Business & Financial News

Japanese gross domestic product increased by 1% from January to March compared with the previous quarter, helped by a rebound increase in consumption, for reconstruction after the earthquake of March 11, 2011 and some improvement in exports, according to government statistics released Thursday.

On an annualized basis, GDP was up 4.1%, above economists' expectations (3.5%), against 2.2% for the U.S. over the same pe riod.

First announced in fall of 0.2%, the economy finally stagnated between October and December.

Consumption, which the Japanese economy depends to 60%, increased 1.1%, while economists expected a 0.8% increase, thanks to subsidies the purchase of fuel efficient cars. 

Consumption contributed 0.7 percentage points to quarterly growth and public investment to 0.3 points.

Economists expect a Japanese GDP growth of around 2% during the fiscal year that began in April, with a gradual recovery of the U.S. economy and the work reconstruction in the northeast of the archipelago devastated by the earthquake and tsunami of March 11, 2011.

"Consumer spending and public investment have brought the economy, with demand for automobiles supported by government incentives and investment supported by supplementary budgets that followed the earthquake , "said Yoshimasa Maruyama, chief economist at Itochu Economic Research Institute. 

"So if they are government policies that are behind this quarterly growth, can not have say it reflects a strong economy."

The yen, which remains a strong currency poses risks in the medium and long-term competitiveness of Japanese products and hinders exports.

Europe, one of the major markets of Japan, parallel to continue mired in crisis and the European consumer behavior does not bode well for Japanese exports.

"I monitor the situation in Europe carefully, because it interferes with the movements of foreign exchange market. We will take strong decisions against excessive movements on the foreign exchange market, "said Japanese Economy Minister Motohisa Furukawa

…. ….. Economists expect growth of 1.0% in the first quarter is a peak in 2012. Their median forecast of growth shows an increase of 0 , 5% early in the second and third quarters and 0.4% during the last three months of the year

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Vallourec has revised downwards its growth forecast Thursday in turnover this year after beginning the exercise penalized by a demand remained weak markets as electrical energy and the automobile.

The producer of seamless steel tubes are now waiting for the current year to grow by about 5% of its turnover, while initially provided an increase of order of 10%.

In the first three months of the year, sales came out at 1.199 million euros, up 4% from first quarter 2011 but a contraction of 23% over the last quarter of 2011.

Its operating profit margin stood at 12.7% at end-March 2012, against 16.4% in the fourth quarter and 17.7% in Q1 2011. 

"What we see today is that the macroeconomic environment in Europe remains very uncertain and demand in markets outside oil and gas remains low," said Olivier Mallet , CFO of Vallourec in a conference call.

"(Demand) is well below our expectations at the beginning of the year," he added. "And if there was a slight rise in orders since January, it is below what was expected and visibility remains limited."

The group warned last February, on the occasion of the presentation of its annual results, expect a further decline in margin in 2012 due to the costs of de ; boot of his new plants.

Vallourec says still expect a "slight improvement" of its gross operating margin over the next three quarters, reaching a 15% margin over the full year.

At the Paris Bourse, the Vallourec share price closed before the quarterly earnings release, to 42.865 euros, up 1.46%.

General Motors announced Wednesday consider selling its manufacturing plant in Strasbourg gearboxes and be looking for potential investors.

The U.S. automaker, which has taken an investment bank, said in a statement it had committed a "strategic review" concerning both the production as engineering and development of this plant.

He was willing to explore the internal and external solutions to find "viable alternatives and potential solutions to secure the future of the site".

GM intends to favor buyers who will continue the work site with the current force is about 1,000 people.

Last year, the plant produced 280,000 six-speed automatics, mainly for customers outside of Europe. 

GM announced in February an alliance with French carmaker PSA Peugeot Citroen.

Lafarge will continue in 2012 its price increases, to reduce its debt and its asset sales, in a context of increasing global demand for cement which supported its first quarter results.

The world's leading cement, who is currently refocusing on the job and on the concrete and aggregates while leaving the plaster continues to anticipate for the year increased 1 to 4% demand for cement due to emerging countries, where it now generates 60% of its sales, and even Europe, especially in the South.

It is right to catch up on prices, particularly favorable to the margins of the group Lafarge anticipates a more moderate cost inflation in 2012 and 2011. 

"Price increases passed successfully at the beginning of the year confirm our optimism on prices for the entire year," said Chief Financial Officer Jean- Jacques Gauthier during a teleconference.

He also expressed confidence to proceed to a further increase in August in the U.S. cement.

