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Issue 1,262 Friday 12 November 2010 www.cityam.com FREE

STORM CLOUDS GATHER

AS G20 LEADERS MEET
■ Group of Twenty in ■ Ireland moves ever ■ Oil price hits a fresh
Seoul clash on growth, closer to the brink as 25-month high of $88 a
currencies and trade bailout fears mount barrel on China demand
WORLD ECONOMY
▲

BY JULIET SAMUEL AND KATIE HOPE its own disease”.

IRISH ten-year bond yields shot to
their highest level since the founding
of the euro yesterday, closing at 8.6
per cent, as German chancellor
Angela Merkel used a speech at the
G20 summit to suggest that bond-
holders should be on the hook for
losses rather than taxpayers if the
country defaults.
“We cannot keep constantly
explaining to our voters and our citi-
zens why the taxpayer should bear
the cost of certain risks and not those
people who have earned a lot of
money from taking those risks,” she
said to the gathering of world leaders
in Seoul.
Ireland’s debt is fully covered until
the middle of next year, meaning it
will not have to borrow from the
bond market at the current high
rates. But Merkel’s insistence that the
new EU bailout agreement should
force private investors to shoulder
more of the costs has spooked the
market.
The International Monetary Fund
(IMF) said yesterday that Ireland had
not yet asked for help with its debt,
but the prospect of a bailout looms if
the republic cannot convince markets
of its credit-worthiness.
“The most likely outcome now is
that Ireland will need to receive assis-
tance from the EU/IMF,” said Gary
Jenkins at Evolution, who estimated a
funding requirement of around
David Cameron, Barack Obama and Angela Merkel are pushing for an agreement on currencies
€43bn (£36.4bn) over two years.
Escalating fears over Ireland came
as the price of oil soared to levels not
seen since 2008, with US crude top-
ping $88 (£55) a barrel this week.
Oil continued to hover close to its
two-year high yesterday after rising 10
per cent since the end of October.
The Organization of the Petroleum-
Exporting Countries (Opec) forecast
strong demand from fast-growing
emerging markets.
But rising energy costs are likely to
provide an additional headwind for
advanced economies still struggling
with the ongoing fall-out from the
financial crisis.
Global growth was high on the
agenda as talks entered their second
day in Seoul but hopes for a resolu-
tion to global capital imbalances and
currency disputes were already fad-
ing.
Prime Minister David Cameron
Pictures: REUTERS/ GETTY
used a speech at Peking University
this week to warn of a “dangerous
tidal wave of money” crossing the
world from indebted nations to those
with huge surpluses.
But there was little sign of a
response. Yesterday saw the US’s pro-
posal for current account surplus lim-
its removed from draft documents
and a Chinese ministry of commerce
official declare that America “should
not force others to take medicine for
Advanced and developing
economies have locked horns over
currency policy at the summit, with
China critical of the Federal Reserve’s
recent re-launch of its quantitative
easing (QE) programme.
The Fed has committed to buy
$600bn worth of treasuries in an
attempt to stimulate the sluggish US
economy, a move that former Fed
chair Alan Greenspan claims
amounts to an attempt to devalue the
dollar.
The US wants the G20 resolution to
include a clause condemning the
“competitive undervaluation” of cur-
rencies, in a clear reference to China’s
longstanding policy of holding down
the yuan to boost exports.
In an open letter to G20 leaders just
before the start of the summit,
President Barack Obama wrote: “Just
as the United States must change, so
too must those economies that have
previously relied on exports to offset
weaknesses in their own demand.” He
added that measures were needed to
“reverse significant undervaluation”
in certain currencies.
But America’s position, coming so
quick on the heels of its QE
announcement, has prompted claims
of hypocrisy from developing nations.
The currency row threatened to
overshadow other pressing issues on
the G20 agenda, such as how to tackle
the issue of sovereign default.
ALLISTER HEATH: P2

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 4 News
We must adjust to new global order
EDITOR’S LETTER
ALLISTER HEATH
IT takes time for new realities to sink
in, especially in economics and
geopolitics. One reason why the G20
meeting in Seoul won’t achieve any-
thing of any real substance is that the
old order still believes that it can play
by the old rules – and by that I mean
primarily the Americans. The Fed’s
decision to engage in a fresh round of
quantitative easing last week, even
though its economy grew by an annu-
alised two per cent in the third quar-
ter, was the last straw for the
emerging nations. They are convinced
that this is a deliberate ploy to weaken
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Deputy Editor David Hellier
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Night Editor Katie Hope
Associate Editor David Crow
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
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WHAT THE OTHER PAPERS SAY THIS MORNING
SMARTPHONES IN HACKING RISK
Certain smartphone models running
Google’s Android operating system
have security flaws that could allow
hackers to steal personal information
or record conversations, researchers
said this week. In a demonstration at
the Black Hat security conference in
Abu Dhabi, a UK researcher showed
how a vulnerability in the web brows-
er on an HTC Android phone allowed
him to install an application that
gave him broad control over the
phone.
MICROSOFT LINKS WITH SINA ON
MESSAGING
Microsoft has joined forces with Sina,
China’s largest online news portal
and microblogging site, in a deal that
could help the US group’s instant
messaging service grow into a size-
able player in the country’s internet
industry. MSN China, a joint venture
the greenback, inflate away the US
national debt (much of which is held
overseas) and boost US exports at the
expense of other countries.
There was a time when the rest of
the world would merely have lumped
it and accepted its fate. No longer. We
are now truly in a multi-polar world
yet one devoid of a proper roadmap.
The US remains the world’s most
important superpower but can no
longer impose its will either militarily
or economically; China is hugely pow-
erful, is starting to throw its weight
about but remains a developing coun-
try; the same is true, to a lesser
degree, of India and Brazil. Europe is
in steady relative decline; it remains
wealthy and stable but has lost its abil-
ity to translate its large GDP into true
power and influence. Japan is also in
decline, its economy eroded by an age-
ing population.
Any of these countries or regions
can now derail the global economy;
America last managed in 2008; there
is at least an outside chance that
Talks over EU
Budgets fail
EU ECONOMY
▲
BY HARRY BANKS
TALKS between European Union law-
makers and the bloc’s governments
over the size of the EU’s 2011 budget
collapsed yesterday, threatening to
throw EU finances into disarray.
The EU budget is a highly sensitive
issue this year in many of the EU’s 27
member states, especially in Britain,
because many governments are slash-
ing spending at home and are under
pressure to reject big increases in EU
expenditure.
The deadline for an agreement is
15 November and negotiators have
scheduled a last-ditch meeting for
Monday.
Failure to agree on the budget
would undermine many EU pro-
grammes, such as the bloc’s new
diplomatic service and multi-billion
that runs the service in the country,
and Sina on Thursday started to link
their instant messaging tools and
blogging sites.
OIL FIRE LINKED TO ROLLS-ROYCE JET
INCIDENT
An oil fire could have caused the
Rolls-Royce engine of a Qantas A380
superjumbo to break apart after take-
off last week, European regulators
have revealed, in the first official
comment on possible causes of the
famous aircraft’s worst safety scare.
CHINESE BUYING DRIVES COPPER TO
RECORD
Chinese buying has driven the price
of copper to a record high of nearly
$9,000 a tonne and traders warned
that prices could rise a further 25 per
cent next year to more than $11,000
as demand continues to outpace sup-
ply. The red metal is a crucial cog in
the global economy as its use in elec-
tronics and construction means it is
found in almost every appliance.
Europe could do the same if its sover-
eign debt crisis spirals out of control
and triggers another financial night-
mare. A recession in China would be a
disaster for the whole world. Three fac-
tors make this situation even more
unstable.
The first is that all of the new eco-
nomic superpowers are flawed, at
least in part; all are giants with feet of
clay. China is a dictatorship, attempt-
ing to construct a new civilisation
based on state capitalism; its currency
is deliberately under-valued, its con-
sumers don’t spend enough, its cen-
tral bank is hoarding too many assets
and its government desperately
attempting to prevent a new bubble.
India remains bureaucratic. Brazil has
yet to emerge from its regional sphere
of influence. The Western economies
suffer from excessive national debts,
failing welfare states and bankrupt
state pension systems; the emerging
economies lack a truly trustworthy
rule of law and their democracies, in
most cases, remain fragile.
euro nuclear fusion project ITER, said
budget commissioner Janusz
Lewandowski.
By law, unless a deal is reached,
next year’s EU spending will be the
same as in 2010 and disbursed in 12
equal instalments through the year.
“Not to have a budget would be a
very bad message to the European
public. We would be left ... without
the ability to finance ITER and the
external action service and the soli-
darity mechanism,” Lewandowski
said, referring to aid for EU countries
struck by natural disasters.
Budget commissioner
Janusz Lewandowski
said not agreeing a
budget would be “a
very bad message”.
WAL-MART OFFERS FREE SHIPPING
FOR CHRISTMAS
As the Christmas holiday shopping
wars heat up, Wal-Mart has dealt
what it hopes will be a killer blow to
its rivals by offering free shipping for
online orders on 60,000 products,
with no minimum purchase
required. The move will increase pres-
sure on other online retailers to fol-
low suit, as customers become
conditioned to ever more favourable
terms for purchases.
UK SHARES ARE FALLING OFF THE
RADAR OF BIG INVESTORS
The typical British defined-benefit
pension fund now has just one sixth
of its assets invested in home-grown
shares. The annual “Purple Book”
snapshot of the industry from The
Pensions Regulator, published yester-
day, showed sharp reductions in
investment in British equities.
The second problem is that there is
no proper mechanism for these pow-
ers to communicate. The G20 is too
unwieldy; the UN is flawed; all the
existing global institutions – from the
IMF to the WTO – are relics of a previ-
ous era. The third, related problem, is
that the world continues to use the
dollar as its main reserve currency
and unit of account, even though it is
a paper money that is primarily used
by the US to serve its own interests.
This relic of the post-Bretton Woods
era is no longer sustainable.
Remember when clever-silly pun-
dits used to believe that the euro was
about to dethrone the greenback as
the world’s currency? Today, with the
Eurozone on the verge of break-up,
this is self-evidently nonsense. A much
more sensible prediction is being
made by HSBC’s currency team, which
believes that the renminbi could
become the dollar’s main rival. We
shall see; but don’t expect any real
answers from the G20 today.
allister.heath@cityam.com
UBS boss Oswald Grubel saw the group lose millions over missent emails
Email loses UBS $10m
BANKING
▲
BY KATIE HOPE
A UBS banker has allegedly lost the
bank more than $10m (£6.2m) in fees,
after he sent an email detailing
General Motor’s (GM) upcoming float
to over a 100 of the firm’s clients.
The alleged leak was disclosed in
papers filed by GM with the US regu-
lator the Securities and Exchange
Commission (SEC).
GM’s filing warned that the email,
which contravened SEC rules govern-
CARE HOME FEES UP BY 20PC IN FOUR
YEARS
More than 20,000 pensioners were
forced to sell their homes to pay for
care last year, according to new gov-
ernment figures. But far more fami-
lies could find themselves facing
spiralling care fees, since most local
councils interviewed by the BBC said
they had considered reducing their
spending on care for the elderly. They
blamed severe budget cuts and an
ageing population.
“TOO BIG TO FAIL” BANK RULES TO BE
UNVEILED AT G20
The world’s largest banks will learn
more details of the plans by interna-
tional regulators to ensure that
financial institutions considered
“too big to fail” become less of a risk
to the global banking system, in par-
ticular banks that are “systemically
important”.
CITYA.M. 12 NOVEMBER 2010
NEWS | IN BRIEF
Disney misses forecasts
Walt Disney posted a rare quarterly
earnings miss after TV broadcasting and
theme park revenue fell, offsetting a
boost from smash "Toy Story 3" and
robust advertising sales. Disney's fourth-
quarter net income fell to $835m, com-
pared with $895m a year earlier. Total
sales fell one per cent to $9.7bn from
$9.9bn. Analysts on average had fore-
cast sales of $9.95bn. Wall Street had
expected better numbers from a compa-
ny that has exceeded earnings expecta-
tions in each of the past six quarters,
hoping that an improving economy
boosted advertising, parks, consumer
products and its other businesses.
Trinity Mirror sales slide 5pc
Trinity Mirror said in a trading statement
its like-for-like sales fell five per cent in
the four months to the end of October
and the national and regional newspaper
publisher said the environment would
remain tough into 2011. Excluding rev-
enue from GMG Regional Media, which
Trinity Mirror bought this year, advertis-
ing revenue fell 4.6 per cent and circula-
tion revenue fell 6.7 per cent. The stock
closed 1.9 per cent down at 106p.
Picture: REUTERS
ing IPOs, meant that investors who
bought GM stock could seek refunds
or damages because of the leak if UBS
had remained an underwriter on the
deal.
“We had no knowledge of the e-
mail until after it was sent, and the e-
mail does not reflect our views,” GM
said in the filing.
UBS, which is led by chief executive
Oswald Grübel, would have earned
an estimated $10m in fees in the
$13bn share sale. UBS declined to
comment yesterday.
APPLE'S IAD HELPING RIVALS
Apple’s iAd interactive mobile ad
service is having an unintended
impact on rivals: It’s largely helping
their businesses by generating broad-
er advertiser interest in mobile
phones and gadgets. When Apple
launched iAd last July, some industry
executives worried that they would
lose mobile advertising business to
the Cupertino, California company.
NISSAN RECALLS MORE THAN 600,000
VEHICLES
Nissan Motor is recalling more than
600,000 vehicles in North and South
America and Africa due to steering or
battery cable problems. The Japanese
auto maker said yesterday that the
steering recall affects 303,000
Frontier pickup trucks and 283,000
Xterra sport utility vehicles in the US,
Canada, Mexico, Argentina, Brazil
and other Latin American countries.
CITYA.M. 12 NOVEMBER 2010 News 5

PEPPA PIG TO DEBUT IN THE US

BA cabin crew deal in doubt
after union changes its mind on strike in the past year. ommend to our cabin crew members

▲
TRANSPORT
BY MATTHEW WEST
HOPES of an agreement between
British Airways (BA) and its cabin
crew faltered yesterday after the
Unite union suspended a ballot on a
deal offer from the airline.
Last month, Unite said it would bal-
lot staff on a new deal from BA which
seemed to address the main area of
conflict, the removal of travel conces-
sions for workers who had gone out
ENTERTAINMENT ONE said it had signed a three-year broadcast deal to screen its hit
pre-school TV show Peppa Pig in the US on Nickelodeon’s Nick Jr channel. The series is
broadcast in more than 180 countries and made more than £100m in merchandising in
the UK alone last year. Analysts said in the US merchandising could range between
£1.5bn and £2bn if the show is a hit. Details of the broadcast deal were not disclosed.
The dispute which began last year
has so far cost BA £150m and has seen
a number of walkouts led by Unite
which represents around 90 per cent
of the airline’s 12,000 cabin crew.
Unite had previously said it would
recommend its members vote to sup-
port the deal, but it said its cabin
crew representatives had now
changed their mind.
“It has been made clear on many
occasions that Unite and I personally
will not under any circumstances rec-
any offer that was not also recom-
mended by our elected representa-
tives,” Tony Woodley, the Unite’s joint
general secretary said.
“Under these circumstances, I have
suspended the ballot on the offer and
will meet with all of our cabin crew
representatives as a matter of
urgency to consider the next steps.”
BA said it believed the deal was fair
and could resolve the dispute which
started after it announced it was cut-
ting crew pay and reducing staff.

BG Group in a
$3.5bn Brazil
drilling deal
Construction of the hulls will start
▲

ENERGY
BY HARRY BANKS
BG GROUP has signed a $3.5bn (£2.bn)
contract to build eight giant floating
drilling platforms to help pump oil
from a string of discoveries off the
coast of Brazil.
BG and Petrobras, Brazil’s state oil
company, said the joint order for the
new vessels had been placed with pri-
vate Brazilian company Engevix
Engenharia.
BG will pay $911m of the total,
with the balance coming from
Petrobras, Repsol of Spain and
Portugal’s Galp, joint venture part-
ners in Brazil’s Santos Basin oil proj-
ect.
The floating production units
known as FPSOs will have the capaci-
ty to process up to 150,000 barrels per
day of oil and 6m cubic meters of gas
per day and are expected to be in
operation by 2017, Petrobras said in a
statement.
in March at a shipyard in the south-
ern state of Rio Grande do Sul with 70
per cent of their content sourced in
Brazil. The first two should be deliv-
ered in 2013 and the rest completed
by 2015. Of the eight units, six will be
used in the Santos Basin blocs where
the Tupi and Iracema fields are locat-
ed and which are operated by
Petrobras, BG Group and GALP. The
other two will be used in a bloc con-
taining the Guara and Carioca fields.
ANALYSIS l BG Group
1,300 p
1,277.50
11 Nov
1,200
1,100
1,000
16 Aug 15 Sep 14 Oct 3 Nov

