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Leighton Holdings Limited (LEI) said that the 2010 financial year has started well for the company with total revenue for the first quarter to 30 September 2009 up 10% to $4.5 billion. The company said it had generated profit after tax (unaudited) of $131m, an increase of 25% on the prior first quarter.

Chairman, David Mortimer, said the group’s outlook for the 2010 financial year remains solid despite the impacts of the global financial crisis.

“A decline in some of the Group’s core markets has been countered by significant spending by Governments to stimulate economic activity both in Australia and overseas,” Mr Mortimer said.

“For the 2010 financial year, the Group is confident that revenue will exceed $19bn and expects a net profit after tax of around $600m, subject to any further asset impairments."

The company said work in hand at 30 September stood at $38.2bn, up by $1.2bn since 30 June 2009, while in addition, Leightons is preferred on another $4bn worth of work which should be awarded in the near future.

“The company’s record level of work in hand will ensure a steady operating profit in 2010 before the Group returns to growth in 2011,” Mr Mortimer said.

“Substantial government spending on infrastructure – across both Australia and Asia, demand for resources fuelled by the economic growth of China, and an eventual recovery in the property market augurs well for the Group’s longer term prospects.”

CEO, Wal King, added that the company’s newer markets such as the broader Middle East and Mongolia offer great opportunities, while in Australia, the need to invest in infrastructure to improve productivity remains as important as ever.

“Engineering construction is expected to grow to $140 billion per annum by 2018 – more than doubling within a decade,” Mr King said.

“The next decade should see a significant spend on utilities such as water and energy. Additionally, the new $43bn National Broadband Network project should offer the Leighton Group significant construction opportunities.”

Mr King said mining volumes are expected to continue to grow on the back of the growth in demand in the region, while oil and gas as emerged as a great opportunity with some $150 billion worth of projects in the pipeline.

"Looking around at our markets and the opportunities that they are presenting I’m very positive,” Mr King said.

“We are positioned alongside the world’s growth engine – Asia – and have the diversity to take advantage of the many opportunities that we see out there.”

Leighton posted a profit after tax of $440 million at the end of FY09 on revenue of $18.3 billion.

As at 1056 AEDT, Leighton shares were up 4c to $34.02.

Myer Holdings Limited (MYR) reported sales revenue for the quarter to the 24th of October of $717.1 million, up 5.2% from the 2008 quarter. Like-for-like sales grew at 4.5%, including the company’s refurbished stores.

Shares in Myer were up 4c to $3.88 at 1043 AEDT, though still down 5.3% from the offer price for the shares, which listed Monday.

CEO Bernie Brookes said that consumer sentiment heading into the busy Christmas period was stronger than last year.

“The business is in good shape as we approach the important Christmas trading period,” Mr Brookes said.

”By this Christmas all stores will have undergone our Visual Merchandising Refresh program (Project Batman) with the exception of Canberra, which will be fully refurbished in calendar 2010,” Mr Brookes added.

David Jones Limited (DJS) reported sales revenue of $452.1 million for the period 26 July to 24 October, up 2.2% from total sales of $442.3 million in the equivalent 2008 quarter. The retailer said that there were positive factors from the first quarter trading which augurs well for the Christmas trading season.

The retailer reported like-for-like sales growth was 0.8%. However David Jones noted that excluding the results from the Bourke Street, Melbourne store which is being redeveloped, like-for-like sales grew at 1.9%.

CEO Mark McInnes said the outlook was promising.

“Our better than expected trading in 1Q10 is a good sign for our business as we enter the all important Christmas trading period, especially given we will be cycling the worst trading conditions (2Q09) we have experienced in more than 20 years,” Mr McInnes said.

“Added to this we look forward to the completion of Stage 1 of our new flagship Bourke Street store in time for Christmas trading.”

However Mr McInnes declined predicting the company’s first quarter profit.

At 1020 AEDT, David Jones shares were trading down 12c to $5.30.

Rocklands Richfield Limited (RCI) announced that its board has determined that Chinese commercial coke producer Meijin Energy Group’s recent takeover proposal is superior to the Jindal Proposal offered in September. Earlier this week Meijin proposed to acquire 100% of the shares in RCI at an offer price of 52c cash per share.

Jindal proposed to acquire 100% of the shares in RCI at $0.42 cash per share.

Rocklands said the Meijin Proposal would be undertaken either by a scheme of arrangement between RCI and its shareholders or by a takeover bid, and otherwise on terms to be set out in an Implementation Agreement to be agreed and executed by RCI and Meijin.

