier made in 2014 about regulatory cooperation were absolutely right then and they are absolutely right today.

TRADE BEYOND BREXIT

Indeed, the idea of mutual regulatory recognition as a basis for UK-EU trade, first proposed by the International Regulatory Strategy Group and now adopted by the UK government as the best approach to frictionless trade beyond Brexit, is rooted in what the EU was seeking with the US. A Brexit deal based on mutual regulatory recognition would allow for ongoing regulatory alignment between the UK and the EU, requiring our regulators to continue to work closely on various emerging issues. It would also provide for a mechanism to manage any future divergence. As David Davis said just last week, and Barnier said in 2014, it would result in a regulatory “race to the top, not a race to the bottom”. “We will of course never agree on everything and neither jurisdiction should be able to force the other to follow its rules.” That was Mr Barnier again. The question is, when we agree on so much, surely a deal which includes financial and related professional services is not only possible, but essential for both the UK and the EU? We have consistently argued that the winners of such an approach would be customers, shareholders and employees. Let’s hope Michel Barnier listens to his own wise advice. £ Miles Celic is chief executive of financial lobby group TheCityUK

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GKN workers to lobby against deal LUCY WHITE @LucyGJWhite WORKERS at beleaguered engineering giant GKN are set to take to the streets outside Westminster on Wednesday to lobby against a £7.4bn hostile takeover. The bid, from listed turnaround firm Melrose, is currently under government scrutiny due to national security concerns, as GKN makes components for a number of military aircraft.

Berlin sees no need to act on Daimler stake

Members of Unite union will urge parliament to intervene on national security grounds, though they are also concerned that a takeover from Melrose could lead to heavy job cuts and the shifting of parts of the business overseas. Melrose specialises in operationally improving industrial companies, before selling them on for a profit. GKN, which employs around 6,000 staff in the UK, is also due to come

under increased pressure tomorrow as it releases full-year results expected to show profits sliding. Part of this was due to a £112m hit thanks to accounting issues discovered in the firm’s north American arm. GKN and Melrose have been publicly battling the merits of a takeover. Melrose has said its offer will increase value for shareholders, while GKN’s management has promised to hand shareholders back £2.5bn.

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GKN creates components used in Volkswagen cars and military aircraft

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Government brings energy cap law to floor

ANDREAS RINKE

LUCY WHITE

DAIMLER and its Chinese partner BAIC plan to invest almost $2bn (£1.4bn) in a state-of-the-art factory in China, underlining their relationship as rival Geely makes a surprise swoop on the German car maker. The two will invest more than 11.9bn yuan (£1.4bn) in modernising a plant to build premium MercedesBenz cars including electric vehicles, BAIC said in a filing to the Hong Kong Stock Exchange dated Friday and confirmed by Daimler yesterday. The chairman of Chinese carmaker Geely said late on Friday he had bought an almost 10 per cent stake in Daimler, in a $9bn bet to access the Mercedes-Benz owner’s technology. The move poses a challenge to Daimler, which as well as its Chinese partnership with BAIC Motor Corporation has an industrial alliance to develop cars and trucks with Renault-Nissan, which owns a 3.1 per cent stake in Daimler. Geely’s chairman Li Shufu, who quietly built up the 9.7 per cent stake, is now expected to meet Daimler executives in Stuttgart today, a source familiar with the matter said, and hopes to meet top German government officials in Berlin. His approach contrasts with that of previous Chinese investors in German technology companies who have tended to engage in lengthy consultation with stakeholders. Berlin said it saw no need to take any action over Geely’s purchase, either in terms of competition rules or of foreign investment rules. “It is a company decision,” a government spokesman said. “Due to the character of the investment as a minority stake, there is no need to act.” The government declined to comment on a report in German tabloid Bild am Sonnntag that Li would hold a “secret meeting” with Angela Merkel’s economic adviser Reuters tomorrow.

@LucyGJWhite A NEW power for regulators to cap high energy tariffs is being introduced to parliament today. The Bill will require Ofgem, the independent energy regulator, to cap energy tariffs until 2020. This will also mean Ofgem can set an absolute cap on poor value standard variable or other default energy tariffs, which may not be protected by existing price caps. “Energy prices for millions of households on default tariffs are still too high,” said business and energy secretary Greg Clark. “Our new price cap will guarantee that consumers are protected from poor value tariffs and further bring down the £1.4bn a year consumers have been overpaying.” The introduction of the Bill to parliament follows its approval from the Business, Energy and Industrial Strategy (Beis) Select Committee. Rachel Reeves, chair of the committee, said the cap “is urgently needed to help fix the broken energy market and protect consumers”. She added that the Bill had crossparty support. In a report published earlier this month, the Beis committee found the “Big Six” energy suppliers (British Gas, EDF Energy, Npower, E.On, Scottish Power and SSE) had “brought the introduction of a price cap upon themselves” by raising prices in 2017 and failing to correct “years of overcharging” on default and standard variable tariffs. When setting the cap, Ofgem will take into account the need to create incentives for suppliers to improve efficiency, competition aspects and the need to ensure suppliers can finance their activities. The regulator will review the cap every six months, and in 2020 will recommend to government whether it should be extended up to 2023.

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Persimmon’s profits jump up towards £1bn HELEN CAHILL

Persimmon’s board was under pressure from investors over a 2012 share scheme

@HelCahill PERSIMMON’S profits are expected to jump close to the £1bn mark this week as the housebuilder continues to bat off criticism for the pay awards it handed to executives. Analysts are expecting pre-tax profits to rise 25 per cent, up from £775m to £965m, when the firm

announces its 2017 figures tomorrow. The figures come after the housebuilder cut its chief executive’s pay award by £51m in response to complaints from shareholders. Persimmon’s share price growth has slowed in recent months after the Bank of England raised interest rates in November, and said rates would continue to rise this year. Mortgage approvals fell by nine per cent year-on-

year in December, suggesting the market could be cooling. Analysts are also concerned about house price affordability as house price inflation continues to outpace wage growth. Persimmon has amended the company’s pay awards for executives under its 2012 long term incentive plan. The pay scheme was described as “excessive” by investor Standard Life Aberdeen.


CITYAM.COM

MONDAY 26 FEBRUARY 2018

What’s eating Jamie? Alys Key looks back on the TV celebrity chef’s most and least successful ventures

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AST week, staff at Jamie Oliver’s Barbecoa restaurant in Piccadilly were informed that the site was being passed into the hands of administrators. Around 80 people lost their jobs, on top of at least 200 who had already been let go from the Jamie Oliver restaurant empire when 12 Jamie’s Italian restaurants closed earlier this year. It is not the first time businesses tied to Brand Jamie have been abruptly shuttered. Back in 2014, two cookery shops called Recipease closed, with staff told that management wanted to focus on the one remaining branch in Notting Hill. A year later, this one closed as well. Oliver’s “British pizza” concept Union Jacks also failed to take off, with the final of four stores closing last year. The restaurant group’s chief executive Jon Knight made an appearance at the Casual Dining Show last week, where he explained: “Essentially, we had got a little bit lost. We hadn’t acknowledged how much the UK high street had changed in 10 years and we hadn’t adapted our restaurants in line with Jamie the person.” Industry sources agree that this is

Jamie Oliver is the bestselling British non-fiction author of the last decade

the case, and the numbers bear it out. The Jamie Oliver brand is still one of the most successful in the food world. Jamie Oliver Holdings Limited, the company which includes TV and books, made £30m in revenue in 2016, while underlying earnings shot up to £5.6m. Accounts are not yet available for 2017, but Oliver’s “5 Ingredients – Quick & Easy Food” was the UK’s top-selling book of 2017, while the TV show sold to 120 countries. In fact, Oliver is the bestselling British non-fiction author of the last decade. The problem appears to be that the restaurants have been detached from Oliver. The man himself has yet to comment on the blows which his empire has suffered, but Knight admitted that “as a restaurant group we were still representing Jamie from way back when, with his scruffy hair and his chef’s trousers”. Add all of this to rising costs and increased competition, and it is not hard to see why the restaurant ventures have had such different fortunes from the media output.

JAMIE’S EMPIRE IN NUMBERS

£7.3m – the amount made in 2016 from licensing the Jamie Oliver name for use on products 18 – the number of Jamie’s Italian UK restaurants which have been closed since the beginning of 2017, almost half the estate £3m – the amount Oliver himself put into Jamie’s Italian at the end of 2017 £71.5m – Jamie’s Italian’s debt pile 40 per cent – the proportion of his ventures Oliver admitted in 2015 didn’t work out

Brits splash £60 for each night on the tiles as drink spend rises HARRY BANKS BRITS spent an average of £59.49 on a night out during the last quarter – up 13.8 per cent from the same period last year – according to leisure giant The Deltic Group’s latest night index. The quarterly report found that consumers are spending a significant 26.6 per cent more on pre-drinks, 25 per cent more on transport, and 19.4 per cent more on in-venue drinks, but 9.1 per cent less on food. Peter Marks, chief executive of The Deltic Group, said: “The index continues to show that the current narrative around a supposed declining demand for a good night out, that millennials don’t like going out, socialising is all online and that the rest of us have outgrown it,

simply isn’t true.” The index also found that more than half (58 per cent) of consumers go on a night out at least once a week. Though this is down slightly from last quarter’s 60.1 per cent, it goes up to 73 per cent among 18 to 21-year-olds, and 63.8 per cent among 26 to 30-year-olds. More than 40 per cent of respondents said seeing other people post about their night out on social media makes them want to go on a night out. Among 18 to 30-yearolds this went up to 57 per cent. “In this report we’ve looked at some of the drivers behind this – in particular social media and the emergence of apps such as Uber and Apple Pay. We found that actually, technology is working with us rather than against us,” added Marks.

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Weakened Merkel offers job to arch critic in new German cabinet ANDREAS RINKE GERMAN Chancellor Angela Merkel said she would promote her most prominent critic from within her conservative party, 37-year old Jens Spahn, to a coalition cabinet, in a sign she has heeded calls for renewal to revive her grumbling party. Although she has agreed a deal with the leaders of the Social

Democrats (SDP) for a new “grand coalition”, Merkel needs the blessing of both camps to be sure of a fourth term. Approval from SDP members is far from certain. She announced her choice of six cabinet ministers from her Christian Democrats (CDU) before the party votes on the deal today. There are as many women as men and Merkel said she was the only one who is over 60

years of age. She said she had put together a young, dynamic team which represents something of a new start for the party which slumped to its worst result since 1949 in a September election. “It was my task to present a tableau of people that is future-oriented and that offers a good mix of experience and new faces,” said Merkel. “This is Reuters anything but easy.”

Legendary investor Warren Buffett is the boss of Berkshire Hathaway

US tax changes propel Berkshire to record profit

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@courtneynoelg BERKSHIRE Hathaway, the business headed up by legendary investor Warren Buffett, on Saturday reported a record annual profit after Donald Trump’s tax changes boosted its earnings by more than $29bn (£21bn). The company’s full-year earnings shot up 87 per cent to $44.9bn, though Buffett admitted only $36bn came from Berkshire’s operations. Operating profit fell 18 per cent to $14.5bn due to a $2.2bn loss from the group’s insurance underwriting unit as a string of natural disasters hit the US. On Friday, Berkshire’s class A shares closed at $304,020.01, having risen above $300,000 a share for the first time ever in December on expectations that Trump’s US tax overhaul would pass into law. Berkshire said about $29.11bn of its net income was attributable to the reduction of the US corporate tax rate from 35 per cent to 21 per cent. The 87-year-old Buffett recognised this in his annual letter to

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shareholders, where he said the company’s 2017 results were “far from standard”. “A large portion of our gain did not come from anything we accomplished at Berkshire,” he said. But he added the $65bn gain was “nonetheless real – rest assured of that”. Elsewhere in his letter, Buffett said a lack of “sensible” purchase prices had prevented Berkshire Hathaway from making acquisitions in 2017. “Prices for decent, but far from spectacular, businesses, hit an alltime high,” he said. Though many firms continued a “purchasing frenzy” due to deal-hungry chief execs and cheap debt, he said. Buffett, who is known as the Sage of Omaha, added: “Despite our recent drought of acquisitions, Charlie and I believe that from time to time Berkshire will have opportunities to make very large purchases. “In the meantime, we will stick with our simple guideline: The less the prudence with which others conduct their affairs, the greater the prudence with which we must conduct our own.”

Small businesses to take huge hit from new data regulation LUCY WHITE

Find out more: imprl.biz/city-am-feb

@LucyGJWhite NEW DATA laws are set to catch out small firms, according to the Federation of Small Businesses (FSB), as 90 per cent are unprepared for the introduction of incoming rules. The General Data Protection Regulation (GDPR), which comes into force on 25 May, is designed to push businesses to increase the protection of personal data. But the FSB has found that 33 per cent of small businesses have not

even started preparing, while 35 per cent are in the early stages and only eight per cent have completed their preparations. A number of firms are unaware of what they must do. “GDPR is the biggest shake-up in data protection to date and many small businesses will be concerned that the changes will be too much to handle,” said FSB chair Mike Cherry. Small companies in the arts and entertainment and hospitality sectors are the least prepared, while financial firms are at the other end of the scale, the research found.


MONDAY 26 FEBRUARY 2018

CITYAM.COM

Why customers want more than just dinner Alys Key talks to BoxPark’s founder about how the restaurant industry is moving forwards

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ESTAURANTS are in crisis. Every few weeks, another chain sends out distress signals, with Eat, Jamie’s Italian and Byron Hamburger among the latest to feel the pinch. But Roger Wade, founder of London’s hip retail and dining concept BoxPark, thinks the idea that the eating and drinking out industry is in trouble is “ridiculous”. “It’s like when they said we’d get rid of physical retail five years ago, and it would all be Amazon and drones,” he says. “There’s a correction in the market, sure. But in both cases, they underwent quite rapid expansion, and they took on high rents. The lesson that future guys have to learn is they have to grow organically.” His assessment chimes with a growing consensus within the industry. After the 2008 financial crisis, which killed off or reduced several retail chains, landlords were desperate for a new tenant in their high street stores and shopping centres. Enter casual dining. As

BoxPark founder and CEO Roger Wade thinks the idea that the UK restaurant sector is in trouble is “ridiculous” consumers reined in shopping, they treated themselves to experiences instead. And when private equity got involved, several chains expanded nationally in a matter of months. “It's been a chase to the top, to expand rapidly without really thinking about how to expand,” says Wade. While restaurants have been taking on hefty leases, Wade’s own venture has offered something very different. At BoxPark, foodie startups can take up short leases on a converted shipping container. The just-approved BoxPark Wembley will have a food focus, with kitchens serving a shared eating area as well as providing meals to Deliveroo, Uber Eats, and Just Eat. It is low-risk, but it also offers something which

It’s not just about the eating, it’s about how you operate the space Wade says is crucial in the age of the crumbling restaurant chain: individuality. “I do see a move away from globalisation into specialisation, and localisation,” he says. “In my home town of Brighton, when I go to where my local coffee shop [is], there’s a Starbucks 50 yards away but the local small coffee operator is twice as busy. People like the idea of a more local operation.” Brighton’s famous Laines are another source of inspiration. Independent shopping continues to draw visitors because, says Wade, “it makes the customer feel special”. This has bled into the short-lease model of BoxPark, especially when it comes to food operators. “The customer doesn’t want to go to the same places,” he says. “This is what the internet is bringing us. It’s led to more knowledge and specialisation.” After the opening of the Wembley site, BoxPark will have three locations around London. Wade has his sights set beyond the capital, predicting that the group will open a dozen more up and down the country. He’s confident that the project offers something the consumer is crying out for, and is happy to see other ideas like Street Feast thriving because “there’s room in the marketplace”. But he has a warning for other businesses looking to imitate the concept of putting several operators together in shared spaces on short leases: it’s a lot harder than it looks. “There’s guys who think they’re going to turn up, call it a food hall, and the money comes rushing in,” he explains. “Maybe the thing that separates us from the rest is we realise it’s not just about the eating and drinking, it’s about how you operate the space.” This is something that could also be translated across to dining chains, where consumers are increasingly looking for beautiful surroundings, excellent service, or a social element to get their money’s worth. “There’s fallout from the customer looking for an all-encompassing dining experience,” says Wade. “They want to eat, drink and play.”

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MONDAY 26 FEBRUARY 2018

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FOCUS ON MOBILE WORLD CONGRESS

Nokia boss says faster-than-expected 5G rollout will boost business in 2018 ERIC AUCHARD AND JUSSI ROSENDAHL TELECOM operators are accelerating their timelines for the roll-out of next-generation 5G networks, lifting Nokia’s confidence of an uplift for its business this year, chief executive Rajeev Suri said yesterday. The telecom network industry, dominated by China’s Huawei, Finland’s Nokia and Sweden’s Ericsson, is weathering the toughest part of a decade-long cycle as demand

for 4G gear falls. But the first commercial 5G rollouts are due to begin this year and Suri said he expected large deployments in the US, South Korea, Japan and China to take place sooner than what the industry could have expected a year ago. “The confidence about where that 5G uplift comes from is understanding the accelerated timelines operators now have,” Suri said, ahead of the Mobile World Congress Barcelona this week.

