European Business News 96-08-22

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From: The European Business News Server at <http://www.ebn.co.uk/>

Page last updated August 22 9:35 CET

CONTENTS

[01] Germany's BASF reports a 14.5% rise in first-half profits

[02] Rentokil results rise more than 35 percent helped by contributions from B-E-T

[03] Markets nervous ahead of Bundesbank meeting

[04] News Corp announce lower than expected 1995 profit - but forecasts an earnings boost this year

[05] Credit Lyonnais denies negligence over rescue loan

[06] CS Holding reports a 20% rise in interim profits - slightly below market forecasts.

[01] Germany's BASF reports a 14.5% rise in first-half profits

For the full year, BASF forecasts a slight rise in sales and a profit 'at least' at the previous year level.

However, BASF said it expects the growth in pretax profit to slow in the second half from the 14.7% increase achieved in the first half. The possible slowdown will stem mainly from the effect of comparing the second- half development with the 'relatively high' basis in the previous year, the company said.

In the first half, BASF health and nutrition segments as well as oil and gas 'significantly' improved their contributions to group profit, the company said.

In contrast, plastics and fibers, as well as chemicals, couldn't repeat their high previous-year profit levels because of falling sales prices.

[02] Rentokil results rise more than 35 percent helped by contributions from B-E-T

Net debt was just under 590 million due to the recent acquisition of services group BET.

Rentokil said the integration of BET is progressing swiftly as planned and the board expects the group as a whole to have 'continued good growth for the full year.'

The company said it is to change its name to Rentokil Initial PLC 'to reflect the company's plans to develop two international brands, Rentokil and Initial.'

Initial was the brand name used by BET to market its textile rental and cleaning services. Analysts say the name change is an effort to differentiate between the two businesses of pest control and cleaning services.

The company is understood to be uncomfortable selling cleaning services to schools and hospitals through the Rentokil name, which is associated with pest and 'rat-catching.'

[03] Markets nervous ahead of Bundesbank meeting

Ifo said its monthly economic-climate indicator, which tracks confidence in the manufacturing, construction and wholesaling sectors, was 94.1 in July, up from 90.4 in June. After the survey appeared, traders were more inclined to think the Bundesbank will hold the repo rate at 3.3% - reversing their views of just the day before.

'As of last Friday, most of the market was convinced that the Bundesbank might cut the repo rate [Thursday], and the money-supply numbers reinforced that feeling,' said Michael Perelstein, portfolio manager of Mainstay International Mutual Funds in New York. 'But the Ifo numbers moved [market sentiment] the other way' -- many now think the Bundesbank may drag its heels a little bit' on lowering interest rates.

[04] News Corp announce lower than expected 1995 profit - but forecasts an earnings boost this year

In a statement, News Corp. said its result included an abnormal, loss of A$243 million, stemming from the sale of the company's HarperCollins educational book division and ETAK, a digital mapping service.

News Corp. said profit before abnormal items fell 6% to A$1.26 billion last fiscal year, from A$1.34 billion a year earlier.

Total operating profit declined slightly to A$1.59 billion from A$1.66 billion, as strong performances in the company's U.S. Television and U.K. Newspapers divisions were offset by lower results at Magazines & Inserts, Book Publishing, and Star TV. Commenting on the company's performance this fiscal year, News Corp. said the period has begun 'with great promise.' It cited as positive factors expected strong earnings from the hit movie 'Independence Day,' a moderating trend in paper prices, and a solid forward book of advertising at its Fox Broadcasting Co. unit.

News Corp. further predicted that a profit increase of at least 20% 'appears very attainable' this fiscal year.

[05] Credit Lyonnais denies negligence over rescue loan

[06] CS Holding reports a 20% rise in interim profits - slightly below market forecasts.

Before minority interests, net profit rose 26%, the company said. Market expectations had called for an increase in the range of 25% to 50%.

The group said it expects its full-year result to surpass that of 1995, but added that provisioning for credit risks will remain high. CS Holding blamed the provisioning needs on the sluggish domestic property market and economy, which is 'hurting' small businesses.

The banking group set aside 541 million francs in the first half for doubtful loans, up from 340 million francs in the first half of 1995. Meanwhile, CS Holding said its previously announced restucturing is proceeding as planned. As reported, the company will rename itself Credit Suisse Group as of Jan. 1 and will organize into four business units.

From the European Business News (EBN) Server at http://www.ebn.co.uk/

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