Air France-KLM losses widen as fuel costs rise
Air France-KLM, the Franco-Dutch airline, says it made a big loss in 2012, blaming sharply rising fuel costs and trouble with its cargo business.
Net losses increased 47% to 1.19bn euros (£1bn; $1.57bn), after a 471m-euro restructuring charge and a 890m-euro increase in its fuel bill.
But operating losses fell to 300m euros, from 353m euros the year before.
Revenues rose 5.2% to 25.6bn euros, thanks in part to increased prices on its North Atlantic routes.
Debt fell from 6.51bn to 5.97bn euros after sell-offs and spending cuts - the company plans to reduce its net debt by 2bn euros by the end of 2014.
Chief executive Jean-Cyril Spinetta said in a statement: "The year 2012 was characterised by a slowdown in global growth and recession in Europe, but nevertheless saw a sharp increase in the fuel price.
"In 2013, we will maintain strict discipline in terms of capacity management, investments and costs."
Air France-KLM is renegotiating pay and conditions with its staff and cutting more than 5,000 jobs, as high fuel costs and competition from low-cost airlines take their toll on the debt-laden company.
The airline managed to increase filled capacity on its flights to more than 83% as demand for long-haul trips rose, but its cargo business continues to struggle.
Competition Commission raps Big Four accountants
Britain's four biggest accountancy firms have been heavily criticised by the Competition Commission.
The regulator has accused PWC, Ernst & Young, Deloitte and KPMG of being too dominant and not always meeting a shareholder's needs.
The four accountancy firms act as auditors for 90% of the UK's stock-market listed big companies.
They have also been criticised in the past for not doing enough to warn of the financial crisis.
Critics say accountants failed to scrutinise the banks' balance sheets properly, missing the warning signals that led to government bailouts.
The concern is that the relationship between auditors and company management becomes too comfortable with a "tendency for auditors to focus on satisfying management rather than shareholders' needs".
"It is clear that there is significant dissatisfaction amongst some institutional investors with the relevance and extent of reporting in audited financial reports," said Laura Carstensen, chair of the Audit Investigation Group.
She added that "management may have incentives to present their accounts in the most favourable light, whereas shareholder interests can be quite different".
"We have found that there can be benefits to companies and their shareholders from switching auditors, but too often, senior management at large companies are inclined to stick with what they know."
The Competition Commission pointed out that companies do not tend to change their auditors - with almost a third of the FTSE 100 having used the same one for more than 20 years.
She said her organisation was looking into different ways of encouraging competition in the industry. Mandatory rotation of audit firms is one idea being considered, as well as forcing companies to put the contract out to tender after a certain period.
The Big Four argue that the market is competitive and say many big clients doubt that smaller firms could build up their expertise fast enough.
"We are very clear that we report to the shareholders and engage with the Audit Committee as their representatives," said PWC's Richard Sexton.
"We believe that the Competition Commission have grossly underestimated the critical role that Audit Committees play in protecting the interests of shareholders."
'Significant flaws'
This was echoed by Ernst and Young, who said that competition in the market was "healthy and robust".
Ernst and Young's Hywel Ball added that they would co-operate fully with the inquiry but states that he did not believe that mandatory audit firm rotation was in the public interest.
Deloitte said it did not believe that the current market led to high prices, as contended by the Competition Commission, and added: "We categorically disagree that auditors typically place the interests of management over shareholders."
However, one of the smaller rivals to the Big Four, the BDO, said it was pleased that the report had confirmed "significant flaws" in the market.
"No one solution will achieve market correction, but rather a combination of tendering requirements, encouragement of transparency and dialogue between auditors, companies and investors, and reform of outdated exclusionary practices should provide a backdrop for a healthier FTSE 350 audit market," said Simon Michaels, managing partner at BDO.
The report is a preliminary one, with the final version due to be published in October. No evidence of tacit collusion was found.
AIG reports $4bn loss from sale of leasing business
American International Group (AIG) has reported a huge loss from the sale of its aircraft leasing business ILFC.