“Shareholders should note that, at this stage, neither the Jindal Proposal nor the Meijin Proposal are formal offers capable of being submitted to shareholders for their consideration,” the company said.

“Both offers are preliminary proposals only that are subject to (among other conditions) due diligence and formal terms and conditions being agreed and documented in an Implementation Agreement.”

Rocklands said the offer values RCI at A$200 million on a fully diluted basis plus the value of cash held by RCI and any further funds received by RCI from the exercise of RCI convertible securities by existing security holders.

As at 1013 AEDT, Rocklands Richfield shares were trading at 34c.

Centrex Metals Limited (CXM) said that the Foreign Investment Review Board (FIRB) had given the green light for Wuhan Iron & Steel (WISCO) to take a 60% stake in iron ore rights in five of Centrex’s iron mineral tenements in South Australia. Under the deal, WISCO would pay $186 million for the rights to the tenements, as well as 15% of the issued equity in the Aussie miner.

The two companies would also partner a Joint Venture iron project in South Australia.

The Joint Venture was aimed at accelerating an exploration and study program designed to develop two 5Mtpa magnetite concentrate operations over the next five to seven years.

Centrex Chairman, David Lindh, said today the approvals marked a significant milestone for Centrex.

“The Company is now well positioned to develop a series of significant iron ore mining operations on Eyre Peninsula and in doing so become a major player in Australia’s iron ore industry,” Mr Lindh said.

WISCO is ranked third in its sector in China, with a current annual capacity of 30 million tonnes of steel.

At the close of business Wednesday, Centrex shares were trading at 64c.

News Corporation (NWS) reported an 11% increase in first quarter net profit to US$571 million versus the previous corresponding period. The media company said first quarter consolidated operating income increased 9% in the same period to US$1.04 billion.

News Corp said the increase in profit was largely driven by higher operating profit and equity contributions from affiliates due to the absence of a US$422 million write-down of the company’s investment in Sky Deutschland AG taken during the prior year period.

In regards to the increase to operating income, the company said it reflected double-digit percentage profit increases at the Filmed Entertainment, Cable Network Programming and Book Publishing segments.

Both results were partially offset by decreases elsewhere.

Chairman and CEO, Rupert Murdoch, said the gains at the company’s worldwide cable network programming businesses and renewed momentum at our Filmed Entertainment segment reflected strong slate of films at the global box office.

“The strategic steps we took last year to ensure stability during the downturn have proven successful, with significant cost reductions offsetting much of the revenue declines in our Television and Newspapers and Information Services segments,” Mr Murdoch said.

“The economies in which we do business are clearly in better shape than they were a year ago, and we have further positioned our operations to take advantage of the improvements we are seeing globally.”

At the close of trade yesterday, New Corp shares were trading at $15.15.

RBS – Round Up – 051109

Wall Street finished mixed after the Federal Reserve announced that interest rates would remain unchanged. The market took a turn for the worse in late trade, led by the falling banking stocks.   

At the end of its two-day policy meeting the Fed said interest rates would likely remain at record low levels for an extended period, while saying economic activity would likely remain weak.

In employment news, ADP said employers in the private sector shed a slightly higher than anticipated 203,000 jobs in October after 227,000 were cut the previous month.

In a separate report, Challenger, Gray & Christmas said planned layoffs dropped 16% to 55,679 in October versus September. 

Meanwhile, an Institute for Supply Management's report revealed the services sector index unexpectedly fell from 50.9 in September to 50.6 in October. Forecasts were for a rise to 51.5.

The Dow Jones gained 30.23 points, or 0.31%, to 9,802.14, the S&P 500 added 1.09 points, or 0.10%, to 1046.50 and the NASDAQ dipped 1.80 points, or 0.09%, to 2,055.52. 

Wells Fargo shed 3.1%, while Citigroup and JPMorgan weakened 1.7% and 1.2%.

Timer Warner slipped 0.2% depite reporting quarterly earnings and sales that toppped estimates. The company also increased full-year forecasts.

Walt Disney put on 1.5%.

News Corp added 1.1% before releasing quarterly results after the close.

Tech majors Microsoft and Apple advanced 1.9% and 1.2%.

Kraft Foods dropped 3.2% as it reported lower quarterly earnings that beat estimates on revenue that fell short of estimates. The company increased its 2009 earnings forecast and cut its revenue outlook.