Net wealth back to 2005

levels as housing recovers
home, followed by life assurance,
▲

UK ECONOMY
BRITONS’ net wealth climbed back to
2005 levels last year, largely because
of a mini revival in the housing mar-
ket, according to official statistics
released yesterday.
Household net wealth rose 7.3 per
cent to £117,000 per person in 2009 –
the same as in 2005 – but still below
a peak of £128,000 in 2007. This is as
a result of the drop in house prices
during the recession, the Office for
National Statistics (ONS) said yester-
day.
Most families’ biggest asset is their
pension funds and savings accounts,
the ONS added.
The official data highlighted the
scale of the recession however, show-
ing that GAP per head – a measure of
the economic wealth of a country
plunged by 5.5 per cent in 2008-09,
the biggest margin in 60 years.
Despite the economic strain,
Britons’ disposable incomes contin-
ued to climb, increasing by 1.2 per
cent between 2008 and 2009 as con-
sumers benefited from lower mort-
gage rates and rises in benefit
payments.
 6 Focus on BT
Profits at BT
given a boost
by broadband
▲
TELECOMS
BY STEVE DINNEEN
BT LAST night raised its full-year fore-
casts after bumper broadband sales
boosted its profits.
During the second quarter over
250,000 new broadband customers
were added to its network, including
rival firms renting BT lines.
Virgin added 35,000 new broad-
band customers during the same peri-
od.
BT’s new superfast broadband serv-
ice “Infinity” is rising at a level of
around 4,000 a week after failing to
make a splash since its launch in
January. It now has around 38,000
users.
The telecoms giant raised its full-
year earnings guidance from £5.6bn
to £5.8bn after pre tax profits rose 43
per cent to £781m. Adjusted pre tax
profits were up 13 per cent at £496m.
However, BT failed to arrest its
declining revenues, with sales in the
period falling three per cent to
£4.98bn.
CITYA.M. 12 NOVEMBER 2010
Just 50,000
sign up to BT’s
sports package
MEDIA
▲
BT YESTERDAY announced its Sky
Sports offering has limped to just
50,000 subscribers since its launch
ANALYST VIEWS: JUST HOW GOOD ARE BT’S this summer.
Chief executive Ian Livingston
LATEST RESULTS? Interviews by Steve Dinneen
admitted the firm has a “lot more to
It disappointed investors by raising do” but reiterated BT’s long term
its dividend by a relatively modest committment to the project.
four per cent, below most analyst He said: “Around 10 per cent of our
expectations. WILL DRAPER | EXECUTION NOBLE BT Vision subscriber base is now tak-
“
Chief executive Ian Livingston was ing our Sky Sports package. We think
bullish yesterday, claiming the firm it is important to offer our customers
has created a strong base for future Although this is a brighter set of results from BT, with figures ahead on a broad range of options. I have been
most measures and full-year guidance raised, much of the increased guidance had
”
growth. very, very clear to the market all
He even had a pop at rival Virgin been anticipated. The interim dividend of 2.4p was the one area of disappoint- along that this is a multi-year thing.”
over its ad campaign, which features ment, four per cent lower than our estimate. Overall the firm added 24,000 BT
a Ferrari representing its superfast Vision customers, taking its total
connection speeds. Livingston said: number of subscribers to 520,000.
“Virgin’s product is a bit like a SIMON WEEDEN | CITI This compares to 10m subscribers at
“
Ferrari – it’s very expensive and not rival Sky.
many people buy it.” BT also said it will bring 3D and
BT is comfortably meeting its pension and dividend commitments while faster HD content to its users in time
ANALYSIS l BT reducing debt at an accelerating rate. With the pension scheme also improving the
”
for Christmas and showcased its new
company is probably waiting for a positive response from the credit rating
170 p agencies to its progress before stepping up its payout.
user interface, which will provide
249.00 access to the BBC-backed YouView on-
10 Nov demand TV service.
150 CARL MURDOCK-SMITH | JP MORGAN
“
BT chief executive Ian
Livingston says BT is
Openreach was the key outperformer. Equity free cash committed to its Sky
130 flow was also strong at £535m, 11 per cent above consensus. Its dividend, up four
”
Sports offering despite
per cent to 2.4p, may look light but we would look for more at the full-year stage.
16 Aug 15 Sep 14 Oct 3 Nov Revenues were one per cent above consensus. slow initial uptake
 8 News
Duncan Smith
unveils shake
up of welfare
▲
POLITICS
BY DAVID CROW
BRITAIN’S welfare system is to under-
go the most dramatic shake-up since
its inception in 1942, after the govern-
ment unveiled plans to crack down
on the workshy and make sure that
everyone is always better off in a job.
The plans are designed to simplify
the complex web of benefits to reduce
errors, fraud and inefficiencies, and
to ensure that people in work are bet-
ter off by letting them keep more of
their earnings.
It will see separate benefits such as
housing benefit, income support or
incapacity replaced by a “universal
credit” system whereby individual
households will get a single welfare
payment.
The government says the current
system often deters unemployed peo-
ple from going back to work, as they
could find themselves worse off after
losing many of their state benefits.
Work and pensions secretary Iain
Duncan Smith said it was estimated
CITY VIEWS: WILL WE SEE MORE VIOLENCE AT PROTESTS
AGAINST THE CUTS?
the measures, which will be intro-
duced from 2012-3 and brought in
over the following five years, would
mean 700,000 low-earning workers
would be better off.
Some 2.5m households would get
higher entitlements through the uni-
versal credit and 350,000 children
and 500,000 adults would be lifted
out of poverty, he said.
The system will also come with
tougher sanctions.
Anyone on benefit who turns down
a job, fails to apply for work when
asked to do so or does not complete a
four-week community work scheme
will initially lose their £65-a-week
benefit for three months.
A second offence will result in six
months’ exclusion and a third will
see that increase to three years.
“Almost 1.5m people have been out
of work and on benefits for nine of
the last 10 years,” Duncan Smith said.
He said the 70 per cent net rise in
employment under the previous
Labour government was accounted
for by immigrant workers.
Interviews by Thomas Hamed and Marion Dakers
GARY FRICKER | ELECTRICAL CONTRACTORS
INSURANCE
“It’s an absolute shame that instead of talking
about tuition fees, we’re all talking about the
violence yesterday. I think everybody’s angry
and we will see a lot more from all those
who have lost out in the cuts.”
ODETTE MEDDEMMEN | RAB INTERNATIONAL
“I was shocked by the violence on
Wednesday. The next couple of months will
probably be full of protests, but the police
will be a lot more prepared – they
know there is a group of people who
will get involved just to cause trou-
ble.”
JON MOORE | MBA IT
“The protestors need to make sure their cam-
paigns are peaceful, otherwise the message gets
lost. If the government backs down, how-
ever, more people will start to think
smashing things up works.”
CITYA.M. 12 NOVEMBER 2010
NEWS | IN BRIEF
Alan Johnson in mea culpa
Alan Johnson, the shadow chancellor,
yesterday begun the long march to
regaining the Labour party’s economic
credibility as he admitted the previous
government had made several mistakes.
He rejected claims of “profligacy” but
said Labour had become too reliant on
tax receipts from the City, and had failed
to recognise they would vanish in the
event of a financial crisis. “Before the
crisis hit, the City paid around 25 per
cent of overall corporation tax in this
country – £10bn in 2007. A booming
sector with high remuneration and prof-
its was paying a lot of tax but this
reliance on the financial sector made our
tax base less resilient when the global
financial crisis hit,” he said.
Cisco dives on weak outlook
Technology bellwether Cisco Systems
plunged 16.2 per cent to $20.52 in fren-
zied trading yesterday, a day after a
gloomy revenue outlook left investors
jittery, and some brokerages downgrad-
ed the stock. More than $23.5bn was
eroded from the company’s market cap
with about 200m shares changing
hands in 30 minutes of trading, four
times their 50-day moving average vol-
ume. Shares of rivals Juniper Networks,
F5 Networks, Riverbed Technology and
Jabil Circuit also sank. Cisco also
dragged down the broader market. At
least three brokerages lowered their rat-
ings and six others cut their price tar-
gets on the shares of the company,
which said weak spending by its public
sector customers and soft orders from
its cable segment hurt its results. The
disappointing forecast comes a quarter
after Cisco warned of an uncertain
economy.
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 The Capitalist
10
CITY PAYS ITS DEEPEST RESPECTS
TO BRITAIN’S FALLEN WAR HEROES
SILENCE blanketed the City of London
yesterday at 11am, to mark the
anniversary of Armistice Day, the end
of the First World War.
The largest remembrance ceremo-
ny took place at Lloyd’s of London,
where 5,000 members of the insur-
ance market gathered on the trading
floor to watch on as their chairman
Lord Levene and Lord Mayor Nick
Anstee laid wreaths to commemorate
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those who served in the Great War
and later conflicts.
“It’s a fitting time to reflect on the
bravery of others given our soldiers
currently engaged in conflict,”
Levene said. “It’s important to
remember not only all the men and
women who are serving their coun-
try today, but also those who gave
their lives and contributed so valiant-
ly in previous wars.”
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Lloyd’s has led the way in fundrais-
ing for the Poppy Appeal this year,
raising a record £240,000, though
other City workers have been just as
busy doing their bit for the cause.
Last night saw a number of parties
held across the financial district to
mark the occasion, including solici-
tor Hannah Sisk, who’s soon to join
law firm Rollingsons. Sisk organised
a remembrance evening at Guild City
5,000 attended the Lloyd’s of London remembrance ceremony Pictures: GETTY, REUTERS
church St Dunstans in-the-West,
where speakers included Colonel
Stuart Tootal – formerly of the 3 Para
regiment and now working at
Barclays – and music came from the
likes of Chantage, a chamber choir
from the City. Local businesses also
got behind the event, including Fleet
Street bar El Vino, which donated a
percentage of its profits to the chari-
ties.
CASH IN THE ATTIC
Financial memorabilia buffs had bet- DIGITAL AGE
ter book their ticket to New York, Ping! In zooms a letter from the gov-
pronto, since thousands of goodies
from US Ponzi-schemer Bernard
Care to get your hands on Bernie’s smalls?
Madoff’s various properties are due to
go on the block tomorrow at the
Sheraton hotel.
As with the first auction a year ago,
which raised $1m for Madoff’s vic-
tims as a drop in the ocean towards
the $65bn he stole, the items up for
sale this time range from the glitzy to
the mundane.
They include a 10.5 carat diamond
engagement ring and a Steinway &
Sons grand piano, to the floral canopy
bed in one of Madoff and his wife
Ruth’s master bedrooms, to clothes
and humdrum everyday parapherna-
lia such as cooking implements, tow-
els, boxer shorts (no word on whether
they’ve been washed first), and a
rather fetching pair of black velvet
monogrammed carpet slippers. Form
an orderly queue, now...
TALK’S NOT CHEAP
To the analyst presentation for
BT’s interim results yesterday,
where management was in
ebullient form after revealing a
43 per cent hike in first half
profit.
Taking the opportunity
to plough the deep pockets
of the City analysts pres-
ent, chief executive Ian
Livingston informed them
that they were each allocat-
ed just one question, and any
further questions would be
CITYA.M. 12 NOVEMBER 2010
“charged” at £10 a pop, with proceeds
donated to Children in Need.
Stepping up briskly to the chal-
lenge, the gathered analysts came up
trumps, raising £470 – with the
largest contribution coming from
Morgan Stanley’s Nick Delfas, who
kicked off proceedings with a four-
question grilling.
Livingston himself then matched
their contribution and rounded it up
to £1,000. Sterling work on all sides.
ernment’s digital champion Martha
Lane Fox, calling on the City’s “com-
puter connoisseurs aged 55+” to enter
the search for an Age UK Internet
Champion of the Year.
Apparently, the number of over-65-
year-olds using the Web has gone up
from 18 per cent four years ago to 40
per cent now, as golden oldies get
used to the vast opportunities the
internet can bring. But Lane Fox
wants to improve it even more – and
the aim is for next year’s Champion to
help others who lack the confidence
or skills to get online. Visit the Age UK
website to find out more.
UNSUNG HERO
Regular readers may recall the name
of John Major – no, not the former
Prime Minister, but the security
concierge at PwC who last year won
City A.M.’s competition to discover the
“Unsung Hero” of the City.
Major, who’s guided over a million
staff and guests through the firm’s
doors over his 21-year stint at the
firm, this week celebrated his retire-
ment from PwC at Smollensky’s on
the Strand, where he was presented
with a leaving book of farewell mes-
sages from staff and a bottle of De
Bortoli Old Boys 21-year-old port, for
every year he spent with the firm.
FOND FAREWELL
Finally, it is with sadness that I say
goodbye to you all today on my last
day at City A.M.
Over the course of the
past few years I have had
the pleasure of meeting
some of the wittiest, bright-
est and kindest peo-
ple in the City, and
I would like to take
this opportunity to
thank all of my read-
ers for your support,
feedback and ideas.
I’m sure you will all be
there to assist my succes-
sor in continuing the col-
umn’s success.
CITYA.M. 12 NOVEMBER 2010
ALL ABOARD: BORIS UNVEILS NEW ROUTEMASTER
EU parliament
votes for new
hedgie rules
▲
HEDGE FUNDS
BY DAVID CROW
CONTROVERSIAL new rules to regu-
late the hedge funds, private equity
houses and other alternative funds
were overwhelmingly backed by the
European Parliament yesterday.
After months of wrangling, which
saw hedge fund-friendly states like
the UK extract major concessions,
the parliament backed the rules by
513 votes to 92 with 3 abstensions.
London hedge fund managers
were yesterday toasting what one
described as a “qualified victory”,
after a massive industry lobbying
effort saw some of the most dracon-
ian elements of the directive
scrapped.
A hard cap on leverage limits and
a three-year delay before offshore
funds could market their products
in Europe – which were described by
one industry source as “business
killers” – were omitted from the
final draft.
However, managers of all alterna-
tive investment funds, which also
include real estate funds and invest-
ment trusts, must register to operate
NEWS | IN BRIEF
Siemens bullish on the future
Industrial giant Siemens has said its net
loss was 65 per cent lower in the final
quarter of 2010 than the same period a
year earlier. For the full-year, net income
climbed 63 per cent to €4bn (£3.5bn).
The fourth-quarter net loss was €396m,
compared with a loss of €1.06bn in the
last part of 2009. But it said its growth
was “gaining momentum” and that it
expected to win new orders at a faster
pace next year.
New US trading rules eyed
The US Commodity Futures Trading
Commission expects to unveil a series of
draft rules within a month, including
real-time reporting of swaps trades
next week and possibly the long-awaited
commodities market position limits on 1
December its chairman said yesterday
ahead of its 19 November meeting.
News 11
LONDON mayor
Deutsche Postbank
moves into profit
Boris Johnson yes-
terday unveiled a
3D full-scale model
of the updated
Routemaster bus
due to hit the
streets in 2012.
The fuel-efficient posted an improved tier one capital
▲
BANKING
bus will be quieter BY JULIET SAMUEL ratio of eight per cent versus 7.3 per
than its diesel-run cent at the half-year mark. The bank
predecessor and BONN-based retail lender Deutsche put this down to the disposal of risk-
have a platform Postbank unveiled a dramatic recovery weighted assets and a currency effect.
offering passengers in its third-quarter results yesterday, Like most European retail banks,
the traditional hop- with pre-tax profit moving from a Deutsche Postbank is gradually wear-
on hop-off service. €29m (£24.5m) loss to a €71m gain. The ing down its loan loss provisions: they
The buses merge bank is 41 per cent owned by Deutsche dropped from €142m last year to
“nostalgia” and the Bank. €134m in the third quarter of this year,
“latest technology”, Nine-month earnings per share despite having risen in the second
said Johnson. were up 25 per cent to €1 and the bank quarter to €175m.
in the EU, report data to supervisors
and meet capital requirements.
Under centralised EU supervision,
there will also be tougher rules on
how a client’s assets are safeguarded
at depositories.
The EU assembly beefed up the
law by including pay rules and curbs
on asset stripping on the private
equity sector in a bid to stop them
buying assets just for the short term.
The European Private Equity and
Venture Capital Association (EVCA)
said the rules were not costed and
could have a serious impact on the
financing of small firms and innova-
tive companies.
The new law affects hedge funds
with over £85m under management
and private equity groups investing
over £425m.
The new rules take effect in 2013,
with a “passport” or EU marketing
rights for non-EU funds not available
until 2015. Until then national mar-
keting regimes will continue but
could be phased out in 2018.
Some 80 per cent of the EU’s
hedge fund sector is located in
London which is also Europe’s main
private equity centre.
BHP under heat
to return cash
▲
MINING
ANGLO--AUSTRALIAN miner BHP
Billiton’s boss is likely to face calls on
Tuesday for a massive share buyback
when he confronts shareholders in
Australia after his third straight fail-
ure to pull off a major acquisition.
Chief executive Marius Kloppers’
latest deal, a $39bn bid for Potash
Corp, appears headed for the scrap
heap, after Canada all but vetoed it,
leaving investors focused on the com-
pany’s $12.5bn warchest of cash and
what to do with it. Kloppers has until
3 December to try and change
Ottawa’s mind -- but investors have
already written off any hope of a deal.
 12 News
Land Securities ramps up
City development plans
▲
PROPERTY
BY MARION DAKERS
LAND Securities, the country’s largest
listed property firm, posted a 6.7 per
cent rise in the value of its net assets
yesterday and pledged to accelerate its
development work in the City.
Land Securities’ portfolio gained
3.4 per cent in value to £9.7bn in the
six months to the end of September,
and the firm committed to start
developments worth more than £1bn.
Rental values in the firm’s exten-
sive London portfolio rose 1.1 per
cent, in the first positive move since
2008. This rise contributed to an
underlying pre-tax profit of £135.9m
for the period, a rise of 5.8 per cent on
last year.
Chief executive Frances Salway told
City A.M. that as well as filing plan-
ning permission to redevelop 60
Ludgate Hill and 110 Cannon Street,
the company is in the final stages of
securing an unnamed second office
CITYA.M. 12 NOVEMBER 2010
tenant at One New Change, where
10,000 shoppers a week are now visit-
ing.
Salway said that an influx of for-
eign investors in the City market had
hampered Land Securities’ efforts to
buy new sites, but that buoyant mar-
ket conditions had also worked to its
advantage.
The company made sales worth
£213m in the last six months, repre-
senting an overall 8.8 per cent gain on
March 2010 valuations.
Picture: Micha Theiner/City A.M.
Chief executive Frances Salway (inset) and Land Securities’ development One New Change
CITYA.M. 12 NOVEMBER 2010
New Look to raise
prices as the cost
of cotton rockets
RETAIL
▲
BY JOHN DUNNE
BUDGET retailer New Look yesterday
warned that its prices would be hiked
by up to eight per cent as the cost of
cotton continued to surge.
The company, which provides cut-
price fashions to young shoppers, saw
UK sales drop 4.5 per cent in the 26
weeks to 25 September.
Chief executive Carl McPhail said
price rises were inevitable, but said
that the sales fall came against very
strong comparative figures for the year
before.
New Look, which is owned by pri-
vate equity firm Permira and Apax
Partners, postponed a float planned
for February after volatile markets saw
it pull back.
McPhail said: “We are not ruling out
a float in the future but we do not
JJB issues warning
as promotions fail
RETAIL
▲
BY JOHN DUNNE
STRUGGLING sportswear retailer
JJB yesterday warned that full-year
results would not meet its hopes
after poor recent trading, increas-
ing the chances of the company
having to raise additional cash.
Shares in JJB, which came close
to administration last year, lost up
to 29 per cent of their value after
the retailer said sales over the last
six weeks had failed to match its
expectations, blaming the weaken-
ing trading environment.
The company has slashed the
price of some goods in an attempt
to fuel sales but the drive has failed
to pay off.
It said sales at stores open more
WH Smith bullish on outlook for the
full-year despite a decline in sales
▲
RETAIL
WH Smith yesterday gave an
upbeat view for the rest of the year
despite reporting a drop in sales.
Group sales fell two per cent in the
ten weeks to 6 November.
The firm said sales at stores open
over a year were down one per cent
at its travel division and down four
per cent in its high street business.
The company said: “We remain a
resilient business and are well posi-
tioned for continued growth in the
future.”
Chief executive Kate Swann’s
have to do it. We have a very strong
cash position.”
He also said Britain’s second-biggest
womenswear retailer by value of sales
was gaining market share and its inter-
net business was closing the gap on
online specialist ASOS.
Meanwhile international sales,
which account for about 23 per cent of
the total, climbed 2.4 per cent on a
like-for-like basis.
New Look, which runs over 1,000
stores in Britain and abroad, said in
February it had hoped to raise £650m
in its planned flotation, to reduce its
£1bn of borrowings.
But investors were wary of the plan,
particularly after department store
chain Debenhams returned to the
stock market in 2007 laden with debt
and saw its shares plunge. Primark ear-
lier this week said that the soaring
price of cotton was hitting its margins.
than a year increased 13.1 per cent
in the six weeks to 7 November --
lower than JJB had anticipated and
heavily influenced by promotional
initiatives, which also reduced its
gross margin to 33.8 per cent from
42.2 per cent in the first half.
“The board believes that current
trading conditions are having, and
will continue to have, a negative
impact on its expectations for the
full-year”, said JJB.
“The full-year outcome remains
heavily dependent on our perform-
ance during the important pre-
Christmas and New Year sale
periods.”
Katharine Wynne, an analyst at
Investec Securities, said that it was
“ominous” that JJB’s efforts to kick-
start sales had failed given the
strategy is based on cutting costs
and improving gross margins by
focusing on more profitable prod-
ucts, better sourcing and better
control of markdowns, rather than
driving top-line sales.
She has rebalanced WH Smith’s
mix of products towards core cate-
gories and away from entertain-
ment products -- CDs, DVDs,
computer games and consoles.
Last month the retailer beat
forecasts with a nine per cent rise
in 2009-10 profit, lifted its final div-
idend by 18 per cent and said it
would return up to another £50m
Consumer News 13
NEWS | IN BRIEF
Dairy Crest secures Tesco deal
Dairy Crest yesterday reported a five
per cent increase in first-half underlying
pre-tax profit as sales of its key brands
grew and it increased sales of fresh milk
to major retailers. The company made
an underlying pre-tax profit of £40.1m
in the half year to the end of September,
up from £38.1m the year before.
Meanwhile Dairy Crest has secured a
contract to supply Tesco with 50m litres
of milk – about five per cent of the
supermarket giant’s sales. It said higher
profits in cheese – up 58 per cent to
£12.5m – “more than offset” a lower
performance in its dairies, which are
battling against a highly competitive
milk market.
Waitrose sees sales rise
Waitrose sales rose by nine per cent in
the third quarter as the mild weather
fuelled sales of unseasonal products
including salad and ice cream. The
retailer – which does not issue quarterly
profit figures – said sales for the three
months to the end of October
had been buoyant. On a like-for-like
basis its total branch sales (excluding
petrol) were up by 4.4 per cent, with
growth accelerating last month, the
company said. Over the last week ice
cream sales were up by 16.8 per cent.
Waitrose’s share of the UK grocery mar-
ket increased by 0.2 per cent compared
New Look said its prices will be hiked up to eight per cent higher to a year ago, according to Kantar.
tough consumer environment.
JJB is forecast to make full-year
losses of around £40m, according
to City analysts. The retailer has
249 stores in the UK and Ireland.
Singer Capital Markets analyst
Matthew McEachran said: “The
focus in the short term has to be on
cash generation.”
ANALYSIS l JJB
14 p 8.00
11 Nov
12
10
8
16 Aug 15 Sep 14 Oct 3 Nov
to shareholders through a buyback
programme.
Shares in the company have
risen ten per cent in the last three
months.
The company has 570 high street
stores and a 500-outlet travel divi-
sion with units at airports, train
stations, hospitals, motorway serv-
ice stations.
Numis Securities analyst
Andrew Wade said WH Smith con-
tinued to do the right things,
although he warned the outlook
for next year remained tough in an
uncertain consumer environment.
 14 News
African Minerals raises £191m
▲
MINING
BY MARION DAKERS
CONTROVERSIAL businessman Frank
Timis’ mining company plans to raise
$800m (£496m) in a debt and equity
issue to fund its iron ore project in
Sierra Leone.
Aim-listed African Minerals said
yesterday it has raised £191m
through a share placing and hopes to
secure a $500m (£310m) loan facility.
The proceeds will finance the
remaining construction at its flag-
ship Tonkolili mine and allow first
production to take place towards the
end of 2011.
Demand from
Asia pushes 3i
earnings up
▲
BANKING
BY MATTHEW WEST
PRIVATE equity firm 3i Group said a
manufacturing recovery, driven by
demand from Asia and South
America, pushed earnings higher at
its portfolio companies as it reported
half-year earnings yesterday.
The group said aggregate earnings
across its buyouts portfolio grew by
eight per cent between March and
September, while its growth capital
portfolio saw a seven per cent rise.
Both were driven by a recovery in the
industrials sector.
The value of its portfolio increased
to 330p a share from 321p at the end
of March.
“We have some great manufactur-
ing and industrial businesses that
have seen significant turnover
growth – 30, 40, 50 per cent in a year
based on growing demand from
India, China and South America,”
said 3i’s chief executive Michael
Queen.
As other private equity firms have
done, 3i has spent much of the last
two years protecting its companies
from the downturn. It said it was now
making good progress in increasing
investment.
ICBC looks to strengthen balance sheet O2 gains customers and
through £4bn discounted rights issue aims for smartphone sales
▲
BANKING
BY MATTHEW WEST
INDUSTRIAL and Commercial Bank
of China (ICBC) yesterday revealed
plans to raise 45bn yuan (£4.2bn)
through a rights issue this month to
replenish capital.
ICBC, which first unveiled the plan
in July, is the last among China’s Big
Four state banks to raise funds to
strengthen balance sheets weakened
by last year’s lending binge aimed at
aiding China’s economic recovery.
The company successfully raised
£191m through a placing of 45m
shares at 425p each in the market yes-
terday, with payment expected on 18
November.
Timis, the company’s chairman,
said: “We are delighted with the
tremendous response internationally
from a broad range of high quality
institutional investors.
“We view this as a major endorse-
ment of the quality of African
Minerals’ Tonkolili Project, our team
and Sierra Leone. We are now well
placed to become a significant inde-
pendent iron ore producer.”
Canaccord Genuity, Mirabaud
3i, which recently reshaped its deal
teams to hunt for deals by region,
increased investments in the first
half to £327m from £190m a year ago.
The group added French health-
care provider Vedici and calibration
and measurement testing group
Trescal.
Queen said the pipeline of poten-
tial new acquisitions has improved
progressively and hopes 3i will spend
more on deals than it reaps from
company sales in the second half. It
recently agreed to sell German
engine maker MWM to Caterpillar.
“We are converting that pipeline
into completed transactions and
that’s what I hope you’ll see further
over the next six months,” Queen
said.
ANALYSIS l 3i Group
p There is some evidence to suggest
320
316.10
11 Nov
300
280
260
16 Aug 15 Sep 14 Oct 3 Nov
China Construction Bank Ltd (CCB)
and Bank of China, the country’s sec-
ond- and fourth-largest lenders, have
detailed plans to raise a combined
$18.2bn (£11.3bn) through rights
issues this month, while Agricultural
Bank of China, the third largest
lender, raised $22.1bn in a record ini-
tial public offering in July.
ICBC said it would sell 0.45 shares
for every 10 existing shares, at steep
discounts to its market prices.
The Beijing-based lender, which
will start taking subscriptions from
Securities, Dundee Securities and
GMP Securities Europe are acting as
joint placing agents for the company.
In October, the company’s planned
$1.5bn investment in the Tonkolili
project suffered a further delay with
fellow investor Shandong Iron & Steel
needing extra time to complete due
diligence.
Timis has said Tonkolili could
become the largest iron ore mine in
the world. The Romanian tycoon hit
the headlines last year when he was
head of Regal Petroleum, when the
firm was slapped with a record
£600,000 fine by Aim for misleading
investors.
31 boss Michael Queen has boosted the firm’s investments in the first half of the year
Time to shift up a gear or two
MICHAEL Queen, 3i’s chief execu-
tive, has been quietly repairing the
firm’s balance sheet since he
arrived in January 2009. Yesterday,
he was keen to signal a change in
direction; having spent over a year
preparing for growth, he said he
would now start delivering it.
the new era has already begun.
Investments in the first-half rose to
£327m (compared to £190m in
2009) while realisations fell to
£293m, from £507m in the first six
months of 2009.
Still chunky debt acquisitions
worth £110m accounted for around
half of its investments, and there
investors on 16 November, priced the
issue at 2.99 yuan per share in
Shanghai, 37 per cent lower than its
last closing price of 4.74 yuan.
Its Hong Kong shares will be sold at
HK$3.49 (28p) each, at a 47 per cent
discount to its market price of
HK$6.63.
ICBC’s state parent, Central Huijin,
a unit of China’s sovereign wealth
fund, has said it will fully participate
in the rights issue. Bank of China said
yesterday its $9bn rights issue was
99.57 per cent subscribed.
ROBERT FINLAY &
GUY BLAKENEY
CANACCORD
GENUITY
CANACCORD Genuity has advised
African Minerals since it first floated
on Aim in February 2005, when it was
known as Sierra Leone Diamond
Company. The investment bank has
since seen the company through its
first diamond sale, numerous cash-rais-
ing efforts and expansion into iron ore.
In yesterday’s share placing,
Canaccord Genuity acted as nominated
adviser and joint placing agent, along-
side three other firms.
Robert Finlay, head of UK invest-
were just two new buyouts: French
healthcare firm Vedici (£35m) and
Trescal (£23m), a precision measure-
ment expert. 3i’s dealmakers might
have woken from a long slumber,
but they are hardly alive and kick-
ing.
In many ways, buying 3i is really
a punt on the private equity space.
If it does recover, Queen’s hard work
coupled with 3i’s liquidity should
ensure the firm still trades at a rela-
tively small 2.4 per cent discount to
its 30 September net asset value.
BOTTOMLINE
Analysis by David Crow
▲
TELECOMS
MOBILE phone operator O2 plans to
increase its investment in its network
to support demand from a growing
number of smartphones, it said in its
quarterly results yesterday.
The UK’s second-biggest phone
firm, owned by Spain’s Telefonica,
posted revenue for the nine months
to September of €5.3bn (£4.5bn), up
5.6 per cent on last year.
Its parent company enjoyed a 65.6
per cent rise in net profit to €8.835bn
CITYA.M. 12 NOVEMBER 2010
ment banking at Canaccord, has come
full circle with African Minerals, having
spent his childhood in Africa.
Finlay has been with Canaccord
since 2004, and looks after companies
involved in mining, energy and support
services.
He has more than 20 years of cor-
porate finance experience, having
worked for Credit Lyonnais, ABN
AMRO and Hoare Govett.
Guy Blakeney, director of invest-
ment banking for support services, has
numerous mining clients including
Mwana Africa and Kopane Diamond
Developments.
If African Minerals decides to join
the main stock market (and there have
been rumours about such a move for
years), Blakeney has plenty of experi-
ence, having helped Vision Opportunity
China Fund make the jump last month.
NEWS | IN BRIEF
Hundreds more job losses at Rok
Collapsed housing repair firm Rok will
lose 268 more jobs on top of the 700
cuts already announced, administrator
PwC said yesterday. The job cuts will fall
in the Scottish plumbing, heating and
electrical business. PwC said it was
forced to make the redundancies after
talks with potential buyers of the busi-
ness fell through on Wednesday night,
but that discussions about the remain-
der of the stricken business are ongoing.
Balfour bags new contracts
Balfour Beatty, Britain's market leader
in big-ticket construction projects,
increased its order book in the third
quarter, underscoring its resilience in a
tough environment for the building sec-
tor. The FTSE 250-listed company
increased its order book to more than
£15bn despite the looming public sector
cuts to its core operations.
AMEC reports strong trading
Oil services and engineering group
AMEC said yesterday that its current
business trading was near the top end of
market expectations after major con-
tract wins with BP and the US Navy.
AMEC said its order book stood at
£3.1bn and added it was expecting a
margin of around nine per cent for
group earnings before interest, tax and
amortisation.
BBA enjoys air travel revival
BBA Aviation said it expected to outper-
form its markets yesterday and was
comfortable with its business growth
going forward, as an increase in flying
activity boosts demand for its aircraft
services. After a difficult 2009, the firm
said October is expected to be the
twelfth consecutive month of growth in
business and general flight activity.
Revenue increased six per cent on an
organic basis in the four months to the
end of October.
for the same period. Accounting
adjustments, as well as growth in the
UK, Germany and Latin America,
were the main sources for the jump.
The firm said sales of the next gen-
eration of smartphones drove the
sales boom, with 352,000 new cus-
tomers signing up for contracts,
mostly for smartphones, in the third
quarter. The firm said it plans to
enhance smartphone network capa-
bilities in the coming years.
More than 22m customers now use
O2, a rise of 4.8 per cent year on year.
 16 News
Home repossessions tumble
▲
UK ECONOMY
BY HARRY BANKS
THE number of homes repossessed
by lenders in Britain fell to a two and
a half year low in the third quarter,
data showed yesterday, but courts
issued more orders to reclaim
homes, suggesting there may be a
rise ahead.
Figures from the Council of
Mortgage Lenders showed that 8,900
homes were repossessed in the third
quarter, down from 9,400 in the sec-
ond quarter and the lowest since the
first quarter of 2008.
Separate data from the Ministry of
Justice showed that courts in
England and Wales issued five per
NEWS | IN BRIEF
AngloGold sees production rise
AngloGold Ashanti, the world’s third-
largest gold miner, beat its guidance for
third-quarter output and costs yester-
day. Production rose three per cent from
the previous quarter to 1.162m ounces,
above its own forecast of 1.15m ounces.
Cash costs rose to $643 per ounce from
$617 an ounce in the previous three
months, still below guidance of $645 an
ounce. Africa’s top gold miner, which has
operations across four continents, said
output for the year would be 4.5m
ounces at a cost of $635 an ounce, at
the lower end of its forecast of 4.5m to
4.7m.
Euromoney is back in the black
Publishing and electronic information
group Euromoney Institutional Investor
yesterday reported preliminary results
for the fiscal year ended 30 September,
reporting a pre-tax profit, compared to a
loss last year, reflecting a good recovery
in advertising and sponsorship revenues.
Profit before tax was £71.42m com-
pared to a pre-tax loss of £17.36m in the
previous year. Underlying pre-tax profit
was £86.64m, up from £62.99m a year
ago. Total revenue for the twelve
months improved to £330.01m from
£317.59m a year earlier. It issued a final
dividend of 11.75p per share.
cent more repossession orders com-
pared with the previous quarter at
14,138 – the first quarterly rise in a
year.
Court orders for repossessions do
not always result in a person losing
their home, and almost half of the
orders were suspended, giving
homeowners more time to repay
their debts, but the third-quarter
may signal a reversal of the recent
downtrend.
Repossessions have been falling
since early 2009 when they peaked
at 13,000, but analysts reckon they
could rise again once government
spending cuts – expected to cost half
a million public sector jobs over the
next five years -- kick in.
Resolution eyes
up further deals
▲
INSURANCE
BY VICTORIA BATES
RESOLUTION, the insurance buyout
group founded by entrepreneur Clive
Cowdery, said yesterday that it
remains firmly on the acquisition
trail, with a view to exploiting oppor-
tunities overseas as well as in the UK.
Chief executive John Tiner said the
group has a “wider and longer-term
ambition to build restructuring proj-
ects in other jurisdictions”, including
the US, though he emphasised that
the group’s “priority is the UK”.
Resolution, which aims to build up
a life insurance group valued at
£10bn before floating or selling it by
2013, yesterday reported booming
sales at its Friends Provident brand
over the first nine months of the year,
rising 35 per cent to £683m.
Friends Provident was boosted by
its international and Lombard busi-
nesses, which grew sales 31 per cent
Consumer confidence falls again
as fears over the recovery grow
“The substantial fiscal squeeze
will increasingly hit public sector
▲
UK ECONOMY
jobs and consumers’ pockets, while
households already face high unem- CONSUMER confidence fell for the
ployment, muted earnings growth fifth month in a row in October,
and elevated debt levels,” said according to the closely-followed
Howard Archer, economist at IHS Nationwide Consumer Confidence
Global Insight. Index published today.
“There will also be a lagged impact The index dropped by one point
from the recession as relatively grad- over the month, meaning it now
ual recovery overall will mean that stands 32 points below its interim
many people who have lost their peak of 84 seen in February of this
jobs will be unemployed for a long year.
time and this will weigh heavily on Nationwide attributed the drop in
their finances.” sentiment to continuing pessimism
The CML said home repossessions over the stability of the economic
in the first nine months of this year recovery, with its Expectations index
totalled 28,400, and was trending – which measures how optimistic
below its forecast for 2010 as a whole. people are for the future – falling by
BEST OF THE BROKERS
ANALYSIS l Hill & Smith 238.00
11 Nov
310 p
290
270
250
to £176m and 184 per cent to £213m
respectively, while UK life and pen-
sions sales lingered at similar levels to
last year. Friends Provident’s UK sales 16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
totalled £294m over the period, while
the newly-acquired Axa UK life busi- ANALYSIS l Cairn
500 p
ness contributed £26m of sales in 380.80
September. 11 Nov
Resolution last month announced 460
its intention to acquire Bupa Health
Assurance for a net consideration of
about £102m, expected to complete 420
early next year. The deal aims to up
the group’s market share in individ-
ual and group protection. 380
Resolution’s share price has tum-
bled 30 per cent over the year so far 16 Aug 6 Sep 24 Sep 11 Oct 3 Nov
against a five per cent rise in the sec-
tor as a whole, making it one of the ANALYSIS l Genus 820.00
worst performing insurance stocks in 860 p 11 Nov
Europe. Analysts blame the decline in
part on concerns the company may 820
launch a big rights issues to fund
future deals. The shares lost 0.8 per
780
cent yesterday to close at 244.5p.
740
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
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CITYA.M. 12 NOVEMBER 2010
four points to 70 – its lowest level in
19 months.
Consumers also expressed a grow-
ing pessimism towards the housing
market in October and now expect
the value of their home to decrease
by 0.9 per cent over the next six
months. This compares to an
increase of 0.1 per cent predicted in
September.
“The underlying anxiety around
the strength and direction of the
recovery appears to remain,” said
Nationwide’s chief economist
Martin Gahbauer.
He said that fears over the impact
of the changes announced in the
Spending Review were mounting.
HILL & SMITH
Altium Securities rates the highway infra-
structure group a “hold” with a target
price of 275p. The broker says it is disap-
pointed by the firm’s recent interim man-
agement statement, which reduced the
company’s operating profit forecast by
£7.5m for the year. Altium has cut its esti-
mates for 2010 pre-tax profit to £41m fol-
lowing the news.
CAIRN
AlphaValue rates the oil explorer an “add”
with a target price of 460p. It believes the
sale of Cairn’s Indian branch is a sensible
part of the firm’s plan to realise value from
explorations, and says the best way for the
firm to capture the value of increasing pro-
duction with higher oil prices is through
discounted cash flow, which runs at a 67
per cent upside.
GENUS
Brewin Dolphin has put its “hold” recom-
mendation and 703p target price under
review following the farming technology
firm’s annual general meeting. The broker
believes there is short-term weakness in
the Chinese market and uncertainty in
demand from higher animal feed costs. It
adds that the second half of the year is
likely to be stronger for the firm.
Account Value % Difference
£120,212.86 1102
£94,915.19 849
£90,477.98 805
£79,094.21 691
£78,606.50 686
£59,672.02 497
£47,372.52 374
£43,542.17 335
£37,646.99 276
£36,219.00 262
CITYA.M. 12 NOVEMBER 2010 News 17

