UK Inflation Soars; Vodafone Net Surges

Arthi Gupta, Mayank Mehta and Sanjay Barot
18 May, 2010
New York City

UK stocks rise as commodity prices rebound and inflation hits 17-month high. AstraZeneca enters into an agreement with Teva Pharmaceuticals USA, Inc. SSL International drives fiscal year profit. Vodafone Group net profit surges 179%.

[R]4:00 PM London, 11:00 AM New York – U.K. stocks rise as commodity prices rebound. UK inflation hits 17-month high. AstraZeneca enters into an agreement with Teva Pharmaceuticals USA, Inc. SSL International drives fiscal year profit. Vodafone Group net profit surges 179%.[/R]

U.K. stocks rise as commodity prices rebound. The pound declined as a report showed that U.K.''s annual inflation rose to its highest level since November 2008.

U.K. annual inflation rose to 3.7% in April, the highest since November 2008, data from Office for National Statistics showed Tuesday. The annual rate stayed above the central bank''s 2% target. In March, annual inflation was 3.4%. On a monthly basis, consumer prices were up 0.6% in April, faster than the consensus forecast of 0.4%.

British Airways on Monday won a last minute High Court injunction order blocking a series of four five-days strikes called by the Unite union representing the cabin-crew working for the airlines, just hours before the first of the planned strikes was set to begin on Monday midnight.

Following the High Court ruling on its legal challenge, BA said in a statement that it was """"delighted for our customers that Unite''s plans for extreme and unjustified strike action cannot go ahead.""""

Pharmaceutical company AstraZeneca said Tuesday that it has entered into an agreement with Teva Pharmaceuticals USA, Inc. on a patent litigation filed in the US District Court for the District of Delaware. AstraZeneca has granted Teva a license to enter the US market with AstraZeneca''s generic version of Entocort EC or budesonide, intended for the treatment of Crohn''s disease, in 2012.

Under the terms of the settlement agreement, Teva will enter the US market with its generic version of oral budesonide on 15 February 2012, subject to regulatory approval, or earlier in certain circumstances.

In addition, Teva has conceded that both patents-in-suit in Teva''s US Entocort patent litigation are valid and enforceable. However, other terms of the settlement are not revealed by the company.

Mobile telecom giant Vodafone Group Plc reported a surge in fiscal 2010 profit, driven by revenue growth and much lower impairment losses. The company also proposed a higher final dividend and provided adjusted operating profit outlook for fiscal 2011.

In London FTSE 100 Index closed higher 44.09 or 0.84% to 5,306.63 and the pound edged lower to close at $1.447 and to close at €1.164.

Gainers & Losers

Aegis Group plc, the advertising firm fell 0.3% to 122.60 pence.

AstraZeneca PLC fell 0.3% to 2,896.00 pence. The biopharmaceutical company today announced that it has entered into an agreement with Teva Pharmaceuticals USA, Inc. to settle patent litigation regarding Teva’s proposed generic version of AstraZeneca’s Entocort EC capsules.

BP p.l.c., the oil and gas company rose 0.3% to 531.60 pence.

British Airways Plc, the air carrier rose 0.4% to 201.30 pence.

The British Land Company PLC added 2.9% to 445.80 pence. The real estate investment trust said fiscal year 2010 net rental income fell 29% to £394 million from £554 million a year ago. Net profit for the year was £1.14 billion or 133 pence per diluted share compared to net loss of £3.88 billion or 614 pence per share a year ago.

Britvic plc fell 1.0% to 435.00 pence. The drinks group said first half revenues rose 4.6% to £505.3 million from £483.2 million a year ago. Net profit for the first half rose 88% to £21.1 million or 9.5 pence per diluted share compared to net profit of £4.9 million or 2.2 pence per share a year ago.

Collins Stewart plc, the stock broker rose 0.5% to 87.00 pence.

Dairy Crest Group plc rose 1.4% to 358.80 pence. The manufacturer of milk and dairy products fiscal year 2010 revenues fell 1% to £1.63 billion from £1.65 billion a year ago. Net profit for the year fell 28% to £54.0 million compared to net profit of £75.4 million a year ago.

Drax Group plc, the power generation company increased 1.6% to 335.00 pence.

Paragon Group of Companies PLC increased 3.8% to 150.60 pence after the provider of mortgages to residential property investors said first half net interest income rose 2% to £69.4 million from £68.0 million a year ago. Net profit for the first half rose 88% to £21.1 million or 7.0 pence per diluted share compared to net profit of £11.2 million or 3.8 pence per share a year ago.

Regus Plc, the provider of serviced office space plunged 13.6% to 97.45 pence.

SSL International plc added 2.7% to 847.50 pence after the consumer products company said fiscal year 2010 revenues rose 25% to £802.5 million from £642.4 million a year ago. Net profit for the year rose 31% to £71.4 million or 33.1 pence per diluted share compared to net profit of £54.5 million or 27.4 pence per share a year ago.

Vodafone Group Plc rose 0.2% to 136.70 pence after the mobile telecommunications company said fiscal year 2010 revenues rose 8.4% to £44.5 billion from £41.0 billion a year ago. Net profit for the year rose 179% to £8.65 billion or 16.36 pence per diluted share compared to net profit of £3.1 billion or 5.81 pence per share a year ago.

Yell Group plc plunged 19.3% to 38.00 pence after the directory publisher said fiscal year 2010 revenues fell 11.7% to £2.12 billion from £2.4 billion a year ago. Net profit for the year was £46.8 million or 3.4 pence per diluted share compared to net loss of £1.14 billion or 124.1 pence per share a year ago.