Updates from Serco, IMI and RBS
The German Dax fell -0.82% while the Dow Jones slipped -0.23%. Overnight in Asia Japanese stocks pushed up sharply, up more than 2% due to slumped yen.
First this morning, outsourcing specialist Serco. The company claims full year expectations should be met while there's an improvement in performance in the second-half of the year. So far the company has amassed £5.6bn of contract awards.
New UK business include a £350m contract to operate the ferry services to the Northern Isles of Scotland plus a £175m Compass asylum seeker support services contract. Serco has also been awarded preferred bidder status for two environmental services contracts for Canterbury City Council and Wycombe and Chiltern District Councils - a combined value of £90m.
"We expect an increase in full-year operating margin similar to that achieved in 2011," said Serco this morning, "reflecting the pick-up in second half revenue growth and the delivery of underlying efficiencies."
Next, engineering player IMI. Some weakness from its Fluid Power division with organic revenues slipping 4% thanks to a slowing commercial vehicle sector. But there's better news from its Severe Service unit with strong organic growth.
"This improved mix in the order book, coupled with ongoing improvements in productivity at the Brno manufacturing facility in the Czech Republic underpin our expectation of a healthy improvement in margins," says IMI.
After adjusting for acquisitions and exchange rate movements, revenues for the four months to the end of October are 3% ahead of last year and 4% ahead for the 10 months year to date. On a reported basis, IMI revenues are 5% and 6% ahead.
Lastly, the taxpayer may not see a return on their £66bn cash from Lloyds or RBS for many, many years. Perhaps not ever. That's the depressing conclusion of a new Public Accounts Committee Report.
"It seems inevitable that their 'temporary public ownership' will last for some time, if getting value for our investment remains the most important objective for Government," says the report. "We were not convinced that the taxpayer would be making a profit on these banks any time soon."
Currently the taxpayer owns 82% of RBS and 40% of Lloyds.