A year ago, operators were saying 5G rollouts would be big maybe at the back end of 2019, he noted. “Now, it has accelerated by almost a year, which is good news for the sector, because then they’ll be the next wave of investment coming and we can base our timelines now off of knowing this.” Nokia said yesterday it had struck a partnership agreement with China Mobile to develop new 5G networks for industrial uses across the world’s Reuters most populous country.

Suri believes big 5G developments will happen throughout the world this year

Firms adapting against startup challenge: IBM

PAUL SANDLE

MAJOR corporations are learning to defend against startups that threaten their business models, hitting back by adopting the disruptors’ playbook, according to a survey of top executives by computer services firm IBM. The proportion of executives who thought competitors were set to flood into their industry has halved from 54 per cent to 26 per cent compared to two years ago, the broad-based poll of business decision-makers showed. “There’s been a feeling historically that the elephants can’t dance, the incumbents will find it hard to respond and that everyone will be Ubered or Airbnb-ed out of existence,” Mark Foster, senior vice president of IBM Global Business Services, told Reuters in an interview. “But what we are seeing is actually there is a limit as to how far that can go.” While some sectors had been hugely disrupted by new digital entrants and some intermediaries pushed out, many of those changes were now being led by existing industry players, he said. Disruption is a catch-all term for the use of digital technology to up-end

existing business models, for example Uber’s impact on the taxi industry by using smartphones to connect riders with drivers. But just 27 per cent of the executives surveyed said they were experiencing significant disruption, an unexpected finding given the deluge many predicted, IBM said. Only 23 per cent said the big drivers of change were from outside their industries. Digital giants, like Google, Apple and Facebook, continued to concentrate their power in some industries, but according to the executives surveyed they were not leading the disruption, and startups were increasingly quiescent, the survey found. Instead, 72 per cent said it was the most innovative incumbents who were leading the disruption, including in industries targeted by start-ups such as financial services. IBM said the incumbents had become better at spotting and acquiring nascent disruptors. They had also realised the need to find partners, even sharing physical assets and people with them, to acquire new skills. IBM surveyed 12,854 top execs from Reuters 112 countries for its report.

Cisco says next generation net gear is ready ERIC AUCHARD

Samsung declined to provide a sales forecast for the S9

Samsung unveils Galaxy S9 phone with social media focus JOYCE LEE SAMSUNG Electronics unveiled its flagship Galaxy S9 smartphone yesterday with an emphasis on visual applications for social media, hoping to attract tech-savvy young consumers to weather a market slowdown. With the global smartphone market set to stay flat or even shrink after meager growth of one per cent last year, vendors are focusing on features designed to encourage young consumers to ditch their old

phones earlier than they would have previously. The world’s biggest smartphone maker showcased the Galaxy S9 at a mobile gadget fair in Barcelona. It features improved cameras, an artificial intelligencepowered voice tool, and social media functions that are easier to deploy than previous offerings. New features on the phone include an automatic super-slow motion camera setting that looks primed to show up on Instagram feeds soon, and software that turns selfies into Reuters instant emojis.

CISCO Systems said yesterday it aims to disrupt the wireless radio access market led by Huawei, Ericsson and Nokia by backing challengers who make more flexible software versions of traditional mobile gear. Cisco, known for making networking gear that moves big volumes of data around the internet, wants a bigger share of the mobile market by backing these alternative providers rather than by making radio access equipment itself. Its radio access network push is part of Cisco’s efforts to prove to mobile network operators that investing in modern infrastructure and automation tools can help them to cope with increased data demands, while lowering costs. It made the announcement ahead of this week’s Mobile World Congress in Barcelona. Cisco said it is working with more than 20 network operators to offer nextgeneration 5G services, which promise to deliver not just faster phones and video, but also connected cars and internetconnected industrial sensors over the next decade. “Many of the things we enable you to do, you can do before 5G,” said Yvette Kanouff, general manager of Cisco’s business unit for telecom service providers. Reuters

Telefonica ‘Aura’ voice-activated assistant launches in six nations DOUGLAS BUSVINE

Telefonica has invested €56bn (£49bn) in its digital upgrade since 2012

SPANISH mobile operator Telefonica yesterday launched a voice-activated assistant, called ‘Aura’, in six countries, using artificial intelligence to interact with its customers. The announcement, on the eve of the Mobile World Congress in Barcelona, comes a year after Telefonica promised a makeover in response to US tech giants like

Amazon, whose interactive aide Alexa has become a big seller. Telefonica, present in 17 markets across Europe and Latin America, is offering its assistant in Argentina, Brazil, Chile, Germany, Spain and Britain. “A year ago we said we wanted artificial intelligence to be the basis of our clients’ relationship with us and we are delivering on our promise,” chairman Jose Maria

Alvarez-Pallete said. “Digitalisation is the core of our business and thanks to the deep internal transformation that we have undergone in the last eight years we have become a company of smart platforms.” It will soon be integrated with Google Assistant, as well as Microsoft’s Cortana in 2019, Telefonica said. It will operate as a branded app in the UK, Argentina Reuters and Brazil.


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MARKETS

CITYAM.COM

MONDAY 26 FEBRUARY 2018

CITYDASHBOARD LONDON REPORT

Market braced for full-year results bonanza

T

HE UK’S top share index dipped on Friday after RBS and airline operator IAG tumbled following their results, sending the FTSE 100 to a slight weekly loss. The blue-chip FTSE 100 index closed down 0.11 per cent at 7,244 points. A number of big, earnings-driven falls weighed on the blue-chips. Shares in Royal Bank of Scotland were the biggest fallers, down 4.8 per cent and on track for their biggest one-day drop in nearly one year after the bank reported its full year results. While RBS posted its first profit in a decade, analysts flagged higherthan-expected restructuring costs and a large misconduct fine. IAG was another big faller, down 5.7 per cent after the British Airways operator reported annual figures. Analysts at Liberum said while IAG’s results were in line with their forecasts, revenue was a little light. However, Pearson’s update was wellreceived by investors, with shares in the educational publisher rising 0.7 per cent. Pearson has been grappling with the switch to digital from paper

TOP RISERS 1. BT Group up 5.04 per cent 2. United Utilities up 3.43 per cent 3. Severn Trent up 3.27 per cent

TOP FALLERS 1. IAG down 5.69 per cent 2. RBS down 4.82 per cent 3. Smurfit Kap. down 3.85 per cent

textbooks, issuing a series of profit warnings along the way. BT’s shares were the top performers with the telco rising five per cent after UK regulator Ofcom unveiled new rules on the roll-out of full-fibre broadband, saying that it would not regulate the prices of BT’s Openreach superfast broadband products. This week dozens of major UK companies will report annual results. Today, those companies include Hammerson, Bunzl and Hiscox, while tomorrow Standard Chartered, British Airways owner IAG was one of the big FTSE fallers on Friday Greggs, Interserve, Meggitt, Provident Financial, Direct Line, Persimmon and Fresnillo will update the market. On Wednesday, Taylor Wimpey, Man, Weir, St James’s Place, ITV, Travis Perkins, Admiral and Foxtons will be among those publishing full-year figures, while Rentokil, Cobham, WPP, Bovis Homes, National Express and Merlin Entertainments will do so on Thursday. The London Stock Exchange Group and Spire will be among the firms rounding off the week with annual numbers on Friday.

FTSE

To appear in Best of the Brokers, email your research to notes@cityam.com

555

P 23 Feb

550

531

545 540 535 530

19 Feb

20 Feb

21 Feb

22 Feb

23 Feb

Jupiter reported net inflows of £5.5bn, Liberum analysts highlight. That is equivalent to 14 per cent of the fund house’s opening assets under management. This was well ahead of Liberum’s expectations. And there is more upside to come, they add. “Jupiter remains well positioned in our view, given ongoing product and geographic diversification and should be a core holding in the asset management space,” analysts conclude. So Liberum stick to their “buy” recommendation and slap a target price of 664p on its stock.

SERCO 98

P

96

94.25

94

23 Feb

92 90 88

19 Feb

20 Feb

21 Feb

22 Feb

23 Feb

In the round, Serco’s results were “pleasing”, analysts from Shore Capital say. OK, despite the current crisis of confidence in contracting, Serco was expected to do well – but the announcement shows “recovery progress is on track”. Shore Capital analysts say: “We agree with management that the outsourcing model remains of value to government clients around the world and we note, enthusiastically, great success in winning new (what we trust will be) profitable business through 2017.” It’s a “hold” recommendation from Shore Capital for Serco with a 93p target price.

WILLIAM HILL 337.50

P

335.00 332.50 330.00

333.50 23 Feb

327.50

19 Feb 23 Feb

7,244.41

7,150

20 Feb 21 Feb 22 Feb 23 Feb

20 Feb

21 Feb

22 Feb

NEW YORK REPORT

Rally as tech climbs and Fed eases worries

JUPITER FUND MANAGEMENT

322.50

7,250

19 Feb

BEST OF THEBROKERS

325.00

7,300

7,200

YOUR ONE-STOP SHOP BROKER VIEWS AND MARKET REPORTS

23 Feb

Barclays analysts say a lot has happened at William Hill in the last year. Results out last week came hot on the heels of a multi-million pound fine from the Gambling Commission. Barclays analysts pick out the £238m impairment of William Hill’s Australian business as a “big number but perhaps not a surprise after material regulatory headwinds”. Barclays adds: “There is no current trading commentary and little specific guidance.” So it is an “equal weight” stock recommendation from Barclays and the analysts up the target price from 330p to 350p.

U

S STOCKS rallied on Friday, lifted by gains in technology stocks and a retreat in Treasury yields as the Federal Reserve eased concerns about the path of interest rate hikes this year. The US central bank, looking past the recent stock market sell-off and inflation concerns, said it expected economic growth to remain steady and saw no serious risks on the horizon that might pause its planned pace of rate hikes. Investors largely expect the Fed to raise rates three times this year, beginning with its next meeting in March, the first under new chair Jerome Powell. Traders currently see a 95.5 per cent chance of a quarterpercentage-point hike next month, according to Thomson Reuters data. Powell’s first public outing will be tomorrow, when he will testify separately before the House and Senate committees. The Dow Jones Industrial Average rose 347.51 points, or 1.39 per cent, to 25,309.99, the S&P 500 gained 43.34 points, or 1.6 per cent, to 2,747.30 and the Nasdaq Composite added 127.30 points, or 1.77 per cent, to 7,337.39. Benchmark 10-year US Treasury notes last rose 13/32 in price to yield 2.8714 per cent, from 2.917 per cent late on Thursday. Tech shares climbed 2.17 per cent led by gains in Hewlett Packard Enterprise, which rose 10.5 per cent and HP, up 3.5 per cent. The two companies created from the split of Hewlett Packard Co in 2015, reported strong results and HPE also announced a plan to return $7bn (£5bn) to shareholders. A number of big-name US companies will release fourth quarter and annual results this week, including a number of retailers such as department store giant Macy’s tomorrow, Victoria’s Secret owner L Brands on Wednesday, Best Buy, Nordstrom and Gap on Thursday, while Foot Locker will report results on Friday. Salesforce, Monster Beverage and drug maker Mylan will also report figures on Wednesday.

CITY MOVES WHO’S SWITCHING JOBS PSYON

Psyon, a UK insurtech firm (part of the Punter Southall Group) which offers real-time digital and data employee benefits solutions, has appointed Daniel Vincent as its first head of software development to boost growth and further develop its technology platform – Psyon Elysium. Daniel joins from Emcor Group (UK), a leading facilities management provider, where he was head of data quality and solutions, overseeing the creation of an in-house

development capability designed to bring unique FM insights to clients. Prior to this he worked for media auditing company Ebiquity, initially as a developer, then as development manager, IT operations manager and latterly, UK IT director. Daniel has a huge amount of experience in creating innovative digital solutions, along with a clear business focus which will be invaluable in driving future business growth.

BOODLE HATFIELD

Law firm Boodle Hatfield has reappointed Sara Maccallum senior partner, and partners Saskia Arthur and Simon Rylatt have been reappointed to the firm’s management committee. The three-year appointment takes effect from 1 May. Sara was first elected senior

To appear in CITYMOVES please email your career updates and pictures to citymoves@cityam.com

partner in 2015, with head of residential property Saskia Arthur and head of private client and tax Simon Rylatt joining the management committee in the same year. Under the leadership of Sara and the management committee the firm continues to focus on meeting the needs of wealthy individuals, their families and businesses. This has included investing in building a dedicated Middle East practice, developing the firm’s art law offering, and a growing focus on successful and high value entrepreneurs. Sara Maccallum remains one of the few female senior partners among the top 100 UK law firms.

HILL

Hill, the UK’s third largest privately-owned family-

controlled housebuilder, has appointed Ryan Harris as regional director for the western Region. In his role, Ryan will oversee all production, commercial and technical activity across Oxfordshire, Berkshire, Buckinghamshire and Hertfordshire. Ryan will lead on Hill’s work to deliver 237 new homes at Mosaics, the first residential phase to be delivered at the highly anticipated Barton Park project comprising 885 new homes. Ryan has worked in the housebuilding industry for 18 years and brings a wealth of experience and skill to the role. His strong background in overseeing large urban regeneration developments will further strengthen Hill’s expertise in this sector. Hill boasts a total pipeline of 3,200 homes across London and the south east of England.


MONDAY 26 FEBRUARY 2018

CITYAM.COM

FTSE 100

FTSE 250

7244.41 7.98

19801.05 64.99

Price Chg High Low

GILTS -0.01 0.00 -0.02 -0.02 -0.02 -0.02 -0.02 -0.06 0.01 0.02 -0.03 -0.06 0.02 0.07 -0.08 0.06 -0.14 -0.09 0.04 0.00 -0.29 -0.41 -0.01 0.00 -0.40 0.01 0.04 0.01 0.03 -0.50 -0.50

Tsy 5.000 18 . . . . . .100.12 Tsy 1.250 18 . . . . . .100.34 Tsy 4.500 19 . . . . . .103.97 Tsy 3.750 19 . . . . . .104.63 Tsy 4.750 20 . . . . . .108.11 Tsy 2.500 20 . . . . .363.07 Tsy 8.000 21 . . . . . .123.02 Tsy 1.875 22 . . . . . . .118.60 Tsy 4.000 22 . . . . . .112.07 Tsy 2.250 23 . . . . . .105.88 Tsy 2.500 24 . . . . . .359.14 Tsy 0.125 24 . . . . . . .111.68 Tsy 5.000 25 . . . . . .124.90 Tsy 4.250 27 . . . . . .124.74 Tsy 1.250 27 . . . . . .129.87 Tsy 6.000 28 . . . . .143.84 Tsy 0.125 29 . . . . . .120.02 Tsy 4.125 30 . . . . . .358.55 Tsy 4.750 30 . . . . . .134.68 Tsy 4.250 32 . . . . . .131.07 Tsy 1.250 32 . . . . . .146.52 Tsy 0.125 36 . . . . . .135.54 Tsy 4.250 36 . . . . . .136.45 Tsy 4.750 38 . . . . . .148.93 Tsy 0.625 40 . . . . . .156.51 Tsy 4.500 42 . . . . .150.40 Tsy 3.500 45 . . . . . .132.48 Tsy 4.250 46 . . . . . .151.05 Tsy 4.025 49 . . . . . .156.50 Tsy 0.500 50 . . . . . .181.77 Tsy 0.250 52 . . . . . .177.64

105.1 101.7 109.1 109.3 114.0 375.0 133.0 129.1 118.0 110.9 375.4 120.3 132.9 133.0 141.5 153.9 130.6 380.7 143.9 139.1 160.8 150.1 144.1 157.2 175.2 159.2 140.3 160.4 166.7 209.1 206.3

100.1 100.3 103.9 104.6 108.1 362.4 122.9 118.3 111.8 105.4 356.8 111.3 124.1 123.4 129.1 142.4 119.1 355.1 133.0 129.3 145.1 134.0 134.3 146.2 154.3 147.2 129.4 147.5 152.5 177.0 171.5

AEROSPACE & DEFENCE BAE Systems . . . . . . . .565.0 -20.0 Cobham . . . . . . . . . . . . .121.0 -2.5 Meggitt . . . . . . . . . . . . .471.3 -6.0 QinetiQ Group . . . . . . .206.5 0.3 Rolls-Royce Holdi . . . .836.8 -2.8 Senior . . . . . . . . . . . . . .285.0 1.8 Ultra Electronics . . . .1440.0 2.0

677.0 148.0 526.0 319.7 981.0 296.8 2204.0

535.5 100.6 410.6 195.5 743.0 175.8 1142.0

AUTOMOBILES & PARTS GKN . . . . . . . . . . . . . . . .426.5 1.5 447.6 294.3

BANKS Aldermore Group . . . . .312.6 Barclays . . . . . . . . . . . .209.8 BGEO Group . . . . . . . .3312.0 Close Brothers Gr . . . .1582.0 CYBG . . . . . . . . . . . . . . .292.8 HSBC Holdings . . . . . . .723.4 Lloyds Banking Gr . . . . .68.7 Metro Bank . . . . . . . .3678.0 Royal Bank of Sco . . . .268.4 Standard Chartere . . .829.6 TBC Bank Group . . . . .1666.0 Virgin Money Hold . . .265.4