Lord Mayor’s show promises pomp,

pageantry and a zulu dance troupe
The parade promises LORD MAYOR’S ROUTE 2010
to be the biggest ever,
Guildhall
says Thomas Hamed The Lincoln’s
Inn Fields
City Newgate St
Thameslink
THE City of London will host the Lord Gresham st
Mayor’s Show this Saturday, celebrating the Paternoster
square St Pauls
683rd Lord Mayor Michael Bear. The parade,
which starts tomorrow at 11am, follows the Cheapside
new Mayor as he swears allegiance to the Guided
Fleet street Ludgate Hill St Paul’s Walks
Queen.
and
Str
The event will be one of the biggest ever,
with 6,000 participants, including Hong New Poultry 11:05
Kong acrobats, South African Zulu war- Change 2:28
12:43
riors, and hip-hop dancers from East Bank
London. The parade also includes the Lord Blackfriars Grandstands Mansion
Mayor’s gilded carriage, 20 marching House
bands, 71 floats, and a mobile post office. Temple
The Lord Mayor is the head of the City of Place
Temple
London Corporation, the body that runs Gardens Queen Victoria Street Mansion
the City. Each year, representatives from 1pm House
each livery company elect a new Mayor. As Upper Thames St Cannon St
the majority of livery companies are in
financial services, the Lord Mayor is seen as Temple
representing the UK’s financial industry. Embankment Monument
Bear is an Alderman and Sheriff of the Best standing Blackfriars
point Millennium Peir
City. A trained civil engineer, Bear is regen- Tower of
eration director at Hammerson, managing Fireworks 5pm River Thames London
director of Balfour Beatty Property and a 1/2 mile
non-executive director of Arup.
The parade will begin when he presents
medals to 12 reservist soldiers and one City
policy officer at Mansion House. From GETTING THERE HISTORY
there he will travel to St Paul’s Cathedral,
where the dean blesses the Lord Mayor. The
parade then travels down Ludgate Hill and
Fleet Street, then takes the Strand to the THE best Tube lines are the District (Temple, THE position of Lord Mayor is one of the oldest crown. Westminster was considered far outside of
Royal Courts of Justice. The parade begins Mansion House, Monument), Central (St Paul’s and surviving positions in the UK. The post dates from London, so the journey could be treacherous. Over
its return journey at 1pm, following the Bank), and Northern Line (Bank ). The Circle, 1189, when Henri Fitz-Ailwyn became the first time, the Lord Mayor’s entourage grew, until his
Victoria Embankment and Queen Victoria Metropolitan, and Hammersmith & City lines are Lord Mayor. Since 1215, City liverymen have elect- journey to Westminster was considered a parade.
Street. As the Embankment is farthest from closed, as are the Victoria and Jubilee lines. Buses ed the Lord Mayor. This placed the Lord Mayor The Lord Mayor is sworn in during a Silent
the Underground stop, crowds should be will not enter much of the City itself. Buses will go outside the Crown’s control, which appointed all Ceremony, where no words are spoken apart from
thinnest there. Fireworks will be on the as far as Liverpool Street, Old Street, Kingsway or other local officials. The new Lord Mayor had to go a short declaration. The ceremony is always held
Thames at 5pm, between the Blackfriars the South Bank, all of which are near the route. to Westminster to swear his allegiance to the the day before the Lord Mayor Show.
and Waterloo bridges.

