Browse content similar to 28/01/2016. Check below for episodes and series from the same categories and more!
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Live from London, that's our top story on Thursday | :00:00. | :00:00. | |
Shell shareholders have given the green light - | :00:00. | :00:22. | |
now it's up to investors in BG Group to seal the deal. | :00:23. | :00:28. | |
And to say they are on board. With prices at around $30 a barrel, does | :00:29. | :00:35. | |
it make financial sex. Tax transparency - | :00:36. | :00:38. | |
will the new OECD deal make corporate giants pay | :00:39. | :00:43. | |
the right amount of tax.? And it's a mixed picture emerging | :00:44. | :00:45. | |
in Europe on financial markets - lots of companies have reported | :00:46. | :00:48. | |
earnings as investors cherry pick Monarch Airlines was close | :00:49. | :00:51. | |
to collapse just two years ago, but it's set to return to profit | :00:52. | :01:00. | |
after rebranding itself And how much is your | :01:01. | :01:02. | |
information worth? Facebook says it makes $3.73 | :01:03. | :01:07. | |
a year from each of us, so we want to know - | :01:08. | :01:11. | |
is it right that firms profit Let us know, use the | :01:12. | :01:14. | |
hashtag BBC BizLive. Royal Dutch Shell shareholders have | :01:15. | :01:25. | |
given the go ahead for its takeover It's a merger that would make Shell | :01:26. | :01:34. | |
the world's biggest liquified The deal is worth $49 billion | :01:35. | :01:45. | |
dollars - and as well as LNG assets, it would also give Shell access | :01:46. | :01:49. | |
to valuable oil resources But some Shell shareholders have | :01:50. | :01:52. | |
questioned the logic of the deal - as oil has dropped from 55 dollars | :01:53. | :01:59. | |
a barrel when it was first announced in April - to just 30 | :02:00. | :02:03. | |
dollars a barrel. BG Group shareholders | :02:04. | :02:08. | |
are expected to approve the deal If it goes ahead, the companies | :02:09. | :02:10. | |
would merge on the 15th of February. Christopher Wheaton, | :02:11. | :02:18. | |
Energy Analyst at Allianz Global Welcome. $49 billion, the deal, but | :02:19. | :02:32. | |
makes financial sense given the makes financial sense given the | :02:33. | :02:38. | |
sell-off in oil. Clearly shareholders in Shell think it does. | :02:39. | :02:42. | |
We have had mixed views in the market but it is important to note | :02:43. | :02:47. | |
the value of the deal has come down the third, $25 billion, since it was | :02:48. | :02:53. | |
announced last year. That is because Shell chose to pay sensibly part in | :02:54. | :02:58. | |
shares in part in cash and the falling price has been reflected in | :02:59. | :03:02. | |
the lower price they are paying. On paper it seems to make sense because | :03:03. | :03:08. | |
it is about streamlining operations and controlling a bigger slice of | :03:09. | :03:12. | |
the market. What is in it for both sides, when we talk about potential | :03:13. | :03:22. | |
gains? BG, they get part of a bigger business. Shell, it is important | :03:23. | :03:26. | |
they focus on the parts of the oil industry they are good at, such as | :03:27. | :03:31. | |
liquefied natural gas and deepwater offshore oil and gas industry. If | :03:32. | :03:37. | |
you look their history, that is where they have made the highest | :03:38. | :03:42. | |
return on capital. It makes sense for Shell to focus on the bits of | :03:43. | :03:49. | |
the industry it is good at. What is interesting in the climate of lower | :03:50. | :03:53. | |
oil prices, yesterday reports that officials from the IMF and World | :03:54. | :04:00. | |
Bank looking at Azerbaijan, and an emergency loan to prop up their | :04:01. | :04:04. | |
industry, given their dependence on oil. Are we likely to see more of | :04:05. | :04:08. | |
that, with countries dependent on the price of oil, in the same way | :04:09. | :04:12. | |
these companies look at the price, these countries say they cannot | :04:13. | :04:16. | |