1.4 -1.2 4.0 4.0 -4.0 -4.7 -0.5 96.0 -13.6 -0.4 6.0 -4.2

312.6 212.2 232.9 178.9 3868.0 2805.0 1715.0 1316.0 340.3 260.0 796.0 620.8 73.1 62.2 3834.0 3212.0 302.4 224.7 849.2 685.9 1818.0 1390.0 342.0 258.2

BEVERAGES Barr (A.G.) . . . . . . . . . .640.0 Britvic . . . . . . . . . . . . . .691.5 Coca-Cola HBC AG . .2459.0 Diageo . . . . . . . . . . . . .2477.5

1.0 1.0 7.0 10.0

670.0 820.0 2671.0 2725.0

518.0 630.5 1936.0 2201.5

CHEMICALS Croda Internation . . .4538.0 0.0 4597.0 3310.0 Elementis . . . . . . . . . . .281.6 -0.6 317.1 259.1 Johnson Matthey . . . .3160.0 -25.0 3503.0 2727.0 Sirius Minerals . . . . . . . .25.6 0.6 35.0 17.3 Synthomer . . . . . . . . . .479.0 -4.2 509.5 441.1

FTSE ALL SHARE

BATS UK 100

3991.50 0.90

12300.47 30.86

Price Chg High Low Victrex plc . . . . . . . . .2550.0 -10.0 2730.0 1832.0

CONSTRUCTION & MATERIALS Balfour Beatty . . . . . . .269.0 -1.3 CRH . . . . . . . . . . . . . . .2466.0 -23.0 Galliford Try . . . . . . . . .897.5 23.0 Ibstock . . . . . . . . . . . . .267.2 7.6 Kier Group . . . . . . . . .1066.0 5.0 Marshalls . . . . . . . . . . .410.0 4.8 Polypipe Group . . . . . .408.2 -2.6

307.6 253.5 2920.0 2380.0 1583.0 800.0 270.2 195.0 1503.0 955.5 480.2 288.7 436.5 332.2

ELECTRICITY Drax Group . . . . . . . . .236.6 6.6 364.0 221.4 SSE . . . . . . . . . . . . . . . .1251.5 15.5 1551.0 1182.0

ELECTRONIC & ELECTRICAL EQ. Halma . . . . . . . . . . . . .1207.0 -13.0 Morgan Advanced M . .340.0 -0.2 Renishaw . . . . . . . . . .4856.0 -86.0 Spectris . . . . . . . . . . . .2748.0 -24.0

1330.0 959.5 366.2 281.9 5775.0 3050.0 2834.0 2229.0

EQUITY INVESTMENT INSTRUM. Aberforth Smaller . . .1280.0 2.0 1386.0 1177.0 Alliance Trust . . . . . . . .731.0 2.0 769.0 667.0 Bankers Inv Trust . . . .869.0 3.0 923.0 733.5 British Empire Tr . . . . .708.0 1.0 753.0 658.5 Caledonia Investm . .2750.0 60.0 3008.0 2600.0 City of London In . . . . .410.5 1.5 443.0 402.0 Edinburgh Inv Tru . . . .635.0 0.0 779.5 632.0 F&C Global Smalle . . .1325.0 0.0 1415.0 1250.0 Fidelity China Sp . . . . .249.0 1.5 262.0 186.8 Fidelity European . . . .223.0 1.5 234.0 186.8 Finsbury Growth & . . .749.0 0.0 777.0 679.5 Foreign and Colon . . . .647.0 0.0 672.0 555.5 GCP Infrastructur . . . . . .117.0 -0.4 133.0 116.2 Genesis Emerging . . . .719.0 5.0 750.0 620.5 Greencoat UK Wind . . .120.0 -0.6 126.5 117.8 HarbourVest Globa . .1232.0 2.0 1306.0 1199.0 Herald Investment . . .1175.0 15.0 1210.0 915.5 HICL Infrastructu . . . . .146.5 0.5 174.6 141.1 International Pub . . . . .152.4 1.2 166.6 147.2 John Laing Infras . . . . .118.6 0.2 140.2 113.4 JPMorgan American . .396.0 0.0 418.5 366.1 JPMorgan Emerging . .899.0 7.0 930.0 735.0 JPMorgan Indian I . . . .708.0 4.0 785.0 661.5 Jupiter European . . . .742.0 -1.0 794.0 566.0 Mercantile Invest . . . .2110.0 -10.0 2210.0 1795.0 Monks Inv Trust . . . . . .794.0 2.0 825.0 607.0 Murray Internatio . . .1236.0 -2.0 1307.0 1166.0 NB Global Floatin . . . . .92.5 -0.3 100.2 92.2 Perpetual Income . . .349.5 -1.5 408.5 346.5 Pershing Square H . . .950.0 6.0 1250.0 933.0 Personal Assets T . .39950.0 250.0 41580.039500.0 Polar Capital Tec . . . . .1150.0 8.0 1197.0 903.0 RIT Capital Partn . . . .1906.0 16.0 2005.0 1815.0 Riverstone Energy . . .1180.0 6.0 1370.0 1170.0 Schroder Asia Pac . . . .466.0 6.0 484.0 362.3 Scottish Inv Trus . . . . .825.0 5.0 891.0 777.5 Scottish Mortgage . . .464.2 -3.4 477.0 347.6 Sequoia Economic . . .105.5 -0.5 114.5 105.5 Syncona Limited N . . .196.8 0.6 215.5 141.5 Temple Bar Inv Tr . . .1266.0 -2.0 1335.0 1226.0 Templeton Emergin . .785.0 1.0 825.0 643.0 The Renewables In . . .105.4 0.0 112.2 101.4 TR Property Inv T . . . . .378.0 2.5 405.0 300.9 Vietnam Enterpris . . .468.0 -4.0 495.0 319.0 Witan Inv Trust . . . . .1056.0 4.0 1108.0 939.5 Woodford Patient . . . . .75.4 0.7 106.0 74.3 Worldwide Healthc . .2455.0 0.0 2679.0 2265.0

BATS UK 250

17988.98 38.98

Price Chg High Low Arrow Global Grou . . .349.0 -1.0 470.5 292.5 Ashmore Group . . . . . .403.8 -1.6 433.2 332.3 Brewin Dolphin Ho . . .346.8 -1.8 393.0 301.7 Charles Taylor . . . . . . .276.0 0.0 295.0 215.0 Charter Court Fin . . . . .314.5 9.5 336.0 228.8 City of London In . . . . .435.0 -3.0 450.0 360.0 CMC Markets . . . . . . . . .154.0 0.0 175.5 111.3 Coats Group . . . . . . . . . .74.9 1.6 90.0 52.0 Hargreaves Lansdo . . .1717.5 -15.5 1928.0 1266.0 IG Group Holdings . . . .796.0 -4.5 811.0 491.9 Intermediate Capi . . .1050.0 -22.0 1178.0 700.5 International Per . . . . .192.3 2.3 222.0 157.5 Investec . . . . . . . . . . . .635.0 5.2 641.2 461.4 IP Group . . . . . . . . . . . .114.6 4.0 168.2 107.9 John Laing Group . . . .275.0 2.0 317.8 252.0 Jupiter Fund Mana . . . .531.0 -1.0 631.4 411.3 Liontrust Asset M . . . .566.0 8.0 610.0 380.9 LMS Capital . . . . . . . . . .48.8 0.0 57.1 41.3 London Finance & . . . .44.5 0.0 46.0 43.5 London Stock Exch . .4056.0 -29.0 4092.0 3014.0 Man Group . . . . . . . . . .179.2 -7.4 217.7 141.2 OneSavings Bank . . . .404.2 2.6 470.3 360.2 Paragon Banking G . . .483.0 -4.0 512.0 403.9 Provident Financi . . . .656.6 -0.4 3265.0 589.5 Rathbone Brothers . .2652.0 -98.0 2800.0 2256.0 Real Estate Credi . . . . .167.5 1.0 175.0 159.9 Record . . . . . . . . . . . . . . .47.9 0.0 52.5 38.4 S&U . . . . . . . . . . . . . . .2230.0 0.0 2420.0 1883.5 Sanne Group . . . . . . . .618.0 12.0 830.0 598.0 Schroders . . . . . . . . . .3427.0 -28.0 3773.0 3008.0 Standard Life Abe . . . . .376.1 -9.6 447.1 351.1 TP ICAP . . . . . . . . . . . . .538.0 -2.0 553.6 444.8 VPC Specialty Len . . . . .78.7 0.7 83.0 74.3 Walker Crips Grou . . . . .38.0 0.0 48.5 37.0 Xafinity . . . . . . . . . . . . .188.0 8.0 194.0 152.3

FIXED LINE TELECOMS BT Group . . . . . . . . . . . .244.1 11.7 342.5 225.6 TalkTalk Telecom . . . . .102.8 5.1 218.0 94.5 Telecom Plus . . . . . . .1236.0 8.0 1321.0 1069.0

FOOD & DRUG RETAILERS Booker Group . . . . . . .223.6 Greggs . . . . . . . . . . . . .1307.0 Morrison (Wm) Sup . .224.0 Ocado Group . . . . . . . .522.0 Sainsbury (J) . . . . . . . .255.5 SSP Group . . . . . . . . . . .631.0 Tesco . . . . . . . . . . . . . . .205.4 UDG Healthcare Pu . . .839.5

-0.3 3.0 0.9 10.8 0.4 -2.0 -0.9 6.5

233.2 1399.0 252.9 531.2 281.7 687.5 214.4 959.0

182.7 978.0 207.0 238.5 224.8 404.0 166.5 667.5

FOOD PRODUCERS Associated Britis . . . .2645.0 Cranswick . . . . . . . . .3096.0 Dairy Crest Group . . . .566.0 Greencore Group . . . . .180.2 Purecircle Limite . . . . .430.0 Tate & Lyle . . . . . . . . . .557.6 Unilever . . . . . . . . . . .3760.5

-10.0 22.0 -2.5 3.9 -11.0 1.8 22.0

3371.0 2484.0 3337.0 2310.0 652.5 545.5 262.8 175.5 517.0 276.0 795.0 550.6 4548.5 3714.5

FORESTRY & PAPER Mondi . . . . . . . . . . . . . .1877.5 -15.0 2130.0 1693.0

GAS, WATER & MULTIUTILITIES Centrica . . . . . . . . . . . . .144.2 National Grid . . . . . . . .758.0 Pennon Group . . . . . . .637.8 Severn Trent . . . . . . . .1766.0 United Utilities . . . . . .686.8

2.0 7.0 18.2 56.0 22.8

227.7 1091.0 944.0 2553.0 1056.0

DOW JONES

124.1 736.8 612.6 1703.0 659.0

FINANCIAL SERVICES

GENERAL INDUSTRIALS

3i Group . . . . . . . . . . . .937.0 0.2 969.5 687.5 3i Infrastructure . . . . . .197.4 0.0 214.5 187.7 Allied Minds . . . . . . . . .137.0 3.0 418.0 116.0

RPC Group . . . . . . . . . .819.6 -9.6 993.0 720.5 Smith (DS) . . . . . . . . . .479.9 -10.7 558.5 418.8 Smiths Group . . . . . . .1588.0 -1.5 1685.0 1444.0

25309.99 347.51

Price Chg High Low Smurfit Kappa Gro . .2496.0-100.0 2640.0 1962.0 Vesuvius . . . . . . . . . . .590.0 1.0 619.5 444.9

GENERAL RETAILERS Auto Trader Group . . .362.5 B&M European Valu . .425.4 Brown (N.) Group . . . .202.6 Card Factory . . . . . . . . .201.4 Dignity . . . . . . . . . . . . .802.0 Dixons Carphone . . . . .196.5 Dunelm Group . . . . . . .572.5 Halfords Group . . . . . .350.2 Inchcape . . . . . . . . . . .698.0 JD Sports Fashion . . . .388.0 Just Eat . . . . . . . . . . . . .869.8 Kingfisher . . . . . . . . . .353.0 Marks & Spencer G . . .299.4 Next . . . . . . . . . . . . . .4929.0 Pets at Home Grou . . . .173.2 Saga . . . . . . . . . . . . . . . .119.2 Sports Direct Int . . . . . .374.0 Ted Baker . . . . . . . . . .3012.0 WH Smith . . . . . . . . .2056.0

5.4 -0.2 2.6 2.9 22.5 2.4 7.0 3.6 1.0 -0.7 -7.8 -0.6 1.8 -21.0 1.3 2.2 -2.6 -4.0 -4.0

435.9 319.0 434.8 293.4 357.8 189.0 355.0 185.9 2767.0 748.5 342.0 149.1 753.5 545.0 375.0 307.4 880.5 688.5 456.0 303.3 890.0 496.0 368.1 288.0 395.5 286.1 5320.0 3617.0 219.5 154.9 215.3 111.7 419.5 284.5 3118.0 2320.0 2347.0 1662.0

S&P 500

/€ 1.1374

0.0054 €/$ 1.2285

0.0043

7337.39 127.30

2747.30 43.34

/$ 1.3975

0.0019 €/£ 0.8787

0.0046

/¥ 149.38

0.4002 €/¥ 131.32

0.3020

INDUSTRIAL METALS & MINING Evraz . . . . . . . . . . . . . . .432.2 -1.4 437.3 173.2 Ferrexpo . . . . . . . . . . . .305.1 0.0 323.2 137.2 -1.0 110.0 10.0 8.0 2.5

368.8 292.5 3310.0 2419.0 1761.0 1360.0 573.2 369.9 303.2 188.0

3.5 -8.5 -2.7 -0.6 -2.4 6.0 -2.0 -3.5 7.2

2178.0 1784.0 560.5 423.5 411.3 333.8 303.0 207.5 325.0 228.3 1470.0 1065.0 1448.0 1016.0 759.5 561.5 666.5 570.5

NON LIFE INSURANCE

HEALTH CARE EQUIPMETN & S. Assura . . . . . . . . . . . . . . .58.5 0.5 66.7 56.5 Convatec Group . . . . . .211.4 -0.2 344.0 182.0 Mediclinic Intern . . . . .608.4 2.4 887.0 507.5

Aviva . . . . . . . . . . . . . .500.8 -3.4 544.0 486.5

LIFE INSURANCE

MAIN CHANGES UK 350 Phoenix Group Hold . . . . . . . . .815.0 CLS Holdings . . . . . . . . . . . . . . .224.5 TalkTalk Telecom G . . . . . . . . . .102.8 BT Group . . . . . . . . . . . . . . . . . . .244.1 Hunting . . . . . . . . . . . . . . . . . . .644.5 Playtech . . . . . . . . . . . . . . . . . . .782.2 Rightmove . . . . . . . . . . . . . . .4482.0 IP Group . . . . . . . . . . . . . . . . . . .114.6 Bodycote . . . . . . . . . . . . . . . . . .948.5 Clarkson . . . . . . . . . . . . . . . . . .3310.0

% 7.3 6.4 5.2 5.0 4.3 4.0 4.0 3.6 3.6 3.4

Fallers % International Cons . . . . . . . . . . .587.2 -5.7 Royal Bank of Scot . . . . . . . . . .268.4 -4.8 SIG . . . . . . . . . . . . . . . . . . . . . . . .143.1 -4.6 Vectura Group . . . . . . . . . . . . . . .72.3 -4.2 Man Group . . . . . . . . . . . . . . . . .179.2 -4.0 Smurfit Kappa Grou . . . . . . . .2496.0 -3.9 Rathbone Brothers . . . . . . . . .2652.0 -3.6 BAE Systems . . . . . . . . . . . . . . .565.0 -3.4 Sophos Group . . . . . . . . . . . . . .499.6 -3.4 easyJet . . . . . . . . . . . . . . . . . . .1631.5 -3.2

Price Chg High Low NMC Health . . . . . . . .3498.0 -12.0 3530.0 1741.0 Smith & Nephew . . . .1265.0 -5.0 1431.0 1201.0 Spire Healthcare . . . . .243.8 2.8 361.0 219.2

HHOLD GDS & HOME CONSTR. Barratt Developme . . .549.4 Bellway . . . . . . . . . . . .3106.0 Berkeley Group Ho . . .3851.0 Bovis Homes Group . .1079.0 Countryside Prope . . . .314.4 Crest Nicholson H . . . .491.0 McCarthy & Stone . . . . .138.5 Persimmon . . . . . . . .2472.0 Reckitt Benckiser . . .5920.0 Redrow . . . . . . . . . . . . .584.5 Taylor Wimpey . . . . . .190.4

-2.4 -15.0 -5.0 -3.0 0.2 5.0 3.1 16.0 51.0 -0.5 0.4

700.0 509.0 3792.0 2553.0 4240.0 2881.0 1213.0 769.5 371.5 223.9 636.5 474.0 196.9 134.5 2890.0 2010.0 8108.0 5845.0 664.5 481.3 211.2 174.9

INDUSTRIAL ENGINEERING Bodycote . . . . . . . . . . .948.5 Fenner . . . . . . . . . . . . .479.8 Hill & Smith Hold . . . .1228.0 IMI . . . . . . . . . . . . . . . .1247.0 Melrose Industrie . . . .226.9 RHI Magnesita N.V . .4440.0

33.0 1006.0 705.0 15.4 503.5 277.3 17.0 1475.0 1096.0 -13.0 1443.0 1121.0 0.6 261.2 198.8 35.0 4605.0 3249.0