City hiring back to pre-downturn levels FSA: City managers must have
mobiles tapped to combat fraud
▲

RECRUITMENT agement. expect to receive £30,000-£45,000 plus

The report says: “The candidate-driv- bonuses of 15-30 per cent.
▲

CITY hiring is back to pre-downturn
levels, resulting in a jobseekers’ mar-
ket, according to a new study by Hays,
the financial recruitment firm. Basic
salaries have jumped due to the regu-
latory crackdown on bonuses, with
fast-growing demand for candidates in
financial IT, compliance and risk man-
en recruitment market is now firmly
back in full swing with almost all
strong candidates having multiple
offers and being counter-offered.”
In investment banking, research
analysts boast one of the highest start-
ing salaries: candidates with zero to
three years’ experience can now
Tim Ledger, deputy at City recruit-
ing firm Marks Sattin says talented
accountants of five years’ experience
are particularly in demand: “The mar-
ket is very much candidate-driven
with salaries rising accordingly and
counter-offers of up to 25-30 per cent
of base salary not unheard-of.”
REGULATION
BANKERS, hedge fund and investment
managers and stockbrokers must have
their mobile calls taped from
November 2011 to help crack down on
market abuses, the City’s financial
watchdog said yesterday.
Fixed line calls involving financial
business such as share orders are
already taped to help the Financial
Services Authority (FSA) in any fraud
or market abuse probes. The FSA said
these rules are now being extended to
mobile business calls. Tapes must be
archived for six months.

CITY MOVES | WHO’S SWITCHING JOBS Edited by Victoria Bates in association with

Collins Stewart
The investment banking group said yesterday it
will open a new derivatives desk, headed by
Roger Sharma (pictured) and Brad Dunstan.
Sharma and Dunstan, who become co-heads
of European equity derivatives, joined this week
from inter-dealer broker Icap, where they had
been working in senior derivatives sales since
the beginning of last year.
They both previously worked at Bear Stearns.
Nomura group has appointed former Credit
The Japanese investment banking Suisse banker Jeremy Bennett to the
board of Nomura Capital Markets as a
non-executive director.
Bennett was most recently a senior
adviser at the Financial Services
Authority until November 2009, work-
ing directly for chief executive Hector
Sants.
He also worked for the Treasury in
creating the Asset Protection Scheme,
acting as interim chief executive until
the establishment of the agency.
Barclays Wealth
The wealth management firm has hired
Mike Haslam to join its global research
and investments team as head of long-
only distribution, focusing primarily on
the UK & Ireland and international pri-
vate banking (EMEA) businesses.
Haslam joins from Gartmore, where
he was the investment marketing spe-
cialist. He has also held similar roles at
M&G and Threadneedle.
Bridges Ventures
The sustainable growth investor has
expanded its environment team with
the appointment of Tom Fourcade as an
investment director.
Fourcade, who will be responsible for
new investments for the environment
sector in the Bridges venture funds, has
almost 20 years of experience in the
sector most recently as chief executive
of a biomass energy technology compa-
ny and prior to that, chief executive of a
cleantech advisory business.
Eversheds
The law firm has announced that Peter
Halpin, practice group head of its com-
pany commercial group, will become
client services director, while Keith
Froud will take up his position as head
of the group from May next year.

To appear in CITYMOVES please email your career

updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT +44 (0)20 7557 7245
morganmckinley.com
 Investment
18 CITYA.M. 12 NOVEMBER 2010

| Personal Finance

PERSONAL
FINANCE NEWS
BY JESSICA MEAD
FLEXIBLE DRAWDOWN SUITABLE FOR MOST
How to avoid the dog funds
Over 90 per cent of financial advisers think
that flexible drawdown would be a suitable
Putting your money in funds
retirement solution for their clients, accord-
ing to research conducted by pension prod-
that persistently underperform
uct provider Suffolk Life. Suffolk Life’s John
Moret said: “Industry statistics suggest that
has its costs, says Jessica Mead
the number of new drawdown cases in 2010
is likely to exceed 40,000 and a significant

number of these are likely to be potential
users of flexible drawdown. In addition,
there are over 300,000 current users of
drawdown, many of whom will also find flex-
ible drawdown appealing.”
ENERGY BILL PAYER APATHY COSTS BILLIONS
Energy bill payers are wasting £4bn a year by
not shopping around for the best deal on
their gas and electricity, according to the lat-
est research from Moneysupermarket.com.
The average house-
hold could cut its
annual bill by
£263 by
swapping
to the best
online
dual fuel
deal avail-
able at
the
moment.
Ofgem
research shows
that 58 per cent
of gas customers have
never even looked for a better deal on their
energy provision, while the figure is 57 per
cent for electricity customers.
BARCLAYS’ FANTASY FUND MANAGER
Barclays has this week launched a Fantasy
Investment Portfolio competition which will
run for nine months as of 1 December. Free
of charge, the competition allows partici-
pants to manage their own portfolios with a
virtual £100,000 to invest. The competitor
with the largest assets under management
on 31 August 2011 will win £25,000, which
can be taken as a cash alternative or can be
placed in one or more of the funds available
on the Barclays investments website. For
details or to register for the competition, go
to www.barclaysfantasyfundmanager.co.uk
SKIPTON UNVEILS NEW PRODUCTS
Skipton Building Society today unveils that it
will be launching its second, market leading
E-Bond with a rate of 3.15 per cent. Once the
term of the bond has expired, it will mature
directly into an online account called Loyalty
Saver, which currently offers customers a
rate of 2.25 per cent annual equivalent rate
(AER). This week, Skipton has also launched
a new cash ISA range at rates of up to 4 per
cent AER. It offers a one, two, three and
five-year fixed ISA and these products will
replace those that were withdrawn yester-
day by the building society.
A
N ASTONISHING £13bn is languish-
ing in so-called dog funds, which
persistently fail to deliver returns
for investors, according to
BestInvest’s biannual Spot the Dog report
published earlier this week. Spot the Dog
branded Jupiter as the worst performing
investment house in terms of the value of
assets in dog funds. Also among the main
culprits were Scottish Widows/SWIP,
Schroders, Gartmore and Henderson (see
table). Between them, these five firms
account for over half of the £13.29bn invest-
ed in dog funds.
Dog funds are those that have underper-
formed their chosen benchmark in each
of the past three years by at least 10 per
cent. This eliminates those funds that tomers to view investments as having a Is your fund a dog? analyse performance.”
have suffered temporarily from market five-year-plus horizon. You also need to He adds: “You could also look at how the
conditions and index trackers, which think about your appetite for risk – how Picture: ALAMY fund is performing against its benchmark.
will always undershoot due to charges. would you feel if the value of your invest- While past performance can’t tell you how
Adrian Lowcock, senior investment ment fund were to fall and how much that individual fund will perform in the
adviser at BestInvest, says: “With the age of volatility would you be comfortable with?” future, it should give you a sense of how
austerity cutting ever deeper into our per- Mick Gilligan, partner and head of that fund is managed.”
sonal finances and threatening to reduce research at stockbrokers Killik & Co, rec- In Gilligan’s view, unexpected perform-
personal wealth in the next few years it has ommends looking at the past performance ance – good or bad – should be a reason to
never been more important to make sure of the fund and the fund manager. By look- reassess: “For example, [Invesco’s] Neil
we get the best from our savings and ing at historical data, you can get an idea Woodford had a bad year last year but we
investments.” of the risk taken to generate the returns as probably would have been more concerned
He adds: “Investors simply cannot afford well as whether the fund manager has if he had had a good year because it wasn’t
to leave their hard earned money languish- exhibited skill or not. his type of market.” He also warns against
ing in dog funds and hopefully our report However, he adds that while historic selling out of funds that have performed
serves as a wake up call for people to data is important, it is just as important to poorly because of market conditions.
review their portfolios and ensure their take a view on the future and assess how a You’ll never get your investments per-
money is working harder for them.” manager is positioned. “It’s important to fect. But some research into past perform-
So what should you be looking for in a look beyond past performance and get a ance, the manager and the fund’s
fund manager? How can you avoid invest- view of how the manager sees the world. If investment objective means you’ll avoid
ing your money in a dog fund? Carl it agrees with your own view then that buying into the worst of the dogs.
Howard, head of direct investment at should be an encouragement to put your
Barclays Bank, says that you need to be money into the fund,” he says. DOG FUNDS Source: BestInvest
clear about why you are investing, your Barclays’ Howard says that fund ratings
time horizon and your appetite for risk firms can also be quite a helpful indicator: Number of Dogs Value £m % Total Group Value
when it comes to selecting the right funds “There are two main types: qualitative, Jupiter 3 2,622 36
for you. “Be clear what your investment which look at the approach the fund man- Scottish Widows/SWIP 11 2,144 42
objectives are. We would encourage cus- ager is taking, and quantitative which Schroders 2 1,553 16
ANALYSIS l The long-term effect of underperformance Gartmore 5 941 24
Henderson 4 871 25
100,000
£ AXA Sun Life 3 529 44
Aviva Investors 3 438 19
80,000
Fund X
F&C Asset Management 3 400 16
Benchmark
Martin Currie 7 374 34
60,000
Halifax 1 371 9
AXA Framlington 3 362 12
40,000
Artemis 1 357 6
Liontrust 1 304 55
20,000 JP Morgan 1 251 8
Source: Bestinvest
Year 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 Threadneedle 2 247 2

GETTING THE per cent on over £10m of widely available

stock, it speaks more of the bidders’ zeal
than of the market reality.
But looking at the fine wine market more
have reservations about the promises made
and, above all, some of the prices charged
are rarely seen outside of Knightsbridge or
the auction houses of Hong Kong.
market’s infrastructure. There is growing
evidence of a clear demand for a market-
making role in this notoriously fractured
market.
PRICE RIGHT broadly, as prices continue to canter up and
the investment play becomes ever more piv-
otal, then price transparency and settle-
Caveat emptor for sure, but the market
ought to be able to provide sufficient price
transparency such that the credibility of the
The next steps will be to improve the reli-
ability and visibility of trade in en primeur
(non-physical) wines and make moves

IS CRUCIAL ment certainty grows in importance.

GARY BOOM
MD & FOUNDER OF FINE WINE
MERCHANT BORDEAUX INDEX
I take the view that market professionals,
as for financial services, should be able to
look after themselves. By contrast, private
clients need some protection.
Don’t get me wrong, I’m not calling for
the Financial Services Authority (FSA) to
ride into town but I do think the leading
players in the sector need to up their game.
activity is protected.
The price search websites are a good
starting point but they are of limited use in
a fast-moving market.
Elsewhere, the trade platforms are also
useful but they tend to exclude non-trade
participants and they have really weak cov-
erage across even the most mainstream of
wines.
towards dematerialised settlement.
This is hardly cutting-edge innovation but
the kind of measures that will build flexibili-
ty and certainty.
All these efforts towards transparency
might sound like turkeys voting for
Christmas but I’m firmly of the opinion that
the more we improve the reliability and the
cost of fine wine trading, the more activity

A
S THE giddy prices achieved at the
recent auctions in Hong Kong con-
firmed, the right price for anything is
what someone’s willing to pay for it.
With premia to market averaging around 60
Even a cursory glance at the weekend
papers reveals a small army of wine invest-
ment companies looking to service the pri-
vate investor.
While I welcome new market entrants, I
Our own LiveTrade screen, which gives
real-time bid-offers across all of the top
investment wines, has grown rapidly over
the past couple of years.
It is now regarded as a part of the
and liquidity can grow.
There are exciting times ahead for the
wine market and we have to make sure that
all parties have the right tools to take
advantage of them.
 20 Markets & Investment CITYA.M. 12 NOVEMBER 2010

