International Business News

France Telecom has hardened its dividend policy and its promise of deferred stock repurchases facing a price war triggered by the new entrant Free Mobile on the French market mobile telephony.

The incumbent, who on Wednesday released 2011 results consistent with its objectives, expected this year to give priority to the preservation of its balance sheet in a context of de gradation-than-expected economic conditions.

"2012 is the most difficult year for us," said Chief Financial Officer Gervais Pellissier during a conference call, considering that the group could reach a low point this year e before a possible rebound in 2013. 

"We do not imagine that the price war is very long in France. We started at a price level which is extremely low, "he said

. Free has an entry burst onto the market of mobile phones last month with two offers at bargain prices, forcing its competitors in place to review the rates down a portion of their offerings in an attempt to prevent ; expensive an exodus of their subscribers

. While the group led by Xavier Niel has not yet provided the number of subscriber s, France Telecom said on the other hand have lost 201,000 mobile customers from the beginning of the year and February 15, which represents approximately 0.7% of its fleet of 27 million customers in France

. Requests for subscribers seeking portability to switch operators while keeping their digital ; ro peaked at 150.000 requests per day within two days following the launch of Free Mobile, France Telecom said in a statement, adding that this figure has since been divided by ten.

NET CASH FLOW BACK TO THE 2012

In this context of increased competition in France, which still accounts for half of sales in Orange and more than 50% of its total EBITDA, France Telecom expects a significant decline in its operating cash flow expected to 8 billion euros for 2012, against 9.33 billion last year.

Sensed as a part of investors, the group announced an adjustment to its dividend policy.

The group now plans to pay under the 2012 and 2013 earnings to shareholders between 40% and 45% of operating cash flow for the year. 

The dividend should therefore be between 1.21 and 1.35 euros per share for 2012, instead of 1.40 euros previously promised by the group, Gervais Pellissier said.

Also in order to preserve its financial strength, France Telecom has also decided to postpone the redemption of shares, a time considered in the wake of the sale of the group's subsidiary in Switzerland for $ 1.5 billion.

"We believe that the financial circumstances of early 2012 did not allow to continue in that direction today," said Gervais Pellissier.

"It does not mean that there will be no buyback at France Telecom Orange but not in 2012," he added. 

EUROPEAN OPERATORS UNDER PRESSURE

These prudent measures reflect the challenges facing European telcos to continue to grow in an environment of increased regulatory and competitive pressures.

Telefonica has lowered its target for the December dividend it will pay under 2012 in order to control its debt in a context of sluggish economic growth in Spain.

Analysts said France Telecom could have even less hesitation than the dividend, far more generous, offered by the group did not result in a brilliant performance of its stock price in 2010 and 2011. 

"There is no doubt that the group saw little point in paying a dividend for which it has received little or no credit," say analysts at Bernstein Research in a note .

At 10:20, as the advance of 1.53% to 11.62 euros. Since the beginning of the year, it posted a drop of 4.0% compared with a decline of 0.85% of the telecoms sector index.

The full year 2011, the Group generated a turnover of 45.28 billion euros, against 45.27 billion expected on average according to Thomson Reuters I / B / E / S.

The adjusted EBITDA was $ 15.083 billion, giving a margin of 33.3%, limited decline of 1.1 points, thanks in particular to the resistance displayed by activities in France, despite already increased pressure on prices, most operators have anticipated since last year the arrival of Free. 

The group has seen its share of conquest in broadband up to 30.5% in 2011 thanks to the success of its offers "quad play" Open totaling 1.2 million customers in late last year.

List of stocks covered Wednesday at the Paris Bourse, where the CAC 40 index was up 1.01% to 3,409.69 points at 24:08, notably supported by the comments of the governor of China's central bank promised Europe to support the crisis.

* Values ​​European BANK (2.46%) signed the largest increase in the sector in Europe for about the governor of the PBOC as investors also hope qu'Antonis Samaras, the leader of the Greek conservative party New Democracy, submit his written support for new austerity measures adopted in the country.

BNP PARIBAS (6.22%), which is expected this year to stabilize the crisis in the euro zone but does not anticipate a recession in Europe is ahead of increases in the CAC 40 and SBF 120 index. 

SOCIETE GENERALE advance of 4.11% and Crédit Agricole.

* The CYCLIC are well oriented. The French economy has withstood the fourth quarter with a growth surprise of 0.2%, thanks to foreign trade and investment, while activity ; contracted in Germany and Italy.

RENAULT wins 3.65%, 3.16% and STMICROELECTRONICS LAFARGE 2.2%. The pan-European Stoxx index of auto sector advance of 1.47% and 1.22% of the construction.

* In contrast, PSA was down 1.72%, largest drop in the CAC 40. The group announced new savings and a comprehensive plan for asset sales in order to redress the financial situation of the group after a year marked by a relapse in 2011 net profit.

Moody's placed the ratings under review with the manufacturer as possible downgrade.