afford to pay their bills? The industry is screaming in pain at $30 | :04:17. | :04:23. | |
oil. And countries like Azerbaijan, you could add Nigeria, Columbia, and | :04:24. | :04:29. | |
Middle Eastern nations. It is hurting. We will see more of this | :04:30. | :04:35. | |
intervention at government level. There have been issues in Russia on | :04:36. | :04:40. | |
whether they need to tax the oil and gas industry to raise more | :04:41. | :04:43. | |
government revenue because the budget does not work at $30 oil. We | :04:44. | :04:50. | |
will see more of this, just as in the commercial sector more banks | :04:51. | :04:53. | |
trying to recover money they have led to the oil industry, | :04:54. | :04:56. | |
particularly the US shale industry over the last five years. To return | :04:57. | :05:03. | |
to this merger issue. What happens next? Shell shareholders giving this | :05:04. | :05:07. | |
the green light, are we set for it to go ahead? That is one formality, | :05:08. | :05:15. | |
the BG shareholder vote today which will almost certainly go through. | :05:16. | :05:20. | |
And the green light goes on on the 15th of February. Thanks very much. | :05:21. | :05:21. | |
Good to see you. When we hear about that result, the | :05:22. | :05:30. | |
vote, which is expected to be approved, we will let you know. | :05:31. | :05:34. | |
Facebook has been winning more friends on Wall Street. | :05:35. | :05:37. | |
Shares in the social media giant jumped almost 12 per cent | :05:38. | :05:42. | |
in after-hours trading after it said profits doubled in the last quarter. | :05:43. | :05:45. | |
Revenue was up strongly - as were the number of active users | :05:46. | :05:48. | |
Facebook has now beaten analysts' expectations for ten quarters | :05:49. | :05:52. | |
in a row as advertising revenue continues to surge. | :05:53. | :05:59. | |
EBay's shares have fallen sharply after it forecast lower | :06:00. | :06:02. | |
than expected earnings that could mean a decline | :06:03. | :06:04. | |
EBay is struggling with competition from rival Amazon and traditional | :06:05. | :06:08. | |
retailers like Wal-Mart that are boosting their online presence. | :06:09. | :06:13. | |
Rules to stop companies using complex tax arrangements | :06:14. | :06:18. | |
to avoid paying corporate tax have been agreed by 31 OECD members. | :06:19. | :06:22. | |
They will make it harder for firms to hide money in tax havens or play | :06:23. | :06:26. | |
one country's tax authority against another. | :06:27. | :06:28. | |
Firms such as Google, Amazon and Facebook must now pay tax | :06:29. | :06:30. | |
in the country where the profits are made. | :06:31. | :06:40. | |
Staying with the theme of tax, I want to take you to the life page | :06:41. | :06:48. | |
because the Today programme have spoken to a Commissioner responsible | :06:49. | :06:52. | |
for the deal over taxes and a debate about whether the EU could force | :06:53. | :06:55. | |
Google and other companies to pay more tax in the country's revenue is | :06:56. | :07:03. | |
earned. It has been debated, Starbucks, Tech giants, specifically | :07:04. | :07:08. | |
related to this row. A debate on the life page about whether the EU could | :07:09. | :07:12. | |
make a firm start paying fairer tax in the countries in which they earn | :07:13. | :07:19. | |
the money. I was going to jump in to say something I noticed today, this | :07:20. | :07:24. | |
is my opportunity to mention it, we have results coming in, Apple, | :07:25. | :07:30. | |
Boeing, eBay. Yesterday we had a steep fall on the markets in the US. | :07:31. | :07:36. | |
Apple and Boeing plunging on disappointing results. Together the | :07:37. | :07:39. | |
share price fall accounted for more than half the slide on the Dow Jones | :07:40. | :07:44. | |
industrial average. They are such big companies, and Apple the biggest | :07:45. | :07:51. | |
in terms of market capitalisation. That is interesting. Please agree | :07:52. | :07:55. | |