Price Chg High Low Just Group . . . . . . . . . .143.9 Legal & General G . . . .259.3 Old Mutual . . . . . . . . . .254.1 Phoenix Group Hol . . .815.0 Prudential . . . . . . . . . .1832.5 St James's Place . . . . .1122.5

-0.7 -0.9 1.6 55.5 -11.0 -21.0

170.4 121.5 277.4 245.0 256.5 188.0 817.3 724.0 1981.0 1607.5 1270.5 1030.0

-15.0 7.4 -2.0 -1.5 2.4 -4.0 -1.2 0.0 0.9 1.0 -0.4 -0.3 0.1 -6.8 -4.8 0.0 172.0

2020.0 1550.0 391.0 295.0 190.0 157.3 56.8 40.5 329.4 216.0 1305.0 1027.0 118.0 86.0 227.0 152.5 84.0 40.8 761.0 629.5 195.3 152.0 219.6 146.9 26.5 9.5 366.5 274.2 750.0 566.5 1782.0 1455.0 4573.0 3889.0

MEDIA 4Imprint Group . . . . . .1915.0 Ascential . . . . . . . . . . . .378.2 Bloomsbury Publis . . .162.3 Centaur Media . . . . . . . .50.0 Entertainment One . . .297.0 Euromoney Institu . . .1194.0 Gocompare.com Gro . .112.2 Haynes Publishing . . .214.0 Huntsworth . . . . . . . . . .77.9 Informa . . . . . . . . . . . .688.4 ITE Group . . . . . . . . . . .165.0 ITV . . . . . . . . . . . . . . . . .170.6 Johnston Press . . . . . . . .10.5 Moneysupermarket. . .276.8 Pearson . . . . . . . . . . . .700.0 Relx plc . . . . . . . . . . . .1518.0 Rightmove . . . . . . . . .4482.0

Price Sky . . . . . . . . . . . . . . . .1104.5 STV Group . . . . . . . . . .360.0 Tarsus Group . . . . . . . .303.0 Trinity Mirror . . . . . . . . .75.8 UBM . . . . . . . . . . . . . . .905.0 WPP . . . . . . . . . . . . . . .1355.5 ZPG Plc . . . . . . . . . . . . .338.8

Chg High Low 6.5 1106.0 900.0 0.0 389.8 306.0 -6.0 335.0 273.3 0.1 121.0 66.1 3.0 908.5 645.0 -5.5 1921.0 1227.0 2.2 394.0 321.7

MINING

INDUSTRIAL TRANSPORTATION

Admiral Group . . . . . .1923.0 Beazley . . . . . . . . . . . . .534.5 Direct Line Insur . . . . .388.2 esure Group . . . . . . . . .231.6 Hastings Group Ho . . .300.8 Hiscox Limited (D . . .1396.0 Jardine Lloyd Tho . . . .1314.0 Lancashire Holdin . . . .569.0 RSA Insurance Gro . . . .639.8

Risers

Acacia Mining . . . . . . . .140.7 -0.5 Anglo American . . . . .1788.4 -11.6 Antofagasta . . . . . . . . .899.8 -2.4 BHP Billiton . . . . . . . . .1516.0 -5.2 Centamin (DI) . . . . . . . .155.1 0.8 Fresnillo . . . . . . . . . . . .1311.0 -15.0 Glencore . . . . . . . . . . . .396.3 -6.1 Hochschild Mining . . . .210.0 0.0 Kaz Minerals . . . . . . . .835.0 12.8 Polymetal Interna . . . .769.2 -0.8 Randgold Resource . .6014.0 -116.0 Rio Tinto . . . . . . . . . . .4001.5 -21.5 Vedanta Resources . . .742.8 -14.6

541.0 139.1 1814.8 959.4 1061.0 748.0 1660.0 1117.0 190.5 131.8 1725.0 1232.0 415.0 276.6 331.6 208.3 965.8 430.5 1095.0 744.4 8190.0 6008.0 4172.5 2910.0 954.0 575.0

MOBILE TELECOMS Inmarsat . . . . . . . . . . .454.2 10.2 850.5 426.1 Vodafone Group . . . . .203.9 2.0 238.0 198.8

OIL & GAS PRODUCERS BP . . . . . . . . . . . . . . . . .476.1 Cairn Energy . . . . . . . . .192.1 Royal Dutch Shell . . .2258.5 Royal Dutch Shell . . .2285.0 Tullow Oil . . . . . . . . . . .190.9

2.2 1.9 -5.5 -6.5 4.2

534.8 439.8 236.2 167.5 2573.5 1992.5 2609.0 2052.5 238.9 145.6

OIL EQUIPMENT & SERVICES Hunting . . . . . . . . . . . .644.5 26.5 658.5 382.6 Petrofac Ltd. . . . . . . . . .427.6 -0.2 941.0 349.0 Wood Group (John) . . .637.6 4.6 828.5 560.0

PERSONAL GOODS Burberry Group . . . . .1540.5 -12.0 1985.0 1498.0 PZ Cussons . . . . . . . . . .285.8 5.2 363.7 279.8 Superdry . . . . . . . . . . .1777.0 -13.0 2076.0 1446.0

PHARMACEUTICALS & BIOTECH AstraZeneca . . . . . . . .4752.0 -20.0 BTG . . . . . . . . . . . . . . . .661.0 -10.0 Dechra Pharmaceut .2326.0 16.0 Genus . . . . . . . . . . . . .2236.0 2.0 GlaxoSmithKline . . . .1296.0 -7.0 Hikma Pharmaceuti . .892.2 -5.8 Indivior . . . . . . . . . . . . .384.1 -9.9 Shire Plc . . . . . . . . . . .3024.0 -13.0 Vectura Group . . . . . . . .72.3 -3.2

5508.0 4325.0 779.0 563.5 2400.0 1538.0 2573.0 1695.0 1722.0 1242.8 2297.0 855.6 419.5 267.6 5036.0 2992.0 163.0 70.2

1.5 13.5 80.0 2.6 2.6 4.0 2.0 7.0 -6.8 0.5

324.8 253.1 1989.0 190.2 7005.0 5650.0 151.8 134.5 299.8 244.0 366.2 278.0 520.0 366.0 1034.0 842.0 426.0 317.6 92.5 81.5

10.5 12.6 24.0 6.0 6.4

869.5 707.5 691.5 590.5 3118.0 2580.0 703.7 587.5 609.5 456.0

REAL ESTATE INVEST. TRUSTS Big Yellow Group . . . . .828.5 British Land Comp . . .650.4 Derwent London . . . .2872.0 Great Portland Es . . . .642.0 Hammerson . . . . . . . . .476.2

AB INBEV .........................................................86.61 ADIDAS N........................................................181.80 AIR LIQUIDE ...................................................102.85 AIRBUS............................................................98.30 ALLIANZ..........................................................191.50 ASML HLDG.....................................................158.55 AXA..................................................................25.48 BANCO SANTANDER ..........................................5.65 BASF N.............................................................88.07 BAYER N...........................................................97.92 BBVA ..................................................................6.91 BMW ................................................................87.05 BNP PARIBAS BR-A.........................................64.89 CRH PLC.............................................................0.00 DAIMLER N .......................................................70.41 DANONE...........................................................65.82 DEUTSCHE BANK N...........................................13.30 DEUTSCHE POST N............................................37.43 DEUTSCHE TELEKOM N .....................................13.40 E.ON N ...............................................................8.68 ENEL N...............................................................4.84 ENGIE ...............................................................12.98 ENI N.................................................................13.79 ESSILOR INTL..................................................109.85 FRESENIUS.......................................................63.48 IBERDROLA ........................................................6.10 INDITEX ...........................................................25.00 ING GROUP.......................................................14.74 INTESA SANPAOLO N.........................................3.08 KON AH DEL BR ................................................17.62 L'OREAL ..........................................................178.70 LVMH..............................................................246.75 MUENCHENER RUECKV N ...............................183.55 NOKIA................................................................4.69 ORANGE ...........................................................14.02 ROY.PHILIPS .....................................................31.50 SAFRAN...........................................................90.30 SAINT-GOBAIN.................................................45.38 SANOFI ............................................................65.05 SAP I................................................................84.52 SCHNEIDER E.SE..............................................72.00 SIEMENS N ......................................................110.72 SOCIETE GENERALE .........................................46.54 TELEFONICA.......................................................8.02 TOTAL ...............................................................47.07 UNIBAIL-RODAMCO........................................192.55 UNILEVER CERT ...............................................43.49 VINCI ...............................................................82.90 VIVENDI...........................................................20.90 VOLKSWAGEN VZ I.........................................162.60

Chg High Low -0.1 145.6 116.3 -0.2 294.0 194.7 9.8 1208.5 917.0 1.8 188.4 151.2 0.3 40.5 33.9 3.2 591.2 448.0 11.0 1055.0 900.0 0.7 151.4 138.7 3.5 813.0 621.5 8.5 1035.0 758.5 3054.0 1879.0 1192.0 715.0 1031.0 645.0 3860.0 2041.0 2871.6 2006.0 1016.0 739.4 821.4 615.5 585.0 319.4 669.5 263.5

SUPPORT SERVICES AA . . . . . . . . . . . . . . . . . .86.0 -2.0 Aggreko . . . . . . . . . . . .791.6 23.2 Ashtead Group . . . . .2053.0 3.0 Babcock Internati . . . .663.0 6.2 BCA Marketplace . . . . . .171.2 3.6 Bunzl . . . . . . . . . . . . . .2011.0 21.0 Capita . . . . . . . . . . . . . . .181.7 1.9 DCC . . . . . . . . . . . . . . .6760.0 100.0 Diploma . . . . . . . . . . . .1135.0 18.0 Electrocomponents . . .631.8 -5.2 Equiniti Group . . . . . . .291.0 3.0 Essentra . . . . . . . . . . . .467.0 -2.8 Experian . . . . . . . . . . .1563.0 -0.5 Ferguson . . . . . . . . . .5222.0 -64.0 G4S . . . . . . . . . . . . . . . .260.9 0.6 Grafton Group Uni . . . .799.0 -4.5 Hays . . . . . . . . . . . . . . .195.8 0.4 Homeserve . . . . . . . . . .741.5 3.0 Howden Joinery Gr . . .460.2 -0.5 Intertek Group . . . . . .4932.0 -7.0 Mitie Group . . . . . . . . . .161.4 -1.3 Pagegroup . . . . . . . . . .536.0 -1.0 Renewi . . . . . . . . . . . . . .94.0 0.5 Rentokil Initial . . . . . . .293.6 0.2 Serco Group . . . . . . . . . .94.3 1.2 SIG . . . . . . . . . . . . . . . . .143.1 -6.9 Travis Perkins . . . . . . .1426.5 -6.0

272.6 83.6 1064.0 751.6 2152.0 1542.0 969.5 626.2 227.0 160.2 2465.0 1941.0 705.5 158.6 7755.0 6635.0 1247.0 1019.0 709.0 471.1 310.9 174.8 581.5 463.6 1705.0 1446.0 5702.0 4460.0 341.1 248.8 841.0 607.0 205.0 153.5 867.0 523.0 475.7 399.5 5425.0 3445.0 297.2 150.9 560.0 417.0 108.2 80.0 335.8 233.8 123.1 83.6 182.0 106.0 1696.0 1396.0

TOBACCO British American . . .4460.0 105.5 5643.0 4313.5 Imperial Brands . . . . .2614.5 5.0 3933.5 2582.5 888 Holdings . . . . . . . .288.8 3.0 Carnival . . . . . . . . . . .4797.0 -42.0 Cineworld Group . . . . .237.2 3.4 Compass Group . . . . .1526.5 -14.0 Domino's Pizza Gr . . . .332.2 2.9 easyJet . . . . . . . . . . . . .1631.5 -53.0 FirstGroup . . . . . . . . . . .83.4 -0.3 Go-Ahead Group . . . .1560.0 33.0 Greene King . . . . . . . . .521.2 4.8 GVC Holdings . . . . . . . .912.5 -8.5 InterContinental . . .4629.0 -38.0 International Con . . . . .587.2 -35.4 Ladbrokes Coral G . . . .166.0 -2.0 Marston's . . . . . . . . . . .105.7 2.8 Merlin Entertainm . . . .344.5 3.3 Millennium & Copt . . .536.0 1.0 Mitchells & Butle . . . . .241.0 3.0

Price Chg High Low National Express . . . .348.4 2.0 386.8 340.9 Paddy Power Betfa . .8435.0 -40.0 8900.0 6665.0 Rank Group . . . . . . . . .224.0 1.5 248.5 205.9 Stagecoach Group . . . .138.5 0.7 216.7 132.4 Thomas Cook Group . .123.9 -0.5 129.5 84.1 TUI AG Reg Shs (D . . .1546.0 1.0 1640.5 1068.0 Wetherspoon (J.D. . . .1236.0 23.0 1315.0 929.5 Whitbread . . . . . . . . .3899.0 -34.0 4307.0 3512.0 William Hill . . . . . . . . . .333.5 2.4 338.0 240.0 Wizz Air Holdings . . .3419.0 53.0 3716.0 1615.0

AIM 50

SOFTWARE & COMPUTER SERV. Aveva Group . . . . . . .2900.0 -44.0 Computacenter . . . . .1104.0 8.0 FDM Group (Holdin . . .870.0 9.0 Fidessa Group . . . . . .3790.0 -40.0 Micro Focus Inter . . . .2031.0 -36.0 Playtech . . . . . . . . . . . .782.2 30.4 Sage Group . . . . . . . . .698.0 -0.2 Softcat . . . . . . . . . . . . .579.0 8.0 Sophos Group . . . . . . .499.6 -17.4

TRAVEL & LEISURE

REAL ESTATE INVEST. & SERV. Capital & Countie . . . . .273.0 CLS Holdings . . . . . . . .224.5 Daejan Holdings . . . .5830.0 F&C Commercial Pr . . .142.6 Grainger . . . . . . . . . . . .279.0 NewRiver REIT . . . . . . .317.0 Safestore Holding . . . .504.0 Savills . . . . . . . . . . . . . .994.5 St. Modwen Proper . . .390.0 UK Commercial Pro . . . .86.7

Price Hansteen Holdings . . .135.5 Intu Properties . . . . . . .214.8 Land Securities G . . . . .947.1 LondonMetric Prop . . .176.4 RDI Reit . . . . . . . . . . . . . .35.3 SEGRO . . . . . . . . . . . . . .587.4 Shaftesbury . . . . . . . . .979.5 Tritax Big Box Re . . . . .141.9 Unite Group . . . . . . . . .778.5 Workspace Group . . . .970.0

EU SHARES Price

19

NASDAQ

Price Chg High Low Rotork . . . . . . . . . . . . .290.0 -0.1 304.2 223.5 Spirax-Sarco Engi . . .5640.0 15.0 5920.0 4371.0 Weir Group . . . . . . . .2004.0 -23.0 2305.0 1727.0

BBA Aviation . . . . . . . .342.0 Clarkson . . . . . . . . . . .3310.0 Fisher (James) & . . . .1402.0 Royal Mail . . . . . . . . . . .570.0 Stobart Group Ltd . . . .258.0

MARKETS

300.5 229.3 5380.0 4346.0 327.3 214.0 1760.2 1425.0 394.0 263.4 1696.0 914.5 153.0 81.6 2285.0 1338.0 766.0 500.6 982.0 677.0 4928.0 3668.0 670.0 504.5 188.0 111.3 146.1 101.4 537.0 318.4 625.5 424.4 283.1 221.0