The insurer reported a net loss of $4bn (£2.6bn) for the last three months of 2012, due to the $4.4bn loss from the ILFC sale.
It had made a net profit of $21.5bn in the same period of 2011.
AIG also said Storm Sandy had been the second most expensive single catastrophic event for it in the US on record, costing $1.3bn after tax.
Despite that, it made an operating profit, which excludes the effects of the ILFC sale, of $290m, compared with $1.5bn in the last quarter of 2011.
"AIG's operating profit this quarter shows the power and financial strength of our diverse global franchise," said chief executive Robert Benmosche.
The results were better than had been expected and AIG shares rose 2.5% in after-hours trading.
The fourth quarter was a busy one for AIG, which sold its remaining stake in the Asian insurer AIA in December for $6.5bn.
Also during the quarter the US Treasury sold its remaining shares in AIG for about $7.6bn, repaying the last of its financial support to the insurer.
Japan Moves to Stimulate their Stalled Economy
Japan's central bank is embarking on an American-like plan to stimulate the country's stalled economy by pumping more money into it.
The Bank of Japan, under pressure from the new government of Prime Minister Shinzo Abe, agreed Tuesday to double its inflation target to 2 percent and stimulate the world's third largest economy for an indefinite period through asset purchases. The economic boost is similar to that undertaken in recent years by the U.S. central bank, the Federal Reserve.
Japan's economy has been long stalled, restrained by deflation, with falling prices. Mr. Abe said the new policy marked a significant change.
“In terms of making a bold review of monetary policy, I believe (the agreement with the bank) is a ground-breaking statement. A macroeconomic regime change clearly is under way.”
A governor for the Bank of Japan, Masaaki Shirakawa, is optimistic that the stimulus will boost the country's economy.
“They (the government) have again pledged to take concrete steps towards a sustainable fiscal structure. We have high expectations for the government's measures.”
British Women Gets Death Sentence for Drug Smuggling in Bali
An Indonesian court has sentenced a British woman to death for attempting to smuggle drugs into the resort island of Bali.
Fifty-six-year-old Lindsay Sandiford cried when she heard the sentence Tuesday, but did not comment as she was escorted back to jail.
Although Indonesia has notoriously strict drug laws, the sentence was harsher than expected. Prosecutors had recommended only 15 years in prison.
A panel of judges at the Denpasar District Court said there was no reason to lighten Sandiford's sentence, saying she had damaged the image of Bali as a tourist destination.
Sandiford was arrested in May at Bali's international airport with 4.8 kilograms of cocaine in the lining of her suitcase. She says a criminal gang threatened to hurt her children if she did not transport the drugs, which had a street value of $2.5 million.
Her lawyer says she will appeal the verdict.
Two other British citizens have received lighter sentences for their role in the case. A fourth is expected to be sentenced at the end of the month.
Australia's Lowy Institute for International Policy says Indonesia has 114 prisoners on death row, although no executions have taken place since 2008.
Condemned criminals there face death by firing squad. But death sentences are sometimes commuted to lengthy prison sentences.
Bermudian Arrested In NJ For Drug Offences
A Bermudian man was arrested in New Jersey in connection with a drug related matter.
The Bermuda Police Service released limited information, saying only that they are “aware of an arrest of a Bermudian National in New Jersey on a drug related matter and are liaising with the relevant authorities accordingly.”
Update 5.43pm: People arrested – and not charged – are generally not named in local media, however American websites indicate that a 45-year-old male was arrested yesterday [Feb 20].
His nationality is not identified however his name and photo are posted, and he is known to be Bermudian. He is listed as “in custody,” and his bond amount is listed at $300,000.00
Jamaica overcome few hiccups to record four-wicket win
Jamaica overcame a few hiccups to coast to a comfortable four-wicket win over Trinidad and Tobago in the Regional Super50 Championship here yesterday Chasing an inadequate 153 for victory, Jamaica recovered from a position of one run for two wickets in the second over, to reach their target off 45.2 overs and win their second round match at Sabina Park.
