London open: Dull start for Footsie

12th Aug 2009 08:45

London's leading share index is in reverse gear again as the banks drift lower with miners also weak after BHP Billiton's figures and four Rio executives being charged with bribery by China. Full-year profits have halved at miner BHP Billiton as the recession slashed volumes and sent prices tumbling, although restocking and improving demand is brightening the outlook. The world's largest mining company said profit before tax tumbled to $11.6bn in the year to 30 June from $23.5bn in 2008 on revenue down 16% to $50.2bn.Meanwhile, the Chinese authorities have formally charged Rio Tinto executive Stern Hu with bribery and violating commercial secrets, raising the prospect of seven years in a Chinese jail. Australian citizen Hu, Rio's chief negoiator of iron ore sales, was arrested with three Chinese colleagues who work with him at the world's third-largest miner.Banks are lower again as the excitement of last week's results dissipates further. The FSA today will publish its report on financial remuneraton. Lloyds and Barclays are both lower. Package holiday group TUI Travel saw a sharp rise in third quarter profits with good trading in the UK, Nordics and Germany outweighing an adverse impact from the swine flu outbreak. Revenues for three months to June fell by 1% to £3.58bn, while underlying operating profit rose by 57% to £102m. Thomas Cook is up in sympathy.A strong pipeline of orders from the public sector helped engineer and construction contractor Balfour Beatty post a rise in pre-tax profits and revenues in the six months to June 27. Revenue climbed to £5.1bn from £4.3bn over the same period the previous year as pre-tax profit before exceptional items rose to £108m from £95m. The interim dividend climbed 8% to 5.5p.Platinum miner Aquarius Platinum slumped into losses in the year to June 30 as prices for the precious metal collapsed from the highs they reached in the middle of last year. The company posted a pre-tax loss of $97.4m for the year, compared with a profit of $536.8m over the same period the previous year as revenues slumped to $310.6m from $919m.Royal Bank of Scotland has agreed to sell its Pakistan unit to MCB Bank for $87m (£53m). The UK lender, 70%-owned by the British government, said it has reached agreement in principle for the sale of its 99.37% to Pakistan's largest bank.Legacy software specialist Micro Focus has predicted a running twelve-month revenue contribution of $150m from recent acquisitions Compuware and Borland. Combined EBITDA margins will be approximately 15% in the first year of ownership, well below the rest of the group, but with the longer term seeing a move towards the group target of approximately 40%, it added.