with me! The world is glad he reported on that news. We have heard | :07:56. | :07:57. | |
from many big names in technology. Samsung has reported profits down | :07:58. | :08:02. | |
40% for the fourth quarter, It is squeezed at both ends of the | :08:03. | :08:19. | |
smartphone market we can talk to Sarah. Give us more detail on how | :08:20. | :08:29. | |
Samsung is doing. Hello, Sally. After years of record profits it | :08:30. | :08:34. | |
appears things are finally slowing down for Samsung Electronics. | :08:35. | :08:40. | |
Profits fell by about 40% down to $2.7 billion in the first three | :08:41. | :08:44. | |
months to December. That is significantly below estimates. | :08:45. | :08:50. | |
Samsung warned it would be difficult to maintain profits this year. | :08:51. | :08:55. | |
Smartphone sales hit by strong competition, and cheaper Chinese | :08:56. | :09:02. | |
rivals and at the top of the market, Apple. The slowdown in China is | :09:03. | :09:10. | |
taking its toll. The most recent top of the range handset, Galaxy Essex, | :09:11. | :09:18. | |
fails to excite consumers and their other core business, semiconductors, | :09:19. | :09:23. | |
faces we can demand, for personal computer. It makes components for | :09:24. | :09:27. | |
the iPhone and that too is also facing a slowdown in sales. Thanks. | :09:28. | :09:34. | |
Ling us in on Samsun, it is one of those companies that has a massive | :09:35. | :09:48. | |
impact on the market here. The big loser on the Dow Jones, Apple, and | :09:49. | :09:58. | |
Boeing. Six and a half per cent down, Apple shares. A lot of | :09:59. | :10:02. | |
companies have come up with earnings. Diageo, better than | :10:03. | :10:09. | |
expected news. The FTSE was up. And Germany France hovering around the | :10:10. | :10:14. | |
same level, one third. It is reading between the lines as companies | :10:15. | :10:17. | |
reveal how they are faring stock companies like Diageo and the | :10:18. | :10:25. | |
American firms, some of them affected by the dollar. For a look | :10:26. | :10:36. | |
ahead today and what we can expect, we can go to the US. Microsoft | :10:37. | :10:47. | |
should impress and it is looking at how the strong dollar is affecting | :10:48. | :10:51. | |
revenue. The company has been more focused on its cloud business. | :10:52. | :10:57. | |
Amazon will look to beat expectations when it reports | :10:58. | :11:01. | |
fourth-quarter revenue. It is thought to have cornered 43% of | :11:02. | :11:04. | |
online sales in November and December and that combined with | :11:05. | :11:07. | |
strength in cloud computing should have led to strong growth. Ford | :11:08. | :11:12. | |
motor company is expected to announce record profits in 2015. The | :11:13. | :11:18. | |
US Congress department will release data on orders for US manufactured | :11:19. | :11:22. | |
goods which likely slipped in December because of the strong | :11:23. | :11:27. | |
dollar and fall in global demand. As far as financial markets are | :11:28. | :11:36. | |
concerned, in Asia we saw reaction to the Fed statement about interest | :11:37. | :11:39. | |
rates. But they are keeping a close eye on events before they make their | :11:40. | :11:46. | |
next choice on rates. We expect it to go up rather than down. | :11:47. | :11:51. | |
We are keeping an eye on UK GDP figures also today. We asked at the | :11:52. | :11:58. | |
start of the programme how much your personal information was worth, | :11:59. | :12:03. | |
relating to the fact Facebook said it makes $3 73 from each of us on | :12:04. | :12:08. | |
average from information we put on the site. Add that up and it comes | :12:09. | :12:15. | |
to a lot of money. Some comments. Never give correct details, says | :12:16. | :12:19. | |
Jerome Hurel. Protect your security data. Is he | :12:20. | :12:23. | |
really called to Rome?! If you are a product and you are | :12:24. | :12:29. | |