Abcam . . . . . . . . . . . .1269.0 -13.0 1286.0 806.0 Advanced Medical . . .325.5 0.5 350.0 212.0 ASOS . . . . . . . . . . . . . .7332.0 -82.0 7530.0 5329.0 Blue Prism Group . . . .1572.0 -14.0 1640.0 436.0 Brooks Macdonald . .2040.0 35.0 2582.0 1810.0 Camellia . . . . . . . . . .12125.0-125.013600.010070.0 CareTech Holding . . . . .397.5 2.5 454.8 346.0 CityFibre Infrast . . . . . . .43.9 0.0 70.0 39.5 Clinigen Group . . . . . .1055.0 1.0 1177.0 758.0 Conviviality . . . . . . . . .289.5 3.5 426.3 263.5 CVS Group . . . . . . . . . .1092.0 -29.0 1490.0 855.0 Dart Group . . . . . . . . . .790.5 -3.5 799.5 486.3 EMIS Group . . . . . . . . . .761.0 0.0 1017.0 705.0 Faroe Petroleum . . . . .106.0 4.2 114.4 75.5 Fevertree Drinks . . . . .2531.0 1.0 2543.0 1396.0 First Derivatives . . . .3900.0 80.0 4380.0 2288.0 Frontier Developm . .1245.0 -5.0 1510.0 281.5 Gamma Communicati 676.0 -4.0 704.0 463.0 GB Group . . . . . . . . . . .403.0 8.0 455.0 277.5 Gooch & Housego . . .1420.0 -10.0 1539.0 1165.0 Hurricane Energy . . . . . .31.1 0.1 67.0 24.0 Iomart Group . . . . . . . .388.5 5.0 410.0 285.5 IQE . . . . . . . . . . . . . . . . .139.0 15.5 178.8 46.0 James Halstead . . . . . .425.0 0.0 542.0 410.0 Johnson Service G . . . .131.4 -1.6 151.0 108.3 Keywords Studios . . .1552.0 14.0 1661.0 580.0 Learning Technolo . . . .80.6 -1.2 84.0 40.0 M&C Saatchi . . . . . . . .400.0 15.0 402.0 292.0 M. P. Evans Group . . . .756.0 5.0 819.8 685.0 Midwich Group . . . . . .602.5 2.5 640.0 303.5 Mulberry Group . . . . . .932.0 -22.0 1149.0 914.0 Next Fifteen Comm . .440.0 -5.0 455.0 370.0 Nichols . . . . . . . . . . . .1500.0 27.5 1958.0 1420.0 Numis Corporation . . .343.5 12.0 344.0 231.3 Pan African Resou . . . . . .7.9 -0.0 17.3 7.8 Patisserie Holdin . . . . .360.0 10.0 400.5 300.5 Polar Capital Hol . . . . .500.0 13.0 558.0 329.3 Purplebricks Grou . . . .426.8 2.0 514.5 257.5 Redde . . . . . . . . . . . . . .167.6 0.0 182.0 144.3 Renew Holdings . . . . .408.0 1.0 485.0 364.5 RWS Holdings . . . . . . .450.5 -1.5 539.0 310.0 Scapa Group . . . . . . . .480.6 -16.4 515.5 351.0 Secure Income Rei . . .355.0 0.0 380.0 327.5 Smart Metering Sy . . . .713.0 13.0 874.5 479.5 Sound Energy . . . . . . . .46.7 1.8 93.0 39.8 Staffline Group . . . . . .976.0 24.0 1450.0 913.0 Telford Homes . . . . . . .402.5 5.0 444.5 340.8 Thorpe (F.W.) . . . . . . . .346.0 5.0 396.5 307.5 Watkin Jones . . . . . . . .201.0 0.0 249.0 141.8 Young & Co's Brew . .1420.0 22.5 1440.0 1300.0 Young & Co's Brew . . .1130.0 0.0 1145.0 995.0

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US SHARES

Chg

High

Low

Price

Chg

High

Low

0.87 1.30 -0.10 0.60 -0.92 1.00 -0.13 -0.01 -0.04 -0.52 -0.06 -0.17 -0.21 0.00 0.37 0.53 -0.15 0.07 0.43 0.32 0.11 0.16 0.11 0.05 -0.18 0.11 -1.90 0.02 0.02 -0.02 3.25 1.70 0.80 0.01 0.21 -0.12 0.20 1.28 0.16 0.02 -0.08 0.18 -0.15 0.09 0.20 2.00 0.33 0.36 -0.06 -1.32

110.10 202.10 111.60 98.30 206.85 169.20 27.69 6.20 98.80 123.90 7.93 97.50 69.17 34.87 76.48 72.13 17.69 41.36 17.53 10.81 5.59 15.16 15.45 122.15 80.07 6.99 36.90 16.69 3.23 20.88 197.15 260.55 199.00 5.96 15.80 36.12 92.36 52.40 92.97 100.70 76.34 133.50 52.26 10.63 48.75 238.15 52.31 88.80 24.87 192.46

82.03 150.90 91.64 67.68 162.60 112.40 21.88 4.89 78.97 94.72 6.01 77.07 53.96 26.53 59.01 59.55 12.37 30.52 12.74 6.70 3.95 11.16 12.94 100.60 60.15 5.82 24.75 12.81 2.06 14.72 170.30 188.35 166.60 3.81 13.32 27.67 64.78 42.05 63.09 82.19 63.36 106.40 40.66 7.45 41.11 184.40 42.70 67.01 15.96 124.75

3M ..................................................................237.02 ABBVIE............................................................118.75 ACCENTURE-A................................................162.95 ALPHAB NON VTG RG-C ...............................1126.79 ALPHABET RG-A ..........................................1128.09 ALTRIA GROUP................................................64.59 AMAZON.COM..............................................1500.00 AMERICAN EXPRESS.......................................98.80 AMGEN...........................................................186.67 APPLE.............................................................175.50 AT&T.................................................................36.72 BANK OF AMERICA..........................................32.03 BERKSHIRE HATH RG-B ................................202.76 BOEING CO ....................................................356.66 CATERPILLAR..................................................162.41 CHEVRON........................................................112.59 CISCO SYSTEMS...............................................44.00 CITIGROUP.......................................................77.08 COCA-COLA CO................................................44.04 COMCAST-A .....................................................39.50 DOWDUPONT ..................................................73.26 EXXON MOBIL...................................................77.53 FACEBOOK-A..................................................183.29 GENERAL ELECTRIC..........................................14.49 GOLDMAN SACHS GR ....................................266.77 HOME DEPOT..................................................188.35 IBM.................................................................155.52 INTEL................................................................47.73 JOHNSON & JOHNSO .....................................132.02 JPMORGAN CHASE...........................................117.31 MASTERCARD RG-A .......................................175.76 MCDONALD'S .................................................163.06 MERCK.............................................................54.87 MICROSOFT .....................................................94.06 NETFLIX .........................................................285.93 NIKE -B- ..........................................................68.16 NVIDIA...........................................................245.93 ORACLE ...........................................................50.50 PEPSICO...........................................................118.61 PFIZER.............................................................36.26 PHILIP MRRS INT.............................................106.11 PROCTER&GAMBLE..........................................81.05 TRAVELERS COS..............................................139.74 TWITTER..........................................................32.66 UNITEDHEALTH GRO ......................................230.16 UTD TECHS ......................................................133.15 VERIZON COMM...............................................48.29 VISA RG-A......................................................122.93 WALMART .......................................................92.89 WALT DISNEY RG-DIS ....................................107.25 WELLS FARGO ..................................................59.17

1.02 1.19 2.63 20.16 18.19 1.25 14.66 1.45 4.22 3.00 0.25 0.34 2.03 0.74 3.55 2.70 1.06 0.81 0.52 0.70 1.33 1.67 4.30 -0.13 5.34 2.88 2.34 1.93 2.11 2.33 2.81 2.40 0.30 2.33 7.79 1.03 3.78 0.91 0.56 0.52 3.13 0.21 2.10 0.55 3.07 -0.43 0.42 2.55 0.12 2.01 0.36

259.77 125.86 163.76 1186.89 1198.00 77.79 1503.49 102.39 201.23 180.10 42.70 32.67 217.62 361.45 173.24 133.88 45.13 80.70 48.62 44.00 0.00 89.30 195.32 30.54 273.79 207.61 182.55 50.85 148.32 117.45 177.11 178.70 66.80 96.07 286.81 69.00 251.97 53.14 119.74 39.43 123.55 94.67 150.55 35.00 250.79 139.24 54.77 126.88 109.98 116.10 66.31

186.30 61.49 114.82 803.37 824.30 60.01 833.50 75.51 152.16 135.28 32.55 22.07 160.93 173.75 90.34 102.55 30.36 56.55 41.59 34.78 0.00 73.90 134.16 14.23 209.62 144.25 139.13 33.23 120.90 81.64 109.76 126.58 53.36 63.62 138.26 50.35 95.17 42.25 101.06 31.67 96.66 78.59 113.76 14.12 161.74 107.05 42.80 87.30 69.33 96.20 49.27

COMMODITIES Gold............................................................1327.95 Silver ..............................................................16.61 Brent Crude ..................................................66.39 Krugerrand................................................1353.95 Palladium .................................................1024.00 Platinum.....................................................987.00 Tin Cash Official ......................................21675.00 Lead Cash Official ....................................2560.00 Zinc Cash Official......................................3524.00

-0.40 0.15 0.97 8.60 -3.00 -7.00 0.00 0.00 -39.00

CREDIT & RATES

Copper Cash Official ................................7002.00 Aluminium Cash Official..........................2194.00 Nickel Cash Official .................................13570.00 Aluminium Alloy Cash Official ................1865.00 Cocoa Futures ..........................................2204.00 Coffee 'C' Futures ........................................120.97 Feed Wheat Futures ...................................139.25 Soybeans Futures Continuation Contract1037.00

0.00 -7.00 -20.00 0.00 48.00 -0.15 -1.85 5.00

BoE IR Overnight .......................................0.500 BoE IR 7 days.............................................0.500 BoE IR 1 month..........................................0.500 BoE IR 3 months .......................................0.500 BoE IR 6 months .......................................0.500 LIBOR Euro - overnight ............................-0.443 LIBOR Euro - 12 months............................-0.257 LIBOR USD - overnight ...............................1.448 LIBOR USD - 12 months..............................2.460 Halifax mortgage rate...............................3.990

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.02 0.00

Euro Base Rate ..........................................0.000 Finance house base rate............................1.000 US Fed funds..................................................1.41 US long bond yield .......................................3.16 Euro Euribor..............................................-0.379 The vix index...............................................16.49 The baltic dry index ................................1185.00 Markit iBoxx EUR .....................................228.26 Markit iBoxx GBP.......................................318.84 Markit iTraxx...............................................69.48

0.00 0.00 0.00 -0.05 0.00 -2.23 18.00 0.48 0.34 -0.78

WORLD INDICES Price Chg %chg FTSE 100 . . . . . . . . . . . . . . . . . . . . . 7244.41 -7.98 -0.11 FTSE 250. . . . . . . . . . . . . . . . . . . . 19801.05 64.99 0.33 FTSE All-Share. . . . . . . . . . . . . . . . 3991.50 -0.90 -0.02 FTSE AIM All-Share . . . . . . . . . . . . 1043.39 3.30 0.32

Price Chg %chg S&P 500 . . . . . . . . . . . . . . . . . . . . . 2747.30 43.34 1.60 Dow Jones I.A. . . . . . . . . . . . . . . 25309.99 347.51 1.39 Nasdaq Composite . . . . . . . . . . . . 7337.39 127.31 1.77 Xetra DAX. . . . . . . . . . . . . . . . . . . 12483.79 21.88 0.18

Price Chg %chg CAC 40. . . . . . . . . . . . . . . . . . . . . . . 5317.37 8.14 0.15 Swiss Market Index . . . . . . . . . . . 8948.19 -19.24 -0.21 ISEQ Overall Index . . . . . . . . . . . . 6722.27 -50.49 -0.75 FTSEurofirst 300 . . . . . . . . . . . . . . 1492.72 1.47 0.10

Price Chg %chg Hang Seng . . . . . . . . . . . . . . . . . . 31267.17 301.49 0.97 Shanghai Composite . . . . . . . . . . 3289.02 20.47 0.63 Straits Times . . . . . . . . . . . . . . . . . 3533.22 44.76 1.28 ASX All Ordinaries . . . . . . . . . . . . 6105.20 47.50 0.78


20

OPINION

MONDAY 26 FEBRUARY 2018

CITYAM.COM

FORUM EDITED BY RACHEL CUNLIFFE

Now the fog has lifted, the UK’s post-Brexit future looks bright

I

N THE 18 months following the Brexit referendum, the forecasts from the Treasury, the Bank of England, the IMF, and the OECD were proven wrong. The predicted recession, higher unemployment and a list of other calamities did not happen. Nobel Prize winning economist professor Paul Krugman described the analysis from the Project Fear propagandists as “intellectual slumming”. Professor Patrick Minford of Economists for Free Trade (who is, in my humble opinion, the leading economist and best economic forecaster in this country) has demonstrated how the supposed “independent” economic modelling from the Treasury is just a case of “garbage in, garbage out”. Civil servants got the answers that their political bosses wanted. The Treasury officials and other forecasters assumed that upon Brexit we would adopt the EU’s high tariff levels and retain the EU’s expensive set of regulations, whereas of course the whole point of Brexit is to escape all of this. The best trade policy is unilateral free trade that allows us to set our own deals where the action is. About half of this year’s growth in the global economy comes from emerging Asian economies. Some 12 per cent of our economy is trade with the EU, and only eight per cent of firms sell directly to the EU’s Single Market – but 100 per cent of the economy is subject to EU regulation. Half of UK trade is already on WTO terms, and it is worth noting

that trade in data and other services, where we have an £80bn surplus is, greater than trade in widgets. In that sense, the world is our oyster. Beijing, not Brussels, is where it’s at. Even the European Commission itself acknowledges that 90 per cent of global trade growth is expected to come outside of the EU. And as far as the City is concerned, no bank has moved lock, stock and barrel to Paris and Frankfurt. The fact is that London is already the world’s financial center. New York, Singapore and Hong Kong are the City’s proper competitors, not anywhere in Europe. You also do not need a trade deal to trade. Some of the EU’s biggest trading partners do not have trade deals with the bloc. The worst case scenario for the UK economy is to be trapped in the EU’s customs union, which was set up to protect big business, the big banks, and big farmers. Almost as bad is to be stuck in a “transition period” in which we are subject to the primacy of EU law, “aligned” with burdensome EU regulation, and still have to cough up £10bn a year to Brussels without any vote in the European Parliament or European Council, making the UK simply a “vassal state”. Why would any democratic sovereign nation want that? It is not as if Britain needs to panic and take any deal the EU tries to force through. The economic outlook for the UK is bright. Rather than sinking into recession, GDP data increased 0.5 per cent in the last quarter of the year.

Neil MacKinnon

Employment is at a record high, productivity is increasing, and manufacturing output extended its record run in December, capping the best year since 2014

Employment is at a record high, productivity is increasing, and UK manufacturing output extended its record run in December, rising for eight consecutive months and capping the best year since 2014. The UK trade deficit narrowed in 2017 as exports increased by 11 per cent, and net trade made its first contribution to economic growth in six years. For sure, the depreciation in sterling has helped, but this is what an exchange rate is designed to do by acting as a “shock absorber”. There are many countries in the Eurozone that would love to have the ability to enjoy this exchange rate effect – such as Italy, Portugal and Spain – but which are locked in the straitjacket of a “one size fits all” exchange rate and interest rate policy. Of course, the Project Fear propagandists do not have the good grace to admit that they were wrong, and now try to explain the better position of the UK scene as being the result of a recovery in the global economy. Now even the Bank of England and others have been compelled to face facts and upgrade their economic forecasts for the UK. Brexit is obviously not a magic cure-all for the long-term problems such as low investment. But talking down the economy does little to encourage investment either. Rather, Brexit should be seen as a positive opportunity to promote the longer-term prosperity of the UK economy, not as a negative uncertainty. £ Neil MacKinnon is a global macro strategist at VTB Capital.

Mutual regulatory recognition is the key to a swift business-friendly EU agreement

L

AST week, Brexit secretary David Davis made a speech in the Austrian capital of Vienna, and sent a clear message to UK and the EU that, through common interests, we should remain strong allies and trading partners. These common interests highlighted throughout Davis’ speech focused on one key area: regulation. Often, regulation acts as a kind of glue that binds countries together, no matter what their cultural or economic differences. Since the UK voted to leave the EU, the financial and related professional services sector has been working to produce a regulatory framework that would retain the strength of London as Europe’s global financial hub and would cause the least amount of disruption for people and businesses across the UK and the EU. The International Regulatory Strategy Group (IRSG) has been working towards these goals, while adhering to the negotiating teams’

“red lines”. The IRSG proposed a free trade agreement which would enable both sides to continue accessing one another’s markets, based on recognising each other’s regulatory regimes. In simple terms, on the basis that we share identical regulatory frameworks, there should be no unnecessary trade barriers erected because of Brexit. As the UK leaves the EU, we might see our regulations diverge or differ slightly. In these scenarios, we would look to whether or not our outcomes – rather than word-forword laws – are the same. You don’t take the same driving test in Lille that you would in Leeds, but in each case, you are proving that you are a safe and competent driver. If you pass, you can drive on either side of the Channel – the same outcome via a different route. The proposals also suggest ways to monitor the regulatory alignment between the UK and the bloc, in the form of a dispute resolution body,

Catherine McGuinness

which would be made up of adjudicators from both sides. Should it be deemed that the UK strays too far away from EU regulation, it would lose access altogether. Unlike any other country, the UK is looking to secure an agreement from the exact same regulatory starting point as the bloc. Never before has the EU negotiated a trade deal with a country that has mirrorimage regulatory coherence. Why should the EU consider this? First, London is one of the world’s leading financial hubs. People and businesses across Europe rely on its deep pools of liquidity and capital. Second, the expertise and knowl-

edge of London’s financial sector cannot be replicated anywhere else in the EU. If London lost its prominence, overall activity in Europe would likely slow down and fragment, meaning higher costs for customers and potentially increased risk. Third, the UK is a significant importer of EU goods and services. Hampering trade would damage many small and large businesses across the continent. The UK is historically an ambitious nation. While the proposals put forward by the IRSG reflect this ambition, they are also achievable. But time is ticking. If we are to pursue this free trade agreement, which would safeguard jobs in the UK and the EU and ensure firms can continue to thrive long after Brexit, we need more clear commitments from the government – and soon. £ Catherine McGuinness is policy chairman of the City of London Corporation.