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Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low Company Name Closing Price Price Change 52wk High 52wk low
(p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p) (p)
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A.B. Foods . . . . . . . . . . . . . . . .1099.00 –1.00 1113.00 790.00 Cookson . . . . . . . . . . . . . . . . . . .530.50 –32.50 616.00 364.80 Kesa Electricals . . . . . . . . . . . . .162.60 +1.70 172.40 98.45 Schroders N/V. . . . . . . . . . . . . .1283.00 — 1330.00 912.50
Aberdeen Asset Man . . . . . . . . . .179.40 –5.70 191.60 111.00 Croda Intl . . . . . . . . . . . . . . . . .1446.00 –4.00 1540.00 735.00 Kingfisher . . . . . . . . . . . . . . . . . .236.30* –1.80 255.00 196.50 Scot. & Sthrn Energy. . . . . . . . .1143.00 –17.00 1206.00 1006.00
Admiral. . . . . . . . . . . . . . . . . . .1603.00 –30.00 1721.00 1003.00 Daily Mail ‘A’ . . . . . . . . . . . . . . . .555.00 –7.50 573.50 401.70 Ladbrokes . . . . . . . . . . . . . . . . .132.50* –0.50 164.60 114.60 Scottish Mortgage. . . . . . . . . . . .674.00 –3.00 684.00 475.00
Aegis . . . . . . . . . . . . . . . . . . . . .130.50 –2.00 137.30 103.10 Davis Service . . . . . . . . . . . . . . .402.30 –2.70 442.30 356.00 Lamprell . . . . . . . . . . . . . . . . . . .363.10 –22.00 393.90 157.30
Afren . . . . . . . . . . . . . . . . . . . . .127.20 +0.70 135.90 77.00 Debenhams . . . . . . . . . . . . . . . . .71.50 –0.35 90.00 51.95 Lancashire Hldgs . . . . . . . . . . . .612.00 –5.00 618.00 416.70 SEGRO . . . . . . . . . . . . . . . . . . . .298.40 –1.70 389.30 244.00
African Barr Gold . . . . . . . . . . . .564.50 +15.50 685.00 520.50 Derwent London . . . . . . . . . . . .1472.00 –20.00 1633.00 1183.00 Land Securities . . . . . . . . . . . . . .694.00 –1.00 743.50 543.00 Serco . . . . . . . . . . . . . . . . . . . . .559.00 –3.00 656.50 491.20
Aggreko . . . . . . . . . . . . . . . . . .1588.00 +6.00 1698.00 727.50 Dexion Absolute . . . . . . . . . . . . .139.60 — 148.00 131.20 Legal & General . . . . . . . . . . . . . .99.25 –1.45 107.50 69.05 Severn Trent . . . . . . . . . . . . . . .1436.00 –2.00 1468.00 966.00
Alliance Trust . . . . . . . . . . . . . . .361.30 +5.50 363.00 292.80 Diageo . . . . . . . . . . . . . . . . . . . 1151.00 +1.00 1240.00 988.00 Lloyds Banking Gp . . . . . . . . . . . .68.59 +1.00 79.15 45.30 Shaftesbury . . . . . . . . . . . . . . . .435.50 –1.50 465.00 348.00
AMEC . . . . . . . . . . . . . . . . . . . . 1100.00 +1.00 1144.00 728.00 Dixons Retail . . . . . . . . . . . . . . . .26.50 –0.14 39.75 23.07 Logica . . . . . . . . . . . . . . . . . . . .127.30 –2.30 149.10 100.80 Shire. . . . . . . . . . . . . . . . . . . . .1505.00 +9.00 1532.00 1117.00
Amlin . . . . . . . . . . . . . . . . . . . . .395.00 –1.00 437.60 357.30 Domino’s Pizza . . . . . . . . . . . . . .517.50 –2.50 522.50 278.20 London Stk Exchange . . . . . . . . .735.00 –2.00 920.00 540.50 SIG . . . . . . . . . . . . . . . . . . . . . . . 118.00 +4.90 142.10 89.55
Anglo American . . . . . . . . . . . .3055.00 +100.00 3069.00 2210.00 Drax . . . . . . . . . . . . . . . . . . . . . .368.40 –6.90 464.80 321.50 Lonmin . . . . . . . . . . . . . . . . . . .1789.00 –17.00 2198.00 1344.00 Smith & Nephew . . . . . . . . . . . . .588.50 –8.00 700.50 532.00
Antofagasta . . . . . . . . . . . . . . .1472.00 +67.00 1482.00 755.50 Dunelm . . . . . . . . . . . . . . . . . . . .498.50 +7.60 515.00 319.40 Man . . . . . . . . . . . . . . . . . . . . . .293.20 +1.70 373.60 199.60 Smith(Ds) . . . . . . . . . . . . . . . . . .181.80 –0.90 185.90 103.00
Aquarius Platinum . . . . . . . . . . .389.30 +8.60 490.00 211.50 Easyjet . . . . . . . . . . . . . . . . . . . .460.40 –3.70 499.90 339.80 Marks & Spencer. . . . . . . . . . . . .391.20 –4.40 431.40 321.90 Smiths . . . . . . . . . . . . . . . . . . . 1181.00* –8.00 1297.00 930.00
ARM Holdings . . . . . . . . . . . . . . .350.60 +0.30 419.50 150.60 Edinburgh Inv Tst . . . . . . . . . . . .451.00 –3.20 466.80 345.50 Meggitt . . . . . . . . . . . . . . . . . . . .314.60 –6.60 336.70 234.50 SOCO Intl . . . . . . . . . . . . . . . . . .338.50 –2.00 510.00 287.40
Ashmore . . . . . . . . . . . . . . . . . . .368.50* –8.50 400.50 215.00 Electrocomponents . . . . . . . . . . .247.90 –4.10 261.50 155.00 Melrose . . . . . . . . . . . . . . . . . . .289.30 –6.30 304.90 160.00 Spectris . . . . . . . . . . . . . . . . . . 1122.00* –10.00 1146.00 653.00
Ashtead . . . . . . . . . . . . . . . . . . .133.60 –1.30 135.60 61.25 EnQuest . . . . . . . . . . . . . . . . . . .132.20 +3.20 138.50 87.35 Mercantile IT . . . . . . . . . . . . . . .1018.00 –3.00 1029.00 822.50
Astrazeneca . . . . . . . . . . . . . . .3033.50 –31.00 3389.50 2680.50 Essar Energy . . . . . . . . . . . . . . .530.50 –12.50 566.50 358.50 Michael Page Intl. . . . . . . . . . . . .500.00 –1.50 507.50 326.00 Spirax-Sarco Eng . . . . . . . . . . .1734.00* –61.00 1888.00 1060.00
Atkins(Ws) . . . . . . . . . . . . . . . . .736.00 –17.00 801.00 539.00 Eurasian Nat Res . . . . . . . . . . . .990.00 +18.00 1276.00 801.00 Micro Focus . . . . . . . . . . . . . . . .343.20 –9.80 550.00 272.20 Spirent Comms . . . . . . . . . . . . . .150.60 –1.40 158.30 90.45
Autonomy Corp . . . . . . . . . . . .1419.00 –7.00 2012.00 1319.00 Euromoney Inst Inv . . . . . . . . . . .672.50 +1.00 683.00 383.00 Millen & Copthorne . . . . . . . . . . .537.50 –8.00 585.00 329.20 Sports Direct Intl . . . . . . . . . . . . .128.50 +3.00 154.30 89.85
Aveva . . . . . . . . . . . . . . . . . . . .1433.00 –21.00 1572.00 900.50 Experian . . . . . . . . . . . . . . . . . . .716.00 –9.00 763.50 559.00 Misys . . . . . . . . . . . . . . . . . . . . .295.50 –1.60 300.00 196.60 SSL Intl . . . . . . . . . . . . . . . . . . . 1162.00 –1.00 1190.00 634.00
Aviva . . . . . . . . . . . . . . . . . . . . .403.10* –13.40 428.70 290.20 Ferrexpo . . . . . . . . . . . . . . . . . . .395.90 +38.50 401.60 167.00 Mitchells & Butlers . . . . . . . . . . .342.60 –6.30 351.60 242.50 St James’s Place . . . . . . . . . . . . .261.00 –2.90 298.00 203.40
Babcock International . . . . . . . . .570.50 –8.00 645.50 489.00 FirstGroup . . . . . . . . . . . . . . . . .388.40 –10.40 428.40 331.20 MITIE . . . . . . . . . . . . . . . . . . . . .195.00 –2.10 248.60 187.60 Stagecoach. . . . . . . . . . . . . . . . . 211.30 –3.70 226.10 138.40
BAE Systems . . . . . . . . . . . . . . .354.50* –4.90 389.90 288.10 Foreign & Col Inv Tst. . . . . . . . . .295.90 +0.50 300.00 250.00 Mondi . . . . . . . . . . . . . . . . . . . . .492.80 –16.70 562.00 304.70 Standard Chartered . . . . . . . . . .1885.50 –3.00 1975.00 1316.50
Balfour Beatty . . . . . . . . . . . . . . .284.80* –0.30 304.80 228.60 Fresnillo . . . . . . . . . . . . . . . . . .1460.00 +64.00 1461.00 647.00 Monks Inv Tst . . . . . . . . . . . . . . .343.00 –1.00 349.70 265.00 Standard Life . . . . . . . . . . . . . . .225.40* –4.00 238.00 170.00
Barclays . . . . . . . . . . . . . . . . . . .284.90 –4.70 394.25 253.40 G4S . . . . . . . . . . . . . . . . . . . . . .248.60 –2.00 285.70 238.70 Morrison Wm . . . . . . . . . . . . . . .275.00 +1.40 307.10 255.00 SuperGrp . . . . . . . . . . . . . . . . .1350.00 +150.00 1365.00 499.00
Barratt Development . . . . . . . . . . .81.30 –2.30 149.90 75.50 Genesis Emerging Mkts Fd . . . . .540.50 +2.50 542.50 383.00 Murray Intl Tst . . . . . . . . . . . . . . .912.00* –1.00 938.50 720.00 TalkTalk . . . . . . . . . . . . . . . . . . .140.50 +0.90 153.80 106.60
BBA Aviation . . . . . . . . . . . . . . .198.30 –8.00 220.00 145.90 GKN . . . . . . . . . . . . . . . . . . . . . .173.80 –2.40 188.40 100.40 National Express. . . . . . . . . . . . .243.80 –6.70 261.30 155.86 Talvivaara Mining . . . . . . . . . . . .548.00 –22.00 597.00 341.40
Berkeley . . . . . . . . . . . . . . . . . . .835.50 –6.00 917.50 735.00 GlaxoSmithKline . . . . . . . . . . . .1229.50* –8.50 1347.00 1088.00 National Grid . . . . . . . . . . . . . . .581.00 –2.00 607.65 474.80 Tate & Lyle . . . . . . . . . . . . . . . . .526.00 –1.50 534.50 388.00
BG . . . . . . . . . . . . . . . . . . . . . .1277.50 +0.50 1302.50 966.90 Great Portland Estates . . . . . . . .339.90 –5.10 368.60 265.40 Next . . . . . . . . . . . . . . . . . . . . .2128.00 +10.00 2361.00 1816.00
BHP Billiton . . . . . . . . . . . . . . .2413.00 +3.00 2500.00 1678.00 Greene King . . . . . . . . . . . . . . . .440.00 +3.40 484.00 372.50 Northumbrian Water . . . . . . . . . .344.60 –1.70 364.00 237.80 Taylor Wimpey . . . . . . . . . . . . . . .26.29 +0.36 46.34 22.12
BlackRock Mining . . . . . . . . . . . .736.00 +9.00 737.50 490.00 Halfords . . . . . . . . . . . . . . . . . . .414.30 –6.50 562.50 370.10 Ocado Grp . . . . . . . . . . . . . . . . .132.50 –6.10 169.00 120.90 Telecity . . . . . . . . . . . . . . . . . . . .463.50 –4.50 546.00 323.50
BlueBay . . . . . . . . . . . . . . . . . . .481.20* –0.30 495.00 251.00 Halma . . . . . . . . . . . . . . . . . . . . .324.60 –10.10 345.50 221.80 Old Mutual . . . . . . . . . . . . . . . . .131.00* –1.50 146.90 95.30 Templeton Emrg Mkts . . . . . . . . .675.50 –4.50 688.00 470.00
Bluecrest Allblue GBP . . . . . . . . .174.00 +0.80 174.00 151.00 Hammerson . . . . . . . . . . . . . . . .420.20 –1.00 460.30 332.20 Partygaming . . . . . . . . . . . . . . . .213.50 –6.40 339.70 205.80 Tesco . . . . . . . . . . . . . . . . . . . . . 411.50* –1.65 454.90 368.40
Booker . . . . . . . . . . . . . . . . . . . . .55.25* +0.75 56.00 37.50 Hargreaves Lansdown . . . . . . . .494.00 –3.10 502.50 259.40 Pearson . . . . . . . . . . . . . . . . . . .957.00 –5.50 1069.00 812.00 Thomas Cook . . . . . . . . . . . . . . .186.10 –0.10 277.20 167.50
BP . . . . . . . . . . . . . . . . . . . . . . .449.80 +4.35 658.20 296.00 Hays . . . . . . . . . . . . . . . . . . . . . . 111.30* –1.90 125.30 82.50 Pennon . . . . . . . . . . . . . . . . . . . .625.50 –2.50 644.00 449.90 Travis Perkins . . . . . . . . . . . . . . .863.50* –19.00 915.00 647.50
Brit Insurance . . . . . . . . . . . . . .1042.00 — 1052.00 709.00 Henderson . . . . . . . . . . . . . . . . .133.60 –1.60 157.80 112.10 Persimmon . . . . . . . . . . . . . . . . .360.20* –10.60 520.00 335.90 TUI Travel . . . . . . . . . . . . . . . . . .203.10 –2.60 313.90 189.20
British Airways . . . . . . . . . . . . . .264.20 –8.60 290.00 180.20 Heritage Oil. . . . . . . . . . . . . . . . .386.10 +15.90 585.00 295.90 Petrofac . . . . . . . . . . . . . . . . . .1519.00 –3.00 1545.00 900.00 Tullett Prebon . . . . . . . . . . . . . . .369.00* –28.40 427.00 261.20
British Amer. Tob . . . . . . . . . . .2405.50 –10.50 2490.50 1832.00 Hikma Pharma . . . . . . . . . . . . . .783.00 –8.00 813.00 462.70 Petropavlovsk . . . . . . . . . . . . . .1077.00 +57.00 1370.00 834.00 Tullow Oil . . . . . . . . . . . . . . . . .1262.00 +14.00 1375.00 979.50
British Empire Tst . . . . . . . . . . . .492.30 +2.60 497.00 338.50 Hiscox . . . . . . . . . . . . . . . . . . . .352.10 –3.30 371.60 299.60 Phoenix Group . . . . . . . . . . . . . .675.00 +1.00 775.00 550.50 UK Commercial Prop. . . . . . . . . . .77.30* –0.35 84.90 71.00
British Land . . . . . . . . . . . . . . . .508.00* +7.00 525.00 416.00 Hochschild Mining . . . . . . . . . . .556.00 +16.00 571.50 220.00 Premier Farnell . . . . . . . . . . . . . .274.40 –9.40 290.00 150.80 Ultra Electronics . . . . . . . . . . . .1645.00 –87.00 1903.00 1198.00
Britvic. . . . . . . . . . . . . . . . . . . . .476.40 –0.70 518.00 354.30 Home Retail . . . . . . . . . . . . . . . .212.00* –2.90 326.30 201.70 Premier Oil . . . . . . . . . . . . . . . .1810.00 +40.00 1818.00 984.00 Unilever . . . . . . . . . . . . . . . . . .1852.00* –8.00 2024.00 1662.00
Brown(N.) . . . . . . . . . . . . . . . . . .280.80 –2.70 308.00 204.80 Homeserve . . . . . . . . . . . . . . . . .414.80 –12.10 502.00 414.80 Provident Financial . . . . . . . . . . .734.00* +0.50 983.50 727.50
BSkyB . . . . . . . . . . . . . . . . . . . .726.50* –0.50 737.00 521.00 HSBC Hldgs . . . . . . . . . . . . . . . .684.00 –5.60 766.80 595.20 Prudential . . . . . . . . . . . . . . . . . .623.00 — 665.00 475.70 United Utilities . . . . . . . . . . . . . .624.50 +2.50 634.50 455.10
BT . . . . . . . . . . . . . . . . . . . . . . .169.10 +9.70 169.80 108.40 Hunting . . . . . . . . . . . . . . . . . . .650.00* –5.50 663.50 429.10 PZ Cussons . . . . . . . . . . . . . . . .386.50 –5.00 406.80 231.70 Utd Business Media . . . . . . . . . .664.00 –9.50 692.00 408.30
BTG . . . . . . . . . . . . . . . . . . . . . .259.00 –1.00 270.80 150.00 ICAP . . . . . . . . . . . . . . . . . . . . . .473.60 –20.40 501.50 291.70 Randgold Resources. . . . . . . . .6160.00 — 6755.00 4126.00 Vedanta Resources . . . . . . . . . .2314.00 –25.00 2967.00 1795.00
Bunzl . . . . . . . . . . . . . . . . . . . . .721.50* –8.00 784.50 614.00 IG . . . . . . . . . . . . . . . . . . . . . . . .508.00 –5.50 560.00 312.60 Reckitt Benckiser . . . . . . . . . . .3559.00 –16.00 3667.00 2997.00 Victrex . . . . . . . . . . . . . . . . . . .1230.00 –54.00 1355.00 753.00
Burberry . . . . . . . . . . . . . . . . . .1007.00 +8.00 1065.00 555.50 Imagination Tech Gp . . . . . . . . . .403.50 –5.80 445.00 200.00 Reed Elsevier . . . . . . . . . . . . . . .532.50 –4.50 566.00 454.60 Vodafone . . . . . . . . . . . . . . . . . .171.90 –1.50 179.90 126.50
Cable & Wire Comms . . . . . . . . . .49.39* –0.81 150.00 46.51 IMI . . . . . . . . . . . . . . . . . . . . . . .809.50 –18.00 855.50 483.10 Regus . . . . . . . . . . . . . . . . . . . . . .81.60 –2.10 125.50 64.05 Weir . . . . . . . . . . . . . . . . . . . . .1630.00 –35.00 1720.00 660.00
Cable & Wire Wwide . . . . . . . . . . .70.15 +0.15 94.80 60.05 Imperial Tobacco. . . . . . . . . . . .2000.00 –7.00 2159.00 1728.00 Renishaw . . . . . . . . . . . . . . . . . 1178.00 –15.00 1250.00 479.00 Wellstream Hldgs . . . . . . . . . . . .753.50 +1.00 810.00 429.70
Cairn Energy. . . . . . . . . . . . . . . .380.80 +1.30 497.60 306.80 Inchcape. . . . . . . . . . . . . . . . . . .330.30 –5.70 358.00 235.00 Rentokil Initial . . . . . . . . . . . . . . . .94.25 +3.70 140.20 89.40 WH Smith . . . . . . . . . . . . . . . . . .462.30 –5.20 551.00 392.20
Caledonia Invs . . . . . . . . . . . . .1802.00 –2.00 1833.00 1496.00 Informa . . . . . . . . . . . . . . . . . . . .435.20 –3.90 450.50 263.30 Resolution . . . . . . . . . . . . . . . . .244.50 –2.00 280.50 220.10 Whitbread . . . . . . . . . . . . . . . . .1762.00* –7.00 1807.00 1225.00
Capita . . . . . . . . . . . . . . . . . . . . .732.00 +1.50 829.50 693.00 Inmarsat . . . . . . . . . . . . . . . . . . .686.50 –18.50 831.00 603.50 Rexam . . . . . . . . . . . . . . . . . . . .312.60 –3.00 348.80 271.40 William Hill . . . . . . . . . . . . . . . . .159.20* –1.80 217.80 158.00
Capital & Counties . . . . . . . . . . .151.50 +1.40 159.00 99.60 Intercontl Hotels . . . . . . . . . . . . 1101.00 +1.00 1244.00 803.00 Rightmove . . . . . . . . . . . . . . . . .774.50* –8.50 830.00 456.90 Witan Inv Tst . . . . . . . . . . . . . . . .482.90 –2.60 492.00 397.30
Capital Shopping Centres . . . . . .384.90 –0.70 523.50 300.10 Intermediate Capital . . . . . . . . . .337.80 –3.40 352.80 233.50 Rio Tinto . . . . . . . . . . . . . . . . . .4401.50 +68.50 4477.50 2751.00
Carillion . . . . . . . . . . . . . . . . . . .347.40* –5.30 361.90 272.00 Intertek . . . . . . . . . . . . . . . . . . .1893.00* –39.00 1953.00 1136.00 RIT Capital Partners . . . . . . . . .1155.00 +17.00 1215.00 940.00 Wolseley . . . . . . . . . . . . . . . . . .1745.00 –30.00 1837.00 1155.00
Carnival . . . . . . . . . . . . . . . . . .2690.00 –19.00 2937.00 1963.00 Intl Personal Fin . . . . . . . . . . . . .319.10 –5.90 340.90 181.40 Rolls Royce . . . . . . . . . . . . . . . .584.00* –4.00 661.50 460.90 Wood Group (John). . . . . . . . . . .472.80 +6.50 476.20 279.60
Catlin . . . . . . . . . . . . . . . . . . . . .350.50 –3.80 394.60 303.20 Intl Power . . . . . . . . . . . . . . . . . .427.00 –0.90 438.10 261.60 Rotork . . . . . . . . . . . . . . . . . . .1707.00 –39.00 1906.00 1101.00 WPP . . . . . . . . . . . . . . . . . . . . . .732.00 –12.00 758.50 561.00
Centamin Egypt . . . . . . . . . . . . .184.00 –8.20 202.80 103.50 Invensys . . . . . . . . . . . . . . . . . . .310.90* –2.30 350.30 224.90 Royal Bank Of Scot . . . . . . . . . . . .41.02 –1.14 58.95 28.25 Xstrata . . . . . . . . . . . . . . . . . . .1419.00 +50.50 1462.50 832.50
Centrica . . . . . . . . . . . . . . . . . . .336.00* –0.20 347.00 243.00 Investec . . . . . . . . . . . . . . . . . . .503.50 –11.50 565.00 411.50 Royal Dutch Shell A . . . . . . . . .2041.50* +5.50 2106.50 1621.00 LONDON TOP 250 BY MARKET CAPITALISATION
Charter Intl . . . . . . . . . . . . . . . . .706.00 –16.00 855.50 563.50 ITV . . . . . . . . . . . . . . . . . . . . . . . .69.55 –0.15 73.00 46.77 Royal Dutch Shell B . . . . . . . . .2006.50* +5.00 2071.00 1550.00
Chemring . . . . . . . . . . . . . . . . .2836.00 +4.00 3711.00 2551.00 Jardine Lloyd Thompson. . . . . . .584.00 –5.00 604.50 420.70 RSA Insurance . . . . . . . . . . . . . .127.70* –1.20 137.40 114.10 * Ex-Dividend † Suspended
Close Bros . . . . . . . . . . . . . . . . .808.00* –10.00 834.00 657.00 Johnson Matthey . . . . . . . . . . .1905.00 –20.00 1999.00 1435.00 SABMiller . . . . . . . . . . . . . . . . .2017.50 –19.50 2103.00 1638.00
Cobham . . . . . . . . . . . . . . . . . . .207.90* +0.70 278.60 199.20 JPMorgan Emerg Mkts . . . . . . . .608.50 –0.50 618.00 448.00 Sage . . . . . . . . . . . . . . . . . . . . . .264.90 –7.40 286.80 208.20 www.interactivedata.com

FTSE 100 slips on financials’ Dow falls after Cisco

exposure to Ireland’s debts warns on earnings
ed in July. November when the airline starting to realize that maybe this is

THELONDON Ireland warned yesterday that a

surge in its borrowing costs to record
announced it was cutting crew pay
and reducing staffing. THENEW YORK just a Cisco-specific story,” Massocca
said.