using it for free, you are the product and they are entitled to | :12:30. | :12:33. | |
make that money from you. Alistair says few people know how | :12:34. | :12:38. | |
Facebook generates their revenue, including HMRC. Perhaps like me the | :12:39. | :12:44. | |
best protest is to cancel our Facebook accounts, he says. | :12:45. | :12:47. | |
Another says, perhaps there should be an opt out where Facebook users | :12:48. | :12:53. | |
could pay $4 to opt out from that data being used. Other suggest stop | :12:54. | :12:57. | |
using it. Still to come. Monarch Airlines was | :12:58. | :13:07. | |
close to going under but the company has reinvented itself as a low-cost | :13:08. | :13:12. | |
carrier. That move is paying off. The chief executive will be hair. | :13:13. | :13:25. | |
Stay with us for that. We can bring you more detail now on the figures. | :13:26. | :13:34. | |
We are expecting to get a number of around double .4,. .5%, something | :13:35. | :13:39. | |
consistent with the economy growing at 2%. Not terrible and that not | :13:40. | :13:44. | |
relent. Let me show you where we have been. There is the Big Dipper, | :13:45. | :13:50. | |
the great recession. We have been hovering -- between 2% and 3% -- the | :13:51. | :14:01. | |
big decrease. Recently we have seen service sector is doing well but the | :14:02. | :14:08. | |
bit the government would like to stimulate, manufacturing, | :14:09. | :14:11. | |
construction, have been pretty weak. The march of the makers has not | :14:12. | :14:16. | |
materialised. Manufacture has been weak. Expects the oil price plunge | :14:17. | :14:21. | |
to affect the North Sea, which will have an impact on manufacturing. We | :14:22. | :14:25. | |
expect half a per cent but it will not be the headline number that is | :14:26. | :14:28. | |
interesting, it will be the way it is made up and it will show a | :14:29. | :14:34. | |
picture of a balanced, rebalanced economy. And the cocktail of risks | :14:35. | :14:43. | |
facing the economy, which the Chancellor highlighted. Those are | :14:44. | :14:47. | |
still ringing in the air is of many. -- in the ears. We have seen big | :14:48. | :14:56. | |
market falls and we have had volatile stock markets. Confidence | :14:57. | :15:00. | |
is not running at a high level. Perhaps people are not taking on an | :15:01. | :15:04. | |
extra person, not investing in an extra bit of equipment. At 2%, the | :15:05. | :15:09. | |
Chancellor will say we are hanging in there. He would like to see it | :15:10. | :15:15. | |
more balanced. It is easy to underestimate the effect the North | :15:16. | :15:19. | |
Sea house on the UK manufacturing economy, particularly in north-east | :15:20. | :15:22. | |
Scotland and North East England and I expect it to show up in the | :15:23. | :15:24. | |
numbers. David Cameron has is visiting | :15:25. | :15:37. | |
Aberdeen, this is a real issue for those parts of Scotland but for the | :15:38. | :15:43. | |
industry as a whole in the UK. Extra help is being demanded by the | :15:44. | :15:46. | |
authorities in Scotland when it comes to the help that can be given | :15:47. | :15:48. | |
to Aberdeen. You're watching Business | :15:49. | :15:56. | |
Live - our top story: The energy megamerger. There is | :15:57. | :16:09. | |
expected to be a $49 billion deal today. We will be watching the | :16:10. | :16:13. | |
details. Until then we are going to turn our attention to the airlines. | :16:14. | :16:18. | |
In 2014 - one of the UK's oldest airlines - Monarch - | :16:19. | :16:20. | |
looked like it was on the edge of collapse. | :16:21. | :16:23. | |
But after a rescue deal and more than a year of restructuring. | :16:24. | :16:25. | |
It says its underlying earnings for 2015 will be more | :16:26. | :16:28. | |
So how did the airline manage to turn itself around? | :16:29. | :16:31. | |
Its workers took large pay cuts - and 700 staff were made redundant. | :16:32. | :16:34. | |
It also restructured its routes, axing long-haul services - | :16:35. | :16:36. | |
