London afternoon: Stuck in consolidation mode

28th Oct 2010 14:53

After going into a slump just ahead of midday, Footsie picked up over the lunch time session, helped by expectations of a firm start on Wall Street. The Anglo-Dutch oil giant Royal Dutch Shell grew earnings by 18% in the third quarter compared with a year ago, while the underlying figure rocketed 88% to $4.93bn, well ahead of market forecasts. Earnings, on a current cost of supplies (CCS) basis were $3.5bn, up from $3bn a year ago, though that was well below the $4.5bn it made in the second quarter. Mining firm Kazakhmys hailed another solid quarter of copper production and said it remains on course to hit its full year output target. Copper cathode production for the first nine months of 2010 totalled 239 kilotonnes (kt). The company has set itself a target of producing at least 300kt during the course of 2010. Other miners, Rio Tinto, BHP Billiton and Xstrata are in the blue.Not so good news for AstraZeneca where third quarter sales eased 4%, or 2% using constant exchange rates (CER), to $7,898m from $8,200m a year earlier. Underlying profit before tax dipped 10% to $3,083m from $3,437m.The champagne corks are popping at oil giant BG after production began at the 100,000 barrel a day facility on the lucrative Tupi field in the Santos Basin, offshore Brazil. BG has a 25% interest in block BM-S-11. As well as the oil, it's expected to produce up to 177m standard cubic feet of gas every day.Societe Generale has upgraded its view on on fashion retailer Next to 'hold' from 'sell' on the prospect of price increases next year. "We see price inflation as a 'get-out-of-jail card' for all but the lowest-priced clothing retailers," the broker said.Premier Oil has been awarded five new licences in the 26th UK Licensing Round, including several blocks close to its existing interests in the Central North Sea. The company, which already has a 35% interest in the potentially huge Catcher field, said the wins, announced yesterday by the Department of Energy and Climate Change, include two operated licences.Revenue jumped 30% at Aggreko on a constant currency basis during the third quarter, and the temporary power and temperature control expert now thinks full-year profit will beat consensus forecasts. The football World Cup in South Africa this summer, a heatwave in America and increase in prices pushed sales up 34% at the Local business in the three months to September 30. It predicts full-year profits of around £300m, better than the current consensus of £290m.Hovis bread owner Premier Foods said total group sales fell 4.2% in the three months to 30 September after a reduction in non-branded sales. "We still aim to make progress in the full year but the slowdown in Q3 means this is likely to be more modest and is, as always, dependent on Christmas trading," said Branston Pickle and Bisto gravy owner.Asia-focused oil and gas firm Salamander Energy said drilling has started on its Marindan-1 exploration well in Indonesia. The Marindan-1 well, located in the Kutai production share contract (PSC), East Kalimantan, will be drilled to a depth of around 3,265 metres true vertical depth sub-sea. It is targeting gas in multiple stacked sequences comprising both sandstone and carbonate reservoirs of late Miocene to early Pliocene age.Speciality chemicals supplier Croda posted a 57% surge in pre-tax profit boosted by a strong performance at its consumer care business and added that momentum was expected to continue into 2011. Small company consultancy Strontium reported a jump in pre-tax profit from £17,000 to £174,000, as revenues grew from £1.73m to £2.37m in the year to June 2010. These figures exclude the Australian business which was sold at the end of the period. Strong cash flow from the business meant that Strontium ended the financial year with £658,000 in the bank.Conroy Diamonds and Gold is raising £1.8m via a placing and subscription at 6p a share to help finance exploration at the Clontibret and Clay Lake gold targets. In addition, Professor Richard Conroy is capitalising debt of £600,000 at the same share price. That will leave Professor Conroy with 21.9% of the company.