REPORT REPORT
highs had become “very serious” and Mining and energy stocks tracked Cisco stock suffered its worst one-
the EU said it was ready to act. gains in commodities following day percentage drop since July 14,
RBS’s Irish business, Ulster Bank, strong industrial production figures 1994, when it slid 17.71 per cent,
made a loss of £176m in the third from China. according to Thomson Reuters

F
INANCIALS pressured Britain’s quarter. The sector was also boosted by a Datastream. However, Cisco’s decline

C
top share index yesterday as con- Interdealer broker ICAP fell 4.1 per bullish note from BofA Merrill Lynch, ISCO’S discouraging outlook accounted for more than half of the
cerns over Royal Bank of cent after Credit Suisse cut its rating which upgraded its ratings on dragged Wall Street lower yes- losses in the Nasdaq 100 Index.
Scotland’s exposure to Ireland’s to “neutral” on valuation grounds. Antofagasta, Xstrata and Kazakhmys terday, but the market fought The Dow Jones industrial average
debt troubles weighed on the bank, FTSE 250 peer Tullett Prebon shed who were among the best perform- back in a sign the bullish trend fell 73.94 points, or 0.65 per cent, to
and ICAP fell after a downgrade from 7.2 per cent, hit by sentiment sur- ers, up 3.7 to 4.8 per cent. remains intact. 11,283.10. The Standard & Poor’s 500
BofA Merrill Lynch. rounding ICAP’s downgrade and wor- “QE [quantitative easing] and dollar Cisco lost 16.2 per cent to $20.52 Index shed 5.17 points, or 0.42 per
Weakness among financials offset ries over trading update on Friday, an debasement figure big in our latest after its earnings report. Major index- cent, to 1,213.54. The Nasdaq
gains in commodity-linked assets, analyst said. global commodity review. We factor es plunged shortly after the open, Composite Index lost 23.26 points, or
which rallied after strong data from Private equity firm 3i Group in higher commodity prices across with Nasdaq falling more than two 0.90 per cent, to 2,555.52.
China, the world’s biggest consumer dropped 2.7 per cent as it reported the board with copper as a key win- per cent, but slowly came back as Cisco’s warning dragged down
of raw materials, while upbeat results higher first-half earnings, with Oriel ner,” the broker wrote in a note. investors viewed Cisco’s problems as shares of other tech heavyweights.
lifted telecoms provider BT. Securities downgrading on the back “We also see concerns on Chinese company-specific. Microsoft lost one per cent to $26.68,
The FTSE 100 closed down 1.71 of recent gains. growth as overdone ...,” the broker “This is a recipe for disaster but the and Hewlett-Packard dropped 2.5 per
points at 5,815.23 yesterday, after it Elsewhere, British Airways slid 3.2 said. fact is, the market is doing pretty cent to $43.06.
closed down one per cent lower the per cent after the union representing Second tier Ukrainian iron ore well,” said Stephen Massocca, manag- More than 531 million shares had
day before. its cabin crew suspended a ballot on miner Ferrexpo jumped 10.8 per cent ing director at Wedbush Morgan in traded in Cisco, the fourth busiest day
“The rally we have enjoyed over the an offer the airline hoped would end after unveiling a $647m (£401m) San Francisco. in the stock’s history, according to
past few months looks to be stalling a year-long dispute. expansion plan to boost output by 40 “The market is exhibiting consider- Thomson Reuters Datastream.
as the situation in Europe is getting Last month, the Unite union said it per cent in three years. able strength here, considering the On Wednesday, Cisco’s chief execu-
more and more unsettling for would ballot staff on the new offer run we’ve had in the past few weeks, tive John Chambers cited weak public
investors,” Angus Campbell, head of from BA, which addressed one of the ANALYSIS l FTSE negative news out of Cisco, and the spending as well as service providers,
sales at Capital Spreads, said. main remaining sticking points, the 5815.23 dollar doing well.” namely cable companies that have
6,000
RBS, down 2.7 per cent, was the removal of travel concessions for 11 Nov In the past, major averages have been losing customers, but said he
biggest faller in a weaker banking sec- workers who had gone on strike. 5,800 taken a bigger beating the day after saw the slowdown as “a couple of air
tor with traders citing worries over The union had indicated it would Cisco’s earnings disappoint. pockets.”
the British state-backed bank’s expo- recommend staff vote to support the 5,600 Short-term technical indicators Cisco’s disappointing outlook came
sure to Ireland's sovereign debt prob- deal, but it said its cabin crew repre- suggest the stock market is still in an as the market’s recent rally lost
5,400
lems. sentatives had now changed their uptrend, and options action in Cisco steam. Tech shares have led that rally,
RBS has the second biggest expo- mind. 5,200 reversed earlier bearishness as traders with the S&P information tech index
sure, €5.020bn (£4.247bn), to Irish sov- BA said when it made the offer that moved to rebuild bullish positions. up about 21 per cent from the end of
ereign debt, based on data supplied to it believed the deal was fair and could 5,000 “There was a panic sell-off initially August, compared with the S&P 500’s
16 Aug 6 Sep 24 Sep 14 Oct 3 Nov
regulators under a stress test conduct- resolve the dispute which began last [on Cisco’s outlook] but people are gain of about 16 per cent.
 Living
Beauty, isolation
and serious bling
An unusual cliff-top
house brings glitz to
the Cornish coast,
writes Timothy Barber
T
HE Cornish coast is known for many
things – ancient ruined castles, des-
olate cliffs, a thriving arts scene,
high-grade surfing – but blinging
property isn’t generally one of them. Blue
Point, a £3.25m home overlooking the
bobbing fishing boats of the tiny fishing
village of Gorran Haven on Cornwall’s
eastern coast, is the kind of space-aged,
super-designed, cliff-top lair one might
more commonly expect to find in Malibu
or Mykonos. The view out over the sea is
heart-stopping.
Outré it may be but it’s also sympathetic.
The building is built into the cliff face, sink-
ing 11 metres into the rock and taking the
house out of the view of surrounding prop-
erties. The front of the house is a wall of
glass, maximising that panorama, and tak-
SUPERBLY DESIGNED 1, 2 & 3 BEDROOM
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| Property of the month ENTREPRENEUR PROFILE
ON PAGE 27
Blue Point’s master
bedroom comes with
a hot tub at the end of
the bed
ing advantage of the fact that the sun
remains in view from rising to setting.
Occupying 12,000 feet of floor space and
with five bedrooms, the house is a place of
sleek, blissed-out cool. Designer Helen
Blake, whose previous projects include the
Cornish outpost of Jamie Oliver’s Fifteen
restaurant and the Cotton Bay Village
resort in St Lucia, has stuck to minimalist
tones, clean lines, gleaming surfaces and
groovy furnishings to create an environ-
ment that’s the essence of movie star chic.
On which note, the hot tub sunk into the
floor at the end of the bed in the master
bedroom is a marvellous indulgence.
As you’d expect with a house of this
type, the tech is as high as it comes.
There’s a cinema room, Lutron mood
lighting, and a house-wide audio system
operated with a portable electronic tablet.
The house also has a sizeable swimming
pool, plus steam room and spa.
If all that bling and razzmatazz gets too
much, it’s a beautiful location from which
to explore the isolated wilds of the Cornish
peninsula – before returning for a splash in
the hot tub as you watch the sun set.
Contact Winkworth on 01392 422 320 or visit
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View from Velocity
22 Living | The Knowledge
FOCUS ON: BRIGHTON AND HOVE, EAST SUSSEX
ONE BRIGHTON, NEW ENGLAND ST
Price: £280,000
There is one two-bed apartment still for sale in this zero-car-
bon development in the heart of Brighton. The development
has roof-top gardens and allotments. The apartment comes
with a fully-fitted kitchen and bathroom while the master bed-
room has an en suite. Contact: Fox and Sons on 01273 777000,
www.onebrighton.co.uk
For more information visit residencessugarbeach.com
MARMION ROAD, HOVE,
Price: £375,000
This smart three-bedroom end-of-terrace house is in a popular
area of Hove and within the catchment area for West Hove pri-
mary school. There is also a back garden with decking. Its solar
panel for hot water and underfloor heating will appeal to the
ecologically-minded.
Contact: Winkworth on 01273 320300, www.winkworth.co.uk
CITYA.M. 12 NOVEMBER 2010
BY JESSICA MEAD
WESTBOURNE VILLAS, NEW CHURCH RD, HOVE
Price: £2.25m
A five-bedroom property dating from the late Victorian period,
this spacious house is just a few hundred metres from the
seafront – the first-floor balcony has sea views. It has recently
been improved by the current owners. There is a large rear gar-
den and off-street parking for two cars. Contact: Hamptons
International on 01273 230230, www.hamptons.co.uk
 CITYA.M. 12 NOVEMBER 2010 Living | The Knowledge 23

CURRENT MORTGAGE DEALS BUYING

Lender Fixed/Flexible Rate Until standard rate apr
BY JESSICA MEAD

Maximum Loan
Q&A
Q.
Dear Camilla, I am
(per cent) (per cent) (per cent) to Value (per cent) thinking of purchasing
a buy to let property. How is the
First Direct Flexible 2.19 2 years 3.69 3.5 65 rental market currently performing and
are there any hot spots?
Santander Flexible 2.19 2 years 4.24 4 60 Camilla Dell
MANAGING PARTNER

A.
Now is an excellent time to be pur-
ING Direct Flexible 2.29 2 years 3.5 3.5 60 OF BLACK BRICK chasing a buy-to-let property – the
rental market is currently enjoying a
HSBC Flexible 2.29 Term 2.3 2.3 60 Dear Camilla, how do you think boom period and rents have risen up to 35
Yorkshire BS Fixed 2.69 To Nov 2012 4.99 4.8 60 Q. the austerity measures put in
place recently by the new govern-
ment will affect UK house prices?
per cent in the last year.
Prime areas of central London such as
Mayfair, Marylebone, Hyde Park, South
Santander Fixed 2.69 To Jan 2013 4.24 4.2 60 Kensington and Kensington are areas that

A.
We believe that house prices outside rent well and houses in these locations
Principality BS Fixed 2.74 To Dec 2012 4.99 4.9 65 of central London are likely to be stand the best chance for capital apprecia-
affected the most by the wave of tion. Prime north London areas including St
ING Direct Fixed 3.39 To Jan 2013 4.2 4.2 60 spending cuts that are due to happen over John's Wood, Hampstead and Islington
the next few years. The property market have seen the strongest rental growth at
Chelsea BS Fixed 3.29 To Dec 2013 5.2 5.2 75 outside of central London is much more of a more than 4 per cent in the three months
Source: MoneySupermarket.com domestic market and it's likely therefore to September.
that prices will go down, particularly in rural For all investors in the London property
areas. market I would recommend a two-bed-
PROPERTY NEWS This does however present an interest- room, two-bathroom flat in any of these
BY JESSICA MEAD ing opportunity for anyone looking to pur-
chase a country home, where demand has
areas. Two-bedroom flats appeal to the
widest tenant market – professional shar-
dropped significantly and supply is out- ers and also individuals. They also have
stripping demand. We have seen evidence more scope for capital appreciation than a
of several distressed sales happening, one-bedroom flat.
even in quite prestigious country estates In the most established areas of prime
in Surrey. central London you can expect your two-
We believe house prices in central bedroom investment flat to rent for
London will be much more resilient to the between £800 per week and £3,000 per
spending cuts. This is mainly due to the week depending on its size, location and
presence of international buyers, who condition.
account for well over 50 per cent of In the more peripheral areas, such as St
London property purchases. John’s Wood and Notting Hill, a two-bed-
PARIS CURTAIN TWITCHING There is also still a lack of supply, partic- room property will achieve anything from
Paris is the single most popular place in France for Britons. Londoners are more interested in the value of their neighbours’ ularly in the prime, sought-after areas. £500 upwards.
Official French data reveals that 20,500 of the 135,000 Britons properties than people from any other region, according to London property won't be immune but we
living in France live in or close to the capital. Paris’ connections research from property website Zoopla.co.uk. Liverpudlians are think prices will remain relatively flat over Camilla Dell is the managing partner at
with the rest of Europe and its status as a business centre have the least interested. Within London, the nosiest residents are the next 12 to 18 months, rather than fall search and acquisition consultancy Black
proved attractive. to be found in Richmond-upon-Thames. significantly. Brick. www.black-brick.com.

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 24 Living | Insight CITYA.M. 12 NOVEMBER 2010
GREENWICH
CREEKSIDE
Investing in property in Hackney
Central
Hackney M

Homerton

the UK Silicon Valley London

Fields

Bethnal Green
Victoria
Park

Bow
Donata Huggins asks whether cluster of creative and tech start-ups con-
gregating around, the newly dubbed,
Bethnal Green
Bethanl Green
it’s wise to buy into the future “Silicon Roundabout” in Old Street and
spread them east – a bold plan that has gen- Shoreditch Stepney Green
of the technology industry erated plenty of scepticism.
Reassuringly, Facebook and Google have Whitechapel
Stepney
already committed to the area, believing it Limehou
will turn into a global centre of creativity ch St

H
AVE you ever The UK tech capital and innovation. Facebook’s vice president
looked at Canary could stretch from Joanna Shields said: “It will give start ups
Wharf’s riverside Shoreditch to the and innovators in the UK a home to realise Wapping
properties and Olympic Park their ambitions as part of the London 2012
wished you had bought Olympics legacy.”
one when Thatcher first Firms such as Cisco, Intel and British
Bermondsy
hatched her plan to turn Telecom have also hinted that they too
it into a business hub? might fill some of the empty office space
Southwark

Feel the
Back when nobody out east.
Park
realised how lucrative it But the question is: could you bring your-
would become? self to take the chance? At the moment the
Well David Cameron’s eastern quarter of the stretch over by
call for a British Silicon Stratford and around the Olympic village is
Valley stretching from considered by many to be a bit of an indus-

Rhythm of
Shoreditch to the Olympic trial wasteland. There are limited local D
Park could be the second amenities and many of the new housing
chance you have been wait- developments have not yet opened. Buying New Cross
Peckham Gate
ing for. here is a bit of a gamble. But here are six
Cameron wants to take the reasons why it’s worth the risk.

the Thames 1. 2.
BUSINESSES ALREADY INVESTED AMBITIONS FOR REGENERATING THE AREA

A flagship
development of
inspirational 1, 2 & 3
bedroom apartments
with superb personal
space partnering vibrant
public space, focusing
on light and modern
living in a dynamic and
exciting part of London.
Spectacular River Thames
and Canary Wharf views
from the communal
roof terrace.
The whole idea of the Silicon
Roundabout sounds uninspiring, fol-
lowing as it does the Silicon Fen in
Cambridgeshire or the Silicon Glen
in Scotland. But it’s fair to say that
Intel, Facebook and Google are pret-
ty big names. A whole host of start-
ups are already flourishing. So far
the government’s specific involve-
ment is a little unclear – perhaps it
would be best just letting the area
develop organically – but you can
bet that they will tag on to this
trend for one reason above all: the
Olympic legacy. If Cameron and
Nick Clegg decide that they can
bathe in reflected East End techno-
glory and claim that they were
responsible for the area’s regenera-
tion, then you can guarantee that
any spare five-pence pieces that
they can find down the back of the
Treasury sofas will be directed
there. Whatever they do, it’s sure to
have some positive effect on the
area’s prospects, and its prices.
When most people think of the Sydney
Olympics in 2000 they think of the stadi-
ums that were left empty and unused
once the Olympics left town. When they
think of Athens in 2004, they remember
how shambolic it was. So understand-
ably enough, the Olympic legacy is a
matter of serious importance for the
government. This means that improving
the area will be high up the govern-
ment’s agenda. Not to mention the fact
that the London Olympic bid was won
partly because the British organisers
pledged to regenerate the area. Camero
reiterated this in his election manifesto,
committing his party to the project and
to more generally regenerating urban
environments throughout the UK. He wi
no doubt have looked at the history of
Canary Wharf, the improved property
prices and the thousands of support jobs
that were created in the deprived area
surrounding it. He’ll be thinking that he
can replicate this for the Olympic Park
area. Savvy investors might be wise to
invest in political paranoia.

SHOW FOCUS ON: EAST LONDON

APARTMENTS THE GAMBLE
NOW OPEN TRADEWINDS, E16
Price: £319,950
If you’ve decided that investing in the
British Silicon Valley is worth the risk,
Selling Agents:
properties such as Tradewinds in Wards
Wharf Approach are the type of place
you should be looking for. The property
is situated on the Thames side, close to
the Thames Barrier.
The apartment featured (right) has two
A development by: bedrooms and two bathrooms. It is
shockingly cheap in comparison to its
Canary Wharf equivalent. The mile-long
move from Canary Wharf to Ward
Wharf Approach knocks around
£100,000 off the average price. It real-
ly is a short distance: you can get to
Canada Square in 15 minutes from
Pontoon Dock DLR station or in 12 min-
utes by car.
The property’s terrace overlooks the
river and 22 acres of the Thames
Barrier Park next door. The owners con-
sider the park to be a “post-modern”
garden, boasting “adventurous” plants
and dancing water fountains.
While the restaurants and bars in the
nearby Victoria Dock have quite a cor-
porate feel, they are only across the
road. The existence of the restaurants in
this area suggests that there is poten-
tial for improvement as soon as interest
in the area picks up.
The building itself has the usual apart-
ment building amenities, including an
on-site gym, secure parking, a business
suite and a 24-hour concierge.
Contact: Chesterton Humberts on 020
7510 8300
 CITYA.M. 12 NOVEMBER 2010 Living | Insight 25

Leyton
Wanstead Park 6. THOSE ALREADY MOVING IN
arsh Forest Gate

ANALYSIS l House price and sales With property investment, people moving into an area spells
Hackney Maryland volume - Newham London borough profit since shops and bars follow suit. Not to
Wick mention that it’s reassuring to
£300,000 600
Newham £ know that your investment is
Stratford West not too far off the wall. As you
a £250,000 500
Ham Upton can see from the graph (left)
Stratford Park £200,000 400 the numbers of people and
prices are picking up after the
Plaistow £150,000 300 recession. It seems that buyers
Mill have started to cotton on to the
w Meads West Ham £100,000 200
Bow Road area’s commuter potential, at
£50,000 Sales volume (RHS) 100
least. Housing developers are
Mile End Average Price (LHS) also interested too. The developers
Tower Canning 0 Ballymore are rumoured to have
Town Jan 95 Mar 00 May 05 Jul 10 plans for Hercules Wharf.
Hamlets
se
CITY
Poplar AIRPORT
5. CANARY WHARF’S STORY

ANALYSIS l House price and sales In 1981 Margaret Thatcher announced that
volume - Tower Hamlets London borough the London Dockland’s area around Canary
Canary Wharf would become a financial centre. Its
North £450,000 800
Wharf £ aim was to regenerate eight square miles of
Greenwich 700 docks that had been in decline since 1950.
£350,000 The property prices in and surrounding the
600
area have rocketed in value. The graph (left)
500
£250,000 shows this and demonstrates how quickly
400 the prices have recovered since the down-
1 mile turn. When Thatcher opened the premise
300
£150,000
she said: “ 10 years ago, it would not have
Deptford 200
Sales volume (RHS) been possible even to think in such bold,
£50,000 Average Price (LHS) 100 ambitious terms” – maybe in ten years,
New Cross Greenwich Greenwich
Park Cameron will say something similar
Jan 95 Mar 00 May 05 Jul 10 about the British Silicon Valley.

3. CITY AIRPORT 4. SOCIAL SHOREDITCH

n Nobody wants to commute if they can help it, and much of East
London is a short walk or cycle ride from an office in the Square
Mile. For some City folk East London is still a relatively undiscov-
ered part of town, so there is scope for development. Don’t forget
ll City Airport either. London’s most civilised gateway is well con-
nected to banking hotspots in Northern Europe and Switzerland,
making it good for those whose work takes them there regularly -
s - also for those who decide that Geneva or Zug’s friendly tax laws
appeal, but need to be in striking distance of the City. A number of
hedge fund managers have already made the move and as the
age of austerity continues more may follow. A swanky bolt-hole
in East London could be a very appealing prospect indeed. And
where bankers go, price-appreciation is sure to follow.
A decade ago Shoreditch and Hoxton
became fashionable, with the opening of
places like Lounge Lover, the Vibe Bar,
Cargo, Cantaloupe, the Hoxton Pony and
a whole host of others. These days the
trendiest of the trendy might shake their
heads at the influx of mainstream types clubs are more than willing to take the
and have packed up their record collec- non-cool pound. The proximity of art gal-
tions and ridden off on their fixed-gear leries, most notably White Cube, also
vintage racing bicycles to pastures new helps make the area a hub for culture as
(Stoke Newington, perhaps). But that well as cocktails. When Crossrail opens
just makes it all the riper for develop- the East and West Ends will be linked
ment, and all those bars, restaurants and like never before.

