Bouygues Faces Delays, Litigation Storm; Remy Cointreau Positive on China

Sarla Buch
19 Oct, 2018
New York City

Bouygues tumbled on weak profit estimates. Michelin plunged despite strong sales growth. Remy Cointreau reaffirmed sales growth in China. Volvo reported strong results despite deliveries in bus segment declined.

[R]4:00 PM Frankfurt – Bouygues tumbled on weak profit estimates. Michelin plunged despite strong sales growth. Remy Cointreau reaffirmed sales growth in China. Volvo reported strong results despite deliveries in bus segment declined.[/R]

In London trading, FTSE 100 index increased 31.81 or 0.5% to 7,058.80 and in Frankfurt the DAX index fell 21.87 or 0.2% to 11,567.34.

In Paris, CAC 40 index decreased 19.98 or 0.4% to 5,096.91.

Bouygues SA tumbled 11.1% to €32.40 after France-based diversified industrial construction services provider forecasted operating profit in the nine-month period ending in September to decline to €140 million or $161.6 million, lower than a year ago period.

The construction services provider said in the French rail business its facing tough situation and worsened in the second and third-quarters and operating profit in colas business estimated to decline by around €25 million.

Bouygues said its construction division is facing problems and delays and cost overruns at two power plant projects and the project in Ireland is cancelled and the company has entered into new litigation.

“Of course, news is disappointing, but current operating margin is expected to a good level and no further deterioration in its trading is expected for the fourth quarter,” said deputy chief executive Philippe Marien

Cie Gnrl des Etblsmnts Michelin SCA plunged 9.6% to €89.40 after France-based tire manufacturer said net sales in the nine-month period ending in September jumped 3.9% from a year ago to €16.2 billion.

The tire maker said sales in the specialty businesses soared 15.2% to €3.6 billion but demand in China declined 5% and demand for passenger car, light truck and truck tire declined after new emission standards

Remy Cointreau SA gained 0.3% to €104.40 after France-based liqueur and spirit maker said revenues in the first-half ending in September soared 5% from a year ago to €571 million.

Revenues in the House of Remy Martin division jumped 8.5% and revenues in liqueur and spirit segment dropped 1.6%.

“We are not seeing any slowdown in global demand in China, so far we are very optimistic on China, more optimistic than a few months ago,” said finance chief officer Luca Marotta.

Software AG advanced 1.9% to €38.83 after Germany-based enterprise software developer said revenues in the nine-month period ending in September fell 2% from a year ago to €601.2 million.

Net income in the period rose 2% to €123.5 million from €120.6 million in the same period a year ago and diluted earnings per share jumped €1.67 from €1.61.

The software developer forecasted fiscal 2018 earnings per share growth between 5% and 15% and operating profit margin in the range of 30% to 32%.

Revenue growth in the internet of things and in the Digital Business Platform segment is estimated to jump between 100% and 135%.

Volvo AB slumped 2.7% to 133.15 Swedish kronor after Sweden-based trucks, buses and construction equipment maker reported revenues in the nine-month period ending in September surged 18.2% from a year ago to 285 billion kronor.

Net income in the period soared 41.9% to 22.7 billion kronor from 16 billion kronor in the same period a year ago and diluted earnings per share jumped to 10.98 kronor from 7.77 kronor.

Volvo said total order surged 26% to 65,348 trucks and deliveries increased 14% to 52,993 vehicles but deliveries in the bus segment declined 16%.