News – Business & Economi

The decline in unemployment for the second consecutive quarter to hope that France moved into a sustained decrease, said Thursday Economy Minister Christine Lagarde.

The unemployment rate as defined in International Labour Office has declined to 9.3% and 9.7% in France with overseas in the second quarter against 9.5% and 9.9% in the first, announced Thursday INSEE.

"This is good news, especially now that a new repeating itself," said Christine Lagarde told Reuters.

"When is two consecutive quarters, there is reason to believe that not only stabilized but unemployment is perhaps past the right side of stabilization.People come, hopefully in permanently reducing unemployment. "

In a previous interview after the announcement of a decline in the number of jobseekers in Class A in July, 25 August Christine Lagarde had referred to "stabilize" trend that is becoming.

Asked to say at what level of growth in France was able to create lasting jobs, the economy minister said: "It is almost certain it was only 2% of net job creation sustainable, but look at the current period, to 1.4% pace of growth was the net creation of jobs.

"The French economy has created about 60.000 new jobs since the beginning of 2010 when it evolves at a rate of 1.4 to 1.5% growth, so somewhere between 1.5% and 2%, the French economy created jobs .

"What is important is that we can maintain this trend of declining unemployment and net creation of jobs," she added.

The government forecasts economic growth of 1.4% this year and 2.0% in 2011.

While the earnings season ends business in the United States, optimism about the earnings outlook for the third quarter gradually eroded as investors fearing that the weak demand reflected by the indicators Macroeconomic weigh on sales and margins of listed companies.

While only a handful of companies in the Standard & Poor's 500 has not yet submitted its accounts, the average growth index of profits in the second quarter stood at 38.4% compared to the corresponding period of the Last year, according to data from Thomson Reuters.

Such performance is unlikely to be equaled in the third quarter.The estimates, which are currently still at the level they were in early July, predicting earnings growth of 24.9% over one year.

"It could well be one of the last quarter for which the results are as good as mine.There is already, for example, they slow down or they're to move downward for 2011, "said Pankaj Patel, analyst at Credit Suisse in New York.

If 75% of the S & P 500 have exceeded estimates in the second quarter, compared to an historical average of 62%, many observers believe that profit margins could well have peaked.

Productivity has in fact declined by 0.9% over the same period, suggesting that companies may well find themselves unable to maintain their level of profitability.

ESTIMATES TOO OPTIMISTIC?

The average margin for the S & P 500 was 8.9% in April-June, against 6.2% a year earlier, according to Howard Silverblatt, an analyst at Standard & Poor's.

The disappointing economic indicators published in recent weeks, particularly on the employment front, began to be integrated into the course: the S & P 500 has a 0.7% drop since July 12, the start of the season results .

"There are many headwinds (…) and if you start to take them into account, we see that some numbers may be too optimistic," said Alan Lancz, president of Alan B. Lancz & Associates, an investment consulting firm.

The second part of the earnings season has been worse than the first.Of more than 2,000 U.S. companies announced their accounts, more than 70% have exceeded analysts' estimates during the first half of the period of publication, but this ratio fell to 66% by the end of the season, according to analysts at the company Studies Bespoke Investment Group.

For the third quarter, the estimates should not change much more until early October.

"Unless exceptional economic event (…) a major change in numbers is unlikely" for at least several weeks, Judge John Butters, head of U.S. monitoring results, Thomson Reuters.

The restatement of financial results of listed companies has been a major driver of the rebound in the S & P 500 from the lowest 12 years hit early in March 2009 and since then, the index rose by 58%.

Merck reported a quarterly results better than expected thanks to strong demand for its treatment fighting against diabetes, arthritis or AIDS.

Excluding items, profit U.S. lab amounts to 86 cents per share while analysts polled by Thomson Reuters I / B / E / S had forecast 83 cents.

In total, net income fell to 752 million or 24 cents per share.In the second quarter of 2009, it was 1.56 billion or 74 cents a share.

Merck has taken control of his compatriot Schering-Plough in November for $ 41 billion.

For the year, Merck now expects EPS of 3.29 to 3.39 dollars per share, excluding special items, a slight adjustment from its previous forecast of 3.27 to 3.41 dollars.

In pre-market, Merck was down 2.2% to 34.29 dollars.

LVMH Tuesday reported a strong rebound in sales and profitability in the first half, driven by the performance of Louis Vuitton and the resumption of activities that had been during the crisis, heavily penalized by destocking.

