London pre-open: Lloyds plays 'pick a number'

8th Nov 2011 07:34

London is set to make a quiet start, possibly because traders are trying to determine which numbers to focus on in the trading update this morning from Lloyds Banking. City sources predict the FTSE 100 will open up 9 points from yesterday's close of 5,527. Part-nationalised lender Lloyds Banking said it made a profit before tax of £1,748m for the first nine months of the year on what it calls a "combined businesses" basis, which it believes provides more meaningful comparatives. On a statutory or "as reported" basis, the group made a loss before tax of £3,858m after making a £3.2bn provision earlier this year relating to possible claims relating to mis-selling of payment protection insurance. Total income (before volatility effects, the impact of liability management exercises and net losses on asset sales) decreased by 9% to £16,095 million, reflecting subdued lending demand, continued customer deleveraging and a lower banking net interest margin, the company said.Third quarter profit before tax tumbled to £644m from £820m in the second quarter on a combined businesses basis. The impairment charge for bad debts improved considerably, declining to £1.96bn from £2.81bn in the third quarter of last year.Retail bellwether Marks & Spencer saw like-for-like (LFL) sales (excluding value added tax) in the 26 weeks to October 1st rise 0.5% from a year earlier, with food sales up 2.1% on a LFL basis but general merchandise sales down 1.3%. Underlying profit before tax slipped to £315.2m from £348.6m last year. The interim dividend has been maintained at 6.2p.Associated British Foods, the foods group that also owns the Primark clothing chain, announced full-year revenue and pre-tax profits that were ahead of market expectations. Revenue was up 9% to £11.1bn, versus market expectations of £10.96m, while adjusted profits before tax edged up 1% to £835m, versus expectations of £802.2m. "Opportunities for further investment are exciting, particularly in Primark, and the strength of the group balance sheet and a strong cash flow will enable us to pursue them with confidence," said George Weston, chief executive of the company.Mobile phone network colossus Vodafone saw profit before tax ease 2.8% to £6.64bn in the six months ended September 30th from £8.24bn the year before, on revenue that rose 4.1% to £23.5bn from £22.6bn last year.--jh