Pharmaceutical Merck & Co surged 6.4% to lead the Dow higher.

Energy heavyweights Exxon Mobil and Chevron defied a rise in the price of crude to be down 0.6% each. ConocoPhillips added 1%.

NYMEX light crude oil for December delivery rose US80c to settle at US$80.40 a barrel.

COMEX gold for December delivery climbed US$2.40 to settle at US$1,087.30 an ounce after hitting an intraday record high of US$1,098.50 an ounce.

Gold producers Newmont and Barrick Gold gained 1.9% and 2.8%.

European Markets

European stocks rallied on the back of positive earnings results within the financial and retail sectors. Automakers were boosted by Nissan’s forecast.

The UK benchmark FTSE 100 gained 70.68, or 1.40% to 5,107.89. The French CAC40 put on 86.08 points, or 2.40% to 3,670.33, while the German DAX advanced 90.88, or 1.70% to 5,444.23.

Société Generale jumped 4.6% after France’s second largest bank after reporting third quarter earnings that had more than doubled. The result was also ahead of analyst estimates.

The country’s largest bank BNP Paribas rose 3.5%, while in Germany Commerzbank and Deutsche Bank climbed 4.4% and 2.3%.

Barclays and Standard Chartered rallied 4.2% and 3.3%.

Insurer Aviva jumped 5.5% after announcing a positive outlook. Prudential put on 4%.

Marks & Spencer surged 6% as the UK’s largest clothing retailer beat earnings expectations.

Rival Next raised its short-term forecast, sending its shares 5.6% higher. Third quarter sales also beat estimates.

UK consumer confidence held at an 18 month high in October.

Renault led the automakers higher with a 4.1% gain after its 44% owned Nissan narrowed its full-year loss forecast.

Peugeot and Daimler advanced 2.1% and 3.1%.

Miners rallied as the price of gold reached record highs. There were modest gains among base metals prices.

Xstrata, Antofagasta and Anglo American climbed 5.9%, 5.4% and 3% respectively.

BHP Billiton and Rio Tinto added 3.3% and 2.8%.

Energy majors BG Group and Total added 2.5% and 1.7%. 

Japanese Markets

Resource stocks led the Nikkei higher following a rise in commodity prices. Several companies across the sectors posted better than expected earnings results.

The Nikkei 225 added 41.36, or 0.42% to 9,844.31.

Fast Retailing rallied 4.4% on the back of a jump in sales at its Uniqlo clothing stores.

Gold producers Sumitomo Metal Mining and Mitsubishi Materials added 2.6% and 3.8%.

Japan Steel Works spiked 10% after increasing its full-year profit forecast.

Nissan advanced 1.7% following a rise in US sales during October. Toyota and Honda rose 1.1% and 1.4%.

Shionogi & Co gained 3.4% after applying for approval for its influenza treatment.

Furukawa Electric surged 7.7% as the company reversed its first half forecast from a loss to a profit.

Chip related stocks fell following a broker downgrade on the semiconductor sector. Tokyo Electron and Advantest Corp lost 5.1% and 1.3%.

Exporters Sony and Canon dipped 0.8% and 0.6%.

Mitsubishi UFJ Financial weakened 1.8%.

Hong Kong Markets

The Hang Seng was spurred on by the Chinese mainland index, with the Shanghai stock exchange closing at three-month highs. Gold and the banks were the order of the day for investors, albeit in light trade.

The Hang Seng rallied 374.71 points, or 1.76% to 21,614.77.

Among the banks, Bank of China rallied 2.7%, while Bank of Communications added 1.8%.

HSBC and ICBC rose 0.2% and 2.6% respectively.

The gold miners benefited from record prices for the metal. Zijin Mining spiked 5.7%, and Realgold Mining was 3.3% higher.

Li & Fung advanced 2.8%, with Petrochina climbing 3.6%.

Offshore rival CNOOC added 3%. Reports indicated the Chinese giant was entering the US energy market, snapping up assets being sold by European oil firm Statoil.

Dongfeng Motor Group put on 12.3% after posting a larger than expected profit.

Gamers were also strong with Galaxy rising 6.6%. SJH Holdings climbed 6.5%.

Casino revenue climbed 42% at Macau from October 2009 in what will be good news for James Packer.

Directors' Interest Notices
04 November 09

* Dividend Reinvestment Plan 

Substantial Shareholder Changes 
04 November 09

All movements are percentage changes

For Director Changes click here.