After Hermes and Burberry, the giant figures confirm global luxury goods sector recovery in the first quarter after suffering in 2009 the largest decline in its history with sales down 8%, according to estimates from Bain & Co.

LVMH saw sales reach 9.09 billion euros, a figure slightly above the consensus reached by the editor of Reuters (8.87 billion euros), growing by 16% as reported.

In comparable data, the dynamics of organic growth was confirmed, the sales growth standing at 14% in the first half, after 13% in the first three months of the year.

Full advantage of the good momentum in sales and cost reduction programs implemented in 2009, during the crisis, current operating income jumped 33% to 1.816 billion euros (1.7 billion Reuters ), advancing 2.5 points the group's operating margin to 19.9% (against 17.5% a year earlier).

Unsurprisingly, these are activities that had suffered most from the crisis and overstocks – namely wines and spirits (Moet & Chandon, Dom Perignon or Ruinart) jewelry and watches (Tag Heuer, Zenith, Chaumet and Fred ) – which recorded the highest increases in sales (+18% and +24% respectively on a comparable basis).

In fashion, leather goods, the division's most profitable group with Louis Vuitton, the main profit center of LVMH sales up 14%.

Turnover increased 10% in perfumes and cosmetics (Dior, Givenchy and Guerlain) and 13% in the selective distribution (perfumery chain Sephora, the department store Le Bon Marche, or network based DFS sales in duty by passengers).

The stock closed at 92.26 euros on the Paris Stock Exchange Tuesday, down 2.91% to an increase of 17.7% since the beginning of the year, outperforming the European diversified consumer goods advancing 13.7% over the period.

The value of trades on valuation multiples of about 18 times its estimated profits for 2011, against 16 times the industry average for non-Hermes.

Philips has released better than expected results for the sixth consecutive quarter and raised its margin target, but not so far succeeded in convincing the market hoped for more.

Around 9:15 GMT, the Dutch electronics group fell by 2.91%, to 24.175 euros after plunging 4.3% in the first exchanges to form when the largest decline of the Amsterdam Stock Exchange.

Victor Bareno, an analyst at SNS Securities, said that the published results did not reflect "the significant increase that Philips had reported in previous quarters.

The group recorded a profit before interest, taxes, depreciation and amortization (EBITA) of 527 million euros in the second quarter, against 118 million euros last year and 486 million euros expected.

Its turnover stood at 6.2 billion euros and net profit to 262 million euros, higher than the 241 million euros expected.

Analysts had warned before the publication of Philips that investor expectations may be too large.

"The magnitude of the excess (of analysts' forecasts) compared to the previous five quarters is somewhat less strong," said Jan Hein de Vroe, an analyst at ING.

Eleven of 13 analysts surveyed by Thomson Reuters StarMine SmartEstimates lowered on average by 22.6% their earnings expectations over the past 30 days, while the stock has gained almost 7%.

The Dutch consumer electronics was confident of being able to exceed its margin target of 10% EBITA before exceptional items this year, while previously thought just to reach this goal.

The European leader in consumer electronics has reduced the cost during the crisis and the beginning of economic recovery, which helped to generate profits even in difficult times.

Philips has hoped to exceed its savings target on its structural costs in 2010 to 700 million euros.

The U.S. recorded a budget deficit of 68.42 billion dollars in June, the 21th in a row, the Treasury announced.

But the deficit is down by 27% compared to 94.33 billion dollars in June 2009.

Over three quarters of the fiscal year ended September 30, the deficit amounted to 1.004 billion dollars against 1.086 billion in the comparable period of fiscal year 2009.

The latest projections for the deficit in 2010 will be given by the White House July 23 normally. In February, it expected a deficit of 1.600 billion dollars against 1.400 billion in 2009.

Noting a marked turnaround that after months of sluggish demand, Lufthansa is optimistic about his chances to reach its profit target by 2010.

"Despite the first negative quarter and the closure of airspace early April, the developments in recent months has reinforced expectations of a higher operating profit in 2010 than last year," reads a statement released Monday by the airline before a meeting with investors.

In May, Lufthansa had already confirmed its 2010 target of a higher operating profit to 130 million euros generated in 2009.

The company also revised up slightly its forecast for the fuel bill this year, seeing now to 5.3 billion euros against 5.2 billion previously.