BY DONATA HUGGINS

THE SURE BET dark wood floors running throughout the

THE FACTORY, NILE STREET, N1
Price: £940,000
If you’re unconvinced that the UK tech-
nology industry is going to move any fur-
ther east, but you are still interested in
tapping into the potential of UK tech’s
expansion, buying around the “Silicon
Roundabout” in Old Street is a good idea.
While the prices are already fairly expen-
sive, the rapid development of the tech
industry could see property prices appre-
ciate further.
The one-bedroom apartment featured
(left) includes all the urban touches you
would expect of a warehouse conversion:
factory windows, exposed brick walls and
high ceilings.
The kitchen is open plan and has a recep-
tion area and large bathroom. There are
apartment.
Since Old Street is located within Zone 1,
the whole of central London is no more
than 30 minutes away by public trans-
port. For instance, nightlife in Shoreditch
is only 13 minutes away. Bars such as the
Callooh Callay on Rivington Street with
its mismatched furniture and hipster staff
are worth a visit. And for night owls, the
Cargo club is often open until the early
hours of the morning.
There is no shortage of restaurants.
Angel (20 minutes walk away) is consid-
ered to have the largest number of
restaurants per square mile in London –
including the fabulous Le Mercury restau-
rant.
Contact: Sterling Ackroyd Shoreditch on
0207 749 3838
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 City Focus OSCAR WILDE’S 27
AN IDEAL HUSBAND
| Entrepreneurs SEE THEATRE REVIEW
ON PAGE 28

How Big Mother

Q&A

ensures success
GOVERNANCE

Q.
A.
At what point do you need
a proper board of
directors?
?
If you’re part of a small company
that has been steadily growing, you
may have started to think about
creating a board of directors, which includes
more than just yourself and your business
Donata Huggins speaks to serial entrepreneur partner. But when is the right time to create
a professional board for your company? The
and founder of Confused.com Sara Murray answer is entirely up to you. It depends on
how big you intend your company to grow,
but business owners usually know when
they want external input. Ashley de Safrin,

E
VERY mother will feel Sara Murray’s
anxiety when she says: “I was at a
supermarket checkout, I turned
round for a moment and when I
turned back my daughter was gone. I spoke
to security and while they searched the
store they told me to stand by the exit of
the car park and check the back of the cars.
I was horrified. ”
its from her last business to jump-start an advisor at Business Link, says: “In a case
Buddi. like this a board may be appropriate or an
After studying psychology, physiology alternative might simply be a business men-
and philosophy at Oxford, Murray went tor. A board will be more structured and,
into consultancy in the City. But it wasn’t once in place, can be hard to dismantle.
long before she set off to do her own thing. Setting up a board is a long term commit-
“I wasn’t bored at my City job, I just have ment and gives a message that a company
this compulsion to try to do things people is serious about growth.”
say can’t be done.” Her first challenge was a

Q.
Luckily, Murray’s daughter had not gone computer software company, which got What are the advantages and
far, but the terror she felt sparked an idea: started somewhat by chance when she disadvantages of having outside
“I thought with so much technology these landed herself a client. “It was luck. directors in your company?

days, why can’t there be a way to help me
find her when she’s too young to explain
where she is.”
So she took the idea and turned it into a
business called Buddi in 2004. The
company makes and markets GPS tracking
devices that are small and simple enough
for a child or an elderly person to handle.
There are even plans to use it to monitor
criminals doing work in the community as
an alternative to prison.
The concept has faced some criticism,
but Murray explains: “It’s more Big Mother
than Big Brother. It actually gives young
and vulnerable people more independence
because it puts the carer’s mind at ease.”
It’s proving lucrative. The company cur-
rently boasts an annual turnover of £12m.
This isn’t the first time Murray has been
entrepreneurial though. She has set up
Entrepreneurs always think their success is
down to their business plan and product –
most of the time it is just luck.”
Her most well known venture,
Confused.com, got started when she was
working on her second venture, a market-
ing company. “I was working for a client
when I realised that insurance websites
were really complicated and that there
needed to be a way to compare prices more
easily.” To get the idea off the ground she
managed to secure the support of five
insurance companies, “that was essential
to the success of the project,” she explains.
Murray sold Confused.com to Admiral in
2001 for an amount of money she refuses
to disclose. But it was enough to retire at 30
had she wanted to.
So what has made Murray a serial suc-
cess? “Well it’s luck – and setting yourself
A.
The main advantage of a board with
“Set yourself up so gests. “But I suppose I’ve always had an non-executives is the usage of out-
luck comes your way” ability to see what is needed in a market side input to create long-term plans
and how it will fit. I’ve heard other peo- for the future and to help your company
Picture: Micha ple struggle with it, so maybe it’s an grow. Additionally, a bank may view a com-
Theiner/City A.M. skill unique to me.” pany that has a proper board of directors
more positively. As De Safrin says: “A bank
will look at the track record of the manage-
CV | SARA MURRAY ment before granting credit so a board with
the right people adds credibility when sub-
mitting a business plan.”
Age: “Just into my forties” Awards: BT Essence of Most small companies will have a board
Born: Lancashire Entrepreneur, “Female that consists of the business owner and a
few non-executive directors. The board’s job
Lives: London & Oxfordshire Entrepreneur of the Year 2010”; is to challenge the company’s executives on
Studied: Psychology, physiology “Entrepreneur of the Year”, strategy and policy making. If you have a
and philosophy at Oxford. National Business Awards 2009; strong business owner who doesn’t like hav-
First ambition: Brain surgeon CBI/Real Business Technology & ing his opinions challenged, having a board
might lead to a clash of personalities.
Idol: Albert Einstein Innovation Award 2009

Q.
four companies, using £200,000 of the prof- up so that luck comes your way,” she sug- What else should you look out for
when setting up a board of
directors?

A.
Choose a board with members who

A golden era for entrepreneurs possess skills that complement

those of the business owner. If the
business owner doesn’t have sufficient mar-
keting skills, appoint a non-executive direc-
tor with extensive marketing experience.
According to the UK corporate governance
code, appointment of new directors should
It’s an excellent time to branch follow formal, rigorous and transparent pro-
cedures. The code also says that directors of
out, quit your job and start a FTSE 350 companies should be re-elected
annually.
business, says Daniel Knowles You should also be aware of the require-
ments of the Companies Act 2006.
Members of the board have to be at least
sixteen and cannot consist of entirely corpo-

H
OW many times have you had an
idea and wondered whether you
could make some money from it?
Probably most of us have several
daily, but do nothing with them. Next
week is Global Entrepreneurship Week
however, and some influential people are
saying that there has never been a better
time to set up a business. Perhaps it is
time for more ideas to get a chance to live?
Among the most enthusiastic is Julian
Ranger. Ranger sold his first business STA-
SYS to Lockheed Martin five years ago. He
now works as an angel investor and has
founded iBundle – an online hub for bud-
ding entrepreneurs. Ranger argues that
thanks to the recession, there is an abun-
dance of good, innovative people looking
for work, while business premises are
cheap and lying empty. “You might have
to kiss a lot of frogs to find the prince who
funds you”, he says, but dedicated people
will succeed, and find themselves
perfectly placed to make the best of recov-
ering demand. Even at the height of the
recession, 51,000 more small businesses
were set up than wound up, and condi-
tions are improving fast.
Professor John Mullins, of the London
You might need to kiss
a lot of frogs to get
funding for your busi-
ness, but it should be
worth it
Picture: GETTY
Business School, agrees. He observes that
during downturns, large companies “have
all pulled in their horns, so they are leaving
the marketplace more or less clear for peo-
ple with innovative ideas”. As old business
models suffer, there is a lot of potential to
improve on them – especially with the web.
Barry Clark, of the Future Foundation,
thinks that green startups and businesses
that tap into the demand for ethically
branded goods will do very well.
Natalie Ellis, the founder of Prestige Pet
Products, says that the important thing is
rate entities. The Companies Act 2006 also
gives directors a set of legal responsibilities
that includes filing annual returns to
Companies House. Directors also have a
duty not to approve accounts “unless they
are satisfied that they give a true and fair
view of the assets, liabilities, financial posi-
tion and profit or loss.” In other words,
directors are liable for the company’s finan-
cial statements.
Riva Sutanto
to be inventive and incredibly dedicated.
Ellis “dreamed of setting up a pet compa-
ny”, and worked night shifts at a casino to
fund her plans. As her experience shows,
with persistence even some of the
quirkiest products can take off.
Certainly everyone agrees on one thing:
successfully starting a business is enor-
mously satisfying. According to Dom
Jackman, the founder of escapethecity.com,
more people starting businesses would
increase not only our wealth but our happi-
ness. That seems like a very good idea.
 Lifestyle
28
Ruling the theatre roost
Timothy Barber talks
to Howard Panter,
the most powerful
man in the country’s
theatre industry
O
F all the areas you might expect a
canny private equity firm to invest
serious bucks, the theatre business –
with its reputation for volatile actors
and directors, no less volatile audiences,
and millions poured into shows that can
fold almost immediately – might not be top
of the list.
However, London firm Exponent has rea-
son to be cheerful over its £134m invest-
ment in Ambassador Theatre Group (ATG),
which included the acquisition of the UK
theatre business of the American entertain-
ment group Live Nation, to create the coun-
try’s biggest theatre company.
A year on from the deal, ATG’s founder,
chief executive and creative director
Howard Panter says that audiences have
risen five per cent and the combined com-
pany is on course for a £20m profit. “We’re
operating better than our business plan at
the time of the acquisition,” he says.
Panter, 62, founded ATG in 1992 with his
wife Rosemary Squire, who is his joint chief
executive. Together, the couple make
arguably the most powerful partnership in
UK theatre, presiding over 40 theatres
nationwide and 400,000 seat sales a week,
with a company worth “north of £160m”.
Its current West End successes include The
Lion King, Wicked and Legally Blonde,
ALSO OUT THIS WEEK
FILMS, MUSIC, GAMES
FILM
SKYLINE Sci fi gubbins of the alien-invasion kind. A
lack of press screenings isn’t a good sign.
YOU AGAIN Family drama with Sigourney Weaver
and Jamie Lee Curtis.
MY AFTERNOONS WITH MARGUERITE Sickly
sweet French drama with Gerard Depardieu.
| Arts
while Jez Butterworth’s play Jerusalem and
a modern version of Moliere’s La
Misanthrope, starring Keira Knightley and
Damian Lewis, are among its recent critical
and commercial triumphs.
Panter, a large, bald man with a thick
orange beard and good-humoured air, is
understandably bullish about the theatre
industry’s health and profit-making poten-
tial, particularly in the capital.
“The two things that distinguish
London’s economy are the City and theatre
– they’re what’s seen to be world class and
unique,” he says. “Theatre generates about
nine times the money invested in it, and
after heritage it’s the thing that brings the
most tourists to London.”
We meet in the magnificent Art Deco
environs of the Savoy Theatre, among
London’s finest auditoriums and one of the
theatres that account for over £100m of
ATG’s worth – Panter describes owning
them as “like having Cezannes that make a
profit: they’re beautiful, unique, premium,
and they earn money.”
The portfolio stretches from grand the-
atres of the West End and county towns to
more modern regional venues, the newest
of which is a £42m development in
Buckinghamshire, the Aylesbury
Waterside, built by the local council and
operated by ATG.
It was in another area of the commuter
belt, Woking, that Panter and Squire start-
ed the company with their first theatre, the
Ambassador (now a cinema but still in the
group), and he’s forthright about the blend
of shows needed to appeal to the broadest
audiences. While some may snipe about a
profusion of easy-to-please, film-based
musicals or unchallenging touring shows,
Panter points out that the shows like Mama
Mia, Dirty Dancing and Legally Blonde have
DVD
DOWNTON ABBEY SERIES 1 Swift turnaround on
ITV’s just-finished period piece.
A CHRISTMAS CAROL Jim Carrey-starring version
of the Dickens story.
24 – SEASON 8 Jack Bauer’s groundhog career con-
tinues. Tick. Tick. Tock.
Howard Panter
oversees 400,000
seat sales a week.
Picture: Micha
Theiner/City A.M.
tapped into a new female audience that’s
increased the volume of theatregoing by
almost 10 per cent.
“We’re like the BBC, in that we do
Panorama and Eastenders, which means
opera to pantomime,” he says. “I don’t
mind which it is, as long as it’s the best of
its kind.”
Running a theatrical business comes
with its own set of unique issues – the prin-
cipal among these being dealing with that
delicate, capricious breed: actors. “It’s a
very particular creature that becomes an
actor,” says Panter, who trained in produc-
tion at LAMDA theatre school but never
wished to tread the boards himself. “You’re
actually saying ‘I am my work’, asking peo-
ple to look at you in a way that’s different
from any other profession. From a manage-
ment point of view, it creates a dynamic
that’s very particular to theatre, which
requires a degree of navigation.”
Having been steering those waters for
four decades, Panter is confident about the
quality of actors, writers and directors still
coming through, whom ATG’s Whitehall
theatre, Trafalgar Studios 2, is designed to
incubate. He’s nevertheless worried about
the lack of young producers able to create
fledgling shows.
“The artistic talent is really strong, but
the entrepreneurial talent is very hard to
find. The risk you take early on is very
great, and I’m not sure if I was starting out
today how far we’d get.”
Panter would like to see tax incentives
for “people who invest in theatre through
producers”, though even with the govern-
ment’s keenness on artistic philanthropy,
that’s unlikely to materialise any time
soon. Instead, audiences will have to con-
tinue relying on this super-producer’s own
talents for some time to come.
MUSIC
CEE-LO GREEN The Gnarls Barkley singer’s solo
offering is titled The Lady Killer.
SUSAN BOYLE Inevitably, Su-Bo does Crimbo, with an
album of carols. One for grandma (poor grandma).
JAMES BLUNT The squeaky-voiced former tank com-
mander’s new album is called Some Kind of Trouble.
CITYA.M. 12 NOVEMBER 2010
A Wilde ride
of political ups
and downs
Elliot Cowan and
Fiona Button in Oscar Theatre review
Wilde’s comedy.
AN IDEAL HUSBAND
Vaudeville Theatre
hhhhi
NICK Clegg could feel a shiver of recogni-
tion in An Ideal Husband. In Oscar
Wilde’s political comedy, Sir Robert
Chiltern (Alexander Hanson) has fairly
effortlessly risen through the ranks of
Parliament to become Under-Secretary for
Foreign Affairs. Halfway through the first
scene he is coerced into agreeing to rec-
ommend a policy he is strongly against in
the House of Commons.
“Circumstances should never alter prin-
ciples,” Lady Chiltern (Rachael Stirling)
reminds her husband before threatening
to leave him if he acts immorally.
Fortunately for them both, “the idlest
man in London,” dashing Lord Goring
(Elliot Cowan) turns out to be a jolly good
egg and tries to ensure everyone gets their
dues eventually.
Lindsay Posner’s production does not
do anything hugely original to Wilde’s
text – because it doesn’t need to. The one-
liners are perfectly delivered by a cast
who leave you as charmed (Fiona Button’s
Miss Mabel Chiltern) and disgusted
(Samantha Bond’s Mrs Cheverly) as the
Wilde intended.
Meanwhile, Stephen Brimson Lewis’
elegant design accentuates the atmos-
phere of precarious grandeur.
The Christmas-friendly theme of redemp-
tion reminds viewers things may just be
alright in the end – perhaps even for Clegg.
Lauren Paxman
GAMES
CALL OF DUTY: BLACK OPS (ALL FORMATS) The
latest in the smash hit war game series.
SONIC COLOURS (WII, DS) Sega’s psychedelic
hedgehog returns.
KINECT SPORTS (X360) Sports game using the
Xbox’s webcam-style peripheral, the Kinect.
CITYA.M. 12 NOVEMBER 2010 Lifestyle | TV& Games 29

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11pm The Review Show: 10.35pm FILM Mercury Rising: 12.25am Music on 4: The Album Victims Unit BBC2, 6.30PM
Weather Chart Show: N.E.R.D 12.55am Analysis of the pro-celebrity couples’
Thriller, with Bruce Willis. 1998. Music on 4: On Track 1.10am 4Play: 10.55pm CSI: Miami
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Robert Plant 1.25am FILM Battle
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Repair: Comedy drama, starring Western, starring Jack Nicholson 3 Minute Wonder: Garage Wars How Not to Decorate 5.10am
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QUICK CROSSWORD
   