Lafarge has maintained its estimate of the market in 2012 despite weaker business in Greece on the one hand, and despite the rebound in the U.S. on the other. Jean-Jacques Gauthier said that the North American market, the group wanted to wait safely in the second quarter before rising to possibly refine its current forecast of demand for cement, between -1 and +2%.

"The main figures should receive a positive reception, especially in light of recent pressure exerted on the action," said Goldman Sachs in a note.

Around 11:30, the title Lafarge is 3.2% to 30.92 euros, after a day earlier to 31.80. At the close of Thursday, title, posted a gain of 10% since the beginning of the year, after -42% in 2011.

OVER ONE BILLION EUROS FOR TRANSFERS OF ASSETS IN 2012

Lafarge posted first quarter revenues up 5% to 3.35 billion euros, slightly above the consensus reached by the editor of Reuters ; estimates from eight analysts who gave $ 3.3 billion.

The EBITDA increased its share to 8% and operating profit by 28%, while net income, group share, showed a loss of 44 million euros , -29,000,000 against a year earlier, reflecting restructuring charges corresponding in particular to the 500 job cuts brought worldwide as part of the reorganization of the group. 

Excluding these charges, Lafarge has emerged over the period with net income of 18 million euros.

Lafarge intends to reduce by at least 400 million euros this year and costs limited to EUR 800 million investment as part of its debt.

In the first quarter, the group's net debt, largely inherited from the acquisition of Orascom in 2008, declined by 13% year on year to 12.4 billion euros . One quarter to another, it is clear, however, up 3%, a trend linked "to normal seasonal variations in working capital (working capital needs)," said Lafarge.

To seek "significant" this debt in 2012, the group also to give one billion euros in assets, of which 71 million were performed on the quarter.

Jean-Jacques Gauthier said that Lafarge would exceed the figure of one billion, but without saying how much.

Both activities are the subject of rumors of transfers, the plaster in North America, a trade balance which the group is almost released last year, and cement in South Africa. Lafarge must also achieve significant asset sales in Britain required by the Competition Authority to give its green light to the proposed joint venture between Lafarge and Anglo American.

"It is not impossible that these divestitures can be made in 2012," said his side the CEO of Lafarge, Bruno Lafont, during a teleconference .

France Telecom has managed to limit the impact on revenues of Free Mobile launch in the first quarter in spite of numerous defections among its customers, tempering the market pessimism on its ability to pass through this turbulence.

The incumbent has suffered a decline in its overall turnover and profit margins as a result of declining revenues in France, whose magnitude was, however, revealed lower than market fears.

The group has particularly benefited from the roaming agreement concluded with the new entrant for the use of its network that pays more than expected at France Telecom.

At 10:50, the title gained 2.3% to 10.48 euros, while the CAC 40 and the European telecoms sector index are 0.96%. 

"The motive in France was stronger than expected," commented analysts at Jefferies in a note, acknowledging also the commercial cost control, remained stable over the period despite increased competition in early January with the launch of Free on the mobile market.

The results of France Telecom, the first operator to provide its quarterly, were eagerly awaited by the market for an initial diagnosis of the impact of entering the fourth on the French market, while France Telecom does not disclose details of its margins by division.

The incumbent has recorded a total loss of 615,000 mobile customers in France during the first three months of the year, a figure to compare to the 219.000 departures recorded on the corresponding period last year.

Applications portability "returned the last two weeks of March to the level before the arrival of Free market," said CFO Gervais Pellissier during a conference call with reporters.

"The customer losses are slightly higher than what we expected but what is most reassuring is that the group indicates that the tumult caused by the arrival of Free market seems to calm down, "said Guy Peddy, Macquarie, which says a bit more optimistic even though" much work remains to be done. " 

NEW PROSPECTS EXPECTED TO SUMMER

Throughout the first quarter, the total turnover stood at 10.92 billion euros, down 1.8%, while adjusted Ebitda stood at 3 , 43 billion (-7.0%), giving a margin of 31.4%, down 1.7 points.

The market expected a turnover of 10.81 billion euros and an EBITDA of 3.45 billion euros, according to Thomson Reuters I / B / E / S.

The group has suffered from the 4.2% decline in sales in France related to the impact of Free mobile subscriber base and its price, which has however been partially offset by income generated by the first roaming agreement concluded with Free Mobile, a subsidiary of Internet service provider Iliad. 

The operator now believes that he should yield about one billion euros over three years against the same amount over six years previously.

France Telecom, which reiterated a target operating cash flow of nearly 8 billion euros in 2012, has however confirmed that he no longer maintained the objectives for the period 2013 to 2015 announced ; s in May 2011 as part of its strategic plan.