* PAGESJAUNES fell 12%, largest drop in the SBF 120 volumes representing already seven times their daily volume the past three months. The group announced that its board would propose as an exceptional pass the dividend for 2011, after registering a decline in its revenues and profit margins last year.

* BIC (4.2%) released 2011 results sharply higher through its consumer business (stationery, lighters and razors) and said target operating margin for 2012 Standardized e "near the record level reached in 2011."

* DANONE (1.59%) stated address with confidence after 2012 achieved its growth targets for 2011 thanks to its good performance in emerging markets where the group re alise today more than half of its sales. 

* Haulotte Group (10.23%) leads to increases in the CAC Mid & Small, supported by the announcement of a 23% growth in turnover in 2011 of the truck manufacturer é ; lévateurs.

* Abandons EUROPACORP 2.55%, the producer and distributor of films that have shown a fall of 58.2% of its turnover in respect of its fiscal third quarter.

On the eve of the 51th Paris Boat Show, the uncertainty is set at the manufacturers of pleasure boats in 2012, the sovereign debt crisis with little visibility, while the water sports market has improved slightly in 2010 / 2011.

French production increased 11% between September 2010 and August 2011, compared to the same period in 2009/2010, while the world market has increased slightly from 0% to 3%, said the Federation of Nautical Industries ( FIN).

"We are in a somewhat unique because our customers are there, the practice is growing, but at the same time we are in a period when accumulated outside the marine industry factors of concern," said Yves Lyon Caen, Vice President and President of the END of the supervisory board of Beneteau.

"The day there will be a release of the brakes, mainly psychological, the industry will rebound very important," he pointed out, however.

The rate of exports is 67% in 2010/2011, against 63.2% a year earlier.

The European Central Bank is considering to extend the maturity of its loans to banks in two or even three years, wanting to prevent the crisis in the euro area does not cause a "credit crunch" that would stifle the economy, we learn of sources familiar with the matter.

The ECB considers this unprecedented opportunity, while growing fears of an explosion in the euro area affect the interbank market, banks tend to reduce the number of establishments to which they lend.

For now, the maximum maturity of liquidity operations of the ECB is one year.A bank to finance two or three years from the ECB, it could be misinterpreted. "

Another source said that the ECB was considering the possibility of providing liquidity to maturity in the same vein through several short-term loans, pledging to keep such a line of credit for a period up to three years.

In June 2009 the ECB has proposed for the first time refinancing operations to one year. She repeated this year with a LTRO to 12 months in October and 13 months in December.

The lobbying firm Clark Lytle & Geduldig Cranford offers 850,000 dollars to the Association of American banks to undermine media-movement Occupy Wall Street. These indignant protest against the Wall Street financial crisis behind, growing inequality and policy failures, they accuse of being subject to the bosses of finance or business. They claim to represent the aspirations of 99% of Americans, arguing that 1% of the population owns most of the wealth and is always preferred.

Lobbyists deemed related to banks, proposed a $ 850,000 plan to attack the movement Occupy Wall Street (OWS) and the politicians who would support him, reported Saturday the U.S. television network MSNBC.In a four-page memo, the Washington firm Clark Lytle & Geduldig Cranford (CLGC) propose to the Association of American banks (ABA) to conduct a "search" Occupy on Wall Street to "build a story negative" on the move , "to place in the media," and on "those who support them," according to the memo published by MSNBC. If the Democrats support OWS, "it would mean more than a temporary embarrassment for Wall Street. This can have an impact long-term political and financial companies for the heart" of Wall Street, the memo adds.

"It may be easy to dismiss OWS as a group of protesters demonstrated disordered but rather they should be treated as competing organized, highly skilled and able to work the media.

The European Commission will Wednesday unveil new rules for new rules to limit the power of rating agencies. The suspension of a rating and the attack to justice agencies include planned. Moody's in New York.

The "blunder" by Standard and Poor's comes almost timely for the European Commission. Brussels Wednesday will unveil a range of measures to regulate rating agencies, and the announcement erroneous degradation of France by S & P should increase the willingness of the European regulatory agances. Details of the measures to be adopted.

Suspend a rating

The Commission will decide to suspend the rating of a State in case of excessive volatility or if it is under European aid program. This decision can be explained by the previous in Greece.

Attack to justice agencies

Any investor can now sue an agency and ask for damages. Brussels wants to create "a European framework of liability in case of serious misconduct or gross negligence." A new measure that should appeal to France after the "true-false" degradation Standard and Poor's.

Impose a turnover in the agencies

Brussels wants to put some competition in the "Big Three", Moody's, Standard and Poor's and Fitch Ratings. The idea of ​​creating a European agency was abandoned now Brussels wants to impose a rotation to the actors who are noted. Clearly, companies and states will be required to change agencies every three years, to encourage competition between agencies. But the idea has been criticized not only by the agencies but also by some of their clients.

Ubisoft has reduced its loss of more than half in the first half, picking a few benefits of the shift to online games and confirms return to operating profitability in the green in 2011-2012.

