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Coca-Cola HBC earnings rise, Sirius enters shaft-sinking contract with DMC

By Josh White

Date: Wednesday 14 Feb 2018

(ShareCast News) - London open
The FTSE 100 is expected to open 53 points higher on Wednesday, having closed down 0.13% at 7,168.01 on Tuesday.

Stocks to watch

Europe-focussed bottler Coca Cola HBC reported full year earnings before interest and tax (EBIT) of €621m, a rise of 20% on net sales revenue of £6.5bn, up 4.9%. "Strong in-market execution, supported by an improving economic environment, resulted in excellent top-line growth and margin expansion in 2017. We are particularly pleased to have achieved revenue growth through a balanced delivery of both volume and price/mix," the company said.

Sirius Minerals has entered into a design and build contract with shaft sinking and mining contractor DMC Mining Services for the construction of the four shafts required for its polyhalite project in North Yorkshire. Managing director and chief executive officer Chris Fraser said: "Sirius continually seeks opportunities to use innovations and a commercial approach to accelerate development and unlock value. DMC has proven, world leading experience using Herrenknecht SBR technology on deep shafts and represents a strong partner, commercially aligned to our success. "We are confident that they can deliver the North Yorkshire polyhalite project shafts significantly earlier than all previous expectations and we look forward to working with the team."

Serco Group updated the market on its planned acquisition of a portfolio of selected UK health facilities management contracts from certain subsidiaries of Carillion on Wednesday, reporting that a revised business purchase agreement had now been signed with the special managers and provisional liquidators acting on behalf of the relevant Carillion divisions. The FTSE 250 company said the agreement covered "substantially" all of the assets that were the subject of the previous agreement. Upon the receipt by the special managers and provisional liquidators of the requisite third-party consents, each individual contract will be transferred to Serco on a cash-free, debt free basis, with the consideration to be paid in instalments and to be satisfied using Serco's existing financing facilities.

Newspaper round-up

MPs are planning to make an unprecedented use of their parliamentary powers to publish a report into the mistreatment of thousands of small and medium-sized companies by Royal Bank of Scotland. Nicky Morgan has asked the Treasury select committee, which she chairs, to support the release of the confidential document, having used parliamentary privilege to obtain it from the Financial Conduct Authority. - The Times

The African National Congress has threatened to throw President Zuma to the "vultures" in parliament and suffer the indignity of being kicked out if he does not resign. "When you resist you leave us no choice but to let you fry in the vote of no confidence because it means you do not respect the organisation," Gwede Mantashe, the ANC chairman, said. - The Times

For the first time in years, Vladimir Putin has cancelled several public appearances due to illness - prompting speculation about the long-term durability of a leader feted for his virility. On Monday, there was no visit to Sochi. Today, there was no discussion of microelectronics in the Kremlin. Tomorrow, the President will not make an appearance at the "Mentor 2018" forum in Moscow. And next week, he will not travel to the Russian Far East. - The Independent

A man has been shot dead in a republican area of west Belfast. The victim was fatally injured in a shotgun blast at a house on the Poleglass estate. It is believed the man, who was in his 20s, was shot in the chest as he opened the door of the property at around 8pm, according to the Police Service of Northern Ireland. He is believed to have been shot in front of two children. - The Guardian

Almost half of those who have taken out car finance deals - representing almost three million British drivers - don't know how much they've borrowed to fund their vehicles. That's just one of a number of astonishing claims from two new surveys that have raised fears of a financial crisis sparked by debt. Almost nine in 10 of people with existing finance arrangements admitted in the polls that they don't understand the small print in their contracts - including excess mileage fees that could send costs spiralling. - The Daily Mail

Israeli police have recommended charging Benjamin Netanyahu with accepting bribes worth 1 million shekels (£200,000), dealing a potentially serious political blow to the long-serving Israeli prime minister. After more than a year of investigating, Israel's police said there was enough evidence to prosecute Mr Netanyahu on allegations he accepted lavish gifts from wealthy businessmen and tried to negotiate a corrupt deal with a newspaper publisher. - The Telegraph

US close

Wall Street indices managed to keep their head above water by the close on Tuesday, having opened on a downbeat note following two days of gains, as investors looked ahead to key inflation data that was set for release the next day.

The Dow Jones Industrial Average finished up 0.16% at 24,640.45, the S&P 500 was ahead 0.26% at 2,662.94, and the Nasdaq 100 managed 0.46% of gains to close at 6,553.86.

Headline CPI, which came in at up +2.2% in November but slipped back to 2.1% in December, was seen slipping again by economists to 2.0% for last month, but rising by 0.4% month-on-month.

"We expect that core services prices rose around 0.25% month-on-month, with the monthly increase in rents cooling off slightly compared to previous months," noted analysts at HSBC.

"We expect that core goods prices were close to unchanged in m-o-m terms, with new and used vehicle prices holding relatively steady.

"Meanwhile, we estimate the headline CPI increased 0.4% m-o-m in January, with average gasoline prices rising by around 5%."

HSBC said it expected the year-on-year headline CPI inflation rate to slow to 2.0%, down from 2.1% in December.

Data released earlier in the day showed that small business optimism in the US improved more than expected in January.

The index of small-business optimism from the National Federation of Independent Business printed at 106.9 last month, up from 104.9 in December beating expectations for a reading of 106.2.

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