"While the arrival of Iliad was expected, the price level at which it is set in January is lower than what we have anticipated in May, or even what we might anticipate yet at last November, "said Gervais Pellissier, adding that the group continued to anticipate an early recovery for next year. 

"We made an appointment to investors in the summer to tell them what would be 2013," he added.

Despite pressure on its margins and its sales, France Telecom does not provide for downsizing in the Hexagon, said the CFO.

Competitors Bouygues and SFR have undertaken a series of measures to reduce costs.

The Defense Ministry said Tuesday it has given to the supplier Thales the first tranche, amounting to 263 million euros, an equipment contract of the French army in next-generation tactical radios from 2018.

The radios of the "Contact" will allow simultaneous transmission and highly secure voice and data for the infantry and armor, the ministry said in a statement.

In a second step, these positions also equip combat aircraft, intelligence and transportation and vessels.

The first installment, devoted to development work, will be notified at Thales Communications in the coming days, the ministry added. 

The contract, which is part of Scorpio French military modernization, especially equip future multi-role armored vehicles (VMBR) called to replace the current armored vehicles ahead (VAB).

According to Le Figaro, the contract of three to four billion euros in total over a period of 22 years had been approved by the Ministry of Defence, but that's the Economy ' objected to the notification of an important contract in its presidential campaign, prompting Prime Minister Francois Fillon to rule in favor of the project.

The Defense Ministry was not immediately available to comment on this point.

The current account deficit of France widened in February to 5.0 billion euros from 4.4 billion in January, show figures released Thursday by the Bank of France .

The trade deficit in goods rose to 6.6 billion euros against 5.8 billion a month earlier.

Trade in services have in turn generated a positive balance of 1.3 billion euros after 0.7 billion in January.

The balance, positive income decreases to 2.6 billion euros from 3.1 billion in January.

The deficit in current transfers remained stable at 2.3 billion euros.

The financial account was positive at EUR 15.8 billion in February from -2.8 billion in January. 

French direct investment abroad stand at 1.5 billion euros from 4.1 billion a month earlier, while direct investment by non-residents in France rose to 2.6 billion after $ 0.9 billion in January.

Portfolio investments are the source of capital inflows to 18.5 billion euros "mainly due to purchases by non-residents of securities (public and bank) issued France ", according to the Bank of France, after trips to 23.4 billion in January.

The residents have reduced their holdings of 0.3 billion euros (-21.3 billion in January after), while non-residents have made purchases , height of 18.8 billion (-2.1 billion in January after). 

Other investment outflows display of 6.3 billion euros from 26.7 billion of inflows in January.

Audi, the premium brand of Volkswagen sold 143,500 vehicles in March, a record, or 14.1% from a year earlier, thanks to solid demand from the States U.S. and China.

Over the quarter, the manufacturer sold 346,100 vehicles, representing an increase of 10.8%.

"We started the year 2012 successfully and we anticipate continued growth in the coming months," said in a statement Peter Schwarzenbauer, responsible for sales of Audi.

The first tripartite round table on the future of the plant PSA Aulnay-sous-Bois has resulted in no concrete progress on Friday and the prefect of Seine-Saint-Denis set the next appointment in late June, after the presidential election.

The interview between the State, represented by the prefect, the direction of the automaker and the unions and local politicians, claimed for nine months by them, was stormy said Jean-Pierre Mercier, representative of the CGT, and five trade unions on these seven left the room before the end.

"The unions have called for PSA agrees in writing (…) To maintain all jobs at least until the end of 2016, officially ended production of the C3, and assign a new vehicle to replace the C3. But management does not want to commit to anything, "he said

." The next date falls after the presidential and the law, it is exactly the speech Peugeot: do not use that either in the middle of election campaigns, "he said

… In an attempt to …… get rid of this calendar, the CGT called for a rally next Thursday before the campaign headquarters of Nicolas Sarkozy in Paris

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The Department of Industry, has said his side "fully alert and mobilized to the site's future automotive Aulnay-sous-Bois" and stressed in a statement, the group confirmed that it "does not consider the proposed closure of site in France." 

But at the roundtable, PSA Peugeot Citroëna again refused to discuss the C3 after repeating, as it has for several months, will still produce cars qu'Aulnay until 2014, unspecified beyond.

The builder also mentioned, the statement of the Ministry, the arrival on the surfaces of Aulnay-sous-Bois unused today, "new economic activities complementary ments ".

PSA declined to comment on the roundtable, but a spokesman said that about 40,000 square meters on the site now unused, 23,000 were de ja and 17,000 rental available for rental for industrial and real estate. 