LETTERS TO THE EDITOR

Comrade Corbyn [Re: Corbyn profoundly misunderstands the nature of the Britain he might inherit] I just visited the Caribbean and heard a talk about Venezuela from a journalist who has been in Caracas, and witnessed the collapse of the economy, the shortages, the bartering, and the marauding gunmen who hold up ordinary people and shoot them dead on the spot if they don’t hand over US dollars. This is Jeremy Corbyn’s vision of a socialist future. It is time for the City and big business in the UK to start taking a direct interest in politics. The Dutch government is now making plans for No Deal on Brexit, because it has come to the conclusion that the British government is fundamentally not up to the job of negotiating a coherent Brexit package. That is a sign of the times. Corbyn and McDonnell are a real menace. We all know that. But what is the City of London going to do about it? You have to get out there and get involved. There is a fight on for the future of the UK. Timothy Stroud Surely there’s a balance to be struck? Iain Anderson seems to be complaining that Jeremy Corbyn thinks the finance sector is 100 per cent wrong, while wanting us to accept that it’s 100 per cent right. Surely finance has made some mistakes (e.g. mistreatment of distressed smaller companies)? Anderson would make a much more convincing case if he were to acknowledge the imperfections and recognise the need for eternal vigilance. Richard Hancock

BEST OF TWITTER The EU has its flaws, but it’s a miracle we have built a Union in which we have been living in peace for more than 70 years #IamEuropean #FutureOfEurope #WeAreEurope @guyverhofstadt Name any two democratic nations *outside the EU* that have fought wars with each other in the past 70 years @guyverhofstadt. You can’t. It’s never happened. It’s got nothing to do with being in the EU. @JuliaHB1 China has used DNA databases, facial recognition software and AI to build a full surveillance dystopia in Xinjiang. Is this the future for everyone else? @anneapplebaum How can socialists outside the Labour Party work to support those inside fighting to turn it into a vehicle for socialist advance? Come to our North London branch’s discussion on 5 March. @CPB_London The Communist Party is openly holding meetings on “cooperation” with Labour. Let that sink in. @JBickertonUK On this day 1455 Johannes Gutenberg publishes the Bible, the first book ever printed on a press with movable type. @TobyBaxendale And 560 or so years later, we got Twitter. @rcolvile


MONDAY 26 FEBRUARY 2018

CITYAM.COM

WE WANT TO HEAR YOUR VIEWS

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Banks must get their heads out of the sand and into the cloud

T

HERE is something for everyone to celebrate in what has been a solid earnings season for the Big Four UK banks. RBS saw its first profit in a decade, HSBC’s pivot to Asia gained momentum, Lloyds’ focus on simple and safe business model continued to bear fruit, and Barclays planned to return more excess capital to shareholders. The UK banking sector may have turned a corner with the worst of the regulatory burden and litigation costs now behind banks. A synchronised upturn in the global economy is on the cards. The Bank of England is signalling faster interest rate rises than previously expected, offering retail banks a greater interest margin. At the same time, the return of market volatility gives investment banks some optimism when it comes to trading activities. So where next? Pivoting for growth is a clear theme among leading banks’ strategic plans as they announced their 2017 full-year results last week. And accelerating and sustaining digital transformation is the centrepiece. Lloyds Banking Group made this clear with a £3bn strategic investment into enhancing the development of digital banking products and upskilling its staff for the digital age. Legacy IT estates are widely acknowledged as the Achilles’ heel of the financial industry’s digital transformation. Such estates are expensive to maintain, not agile enough to underpin new technologies or compete in terms of costs, and cannot be transformed into digital platforms easily. The net outcome is trapped and duplicated customer data and computing power – the oil and

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Matthew Hayday and Kuangyi Wei horsepower of digital finance – across the siloes of spreadsheets, functions, and business divisions. Balkanising data and computing power in digital finance is as unproductive as balkanising capital in traditional banking. Incumbents are aware of this and have sought to overcome the “data silos” by looking into the public cloud – data storage and processing infrastructures hosted by third-party technology providers, such as Amazon or Microsoft. The business rationale is clear: on-demand scalability without the need for upfront investment. Such initiatives have, to date, focused on individual processes in the backoffice. But increasingly, banks will need to move beyond dipping their toes in the cloud and consider migrating core functions to address the opportunities and challenges brought about by PSD2 and Open Banking. Both regulatory initiatives force open access to customer data and customer relationships currently held by incumbent banks to third-party players, be that fintech, challenger banks, or incumbent giants from retail and telecom. Banks will face intensified competition, not least in the race to develop better digital banking products. Industry analysts expect Open Banking to accelerate the sector’s migration to

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OPINION

the cloud from “trickle to tsunami”. Without a single view of the customer, banks will struggle to provide the truly personalised experience expected by those customers. And without the technology architecture to support seamless programmatic integration with partners in the financial ecosystem, banks cannot fulfil the real mandate of Open Banking aimed at enhancing consumer choice and welfare. The banking sector’s migration to the cloud has started. OakNorth has become the first British bank to be born in the cloud. Established incumbents have also responded with similar initiatives. For example, UBS is moving its risk management, one of the most critical parts of the bank, to the cloud. JP Morgan is doing the same with its wholesale trading applications. To enable and sustain the step-change in performance envisaged in strategic plans, banks need to be open to the business and cyber advantages of the cloud and embark on the migration in a synchronised and thorough manner, particularly as the industry gears towards greater openness. Banks will need to be considered in the choice of infrastructure providers to minimise financial stability and data security concerns from concentration. Harmonisation of technology standards and a greater coordination between the financial industry, its regulators, and the technology sector will also be required to ensure that every cloud has its silver lining. £ Matthew Hayday is a partner and Kuangyi Wei is head of strategic research at Parker Fitzgerald, a risk management consultancy.

21

:@cityam

DEBATE Should tech firms be taxed on revenues, rather than profit? When it comes to tax avoidance by large multinational companies, we have reached what can only be described as an unsustainable situation. These large, mainly technology focused firms have been cheerfully manipulating where their profit is booked to pay minimal tax in the UK for many, many years now. The Treasury is looking at a new tax that would be levied on these firms’ revenue, rather than profit, which is an extremely robust step – but probably one that is necessary in the current environment. A revenue-based system of taxing these firms could be used, in the short term, as a rough proxy for their economic activity and act as a strong

There is no doubt that the biggest multinational tech firms have a responsibility to contribute a fair and adequate level of tax to support the UK’s public sector. Britain’s infrastructure is a pillar of the tech ecosystem which has helped these businesses to flourish. But officials have to recognise the positive contribution tech giants make to the thriving technology sector and critically in supporting the UK’s startups and scaleups. Just last week, Microsoft announced that it will be investing £14m and opening a new startup accelerator in the heart of east London. In recent years, investments in tech have reached record levels, and employment in the industry has expanded rapidly. It is therefore an

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YES VINCE CABLE

disincentive to tax dodging in our country. However, this is something of a stopgap measure. In the long run, we need a proper international agreement to create a more suitable taxation arrangement that properly captures the amount of tax firms should be paying and where they should be paying it. £ Sir Vince Cable is leader of the Liberal Democrats and former secretary of state for business, innovation and skills.

NO RUSS SHAW

imperative that we ensure the UK remains an attractive destination for large investment. We must protect the digital economy by signposting the UK as being open for business and ensure that our tax policies encourage growth at a time where other European cities are gaining in appeal. We cannot threaten prosperity by deterring world-leading tech firms. £ Russ Shaw is founder of Tech London Advocates and Global Tech Advocates.

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22

FEATURE

CITYAM.COM

MONDAY 26 FEBRUARY 2018

ENTREPRENEURS

PAST, PRESENT, FUTURE

his bread and butter for the last decade? The kind of market commentary he has been engaged in is on the way out, Buik insists. People want to speak to experts now. “Basically, the thing that made me in demand was the financial crisis because no bugger would talk because they were told by their management keep your mouth shut.” Buik’s next step will not see him leave the City, but certainly take his gruelling routine of 4.30am starts down several notches. He announced in January that he would be stepping down and passing the baton to economist Simon French at Panmure Gordon, where he says he has spent “an enjoyable and exciting” three years. His doctor vehemently advised him against total retirement. “My doctor said to me about three years ago, David you’re a fat bastard, and I said I know that, then he said don’t even think about retiring because he said you’re an absolute racing certainty for a coronary thrombosis within three months. I said that’s a bit strong Peter, and he said no it’s meant as a friendly comment, keep going, keep trucking.” As of 1 February, Buik has been working at Core Spreads on a consulting basis, and trimming his daily

City elder David Buik tells Francesca Washtell how the Square Mile has changed in half a century

Today if you didn’t have at least a 2:1 you wouldn’t get across the floor of an investment bank

GREG SIGSTON/CITY AM

A

LOT has changed in the City of London in 56 years. But ask David Buik, formerly market commentator at Panmure Gordon, about how the Square Mile compares with when he began working there in 1962, and he is resolute that it is neither better nor worse – just different. From the old boys’ network to yuppies and Essex boys, his career has spanned virtually all of the changes and trends that have made the City what it is today. Buik is not a household name, except perhaps for those who watch pre-market TV business commentary, but he has earned himself a space in the City as an outspoken elder. Now 73, he entered the finance track at the age of 18 when he started a five-year management training course at merchant bank Philip Hill, Higginson, Erlangers. He turned to merchant banking after failing his A-levels at Harrow twice, leaving him, in his father’s eyes “unemployable”, and making the world of finance a last resort for his job prospects. “My father made a comment to me which I’ve never forgotten which was, ‘I’m so disappointed in you, I had great aspirations for you being a corporate lawyer and now you’re going to have to go to merchant banking’,” Buik says, sipping a diet coke and waiting for a club sandwich in a bar room off the atrium of the Waldorf. “Well today of course if you didn’t have at least a 2:1 from university you wouldn’t even get across the floor of an investment bank.” Buik spent the 60s and 70s setting up various money broking agencies, before working in marketing at MW Marshall in the 1990s, and as a director at Eurobrokers – a period which he describes as “career in freefall”. Then there was a stint at Yamane Prebon in Tokyo (where he was sacked for blasting through social norms and speaking too directly to his Japanese bosses), and into PR at City Index then Cantor Index, where he worked (in London) during the 9/11 attacks. Things could have turned out very differently. When switching to money broking from his role at Philip Hill, Higginson, Erlangers, he nearly moved sideways from the City to an entirely separate world when he received an offer at the same time to become an actors’ agent at London Artists. A “frustrated thespian”, he says it was, at the time, “the job I wanted to do above anything else in the whole world”. It was his father who put him in his place, pointing out that he had committed to money broking and would, he instructed, have to do that for at least a year. They didn’t speak for about six months. This episode for some would be a missed opportunity, but Buik shakes his head firmly when asked if he ever wishes he’d ever moved to London Artists and the sphere of Rex Harrison and Laurence Olivier. When I ask why, he says: “Because I think my father endorsed something that has been very special to me in the City which is if you give your word, you give your word, and that’s it.” To Buik, the currency of loyalty becoming devalued is one of the many cultural changes in the more than half a century he has spent in UK business. It is in describing this raft of cultural changes he’s seen that he really gets in his element. These changes have come in many forms. On the

If you give your word, you give your word, and that’s it

sartorial front, people are differently dressed, he insists, neither better nor worse, though the office style rules have relaxed and people are much fitter and healthier now. He decries the rise of stubble, but notes that most of the men on Threadneedle Street with a shadow are also wearing a Hugo Boss suit. In his view people drink about the same amount but just at different

times – Thursdays, he says, will always be “an institution”. A change for the worse, in his opinion, has been in interpersonal skills, facilitated in part by the rise of technology. But even if interpersonal skills have waned, people are much better educated than in his time, and he admits he probably wouldn’t make it in the City if he was starting out now. And what of market commentary,

market commentary emails, known as Today’s Fayre, from a daily to a weekly affair, running each Tuesday. And what of the City itself? In the wake of the financial crisis, it is a reswinging of the pendulum towards tough new EU regulation that has created the most destructive instrument facing the City at this time. “Now, because we overcompensate, it’s going too far. This Mifid II thing that’s just been introduced will kill all small stockbrokers. Unless they’ve taken the kind of action that Panmure have, which is to make sure that they offer a service in everything from debt management to private equity to stockbroking to IPOs to all those things, because the level of discouragement for people to play markets or invest is now feeble.” Although many in the City were Remainers before the referendum, Buik was a vocal Leave supporter from the get-go, having a whale of a time attending events in the run-up to the vote where he says he couldn’t possibly win the debate. He voted for Brexit, as he describes, because of the European Court of Justice, wanting Britain to have control of its own legal system. He is optimistic about Brexit – sure, the next couple of years will be hard, but in his view the longer-term picture is strong. “London will remain one of the major financial centres of the world because when you’ve got an infrastructure built up over 70 years, please don’t tell me that a Mickey Mouse town like Frankfurt that’s got 750,000 people is suddenly going to become one of the great financial centres of the world – it isn’t.”


MONDAY 26 FEBRUARY 2018

CITYAM.COM

FEATURE

23

IN ASSOCIATION WITH

Clusters are still relevant in the digital age

Y

OU ONLY have to look at the abundance of tech firms that have set up base around London’s so-called Silicon Roundabout to see how similar businesses tend to huddle together in close proximity. For entrepreneurs especially, there’s certainly something to be said for having safety in numbers. This is the idea behind business clusters, where firms in similar industries gather together in one region to form a network of interconnected companies, including suppliers and larger institutions. Figures from Opus Energy show that some of the biggest clusters in the UK include financial services in London (which employs more than 274,456 people), and manufacturing in Manchester and Liverpool (which employs 339,000 people). The West Midlands is the largest automotive cluster in the UK, where the likes of Jaguar Land Rover, BMW, and Aston Martin are based. And Aberdeen is the biggest oil and gas cluster in the country, employing around 82,000 people. While clustering is a tradition that goes back hundreds of years, as seen

in Alfred Marshall’s “Principles of Economics” back in 1890, it was really made fashionable in 1990 when Michael Porter from the Harvard Business School set out to transform the way businesses think about competitive advantage. Peter Alderson, managing director of business finance provider LDF, says: “The idea of business clusters is nothing new. However, for businesses based in and around major cities, collaboration can help to drive some key benefits – namely lower costs – due to reduced transport distances and a more streamlined flow of information.” Alderson points out that a high concentration of skills in one place also creates greater opportunity for investment and recruitment. “Crucially for smaller businesses, it can help create an added level security,” he adds. While you’d expect the digital era to prompt the death of these geographical clusters, this is not the case. Porter outlined the benefits of a close-knit pool of specialist businesses, as skills can be brought together into one localised area to create better products through the exchange of ideas, and or course

There’s certainly something to be said for having safety in numbers through competition. Clusters have formed around the UK, and high-profile figures have pledged their support for these business networks, particularly because these pools have been found to be beneficial in supporting smaller, younger companies. Clusters don’t just provide an oppor-

tunity for businesses to form partnerships, they can also provide economies of scale, which can in turn support growth. A report from the Department for Business, Energy & Industrial Strategy (BEIS), published last year, praised clusters for improving a firm’s visibility through critical mass.

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“This factor can be particularly important for SMEs and firms expanding into international markets where lack of visibility is a challenge,” the report reads. “In certain industries, such as manufacturing and technology, clusters are already commonplace,” says Alderson, describing these clusters as “hotbeds of entrepreneurialism, innovation, and economic diversification”. “As the economic landscape evolves, particularly as the UK leaves the EU, it is likely that more and more firms will start to explore the benefits of closer collaboration with like-minded businesses.” BEIS also draws attention to the way this pool of companies can share common resources, have more face-to-face interaction (to share ideas and create an element of trust), and strengthen both the skills and infrastructure within each business. While the internet has allowed businesses to stretch globally, it’s clear that location is still crucial to a company’s success. So when deciding where to base your business, sussing out the competition – and placing yourself in the middle of it – could give you the edge.


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FEATURE

MONDAY 26 FEBRUARY 2018

CITYAM.COM

MARKETING THE WEEK IN BRIEF

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I, ARE you ‘you’? I’m me. Niceto-meet-ya,” says a flustered Matt Scheckner in a thick New York drawl, 15 minutes late for our interview. The fast-talking global chief executive of Advertising Week has landed in London days after the inaugural Latin America edition of the industry exposition, before hopping on a plane to South Africa tomorrow. Jumping straight into conversation before taking a seat, he’s telling me about his “bizarre but really close relationship with the Duke of York”, who has just helped him secure Australia House for the closing night dinner of this year’s Advertising Week Europe. Despite being in only its fourteenth year, Advertising Week – whether in New York, London, Japan, Sydney or Mexico City – has become an industry must, a meeting of minds grappling with the tough topics facing AdLand. “When we started in New York in 04, there was a lot of cynicism – it’s a naturally cynical industry,” he says. “Any time you start something new, that’s a little ambitious, people want to shoot you off the top of the building. I’ve never viewed us as in competition with anybody, our product is completely unique. There isn’t anything like this that is accessible to anyone in the advertising industry.” The first and last points are not entirely accurate. Cannes Lions, which has taken a beating in recent years for an over-focus on tech, is definitely competition. The speakers, performances and events are naturally similar. But the barrier to entry is far lower for Advertising Week. See how much change you get out of £50,000 from sending your team to the French Riviera to drink Rosé for a week. A waiter approaches the table, Sheckner orders a chicken salad. “Would sir like a small or large” “Small or large?! Look at me, do I look like a small or large guy to you? Whaddaya think?” “Anyway” he continues. “I think we have a pretty good recipe. One of the things that’s interesting about it is that it makes people feel very good about the industry they’re in. It’s not to say we don’t talk about difficult issues. We talk about real issues, and this is very important. We’ve been on gender equality, diversity, sustainability, mindfulness for years. We’ve been on those issues, and – I mean this in a straight up way – before they became popular. So we’re not just jumping on the bandwagon.”