Highly anticipated by financial analysts on its increasing strength in online games and its focus on higher quality games, the French publisher said it had generated 30 million euros in revenue through "online" in the first half , an increase of 85% for a segment usually very profitable group which was until recently absent.

"We are on track (…

U.S. GDP grew by 2.5% in the third quarter, annualized. This level was accelerated by the rise in household consumption and private investment. Barack Obama at the press conference on July 15, 2011 on U.S. debt

GDP figures published Thursday in the United States show a marked improvement in U.S. growth and suggest a strengthening of the recovery, indispensable prelude to a decrease of mass unemployment affecting the country. The first estimate of Commerce, the U.S. domestic product grew in the third quarter from 2.5% annualized over the second. The number of government reflects a significant improvement over the spring which saw growth rise to 1.3% after falling 0.4% recorded in the first quarter.

The period July to September is the best quarter of the U.S. economy since the summer of 2010. The ministry said the growth was driven by the acceleration of private consumption and private investment excluding housing, which combined made up 3.3 point rise in GDP. The main obstacle to the improvement of gross domestic product was slowing, very strong, the increase in business inventories, which lost 1.1 points of growth.

Peter Newland, economist at Barclays Capital, the sharp change in stocks of summer is "a sign that companies have responded quickly to the weakness of domestic demand in the first half, and it is unlikely that [the slowdown in output stored] is repeated in the fourth quarter. "

The major European chemistry warned Thursday the announcement of their results as demand slowed in the construction sector, compounding their problems related to rising commodity prices.

BASF, the world leader in chemistry in terms of sales, announced Thursday a quarterly profit above expectations, but warned that its growth was slowing, clients sell their stocks.

"BASF's customers are more cautious, reduce inventory and postpone some of their orders in hopes of a possible drop in prices," explains the German group said in a statement.

The chemical sector is highly dependent on investments in highly cyclical sectors such as automotive or construction, which makes it more vulnerable to economic downturns.

In addition, the high cost of operation of its huge factories plunged the benefits as soon as the demand and the rate of capacity utilization decreases.

The slight decline in oil prices since last May, however, somewhat reduced the rising costs of certain petrochemical feedstocks.

"Europe seems to be the worst of markets.We were very pessimistic about the prospects for growth, assuming we can even talk about growth, "said Jan Hein de Vroe, an analyst at ING.

"They keep all their earnings forecasts, but they were at the base not very restrictive," he added.

OBJECTIVES LOWERED

The Belgian Solvay, which in September bought its French rival Rhodia, said the demand for vinyl and specialty chemicals had slowed, while maintaining its forecast of net profit up on its activities in plastics and products chemicals.

Rhodia also confirmed its own perspectives.The French group posted a recurring EBITDA (REBITDA) of 273 million euros against 235 million a year earlier. Its turnover was 1.67 billion euros against 1.36 billion a year earlier.

German Bayer has meanwhile indicated that its MaterialScience arm, which produces the clear plastic used for panoramic roofs coupe convertible SLK Mercedes (Daimler), this year would have an adjusted operating profit of 1.3 billion euros.

Bayer previously provided a similar result to that of last year (1.36 billion euros).The group justified the downward revision by higher prices of raw materials and energy.

Bayer, however, confirmed its outlook and published a comprehensive annual quarterly results better than expected thanks to strong growth in emerging markets.

Last week, Dutch AkzoNobel, the world leader in paints, had abandoned its 2011 profit target, involving the slowdown in economic growth and rising costs, including titanium dioxide (TiO2), a pigment white.

Tuesday, the American DuPont, which produces titanium dioxide, announced quarterly earnings higher than expected.

The placement of the French No. 1 would be the victim of a crisis of confidence? Withdrawals from contracts of life insurance were up 1.8 billion euros in deposits last month. Life insurance, savings, piggy.

Withdrawals from contracts of life insurance on deposits were higher in September, a phenomenon already observed in late 2008, according to figures released Monday by the French Association of insurance.

The net outflow of insurance contracts reached 1.8 billion euros in September, confirming the dire straits facing the preferred placement of French. In September, 9.7 billion have been placed on these contracts. In nine months, the collection of contributions amounting to 98 billion euros, down 11% over the same period in 2010, the association said in a statement.

In detail, 83.4 billion were paid on the supports euros and 14.6 billion euros in the media unit of account (capital not guaranteed). "An outflow of EUR 1.8 billion does not affect the attraction of investors to the guaranteed investment whose remuneration is attractive," said the President of the French Federation of Insurance Companies (FFSA) Bernard Spitz, in an interview with Le Figaro newspaper published Monday.

He said the phenomenon of redemption affects only a little more than half of the 11.5 billion euros of withdrawals, which also reflect the aging population, with retirees who are drawing more and more in their life insurance.

A Booklet has not particularly benefited from the alienation found in September for life insurance, recording an average level (1.13 billion euros).