SUDOKU KAKURO
44 13 9 34 9 6 
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24 8 22  
45
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row, each column and each 3x3 block contains all the numbers Fill the grid so that each block 12 30
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 Punter
30
SPORT TRADER DAVID WILD LOOKS AT ENGLAND V AUSTRALIA
& BEN CLEMINSON PREVIEWS THE WEEKEND’S FOOTBALL
Wallabies’ talented backs
can give visitors the edge
ENGLAND
AUSTRALIA
TOMORROW, 2.30PM, SKY SPORTS
AGAINST the All Blacks last weekend
England showed signs of promise without
quite managing to set Twickenham
alight, but most impressive was Martin
Johnson’s reaction to his side’s perform-
ance. He acknowledged that his side
shone in fits and starts but maintained
that good rugby in fits and starts is not
good enough and has urged for much
more against Australia.
The big doubt hanging over the
Wallabies is the quality of their front row
relative to England’s. Andrew Sheridan
and the improving Dan Cole at tighthead
made life difficult for Keven Mealamu
and co last Saturday, and the Australian
front three have made their fallibility
clear in their last two matches against
New Zealand and Wales. It didn’t come
off last week, but this makes an England
penalty to be the first scoring play a good
bet at 15/8 on Betdaq. The Red Rose will
shoot for the Achilles heel early and a
penalty awarded against the Australians
for a collapsed scrum is likely, as is Toby
Flood to convert inside 50 metres.
Their relative weakness in the tight five
United to make it six out of seven away draws
ASTON VILLA
MANCHESTER UNITED
TOMORROW, 12.45PM, SKY SPORTS
ASTON Villa have struggled against
Manchester United over the years but last
season they pulled off an unlikely 1-0 win
at Old Trafford and took a point at home.
They have now drawn their past two home
league games against the Red Devils, but
you have to go back to 1995 for their last
win against them at Villa Park.
The Manchester derby on Wednesday
night was a disappointing contest in
terms of quality, although United were
STOKE
LIVERPOOL
TOMORROW, 5.30PM, ESPN
TONY Pulis has had a stressful week to say
the least. Firstly, he had to witness some
bizarre refereeing decisions at Sunderland
on Saturday that effectively robbed his side
of at least a point. The Potters then faced
Birmingham in midweek and after taking a
2-0 lead were seemingly cruising, only to
concede two quick goals before eventually
| Sports
notwithstanding, the talent at Robbie
Deans’ disposal in all other areas of the
field means the Wallabies will probably
find a way to beat England - as they did
against their two most recent interna-
tional opponents. Full back Kurtley Beale,
James O’Connor on the wing and centre
Adam Ashley-Cooper are all exceptional
talents, with running ability every bit as
impressive as Hosea Gear and Joe
Rokocoko. England’s defence looked sus-
pect at times against those names and
this is where Johnson’s plans could again
fall down.
Australia have beaten their hosts on
their last two visits to Twickenham, by
nine and 14 points. The visitors are only
offered a three point handicap tomorrow,
but glimpses of England’s potential has
persuaded me that taking the 8/13 with
definitely the better of the two sides and
Sir Alex Ferguson wouldn’t have been too
upset with a point. His side are yet to taste
defeat in the league this season, but they
have drawn half of their 12 games and five
of six on the road.
Gerard Houllier has made a solid if
unspectacular start to his career as Villa
boss, but his side’s main problems have
been away from Villa Park. They are
unbeaten in six home games this season,
but have drawn three of their last four
and it would have been four of four had it
not been for James Collins’ 89th minute
winner against Blackpool on Wednesday.
United will be desperate to close the gap
on Chelsea, especially as the champions
should beat Sunderland at Stamford
Bridge on Sunday. However, both United
and Villa are strong defensively and a
claiming an 85th minute winner.
It’s been a difficult campaign so far for
Pulis’ men, but that is mainly down to their
poor away form which has seen them lose
five of six. They are stronger at the Britannia
Stadium and have drawn both games here
against Liverpool since securing promotion.
Roy Hodgson will be pleased that his
team have arrested their slide, although
he’d have hoped to have made it four wins
in a row at Wigan on Wednesday night. The
win against Chelsea will have given them
plenty of confidence, but Stoke is never an
easy place to go and I don’t think the man-
ager would be too upset with a point.
Since Stoke came up to the top flight two
seasons ago, three of their four meetings
CITYA.M. 12 NOVEMBER 2010
...the home of form
Picture: GETTY
Paddy Power for an Australia win is more
sensible.
With the sun threatening to break
through the south-west London cloud, the
stage is set for a thrilling match and there-
fore a buy of total points at 43 with
Sporting Index appeals. Three of the last
four head-to-heads have yielded 40-plus
points, but we should also bear in mind
that both teams are exhibiting some of
their most free-flowing rugby for years -
with neither placing an emphasis on
defence.
POINTERS...
Australia to win at 8/13 with Paddy Power
Buy total points at 43 with Sporting Index
England penalty to be first scoring play at 15/8 on
Betdaq
draw looks the best option at 13/5 on
Betdaq. Villa have shared the points in
seven of their last nine hosting Big Four
opposition since 2008/09, while United
have taken a point from six of their past
10 trips to middle-third opponents.
There could also be some value in back-
ing no goalscorer at a general 9/1. There
have been two or fewer goals in three of
the past four league meetings between
these sides, while two of Villa’s last three
home games have failed to produce a goal.
Spread bettors should look to sell goals at
2.5 with Sporting Index.
POINTERS...
Draw at 13/5 on Betdaq
No goalscorer at 9/1 general
Sell match goals at 2.5 with Sporting Index
against Liverpool have been draws and I
fancy that trend to continue at 12/5 with
Paddy Power.
It doesn’t look like being a high scoring
game, either. There have been two or fewer
goals in five of Stoke’s last eight home
games against the Big Four and the same is
true in eight of Liverpool’s last 13 trips to
bottom-half sides. Back the 1-1 scoreline at
6/1 on Betdaq and sell goals at 2.4 with
Sporting Index.
POINTERS...
Draw at 12/5 with Paddy Power
1-1 correct scoreline at 6/1 on Betdaq
Sell match goals at 2.4 with Sporting Index
 CITYA.M. 12 NOVEMBER 2010
RACING TRADER BILL ESDAILE, OUR RACING EXPERT, TAKES A LOOK AT THE BEST BETS OVER THE WEEKEND
Picture: GETTY
Long Run can
prove that he’s
the real deal
A
FTER spending two days trying
to find a horse to beat Nicky
Henderson’s LONG RUN in tomor-
row’s Paddy Power Gold Cup at
Cheltenham, I have now finally given
up.
The French bred five-year-old is the
apple of his trainer’s eye and set pulses
racing with a breathtaking debut over
fences in the Feltham at Kempton on
Boxing Day last year. He wasn’t foot per-
fect that day, but proved he has stamina
and serious class.
He handled the drop back to two
miles at Warwick on his next start and
then ran a brave third to Weapon’s
Amnesty in the RSA Chase at the
Festival. That last test unquestionably
came too early in his career and each
time I watch a replay of the race, the
more impressed I am at how well he
actually ran.
The key question has to be how good
Long Run is and more importantly, how
good could he be? If he turns out to be
the next Kauto Star, as many pundits
are suggesting, then he is absolutely
thrown in here off a handicap mark of
just 158. If he really is that good, he may
end this season on a mark closer to 180.
Therefore, at 10/3 with the sponsors,
he just has to be a bet. Put simply, if they
ran the race three times, I’d expect him
to win on more than one occasion. Yes,
the hurly burly nature of a 20-runner
Cheltenham handicap may not be ideal,
but his class should see him through
and rain-softened ground is ideal.
His stablemate Mad Max is respected,
while Festival Plate winner Great
Endeavour looks to be on a handy mark.
However, I’ll be having an each-way
saver on Paul Nicholls’ POQUELIN who
loves it round here and has genuine
Grade One form in the book. He is avail-
able at 14/1 with Paddy Power and will
be spot on for this after his recent
The Punter | Racing 31
THE 2010
PADDY’S TIP
The Paddy Power Gold Cup at
Cheltenham on Saturday is set to be
one of the best ever.
There has been a massive ante post plunge on
David Pipe’s Great Endeavour, who won at the
Cheltenham Festival in March but Pipe has
said that the favourite, Nicky Henderson’s
Long Run, is a ‘good thing’!
When you look at the quality of horse that
wins this race, like reigning Gold Cup champi-
on Imperial Commander, you need to consider
who will turn out to be a proper Grade 1 horse,
LONG RUN fits the bill and will take some This year’s Gold Cup winner Imperial Commander winning the Paddy
beating. Get on! Power Gold Cup in 2008 Picture: GETTY
Aintree pipe opener. If the rain stays
away it is hard to see him out of the
frame, particularly as the handy Ian
Popham takes off a valuable 5lbs.
There’s an excellent card to kick off
the Paddy Power meeting this afternoon
and Garde Champetre will be going for
a remarkable sixth Cheltenham cross
country success. He’s the new Spot The
Difference, but will be priced according-
ly and ran poorly at the Festival. He’s the
most likely winner but I’m going to take
a chance on JOE LIVELY for the in-form
Colin Tizzard stable. They hunt with
this 11-year-old and he has always
looked like he’d appreciate a massive
stamina test.
The Greatwood Hurdle is the climax
of this tremendous three-day meeting
on Sunday and this race has turned into
one of the best early season Champion
Hurdle trials. Khyber Kim landed this
off 11st9lbs last season before going on
to finish second to Binocular in March
and five of the last eight winners of this
race have carried 11st6lbs or more.
MENORAH won this year’s Supreme
Novices’ in great style, goes well fresh
and although he has to carry top
weight, he would need to win this off a
mark of 151 to have any chance in the
Champion. Finally, don’t miss Nicky
Henderson’s FINIAN’S RAINBOW in the
opening Novices’ Chase at 1.10pm on
Sunday. He had a fantastic season novice
hurdling, but was always going to make
a chaser. First time out could be the
time to catch him and he has reportedly
been working brilliantly at home.
POINTERS...
JOE LIVELY e/w 3.00pm Cheltenham (today)
LONG RUN 2.35pm Cheltenham (tomorrow)
POQUELIN e/w 2.35pm Cheltenham (tomorrow)
FINIAN’S RAINBOW 1.10pm Cheltenham (Sunday)
MENORAH e/w 2.20pm Cheltenham (Sunday)
 Sport
32 CITYA.M. 12 NOVEMBER 2010

Results
Harry’s got a
green light to
spend again
▲

FOOTBALL enue will be closer to £150m this year.

SPORTS EDITOR FRANK DALLERES
email sport@cityam.com
BY FRANK DALLERES
TOTTENHAM manager Harry
Redknapp will be given money to
spend in January, City A.M. under-
stands, after the club announced
record revenues of £120m.
Spurs made a loss of more than
£6m, compared to a £33m profit the
previous year, but that was affected by
player trading and the depreciation in
the value of their current squad.
But operating profit surged by 23
per cent to £23m for the year ending
30 June, despite the club not having
the boost to their coffers that
European competition generates.
With Tottenham enjoying a debut
season in the Champions League, esti-
mated to be worth at least another
£20m, club insiders are confident rev-
Spurs spokesman John Bick told City
A.M. Redknapp would be allowed to
spend in the January transfer window,
saying: “They [the board] have never
refused funding for investment in the
squad before.”
He added: “The results are very
encouraging, considering there is no
European competition in there.”
Tottenham hope to increase rev-
enue in the long-term by leaving ANALYSIS l Premier league revenues
White Hart Lane for a larger ground £m
300
and it is understood the Olympic * Excluding property revenues
250
Stadium remains a serious possibility.
Profit from player trading dropped 200
by £40m, having been very high the 150
previous year, but analysts gave the 100
accounts a positive reception overall.
“The figures look very good,” said 50
Roy Kaitcer, of Brewin Dolphin. “If I 0
Man Utd *Arsenal Chelsea Liverpool Man City Tottenham
was a Spurs fan I’d be pretty happy.”

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 CITYA.M. 12 NOVEMBER 2010
Van der Vaart was
an £8m summer
recruit from Real
Madrid.
Picture: GETTY
Alonso single minded on title demands
FORMULA ONE
▲
CHAMPIONSHIP leader Fernando
Alonso insists he will not waste ener-
gy worrying about the multitude of
title permutations as the season
reaches its climax in Abu Dhabi this
weekend.
The Ferrari driver needs to finish in
the top two to guarantee his third
world championship, but three other
drivers, including Englishman Lewis
Hamilton, could yet snatch his crown.
Red Bull pair Mark Webber and
Sebastian Vettel are his closest rivals,
and both could usurp him in the
Poyet in frame for Blues move Mealamu
▲
FOOTBALL
BY JAMES GOLDMAN
BRIGHTON AND HOVE ALBION chair-
man Tony Bloom has paved the way
for manager Gus Poyet to make a
return to Stamford Bridge as Carlo
Ancelotti’s No2 after Ray Wilkins’a
sudden departure from Stamford
Bridge yesterday.
Wilkins, whom Ancelotti credited
in his recent autobiography with play-
ing a significant role in last season’s
Double winning campaign, left with
immediate effect after the club opted
not to renew his contract.
Chelsea chief executive Ron
Gourlay followed up with a brief trib-
ute to the former club captain,
adding: “On behalf of everyone at the
club I would like to thank Ray for
everything he has done for Chelsea
Football Club.
“We all wish him well for the
future.”
Fellow former Chelsea midfielder
Poyet, who won three major honours
during the course of a four-year stint
in west London, is among the early
front-runners to succeed Wilkins.
The 42-year-old has just celebrated a
year in charge of League One club
Brighton, with the team sitting pret-
ty, eight points clear of second place
Huddersfield.
Poyet signed a new four-year con-
final race – not that Alonso is enter-
taining the prospect.
“I will not use one second of my
energy this weekend thinking what is
going to happen on Sunday after-
noon,” said the Spaniard.
“There is much to do on Friday and
Saturday, preparing for the weekend
in the right way.
“Our only goal at this moment is to
win the race or finish second. That’s
the target, and that’s what I think we
can achieve this weekend.”
Webber has led for much of the sea-
son but looks likely to miss out on
what would be his first world title.
THREE KEY CLASHES
EX-ENGLAND NO9 ON
AUSSIE SHOWDOWN: P35
tract in the summer but could find
the lure of returning to the venue at
which he enjoyed the best years of his
playing career irrisitable – a fact
Bloom is all too aware of.
“If things outside of our control
happen and a big club in the Premier
PERMUTATIONS | CHAMPIONSHIP
● Alonso 246 points will win the title
if he comes first or second, whatever his
rivals do
● Webber 238 points needs to win
and hope Alonso doesn’t make the top
two places
● Vettel 231 points can only overtake
Alonso if he wins and the Spaniard
crosses the line fifth or worse
● Hamilton 222 points must win, hope
Alonso takes no points, Webber finishes
out of top five and Vettel outside top two
BRACKEN PICKS HIS
Poyet (inset) is a
potential replace-
ment for Wilkins
(far left).
Picture: REUTERS
League club comes in for him and he
wants to move we are not going to
stand in his way,” said Bloom.
“But we are just focused on work-
ing with him for the long-term.
“That is also what he is concentrat-
ing on.”
SPORT | IN BRIEF
Johnson has a pop at cocky KP
CRICKET: Aussie strike bowler Mitchell
Johnson has taken a swipe at England’s
stellar batsman, Kevin Pietersen, labelling
the South African-born star “cocky” as
the build-up to the first Ashes Test on 26
November intensifies. Pietersen recently
claimed he’s “on fire”. Johnson said:
“Talking about cocky comments... that’s
probably one of them. It’s just how he is.”
Barton accepts FA punishment
FOOTBALL: Newcastle midfielder Joey
Barton has admitted a charge of violent
conduct and apologised to Morten
Gamst Pedersen for the punch that will
earn him a three-match ban. He said: "I
fully accept that I was in the wrong on
33
could still
face Scots
RUGBY UNION
▲
NEW ZEALAND coach Graham Henry
still maintains hope of being able to
select hooker Keven Mealamu for
tomorrow’s match against Scotland
at Murrayfield.
Mealamu was handed a hefty four-
week ban for appearing to headbutt
England captain Lewis Moody during
last weekend’s victory at Twickenham
– the uncapped Hikawera Elliot has
been pencilled in to take his place.
But Henry remains optimistic that
the ban will be overturned, following
today’s appeal hearing, and the 82-
cap Test veteran will be able to take
his place in the All Black’s front row.
“We were always intending to play
him and we hope we can,” said Henry.
“He’s a very important part of our
team. He’s a top man, he’s got very
high personal standards – he sees
himself as a role model for young peo-
ple. He’s a bit destroyed about what
has happened. Once the appeal is
over, hopefully we’ll get a positive
result and move on.”
MOODY DENIES WIND-UP: P34
and would like to apologise.”
Haye hopes for box office A-Force
BOXING: David Haye hopes underdog
Audley Harrison is at his enigmatic best
tomorrow in order to give the paying
public “more than a minute’s worth of
entertainment”. World heavyweight
champion Haye said: “I’m preparing for
the best Audley Harrison and I want the
best Audley Harrison to turn up.”
Murray survives Cilic scare
TENNIS: Andy Murray is through to the
quarter-finals of the Paris Masters after
a tense three set victory over big serving
Croat Marin Cilic. The British No1 eventu-
ally came through 7-6 (8-6) 3-6 6-3.
 34 Sport | Rugby Union
Brace yourselves for
Australian backlash
England skipper Moody warns Wallabies are in the mood to
avenge their summer defeat tomorrow, says Frank Dalleres
ENGLAND
AUSTRALIA
E
NGLAND captain Lewis Moody
has warned his charges they
will face a team bent on
revenge when Australia arrive
at Twickenham for tomorrow’s show-
down.
Martin Johnson’s side pulled off a
landmark 21-20 triumph in June
when they beat the Wallabies on
their own home turf for only the
third time outside a World Cup.
But Australia now have the chance
to settle the scores and ensure
England’s fans are the ones silenced
this time, and Moody insists that will
be a major incentive.
“Australia are hungry for revenge
after what was a tough game in
Sydney, which we just sneaked,” said
the Bath flanker.
“They are playing much better
Twickenham passion can inspire famous win
RUGBY UNION COMMENT
AUSTIN HEALEY
E
NGLAND head into tomorrow’s
grudge match against Australia
if not riding the crest of a wave,
then certainly with a new sense
rugby than they were playing in the
summer.”
England are desperate to register
their first win of the autumn, having
seen an encouraging comeback
thwarted by New Zealand in last
weekend’s 26-16 reverse.
“We are very excited about
this game because we realise at
the weekend we had an oppor-
tunity to beat the No1 side in
the world but we missed it
because of a lack of composure,”
Moody added.
“We were in the game to win it
and the second half showed every-
one the ability we have as a side. We
realise we are a team that has to
keep improving. We had one good
win in Australia but that doesn’t
make us world-beaters. Our aim
is to keep getting better.”
England are tipped to domi-
nate in the scrum, as they did in
Sydney in the summer and last
weekend against the All
Blacks, although the
Wallabies have first-
of optimism following last weekend’s
rousing second-half comeback
against New Zealand.
The Wallabies, fresh from a win
over Wales in Cardiff, will provide a
stern test of our credentials, but
England should believe they are capa-
ble of pulling off a famous win. If
Johnno’s boys follow these three tips,
those Aussies will be leaving with
their tails between their legs.
FEED OFF THE TWICKENHAM CROWD
As ever, the atmosphere at HQ for a
match of this magnitude will be mag-
nificent. But after last weekend’s
CITYA.M. 12 NOVEMBER 2010
choice hooker Stephen Moore (left)
back in the side.
“We pride ourselves on the scrum
and I think we are right up there
with the best in the world at the
minute,” Moody said.
“It is key that in a week like
this we don’t get complacent. I
think the Australians will
have been away and done
their homework.”
Moody also strenuously
denied making comments
to provoke Keven
Mealamu into a headbutt
that earned the New
Zealand forward a four-
week ban. “I certainly didn’t
say anything in terms of the
incident,” he added.
“My head was facing the
other way. The back of my
head was struck.
“It is not down to
me to comment.
That is what the
officials are there
for.”
encouraging display, you get the expect. When I played against them I England should regard themselves as
sense that the feel-good factor is back. always thought they were the best favourites.
The fans will be turning up knowing, thinking team around. England will Stopping their backs will be key,
rather than hoping, they’ll be enter- have to come up with something they’ve got some real class acts in
tained by this England side. It will more inventive than utilising their midfield. Denying the likes of Quade
make a big difference having the fans strength up front. In any case, those Cooper, Adam Ashley-Cooper and
back on the edge of their seats after a Aussie mutants always find a way of Matt Giteau the time to set the tempo
pretty miserable couple of years. We escaping punishment in the scrum. will be far from easy, but we’ve done
must use that to our advantage. it before and we can do it again.
REMEMBER SYDNEY
PLAY SMART That historic victory back in the sum- To get the inside scope on the squad, as well
England have had joy against the mer really should hand England a as fun features, match analysis and up to
Aussie scrum in the recent past, but psychological edge. We shouldn’t tire the minute player interviews with presen-
they shouldn’t just rely on brute of reminding the opposition we’ve ters Austin Healey and Abi Griffiths, watch
strength here. The Australians will be had their number and with a passion- the latest episode of “O2 Inside Line” on RFU
well prepared and will know what to ate home crowd behind them, TV at: www.rfu.com/o2insideline.
CITYA.M. 12 NOVEMBER 2010 Sport | Rugby Union 35

THE BIG MATCH l Twickenham, kick-off 2.30pm, Sky Sports 1

ENGLAND KYRAN’S KEY CLASHES

FORMER England scrum-half Kyran Bracken explains why winning the scrum battle will help England nullify Australia’s
Ben Foden
15. skillful backs, unleash the attacking potential of Chris Ashton and Ben Youngs and earn victory on Saturday.
11.
14. Chris Ashton Mark Cueto
Mike Tindall CHRIS ASHTON v JAMES O’CONNOR
13.
Shontayne Hape Both are dangerous, but have different
12. styles. Ashton is an out-and-out winger,
Toby Flood fast, exciting and aggressive and up
10. there with anyone on current form.
Ben Youngs
9. O’Connor is their best player: a typically
Nick Easter silky Aussie back, with more guile and
8.
Lewis Moody 7. 6. Tom Croft skill than Ashton, and England will have
5. 4. to stop him playing.
Tom Palmer Courtney Lawes
Dan Cole 3. 1. Andrew Sheridan
2. BEN YOUNGS v WILL GENIA
Dylan Hartley Two of the top five scrum-halves in the
Stephen Moore world. Youngs had a good, if quiet, game
last week but scored a fantastic try
2.
Benn Robinson 1. 3. Ben Alexander against Australia in June and I think he’ll
be man-marked. Genia is extremely tal-
Mark Chisholm Nathan Sharpe
4. 5. ented, gets the line going, makes breaks
Rocky Elsom 6. 7. David Pocock around rucks and is a talisman. England
8. need to frustrate supply to him.
Ben McCalman
9.
Will Genia
10.
Quade Cooper ENGLAND PACK v AUSSIE PACK
12. England’s pack is among the best but
Matt Giteau Dylan Hartley (left) isn’t as good in the
13. scrum as Steve Thompson so has to
Adam Ashley-Cooper
Drew Mitchell 14. front up. This will probably get me into
11. James O’Connor
trouble, but if they get ahead I wouldn’t
be surprised to see Australia get too
15. many injuries in their front row and go
Kurtley Beale AUSTRALIA for an uncontested scrum.

Kyran is hosting a rugby business breakfast on 2

VERDICT: If England dominate the scrum, December themed ‘Managing Change’ where he will
be in conversation with England captain Lewis Moody;
and if it’s refereed properly, then they’ll win www.gameplansolutions.co.uk
Moody (left) says Australia will have “done their homework”. Picture: GETTY