REWARDING

Also like Cannes Lions, Advertising Week has an award ceremony. But

TAX AFFAIRS Facebook and Google, the socalled duopoly of the digital advertising market, may be about to pay significantly more tax on these shores. The Treasury has suggested that a new tax on revenues, as opposed to profits, was the “potentially preferred option”. France and Germany are looking at similar measures, which led the OECD to warn against “tax wars” breaking out if competing states impose different policies. There’s a risk it could open up digital firms to being taxed multiple times across the globe on the same activity. Announcements about changes could come as early as the Spring Statement on March 13.

THE AD

MAN

SEE IN THE DARK

COMETH Advertising Week’s top boss is in town, writes Elliott Haworth

Aldi’s Kevin the Carrot won the battle of Christmas ads last year, stealing hearts with his quest across the dinner table to meet his sweetheart. But apparently old Kev is a wrong ’un. After just one complaint, the ASA has banned the ad. The computer-generated legume may have inadvertently sold booze to kids. The regulator ruled the ad, which was likely to have “strong appeal” to under-18s, must not appear again in its current form.

AD OF THE WEEK unlike some of the more banal prizes gifted at the annual industry love-in in France, the D&AD Impact awards are for the “real issues” to which Scheckner refers. “Financial empowerment, sustainability, diversity and inclusion, health and wellness, education. There are 12 categories. It’s the only award show in the world that’s about real issues, and we’re very proud of that,” says Scheckner. It’s not all vogue niceties, however. Last year the misplaced ad debate exploded on stage at Advertising Week Europe in London. Brand safety was always an industry issue – but this time it was splashed across the front of national newspapers. The topic of brands appearing next to, and inadvertently funding, questionable groups, has dominated the news agenda ever since. Google came under mounting pressure to create a brand-

safe environment, as traditional media had always done. Scheckner thinks Matt Brittin, Google’s European boss, handled the fallout with grace. “I give Matt enormous credit. He stood up and he said ‘this is on us, we have to do better’. I think Google recognises that it’s their obligation, and I have a lot of confidence in their ability to fix the problem.” That’s not to say, Scheckner adds, that advertisers, many of whom instigated a kneejerk boycott of Google, don’t have to be accountable. “The promise of a connected world is here now. It’s what enables things like the Arab Spring to take place. It’s what enables us to donate money in times of crisis, like the earthquakes in Mexico, or Haiti. It also creates an opportunity for bad actors to leverage those tools. So we have a collective responsibility to combat bad actors – whether they’re

using old tools or new tools. And that’s everybody’s responsibility.” Parallels between the brand-safe world of television and the comparative Wild West of digital have often been made. If one can do it, why not the other? “You don’t have people uploading millions of hours of programming onto ITV,” chuckles Scheckner. When I suggest that TV is so safe due to regulatory standards backed by a fine structure – which many have suggested should extend to digital – he offers a rebuff: “The ultimate responsibility, and the ultimate opportunity, is for the platforms. And the private sector will lead. I don’t have a whole lot of confidence in the government – yours or ours – to really understand this stuff.” £ Elliott Haworth is business features writer at City A.M.

Try saying the phrase “don’t be a can’t” in your best Scottish accent. Cheeky isn’t it? Irn Bru, the only drink available north of the border apart from Buckfast, used the phrase in a new ad campaign. Lots of people have complained to the ASA about its poor taste (the ad, not the drink) proving there’s lots of snowflakes in cold Scotland. Soft drinks giant AG Barr have defended the ad, although fell short of telling the offended to “stop being cant’s”.

The road to tomorrow needs more than good intentions

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HE THEME of this year’s Mobile World Congress is creating better futures. Startup and breakthrough brands such as those showcasing at MWC and its sister platform 4YFN are widely heralded as a force for good that will be instrumental in the creation of a better future for all of us. But it’s not just new technologies and digital enterprises that can offer hope. Big businesses have a golden opportunity to step up and play their part in creating a better future. Brands have greater scale, reach and resources than some national

governments. If growth is pursued in the right way, with vision beyond profit, we could be entering an age of big brand redemption. There are several areas, aside from profitability, that brands can and should use to fuel growth and genuinely create better futures. Initiatives must be authentic and built into the brands’ overall promise if they are to resonate with customers. They must tackle problems directly related to a business’ sector, such as Volvo with its Vision 2020 target, which aims to ensure nobody is killed or seriously injured in a new Volvo from 2020.

Such a target offers both vision and hope, and if Volvo succeeds it will enjoy superhero brand status. Airbnb is an example of a brand helping to promote shared human experience, by uniting people of all nationalities through initiatives such as “Share your homes, but also share your world,” urging hosts to give guests a real sense of what life in a foreign country is like. It brings us together authentically and taps into our fundamental need to belong, in our increasingly fragmented world. Customers want to feel represented by the brands they choose. They are tired of the media’s limiting

characterisation and categorisation of social groups. Dove, Asos and Nike have all pushed to reflect consumers with sincerity and accuracy, and these brands now play a valuable role in enhancing social mobility and equality. Accessibility is another key area brands should be looking to tap into. Making products and services that are as accessible to as many people as possible can help break down barriers and promote equality. Our ageing western populations both want and need to be catered for. And finally we know consumers want to act ethically and do the right

thing, but convenience and price will always trump good intentions. Brands that can find a way to ease the guilt customers feel about their habits, such as Iceland pledging to remove plastic packaging by 2020, will continue to gain real advantage. Making the shift from being seen as the cause of, to the solution to, social and environmental issues won’t be easy for established brands, but it can, and will happen and in the process brands will be actively creating a better future for us all. £ Christian Purser is chief executive of Interbrand London.


MONDAY 26 FEBRUARY 2018

CITYAM.COM

FEATURE

25

OFFICE POLITICS

Include charity in the mindfulness mix What better way to encourage positivity than by investing time in a worthwhile cause? Gillian Murray Pilotlight

It’s about encouraging positivity and happiness, and what better way to do this than by putting your time to a worthwhile cause?

WORTH YOUR WHILE

SHINY HAPPY EMPLOYEES

C

HANCES are you’ll know what mindfulness is. The trend has dominated headlines and social media feeds in recent years, and those of us seeking more calm in our hectic lives are downloading mindfulness apps in a bid to improve our outlook. Businesses are also getting behind the movement, bringing mindfulness and meditation programmes to the workplace, and in some cases offering customised training to meet the specific needs of their teams. But if the core objective is to reduce anxiety and stress, companies could do well to include charitable initiatives in the mindfulness mix.

BEYOND BREATHING EXERCISES

The movement doesn’t have to be contained to yoga and breathing exercises.

According to the Office for National Statistics (ONS), the number of people volunteering is 41 per cent among men, and 42 per cent among women. A decade ago, we were surprised when our business members reported that they were happier after using their skills to support small charities through our programme. But it has since been shown that engaging in charitable initiatives helps reduce stress levels, improve emotional wellbeing, and may even benefit physical health. Data from the ONS also shows that a more content workforce can help boost productivity levels and support business growth. It’s even been suggested the economy would get a £24bn annual boost if the workforce were just one per cent happier. We now track the outcomes of employees who are involved in charitable schemes. Last year, 92 per cent of our business members reported an increased sense of wellbeing and hap-

Charity Miles Free

The economy would get a £24bn annual boost if the workforce was just one per cent happier

piness, and 72 per cent experienced increased job satisfaction.

SECOND NATURE

Charity leaders are passionate and driven in support of their cause, but can find it difficult to step back from their daily work in order to plan. Some will therefore seek support from Pilotlight to develop their strategic thinking. For business executives, strategic planning is second nature, and there is huge value to bringing this charity and business expertise together in a

Here’s an app to kill two birds with one stone. For every mile you walk, run, or cycle, money is donated to charity on your behalf, so you can keep fit and help others in one fell swoop. The scheme has earned over $2m for charity so far. It might even motivate you to get moving if you know you are helping a worthwhile cause in the process.

meaningful way. Business leaders may have reached a high point in their careers, but many of our members initially feel that they have little to offer small charities. But it’s all about using both the professional and life skills that have been gained from working in a corporate environment. To be successful in the business world, leaders have to strategise and be forward-thinking. And while charities are experts in their own fields, they often need more business knowledge.

DOING GOOD DOES EMPLOYEES GOOD

Finding the right opportunity is key. At Pilotlight, we believe in a managed, skills-giving programme that recognises our business members are timepoor and skills-rich and the leverage effect of using those skills effectively. But there are many other opportunities to explore. So, consider alternatives to creating healthier mindsets, reduced stress levels, and improved wellbeing – the core pillars of mindfulness. There is real power in connecting with the world around you and giving back in a way that may well improve your outlook on life. £ Gillian Murray is chief executive of Pilotlight, an initiative which connects businesses with charities.


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LIFE&STYLE

MONDAY 26 FEBRUARY 2018

CITYAM.COM

TRAVEL Ajay Teli travels to Johannesburg, South Africa’s biggest city, where he finds a fastchanging metropolis of stark contrasts

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he regeneration of Maboneng has been one of the most successful urban-renewal projects in the world. After almost 20 years of decline and decay, this district of Johannesburg is now looking optimistically towards the future. It’s emblematic of a city that’s rapidly changing, with the centre smartening up and a wide-ranging development programme earning international attention. Jo’burg, as it’s often called, is South Africa’s biggest city, the capital of Gauteng province, and the cultural melting pot of the country. Once, the streets were almost literally paved with gold – it was a goldmining settlement in the 19th century – but it’s been calling out for some much needed TLC in recent years. You need to venture to its regenerating regions to really get under the skin of this sprawling Soweto township, and get beyond its famous sons, Nelson Mandela and Desmond Tutu. To understand this resurgence, I met local entrepreneur, Dale de Ruig, a passionate patriot, right in the belly of Maboneng where all this change has taken place. Over a flat white at Chalkboard café – which has a vibe not unlike East London – Dale explained how he wanted to make a genuine difference in the city he grew up in. “South Africans want to get back inside the centre of the city and feel a sense of community,” he said. “They want to break down the walls, not build more, allowing for the people’s passion to rebuild the city’s rich culture instead.” Dale is one of many who want the city to reconnect with its roots so he started in Maboneng, which has earned a hipsterreputation in recent years. He’s made a massive contribution in helping to renew and change perceptions by investing heavily in the urban neighbourhoods. Like many gentrified areas in the UK, Maboneng’s renaissance started after the artists moved in, and has since evolved into a collaborative hub of culture, business and lifestyle, which attracts a diverse community and promotes a sense of urban togetherness. “Jo’burg, as a city, is massively undersold so I wanted to rebuild the Maboneng district by investing in more residential and independent retail to encourage the growth of the community,” said Dale. Situated on the east side of the city’s business district, this urbane pocket now boasts independent restaurants, retail stores that embrace the history and heritage of Jo’burg, and a mix of residential, office and industrial space, none of which would look out of place in Brooklyn or Shoreditch. Music can be heard on every street corner, while consciously-styled Jo’burgers socialise in cafes that punctuate the humidity with the smell of finely-roasted coffee beans. Most striking of all is the colour; a rainbow of murals splatter practically every building and alleyway. You’ll never be stuck for entertainment, even if you’re an over-stimulated Londoner. If the weather’s bad, drop in on The

FROM HIPSTER TO HIPPO IN ONE CITY

Music can be heard on every street corner, while consciouslystyled Jo’burgers socialise in cafes

Bioscope, an independent cinema located in a leafy spot, where the seating is made from recycled car seats. Its creative energy and unabashed optimism were indicative of the energy reshaping Maboneng into a place to be proud of. There are other neighbourhoods doing similar things nearby, such as the affluent Sandton, where I spent two nights enjoying the hospitality of The Saxon Hotel. Located in a peaceful, residential corner of Jo’burg, this former private home turned 53-suite hotel has played a key role in South African history. I knew I would bump into a slice of Mandela

history eventually, but I didn’t expect it to be at a luxurious boutique hotel. But the great man completed his autobiography, Long Walk to Freedom, from The Saxon. It sits in 10 acres of lush landscaped gardens, with six swimming pools, a and a recently opened Michelin starred restaurant, Luke Dale Roberts x Saxon. It’s a comfortable place to get stuck in to the local wines and culinary specialities. Before I got too comfortable, however, I drove two and a half hours north to the province of Limpopo to experience the opposite of urban life, deep in the 12,000 hectares of wilderness. The Saxon’s sister property, the Shambala Pri-


CITYAM.COM

MONDAY 26 FEBRUARY 2018

LIFE&STYLE

: @city_am

: @cityamlife

NEED TO KNOW Rooms at the Saxon Villas and Spas start from approximately 442 GBP based on two people sharing a luxury suite, including breakfast, wifi and a welcome bottle of bubbles upon arrival. Stays at the Zulu Camp at Shambala Private Game Reserve start from around 700 GBP based on two people sharing a chalet, including all meals, sunset cruise, game drives and bush walks.

At 125 years-old, no one knows these fjords, mountains, and charming communities better than we do

Bergen – Kirkenes – Bergen Spring & Summer: 1 Apr to 30 Sep 2018 vate Game Reserve, is perfect for an escape from the heat of the city. Technically still within Jo’burg, it’s set against the backdrop of the monolithic Waterberg mountain range. Arriving at the main entrance, I was asked to sign a waiver taking full responsibility for my actions before I embarked through the game reserve. Had a prior visitor been so overwhelmed by the majesty of a giraffe that they tried to ride it into the horizon? Alas, my guide kept tightlipped about past escapades, and while was exhilarating to see rhino, giraffes and the great African elephants in their natural habitat, I managed to hold it together.

Afterwards, I was escorted back to my luxury glamping tent at Zulu Camp, complete with outdoor shower. The urban challenges being faced on a daily basis seem a world away from the peace, tranquility and total isolation of Limpopo, a place that seems made for private reflection and reconnecting with the natural world. I hope the whole of Jo’burg finds its swagger soon. Whether you’re exploring its dark past in the Apartheid Museum or looking to its bright future in its up-and-coming neighbourhoods like Maboneng, Jo’burg is a city of stark contrasts unlike anywhere else on earth.

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Terms and conditions: Offer of two free excursions and one à la carte dinner applies to new bookings only on Select fare 12-day Classic Round Voyages between 1 April and 30 September 2018. Offer applies to bookings made by 31 March 2018. From price quoted is in GBP and are per person, based on full occupancy of an inside two-berth cabin, on a full-board basis. Single supplements may apply. Cabins and excursions are subject to availability. Hurtigruten operates a flexible pricing system and prices are capacity controlled, correct at time of booking. Not included: travel insurance, luggage handling, international flights (unless otherwise stated), optional excursions or gratuities. Flights booked with Hurtigruten are ATOL protected (ATOL 3584). All itineraries are subject to change due to local conditions. Please enquire for full itineraries and full booking terms and conditions.

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LIFE&STYLE

MONDAY 26 FEBRUARY 2018

CITYAM.COM

TRAVEL

: @city_am

: @cityamlife

HOURS IN... EDINBURGH, SCOTLAND

WHERE TO STAY Enjoy chic interiors and castle views at The Principal Edinburgh Charlotte Street, the recently renovated hotel where every detail is catered for, including a tuck box full of treats. Visit phcompany.com

WHERE TO GO Take in breathtaking views with a city walk atop Edinburgh’s former volcano. There are two routes up and two down, the Salisbury Crags and Arthur’s Seat. Make sure to wrap up warm as it can get very windy.

WHERE TO EAT Castle Terrace, led by culinary expert Dominic Jack, is tucked away underneath Edinburgh Castle and offers innovative and modern fine dining , influenced by French cooking techniques. Visit castleterracerestaurant.com

Discover a different side to Portugal’s Algarve Hannah Wilkinson discovers another side to the ubiquitous Algarve break THE WEEKEND: With 300 days of sun a year and several bajillion package holiday operators making the most of them, the Algarve isn’t undeserving of its reputation as a been-there-done-that beach break destination. But stay in an apartment nestled between a nature reserve and the first tee, with bikes and cars ready to hire on site, and Portugal’s sleepy southern coast becomes the perfect backdrop for a mini-break with no sunbeds in sight. WHERE? The self-catering villas and apartments at Four Seasons Fairways are within walking distance of the beach and driving range, and all include a pool or jacuzzi. The resort, which already has great connections to local vineyards, will unveil an updated Clubhouse and a new wine cellar later this year.