The factory in Aulnay-sous-Bois, which produces the small Citroen sedan, employs 3,500 people and seems the most threatened European sites of PSA while the group was given two years to re ; Gler the issue of persistent overcapacity in Europe.

The fate of the Madrid plant also raises questions as no model has been announced to take forward over the last Peugeot 207 assembled therein.

The deficit narrowed more than expected in 2011. Good news for the future president. But the deficit target of 3% of GDP by 2013 seems difficult to achieve, given the campaign promises made by candidates at the Elysee Palace. View of the Ministry of Economy and Finance at Bercy.

At twenty-three days of the first round of presidential elections, Nicolas Sarkozy may finally assert some good news on the economic front: the public deficit of France was reduced to 5.2% of GDP in 2011, against 5, 7% initially foreseen in the budget law. President, UMP candidate at the Elysee Palace, was granted the first to hear the announcement this morning on Europe 1, grilling politeness in passing at the National Institute of Statistics.

Members of his government were also quick to react. Valérie Pécresse, the budget minister, welcomed an effort "historic". "Never has the government deficit in France has fallen as far from one year to another," Francois Fillon welcomed. "This is the result of both structural reforms that the president and government have undertaken since 2007 and the reactivity of which we have been to take timely steps to preserve our cap facing the crisis, "said the Prime Minister.

In fact, the deficit is indeed historic. It is almost two percentage points of GDP – the deficit was 7.1% in late 2010 – or nearly 40 billion euros. "This is a performance ever," says Jean-Christophe Caffet, economist at Natixis. This improvement comes at a time of buoyant revenue, which rose from 49.5% to 50.7% of GDP, and expenditure restraint, which rose from 56.6% to 55.9% of GDP. The sharp increase in expenses is largely due to strong tax bases and good elasticity of taxes to the moderate growth – 1.7% in 2011.

Taxes on income and wealth have risen by 10% in 2011: the increase in tax revenue comes from both the corporate income tax (8.7 billion) that the income tax (3 , 6 billion) and social contributions (13.3 billion) due to higher payroll. Measures taken in the context of both austerity also had a positive effect: the CSG revenues increased 5.2 billion due to the introduction of taxation over the water revenues of life insurance, VAT receipts were boosted (5.8%) by increasing the tax on insurance contracts and the removal of VAT reduced on triple play.  

The deficit target for 2012 is achievable

Result the tax burden rose 1.3 points to 43.8% of GDP last year, surpassing 2007 levels, while Nicolas Sarkozy promised to lower them. As for spending, they have continued to increase, but it is true more slowly than inflation. Operating expenses of the state, including staff salaries, slowed sharply (+1.6% after +2.1% in 2010), by freezing of the index which is indexed on the salaries of civil servants . Spending inputs have, they, down 1.5% due to very low shipments of military equipment in 2011, and public investment has registered a moderate increase (+1.6%). Ultimately, Jean-Christophe Caffet calculates, "the structural effort of the government is only about a third of the deficit reduction in 2011."

Nevertheless, the result is there. And strength of this success, the executive has even lowered the public deficit target for this year to 4.4% of GDP against 4.5% previously. Given the growth overhang the first half of 2012 to 0.5% according to INSEE – and reduces the effort required this year – 0.8 percentage points of GDP or 16 billion euros -, "this goal deficit is largely achievable, "said Jean-Christophe Caffet. Especially as many measures as part of the austerity plan – increase in VAT reduced from 5.5% to 7%, establishing an outstanding contribution on high incomes, freezing the scale of the income tax, freeze benefits, etc.. – Come fully into force this year.

A boon for the next president to be elected in May and the government that emerges from the polls in June. "The big uncertainty is 2013, warns economist of Natixis, because nothing is known about how the structural effort that will achieve, or about 30 billion euros". France has indeed committed to Brussels next year to bring its public deficit to 3% of GDP. Nicolas Sarkozy and François Hollande, have both confirmed this objective during the campaign. The two favorites in the race to the Elysee to differ only after the UMP candidate promising to balance the budget by 2016 while that of the PS wants to achieve in 2017.

The problem is that Nicolas Sarkozy has not announced anything else, for now, that further measures of reduced spending over the past two years. But it will not be sufficient to reach 3%, especially if growth is still not at the rendezvous. As for Francois Hollande, it provides 25 billion of new spending on the five-year and 40 billion annual tax increases. Increases which will focus on businesses, which may penalize growth. From this perspective, The Economist is right: "Whoever wins on May 6 will adopt a tough stance against the deficit, writes the weekly UK this week. Nicolas Sarkozy will make further cuts in the budget, Despite his promise to protect the French austerity. Francois Hollande will push, if not waived, that many of its spending promises. "