The win was Jamaica’s second of the competition after beating Barbados in the opening round a fortnight ago.
Andre McCarthy top-scored with 45 from 65 balls while captain Tamar Lambert, voted Man-of-the-Match, chipped in with an important 34 and all-rounder David Bernard Jr, 28.
Seamer Raymon Reifer finished with two for 25.
Earlier, CCC were dismissed for 152 off 48 overs after winning the toss and batting.
Raymon Reifer got 32, captain Kyle Corbin scored 24 and Nicholas Alexis, 20.
Out-of-favour West Indies left-arm spinner claimed three for 27 while fast bowler Andrew Richardson (2-22), leg-spinner Odean Brown (2-27) and off-spinner Tamar Lambert (2-39) were the other wicket-takers.
CCC slipped to 15 for two in the seventh over after seamer Andrew Richardson removed both openers cheaply.
Veteran left-hander Floyd Reifer, who hit the top score of 32, and captain Kyle Corbin, who struck 24, then repaired the innings with a 55-run third-wicket stand before CCC lost their last seven wickets for 87 runs.
Jamaica were floundering after eight balls of the innings in their reply before two critical partnerships put them over the line.
McCarthy, who hit four fours and two sixes, and opener Simon Jackson (21) put on 56 for the third wicket while Lambert and Bernard added a further 47 runs for the fifth wicket, to put Jamaica in sight of victory.
CCC innings
C. Walton c Lambert b Richardson 6
S. Thomas c wkp. Baugh b Richardson 6
K. Corbin stp. Baugh b Miller 24
F. Reifer lbw b Brown 32
R. Reifer c Miller b Brown 15
N. Alexis c Bonner b Lambert 20
N. Parris c Bonner b Miller 11
A. Dewar c McCarthy b Miller 9
K. McClean lbw b Miller 5
D. Davis not out 14
R. Austin run-out 5
Extras: (lb-2, w-8) 10
Total: (all out, 48 overs) 157
Fall of wickets: 1-12, 2-15, 3-70, 4-78, 5-111, 6-114, 7-129, 8-134, 9-148.
Bowling: Richardson 7-1-22-2, Cotterell 4-0-11-0, Bernard 5-0-18-0, Miller 10-3-27-3, Brown 10-2-27-2, Lambert 10-0-39-2, McCarthy 2-0-11-0.
JAMAICA innings
J. Blackwood c F Reifer b McClean 0
S. Jackson c wkp. Walton b R Reifer 21
N. Bonner lbw b Davis 0
A. McCarthy lbw b Austin 45
T. Lambert c Davis b R Reifer 34
D. Bernard Jr Corbin b Dewar 28
C. Baugh not out 18
N. Miller not out 1
Extras: (lb-1, w-10) 11
Total: (6 wkts, 45.2 overs) 158
Fall of wickets: 1-0, 2-1, 3-57, 4-77, 5-124, 6-157.
Bowling: McClean 9-1-38-1, Davis 7-1-35-1, Austin 10-1-21-1, R Reifer 8-0-25-2, Dewar 9.2-0-27-1, Parris 2-0-11-0.
Points: Jamaica 4, CCC 0.
Digicel & IslandCom moves ahead with LTE
The TCI Telecommunications Commission has awarded the two available licences on the 700 MegaHertz spectrum to Digicel and Islandcom.
The Commission says that due to its technical characteristics, the 700 MegaHertz spectrum is ideally suited for the deployment of mobile broadband services providing people in this country with services unparalleled in much of the Caribbean. Here’s Phadrian Astwood with more on this.