and instead focusing on becoming a low-cost carrier. | :16:37. | :16:43. | |
With us is Andrew Swaffield, chief executive of Monarch Airlines | :16:44. | :16:46. | |
He has a lot to do with the changes. Thanks are coming on the show. Just | :16:47. | :17:02. | |
to say that when you took over, you were not aware of how bad things | :17:03. | :17:08. | |
were. That's right. I came in and aware of those issues, which turned | :17:09. | :17:16. | |
out to be helpful for me because I think that when you come to try to | :17:17. | :17:19. | |
restructure the company of that size, talking to the workforce, it | :17:20. | :17:26. | |
was helpful that I was nothing to do with the problem and I had not | :17:27. | :17:29. | |
actually been aware of it. We discovered it together. Talk me | :17:30. | :17:35. | |
through that moment you discovered things were quite so bad. What | :17:36. | :17:49. | |
happened? Escape! I had 20 years with British Airways and the parent | :17:50. | :17:55. | |
company. I was not used to being in an environment in that kind of | :17:56. | :18:04. | |
state. My first reaction was that this is going to be very difficult. | :18:05. | :18:16. | |
I was not the CEO at the time. I was number two. From a series of events | :18:17. | :18:30. | |
I was asked to take over. It was as much of an instinct decision as a | :18:31. | :18:35. | |
logical one. We have touched on some of the measures you had to take | :18:36. | :18:43. | |
which were not easy. We know what it is like when bosses try to reshape | :18:44. | :18:48. | |
airline companies. Unions are involved, strike action, problems | :18:49. | :18:53. | |
for the users of the airline, how did you go through that process in | :18:54. | :19:05. | |
such a way that the company came out like that? I think it was in such a | :19:06. | :19:14. | |
way that the owners had made it clear that they were not going to | :19:15. | :19:20. | |
continue owning it and no new owner would buy the company with the cost | :19:21. | :19:27. | |
base that it had. The lack of prospects and profitability. It was | :19:28. | :19:31. | |
about making that clear to the employees and the trade unions, and | :19:32. | :19:42. | |
the great thing about airlines is many of the implied he is our | :19:43. | :19:46. | |
professional. If you take pilots and engineers and cabin crew, they | :19:47. | :19:53. | |
understand if you explain it to them straightforward, they got the | :19:54. | :19:57. | |
message and be understood that the alternative was the company ceasing | :19:58. | :20:02. | |
to exist so they chose that. We spoke in the introduction about this | :20:03. | :20:07. | |
move away from what the company had been towards our low-cost model. | :20:08. | :20:12. | |
What was on that list when you said, these are the things that we've got | :20:13. | :20:21. | |
to cut. It was fairly straightforward to make the | :20:22. | :20:27. | |
decision. That is the future of European aviation. You can see it | :20:28. | :20:30. | |
with the growth of easyJet and Ryanair. The long haul operation | :20:31. | :20:35. | |
only had two Mac planes. It was not scalable. The charter operation was | :20:36. | :20:42. | |
dying. That business has been in decline for years. That was an easy | :20:43. | :20:46. | |
decision and it inspired a lot of other decisions behind it which | :20:47. | :20:51. | |
allowed us to build a new business plan. We are running out of time but | :20:52. | :20:55. | |
I want to ask you a question about being the boss of an airline, safety | :20:56. | :21:10. | |
is on the mind of everybody, tell us about that area of your job. I | :21:11. | :21:18. | |
understand in the industry there is incredible transparency and | :21:19. | :21:23. | |
collaboration between airlines. The aviation industry thrives on | :21:24. | :21:29. | |
openness and we have thorough investigations, and then the | :21:30. | :21:39. | |
industry gets safer. That happened after a previous incident and will | :21:40. | :21:43. | |