About 10:40 GMT, Lufthansa advanced 1.10% to 11.91 euro, making a little more than the index values involving the airline and travel industries (0.57%).

The gas price for individuals is expected to rise 9.5% on 1 April, Wednesday said a source familiar with the matter in accordance with the application of a new method for calculating their evolution. The Commission for Energy Regulation (CRE) is expected to meet Thursday to consider a proposal to this effect of GDF Suez, the source said, confirming a report in the daily Le Figaro. CRE Suez and GDF have declined comment.

Under the new rules for setting regulated rates, intended to make developments more predictable, the government sets an annual schedules determining the framework within which the price of natural gas. GDF Suez is then responsible for proposing increases or decreases in rates within this framework.CRE approves or rejects the proposal submitted by the private group through a binding opinion.

The role of the CRE is limited to verifying the correct application of the formula for calculating the cost of supply of GDF Suez, which takes into account the level of crude oil prices, oil and exchange rates. The proposed tariffs are regulated mainly by GDF Suez (ex-Gaz de France) but also by 16 local suppliers, such as Gaz de Grenoble, Energy Services Occitan, the Municipal Board of Réole, etc..

While the station had generated a profit of 575 million euros in 2008, she recorded for 2009 a net loss of 980 million. Explanations.

The economic crisis worsens the crisis of cargo

Last year, rail freight has made a negative operating margin of 337 million euros. The area subject to competition since 2006, was rolled in 2009 by the slowdown in trade, which affects large customers, such as automotive or steel. "But it's time that business is not flourishing," said Eric Falempin, general secretary of FOR Railwaymen. The causes are multiple. On the one hand, the group acknowledges that it focuses too much on its strategy the only passenger traffic at the expense of transporting goods.On the other hand, to compete and offer better rates, "the station offers its clients not to work with Fret SNCF but with its subsidiaries, or as Geodis UFLI! Accuses unionist. After should not s 'surprising that the turnover of the freight station down … "

Many plans (Veron, Marembaud, Nadal …) have succeeded in an attempt to revive the business. The latest one was presented in September by the SNCF. But the opinion of the union, it is precisely this kind of plan that participates in the destruction of cargo, since it leads by example "abandonment from 50 to 60% of car traffic alone. The government simultaneously announced a comprehensive plan for development of rail freight, with the key, 5 to 7 billion investment by 2020.But until that plan is bearing fruit, the deficit in the freight business has not stopped widening.

The travel industry no longer compensates

Unlike previous years, activity on passenger lines (Coral, TGV, Thalys, Eurostar) did not offset the discomfort of cargo in 2009. Its margin is down 27% to 1.15 billion euros. The TGV activity in particular, which had allowed the accounts of beneficiaries from 2003 to 2008, suffer in turn in 2009. "Hit by the crisis, businesses save on transportation. Executives only travel first class," says Eric Falempin. Management also mentioned the increase in tolls that the group must pay to Network rail of France (RFF) to run its TGV. In one year, they jumped 10.9%, while the number of trains has increased by only 1.9%.Between 2008 and 2013, the bill charges expected to increase by more than 900 million euros, according to Voices. Eric Falempin recalls that if the RFF and the increasing rates, it's because "when the split with the station in 1997, the RFF, which inherited the bulk of the debt that she must pay as it can. "

Nearly one billion of write-downs

In practice, the station must, as an issuer of debt securities in financial markets, presenting the accounts in IFRS, and this since 2007. These rules require that assets be valued at their value in use, ie the amount of cash flows expected from use of these assets. Now the group has depreciated to 245 million in infrastructure and 721 million euros of assets in the cargo, or one third of the locomotive fleet. Translation: The industrial tool is not able to generate profit.A message that does not like unions, who fear that justifies expedited freight subsidiary, seen as a first step towards privatization of the industry.

Furthermore, the timing of this operation "clean" balance sheet is not trivial, while the public company is preparing to compete. Indeed, the partial liberalization of international guidelines has been effective since December 2009. "In depreciating assets cargo to 0, it eliminates the future depreciation on the cost of locomotives, said Olivier Grivilliers, a partner at Crowe Horwath International. This is loaded 2009 with all the expected losses in the future to preserve the group's future results "..

In painting too dark a picture of the financial group, SNCF hopes that perhaps the state will give him a boost."After all, said Eric Falempin, the government has the final word on the toll increases of the RFF.