What does this mean for the consumer? Well, the TCI will be one of the first countries in the Caribbean to benefit from 4G LTE-based mobile broadband services. A key objective of the Commission's licence award has been to achieve the fastest possible deployment of the latest generation of mobile broadband technology throughout the Turks and Caicos Islands. In return for its licence, Digicel has agreed to improve on minimum deployment requirements so that at least 75% of the population will have access to 4G LTE services within 18 months and 98% within 30 months. In addition, Digicel has committed to providing several additional public benefits, including free 4G LTE-based Internet connectivity to all public/Government primary and secondary schools and community colleges. On top of this, a subsidized 4G LTE device and data bundle will be on hand for students and teachers and there will be one Digital Classroom with equipment and training for every public school - and one per each campus of the community college. With this latest generation of broadband services, consumers and businesses will have access to significantly higher data transmission speeds - compared to currently deployed mobile wireless technologies. There will be a more consistent quality of service and a far richer mobile multimedia experience. These blocks are considered as "prime" spectrum because 4G LTE mobile devices are currently available on the market which can deploy them. This is Phadrian Astwood for RTC News.
The Commission's Prime 700 MHz Spectrum Assignment completes a comprehensive public consultation process that started in 2011 and was the first time the Commission has conducted a comparative selection process to assign spectrum. There was excess demand for the available prime 700 MHz spectrum blocks under consideration.
Ten Percent Returns for Civil Servants
The Government has confirmed that Public Servants and members of the Police Force will get the reinstatement of the 10 per cent salary in their pay packets at the end of the month. It takes effect on February 1st and will be paid to those eligible public officers and police officers whose salaries were cut in 2010 as part of the Interim Government’ cost cutting exercise. The 10 per cent reinstatement is expected to add around $4.5 million to the annual wage bill. Here’s ----- with more.
The reinstatement is the first phase of a comprehensive review of government salaries and a commitment by TCIG to implement the recommendations of the 2012/2013 Pay and Grading Review. The intention is to make the pay structure of public servants more equitable, reflect the major differences in responsibility and skill levels, promote fairness and provide a structured and transparent salary system. Starting with the 10 per cent reinstatement, it is the intention of government to implement the new pay and grading structure in the 2014/2015 financial year or sooner, pending the country’s financial situation at the end of the second quarter of this year. Beneficiaries include officers who are appointed on a T-scale, TNF-scale or Police Scale.
Officers who were transferred into government from a statutory body will also benefit from the 10 per cent reinstatement if there is evidence that they were subject to the 10 per cent cut. Allowances will also be reinstated to the levels prior to the reduction.Newly appointed officers, officers appointed with a salary outside of the current scales and those whose jobs were recently upgraded and filled such as Heads of Secretariat, Personal Assistants and those employed to the Tax and Radar Units are not eligible for the 10 percent reinstatement.
The Honorable Anya Williams, Deputy Governor and Head of the Public Service, said today the Pay and Grading Review was critical in bringing about much needed change in the civil service.The new structure would not only address many of the anomalies that currently existed in Government, but seek to adequately compensate staff for their work and assist in attracting more qualified persons to the civil service going forward.This coupled with a new Public Service Ordinance and innovative training and mentoring programs would help to revolutionize the civil service and will help to make the civil service a model employer of choice.
RFA Wave Ruler stops in the TCI
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The Royal Naval support ship RFA WAVE KNIGHT will arrive in Grand Turk on the 27 February for a 4 day visit during her deployment to the region on Atlantic Patrol Tasking North.
During the WAVE KNIGHT’s visit the Commanding Officer will host a working lunch with the Governor, Premier and members of the Disaster Management Team. Plans are also afoot for students on Grand Turk to visit the giant ship. There is a year round British commitment for her five Caribbean Overseas Territories, wider regional Humanitarian Aid and Disaster Relief and Counter Narcotics Operations.
RFA WAVE KNIGHT is a 31,500 tonne Fleet Tanker which has the ability to refuel other naval vessels at sea from its three beam rigs and one stern rig as well as carrying dry stores. She is particularly suited to disaster relief as she can make her own drinking water and electricity. WAVE KNIGHT has loaded Humanitarian and Disaster Relief and stores to support relief operations in the region. The Commanding Officer, said his Ship’s Company and were looking forward to the visit and to making and remaking relationships whilst being able to liaise with Disaster Management authorities regarding Wave Knight’s capabilities.