WHERE TO DRINK Sip Middle Eastern inspired cocktails in a sumptuous setting at Baba, paired with plates of mezze. We recommend the Sufi Fizz and Baba-llini, paired with the delicious muhammara. Visit baba.restaurant

THE FOOD: There are no shortage of Michelinacclaimed restaurants in this part of the Algarve – the tasting menu at nearby Vila Joya has earned it two stars and makes the 40 minute detour worthwhile. But the shellfish at Estamine, a more laid back restaurant on the unspoilt Baretta Island, was the highlight. Try the shellfish Xarem, a maize porridge with Rio

THE LONG WEEKEND QUINTA DO LAGO FOUR SEASONS FAIRWAYS Formosa clams and prawns. Get there on an Animaris eco-tour, where the guide can spot spoonbills and oyster catchers from hundreds of metres and name them in five languages. Whizz back to Faro in a speedboat after hiking round the island, including a stop at Portugal's southernmost point. ASK ABOUT: Reflecting the gourmet culture, the

apartment kitchens are designed for serious cooking, with swish Miele appliances and useful gadgets like hand-blenders. Every terrace has a gas barbecue, and the Fabulous Baker Brothers Tom and Henry Herbert have designed five recipe cards for guests using local ingredients. Pick up some herbs at Loulé market on Saturday morning, and ask the Four Seasons Fairways kitchen to provide the meat. If your grilling skills aren’t up to much, the brothers themselves will be popping by in February to host some masterclasses. AND AFTER THAT? Skip the 18-holes in favour of a private lesson at the Paul McGinley Academy. I was amazed at how much difference an hour’s coaching at Europe’s only TaylorMade Performance Center can make. Academy manager Jose Ferreira can get beginners playing in eight hours, and uses Trackman technology to help experienced golfers make significant improvements. And if you have the energy afterwards, borrow a bike from the Fairways clubhouse and cycle past salt marshes and mud flats into Faro’s pretty old town. NEED TO KNOW Four Seasons Fairways has two-bedroom apartments starting at £850 a week. Barbecue masterclass packages, including accommodation, breakfast and transfers, cost £1,300. Book at fourseasonsfairways.com. BA flies daily from Gatwick to Faro, from £76 return. Book at ba.com/algarve.


CITYAM.COM

MONDAY 26 FEBRUARY 2018

RUGBY UNION

Grainger: Team GB feats have been inspiring FRANK DALLERES @frankdalleres UK SPORT chair Katherine Grainger has paid tribute to Team GB’s recordbreaking achievements at the Winter Olympics, which finished yesterday, calling their performances “an inspiration”. Snowboarder Billy Morgan’s bronze in the men’s big air competition on Saturday ensured that British athletes met their target of five medals for the Games in Pyeongchang, South Korea. Lizzy Yarnold’s gold was one of three medals in the skeleton, where Laura Deas and Dom Parsons both took bronze, while skier Izzy Atkin finished third in the women’s slopestyle event. “To attend my first Games in the capacity as chair of UK Sport and witness at first hand the inspirational impact that our National Lottery funded athletes have delivered for the nation has been an immense privilege and

Tournament organisers tell Scotland and England to clarify pre-match clash @rossmcleanRMAC SIX Nations organisers have asked both England and Scotland to provide explanations for the tunnel fracas which occurred prior to Saturday’s Calcutta Cup showdown at Murrayfield. As the two teams returned to the dressing rooms following their prematch warm-ups, television footage appeared to show England inside centre Owen Farrell and Scotland No8 Ryan Wilson embroiled in a scuffle before teammates intervened and separated the pair. Tournament organisers have advised the governing bodies of both nations, the Rugby Football Union and their Scottish counterparts, that further information on the incident is required before they make a decision on whether a disciplinary investigation is needed. “Six Nations Rugby will be writing to the unions to request clarification on what happened in the tunnel,” said a Six Nations spokesperson. In the immediate aftermath of the clash, which Scotland won 25-13 to seal their first victory over the Auld Enemy for a decade, England head coach Eddie Jones claimed he had no knowledge of the incident in question. “I’ve been coaching a game. I’ve been pretty busy. Are you aware of it?” said Jones, who suffered only the

CRICKET

second loss of his England reign. Scotland’s triumph ended England’s hopes of a Grand Slam and also put a major dent in their chances of securing a third successive Six Nations title, with Ireland now in pole position with two rounds of fixtures to play. Ireland currently top the championship table, five points clear of England, prior to their next game against Scotland in Dublin on 10 March. England face France in Paris later that same day. Jones, meanwhile, has promised an investigation of his own following Scotland’s win consigned Jones to the second loss of his England reign England’s defeat on Saturday when his squad convenes in Oxford this week, and has pinpointed three main areas for scrutiny. “We lacked intensity and we’ve got to find out why,” said Jones. “We got beaten at the breakdown and we’ve got to find out why. We lacked proper spacing in defence and we’ve got to find out why. So there’s three big ones.”

Snowboarder Billy Morgan won bronze

SIX NATIONS TEAM Ireland England Scotland Wales France Italy

PLD 3 3 3 3 3 3

W 3 2 2 1 1 0

D 0 0 0 0 0 0

L 0 1 1 2 2 3

F 108 71 64 67 73 51

A PTS 59 14 46 9 73 8 56 6 64 6 136 0

Scotland’s victory over England was their first in the Calcutta Cup for a decade

Morgan heaps praise on returning Stokes as England slump to defeat ROSS MCLEAN

Stokes claimed two wickets in his first international match since September

29

WINTER OLYMPICS

Rivals asked to explain tunnel fracas ROSS MCLEAN

SPORT

@rossmcleanRMAC ENGLAND skipper Eoin Morgan was buoyed by the return of all-rounder Ben Stokes despite his side slipping to a three-wicket defeat in the opening one-day clash against New Zealand in Hamilton yesterday. Stokes, who was playing his first international match since being arrested outside a Bristol nightclub in September, hauled England back into contention with two wickets during his second spell, on his way to figures of 2-43 from eight overs. But his efforts proved in vain as New Zealand eclipsed England’s score of 284-8 with four balls to

spare, thanks largely to Ross Taylor’s 18th one-day international century in a stand of 178 with Tom Latham, who made 79. Morgan insisted there were positives to take in spite of their defeat, one being Stokes, weeks after his appearance in court on the charge of affray. Morgan said: “I’m really pleased. I thought he adapted to conditions perfectly well, using slower balls well. “After the first spell, he said he could have bowled longer, but we didn’t really need him at that stage. We needed something to happen, and he’s the kind of player who can make something happen. “He’s delighted to be back – he’s told everybody that. It’s an awesome

feeling, when you’ve been away and you’re back in a fun environment.” Stokes could only muster a rather pedestrian 12 off 22 balls with the bat as the main contributors to the England total were vice-captain Jos Buttler and Joe Root, who amassed 79 and 71 respectively. The Black Caps were reeling at 27-3 but their victory march was given a huge shot in the arm by Taylor and Latham, while the equation read 34 runs needed from 18 balls after the former’s departure. Nine runs were required from the final six deliveries as Mitchell Santner, who finished on 45 not out, edged a Chris Woakes yorker for four before smashing a six over mid-wicket after a wide.

humbling experience,” said Grainger, who won rowing gold at the London 2012 Olympics. “This has not only been a record breaking Games but an impactful one for so many reasons, with the theatre of jeopardy played out in full with the high and lows of emotion that makes high performance so incredibly exciting.” Team GB not only exceeded their previous best tally of medals, gained at Sochi in 2014 and Chamonix in 1924, but also registered more fourth and fifth-place finishes than ever before. Their results followed £28m of investment during the last fouryear cycle and saw them finish 19th in a medal table topped by Norway, who won 39. Morgan was given flagbearing honours for yesterday’s closing ceremony. “These athletes can rightly return home very proud of what they accomplished here in South Korea,” said Team GB chef de mission Mike Hay. “To leave Pyeongchang with five medals and a host of fourth-place finishes and top 10s across the sports shows that winter sport in the UK is going in the right direction.”

MEDAL TABLE NAME 1. Norway 2. Germany 3. Canada 19. GB

G 14 14 11 01

S 14 10 08 00

B 11 07 10 04

TOTAL 39 31 29 05


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SPORT

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MONDAY 26 FEBRUARY 2018

EXPLAIN YOURSELVES Scotland and England ordered to clarify pre-match clash PAGE 29

SPORT

FOOTBALL

FOOTBALL

Persistent Kane strikes late as Spurs go fourth PREMIER LEAGUE

CRYSTAL PALACE TOTTENHAM HOTSPUR

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FRANK DALLERES @frankdalleres RELIEVED Tottenham manager Mauricio Pochettino praised the persistence of striker Harry Kane after he put a handful of missed chances behind him to conjure a late winner at Crystal Palace yesterday. The visitors had been frustrated by a combination of Kane’s wastefulness and the sharp goalkeeping of Wayne Hennessey until the 88th minute, when the former headed in a deep Christian Eriksen corner. Victory lifted Spurs back into the top four of the Premier League, overtaking Chelsea, who lost at second-placed Manchester United, and deepened Palace’s relegation worries. Pochettino said of Kane, who scored his 35th goal of the season:

Kane scored his 35th goal of the season “That is important: to keep going and never feel frustrated if you miss some chances – and in the end he can score. “We started to feel when we created chances and dominated the game that it was difficult today, but we always knew we could score. We had great players on the pitch and when you have them it’s always possible.” Injury-hit Palace have now taken just two points from their last five league games but came close to holding out against Tottenham, despite enjoying just 24 per cent possession. “At 0-0, I’d have been a happy man,” said manager Roy Hodgson. “But now I can’t hide my feelings. I’m not an actor, I’m really sad for the players.” Kane blasted a first-half chance straight at Hennessey and was guilty of an even worse miss in the second period, side-footing wide from close range. Hennessey then saved a stinging drive from Serge Aurier and Eriksen’s shot through a crowd but was undone from the latter’s corner with just moments left. Kane found space at the far post and floated a header back across goal that Hennessey only succeeded in tipping over his defenders on the line.

Now let’s go for the treble, says Guardiola

Man City claim first trophy of Pep era with comprehensive win over Arsenal CARABAO CUP

ARSENAL MANCHESTER CITY

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FRANK DALLERES @frankdalleres MANCHESTER City manager Pep Guardiola urged his team to use the first trophy of his reign as a platform for further success this season after they claimed the Carabao Cup yesterday. City took control at Wembley against an obliging Arsenal team through Sergio Aguero’s first-half lob and they swatted their opponents aside after the interval. Captain Vincent Kompany capped a vintage performance when he turned in Ilkay Gundogan’s shot for the second goal and David Silva continued his fine season by firing the third. Premier League leaders City showed few signs of being affected by Monday’s shock FA Cup defeat at Wigan and remain in contention for a possible treble. “There are titles more important than this one but of course we are so happy,” said Guardiola, who paid tribute to City owner Sheikh Mansour and chairman Khaldoon Al Mubarak. “The first half was not good, a lot of mistakes in the simple passes. The second half we played with more courage and personality and that’s why we played much better. In the second half we were outstanding. “It was so important to win this one, after [losing in the FA Cup]. Now we have to focus absolutely on the Premier

League to try to win the games and after arrive good in the quarter-finals [of the Champions League].” Arsenal engineered the first chance when a Jack Wilshere-led counter saw Mesut Ozil deliver a low centre towards Pierre-Emerick Aubameyang, only for City defender Kyle Walker to intercept. But City took the lead on 19 minutes – Aguero capitalising on the Gunners’ failure to deal with a simple long ball and lobbing David Ospina to perfection – and were rarely ruffled thereafter. Kompany went close with a shot that was deflected wide by Laurent Koscielny before he beat Ospina with an effort that survived a referral to the video assistant referee in the 58th minute. City caught Arsenal napping with a corner to the edge of the box, where Gundogan rifled low through a crowd for Kompany to divert beyond the stranded Ospina. Seven minutes later left-back Danilo slipped a reverse ball into the inside left channel and Silva held off Calum Chambers before finding the bottombottom right corner.

Guardiola’s trophies Barcelona: 14 La Liga x3; Copa del Rey x2; Champions League x2; Spanish Supercup x3; Uefa Super Cup x2; Club World Cup x2 Bayern Munich: 7 Bundesliga x3; DFB-Pokal x2; Uefa Super Cup; Club World Cup Manchester City: 1 League Cup

The Carabao Cup is the first title of Pep Guardiola’s reign at Man City

FOOTBALL

Conte slams players for allowing United comeback PREMIER LEAGUE

MANCHESTER UNITED CHELSEA

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ROSS MCLEAN @rossmcleanRMAC CHELSEA boss Antonio Conte slated his players for surrendering a lead at top-four rivals Manchester United and warned his side that their hopes of qualifying for next season’s Champions League is at risk. Substitute Jesse Lingard was the United match-winner with a quarter of an hour remaining after striker Romelu Lukaku registered a quickfire leveller against his former club following Willian’s opener for the

Blues. Victory returned United to second place in the Premier League, demoting Liverpool to third, while Chelsea slipped to fifth following their defeat and Tottenham’s win at London rivals Crystal Palace yesterday. “We have to be disappointed with the final result,” said Conte. “I think we had a good chance to get three points against a competitor for a place in the Champions League, but at the end we are talking about another defeat. “In these type of situations [when you take the lead], you have to manage the game better and you must be able, with experience, with maturity to get three points. “I don’t know if we will finish in the top four, but this [missing out]

could be a possibility for sure. There is the risk we will stay out of the Champions League.” United manager Jose Mourinho, meanwhile, moved to draw a line under his bitter feud with Conte after the pair shared a pre and postmatch handshake. “The handshake doesn’t need any words,” said the former Chelsea tactician. “I think that is what me and Antonio want to show everyone. The handshake before and after the match is an example that you have to respect each other. “Mourinho and Conte, they are not two ordinary persons in football. We have a history, we have an image and I’m really happy with that.” Chelsea had already struck United’s crossbar through Alvaro

Morata by the time the visitors opened the scoring shortly after the half hour mark as Willian exchanged passes with Eden Hazard and rifled a shot through David de Gea. United levelled on 39 minutes as Alexis Sanchez and Antony Marital combined and Lukaku side-footed home, while the ex-Chelsea frontman later turned provider for Lingard to head beyond Thibaut Courtois.

TOP FIVE TEAM Man City Man Utd Liverpool Tottenham Chelsea

PLD 27 28 28 28 28

W 23 18 16 16 16

D 3 5 9 7 5

L 1 5 3 5 7

F 79 53 65 53 50

A 20 20 32 24 25

PTS 72 59 57 55 53


CITYAM.COM

MONDAY 26 FEBRUARY 2018

SPORT

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BEN’S BACK Stokes threatens to trigger England revival on international return PAGE 29 IN BRIEF

Gunners must take criticism, admits Wenger FRANK DALLERES @frankdalleres ARSENAL manager Arsene Wenger admitted his team had been architects of their own downfall against Manchester City, after his hopes of winning a League Cup final at the third attempt ended in a 3-0 defeat. The Gunners allowed Sergio Aguero to run onto a goal kick from Claudio Bravo and net the first, while the second, from captain Vincent Kompany, came amid characteristically hapless defending. “When you lose games and you make mistakes you have to accept being criticised,” said Wenger, who also lost finals in 2011 and 2007. “It’s emotionally difficult after a final so you don’t want to go too much into criticism. When you lose 3-0 you have of course to look at defending better. I still feel sometimes for periods in the game we defend very well and suddenly we lose a bit of concentration and against quality teams we pay for it.” Wenger insisted that Kompany’s goal, which was upheld after a review by the video assistant referee, should not have stood due to City winger Leroy Sane being in an offside position. “We were unlucky as well because the second goal is offside,” added the Frenchman. “I’ve just watched the replay and it was 100 per cent offside.” The Arsenal boss was also unhappy at their attacking output, and in particular PierreEmerick Aubameyang’s failure to reach a low ball across goal from Mesut Ozil before City defender Kyle Walker during the opening exchanges. “We had the first good chance and a very easy one that we missed. After that we made a big mistake on the first goal,” he said.

SARRIES SUCCUMB TO TIGERS AS EXILES BEAT WORCESTER

£ RUGBY UNION: Saracens missed the chance to go top of the Premiership after Leicester claimed a bonus-point win, prevailing 28-20, at Allianz Park yesterday. England centre Manu Tuilagi was among the Leicester scores, while Max Malins twice crossed the line for Sarries, who are four points adrift of leaders Exeter. London Irish, meanwhile, boosted their slim hopes of survival by beating Worcester 22-9. The Exiles remain bottom, 12 points adrift of Worcester.

PEPPERELL SEALS MAIDEN EURO TOUR TITLE IN QATAR

£ GOLF: England’s Eddie Pepperell withstood the challenge of fellow countryman Oliver Fisher to claim his first European Tour title with victory at the Qatar Masters yesterday. Pepperell carded a two-under par final round of 70 to finish on 18 under, while Fisher, who missed a birdie putt on 18 which would have forced a play-off, finished one back. Pepperell said: “You’ve always got to take that step but at some point in everyone’s career they’ve got to do something for the first time.”

O’SULLIVAN TAMES DING TO WIN WORLD GRAND PRIX

£ SNOOKER: Five-time world champion Ronnie O’Sullivan brushed aside China’s Ding Junhui to win the World Grand Prix in Preston last night. Victory handed O’Sullivan his 32nd ranking title and the £100,000 prize. O’Sullivan said: “It is nice to be playing, competing and having fun. I rededicated myself to the sport before last year’s Worlds and put the work in and I’ve had a few results. I haven’t played since the Masters [in January] so I came here cold and I got lucky this week.”

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Jesse Lingard netted his 13th goal of the season as United overcame Chelsea


City A.M. (2018.02.26)  

City A.M. (2018.02.26)

City A.M. (2018.02.26)  

City A.M. (2018.02.26)

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