happen with the current threat. Aviation is very good at adapting, | :21:44. | :21:49. | |
so whether it is a port security or in the air, it will get safer. It | :21:50. | :21:55. | |
takes safety very seriously. That is one of the reasons why I love it | :21:56. | :22:00. | |
because it is a group of professionals. On that note we shall | :22:01. | :22:08. | |
end the interview. Thank you for coming in. | :22:09. | :22:11. | |
Diageo, the maker of Johhny Walker whisky and Smirnoff vodka says it | :22:12. | :22:13. | |
has increased its global sales, despite the slowdown in China. | :22:14. | :22:16. | |
Major bright spots include the high end market in Africa - | :22:17. | :22:19. | |
where premium brands saw sales surge 65 per cent. | :22:20. | :22:22. | |
Ivan Menezes is the chief executive of the drinks maker, | :22:23. | :22:27. | |
speaking a little earlier he gave us his take on. | :22:28. | :22:37. | |
China is not growing double-digit but it grew a very solid 4%. Africa | :22:38. | :22:46. | |
remains a good opportunity. We are used to volatility in emerging | :22:47. | :22:52. | |
markets, these underlying demographics and the trend towards | :22:53. | :22:57. | |
consumers and the middle-class drinking better, they are intact and | :22:58. | :23:01. | |
that bodes well for the company. We need to stay the course and handle | :23:02. | :23:06. | |
the volatility but I'm pleased that our emerging markets grew. We've got | :23:07. | :23:11. | |
some breaking news about the economy Minister of Japan, he has announced | :23:12. | :23:19. | |
his resignation at a press conference. A lot of attention on | :23:20. | :23:22. | |
Japan. The bank of Japan will be having a very important meeting at | :23:23. | :23:28. | |
the end of this week to decide on monetary policy. A lot of pressure | :23:29. | :23:32. | |
on the Japanese central bank to do more to stimulate the economy. That | :23:33. | :23:40. | |
has just occurred. That came as a surprise because they were hoping he | :23:41. | :23:49. | |
would go to New Zealand to sign a big trade deal. This relates to | :23:50. | :23:50. | |
Braves which he denies. Richard Jeffrey from | :23:51. | :23:59. | |
Cazenove Capital Management Talk with us about the other | :24:00. | :24:11. | |
stories. We are starting with tax. Google and apple have hit back. | :24:12. | :24:19. | |
Google settling with UK authorities and some said it was not as good as | :24:20. | :24:23. | |
it could have been, it is paying a lot more in Italy. This debate will | :24:24. | :24:30. | |
rumble on. I think it will. What we are beginning to see is some | :24:31. | :24:34. | |
international agreement that you cannot tackle these issues of big | :24:35. | :24:39. | |
corporations and where they pay their tax on a country by country | :24:40. | :24:44. | |
basis. It must be done amongst countries. There needs to be | :24:45. | :24:47. | |
agreement with America and the European Union in order to locate | :24:48. | :24:52. | |
where profits are made and insured they are taxed where they are made | :24:53. | :24:56. | |
rather than transferred to lower tax areas. It is quite a step forward. I | :24:57. | :25:02. | |
can imagine the likes of Margaret Hodge and others thinking we are | :25:03. | :25:06. | |
getting there. We are getting there, we are still quite a long way away | :25:07. | :25:10. | |
from where we want to be, but you've got to take the first steps, and | :25:11. | :25:16. | |
they are being taken. It is up to corporations to respond to this and | :25:17. | :25:20. | |
realise the environment is changing, people expect them to pay more | :25:21. | :25:26. | |
taxation. What we need now is a more transparent system so people can | :25:27. | :25:32. | |
quite clearly see where these companies are making profits and | :25:33. | :25:36. | |
where they are being taxed on these profits. Very nice to see you. Short | :25:37. | :25:40. | |
but sweet. That is all for now. | :25:41. | :25:47. |