:00:07. > :00:11.This is Business Live from BBC News with Sally Bundock and Alice Baxter.
:00:12. > :00:18.The enduring demand for the iPhone helps the technology giant defy it's
:00:19. > :00:43.Live from London, that's our top story on Wednesday 28th October.
:00:44. > :00:45.Apple's success story has been written by record demand in China -
:00:46. > :00:50.Also in the programme - where are the best places
:00:51. > :00:54.We'll tell you what the World Bank thinks - and some
:00:55. > :01:01.And it's a bumper day for corporate news and European trading is
:01:02. > :01:03.underway. We will tell you all you need to know, and the winners and
:01:04. > :01:06.losers. And we'll be getting the
:01:07. > :01:08.inside track on a girl's best friend - diamonds -
:01:09. > :01:11.from the chief executive of the Is the slowdown in China taking
:01:12. > :01:15.the sparkle out of the industry? Philippe Mellier will join us
:01:16. > :01:18.in the studio. Today we want to know do you need to
:01:19. > :01:21.have the latest gadget - How often do you update
:01:22. > :01:26.your smartphone or tablet? Let us know.
:01:27. > :01:44.Just use the hashtag BBCBizLive. A packed agenda today, let's get
:01:45. > :01:47.cracking. The world's largest tech giant is
:01:48. > :01:51.claiming its most successful year ever, after posting encouraging
:01:52. > :02:01.fourth quarter numbers. The company's revenue reached $51.5
:02:02. > :02:09.billion for the three months to September,
:02:10. > :02:11.up more than 20% It meant the company made a profit
:02:12. > :02:16.of over 11 billion dollars. It's thanks largely to strong iPhone
:02:17. > :02:18.sales - the firm sold more than 48 million
:02:19. > :02:21.of them in the last three months. And despite slowing economic growth
:02:22. > :02:24.in China, sales there have nearly doubled to over 12.5
:02:25. > :02:43.billion dollars - that's nearly I am joined by a technical analyst.
:02:44. > :02:50.Apple claiming 2015 to be its most successful year ever recorded,
:02:51. > :02:56.income of 11.1 billion US dollars. Incredible year in total, generating
:02:57. > :03:01.$234 billion in revenue over the last 12 months. The increase last
:03:02. > :03:05.year was more than the total revenue of 19 companies in the Fortune 500,
:03:06. > :03:11.showing the sheer scale of the Apple business at the moment. It's really
:03:12. > :03:16.about the iPhone. At its heart Apple remains a device manufacturer. It's
:03:17. > :03:19.a bit unfair but you could call it the iPhone company, the iPhone
:03:20. > :03:25.accounts for two thirds of its revenue. IPhone sales, selling more
:03:26. > :03:32.than 48 million in the last three months. Sales of the iPad are
:03:33. > :03:37.flagging. Yes, but it's a much less important product. The iPhone is
:03:38. > :03:42.what's the growth. But the iPad will not replace the iPhone in our hearts
:03:43. > :03:47.any time soon. Sales were down, so the company is hoping the new iPad
:03:48. > :03:52.professional launching next month will reinvigorate sales. Right now,
:03:53. > :03:57.I think we are swapping tablets for larger smartphones. Another small
:03:58. > :04:00.but high profile section of the business, we don't know how many
:04:01. > :04:06.Apple watches were sold in the quarter. In the raft of numbers,
:04:07. > :04:11.according to the Chief Executive, as much as 30% of iPhone buyers are
:04:12. > :04:17.Google android converts. The highest ever conversion rate. That's very
:04:18. > :04:23.important, the one question is, I will be iPhone business develop,
:04:24. > :04:32.with the iPhone seven coming out next year. -- how will the iPhone.
:04:33. > :04:39.Asking about China. We often feel Apple is quite US centric, but 62%
:04:40. > :04:43.of revenues generated outside the US with China accounting for a huge
:04:44. > :04:50.chunk of that despite concerns about the slowdown. It doesn't seem to
:04:51. > :04:55.have affected Apple. Sales of the iPhone up 120% year-on-year with
:04:56. > :04:59.overall sales doubling year-on-year, and they are opening more Apple
:05:00. > :05:05.stores. China market is looking very strong. Sales in China almost double
:05:06. > :05:12.what they took last year. Thank you for your analysis. Apple shares went
:05:13. > :05:16.up in half an hour's trade. Normally they go down. Not this time.
:05:17. > :05:19.And sticking with the tech theme - Twitter disappointed investors with
:05:20. > :05:24.Its revenues for the third quarter rose, but less than expected
:05:25. > :05:27.and the number of active users only grew by 3 million since June.
:05:28. > :05:29.This is Twitter's first earnings report with founder Jack Dorsey back
:05:30. > :05:32.at the helm as its permanent chief executive.
:05:33. > :05:36.Twitter shares lost as much as 11 percent in after market trading.
:05:37. > :05:39.China's online retailing giant AliBaba also reported its results
:05:40. > :05:53.The firm posted record revenues of almost $3.5 billion
:05:54. > :05:55.thanks to strong sales on mobile devices.
:05:56. > :05:57.The latest results pushed up its shares,
:05:58. > :06:02.Also numbers out from japanese carrier All Nippon Airways-six-month
:06:03. > :06:05.net profits soared 51 percent thanks to a big jump in its international
:06:06. > :06:07.business, strong inbound tourism and falling oil prices.
:06:08. > :06:09.ANA Holdings, the parent company of the airline said its profit
:06:10. > :06:15.in the April-September period was $448 million, while revenue rose
:06:16. > :06:32.Just to take you to the business live page, to flag up a few stories
:06:33. > :06:35.catching our eye. Volkswagen making lots of headlines. Registering its
:06:36. > :06:43.first quarterly loss in about 15 years. This is in reaction to the
:06:44. > :06:49.rigging of diesel emissions tests. The first quarterly deficit in 15
:06:50. > :06:52.years. Operating loss of just under 3.5 billion euros. That was walks
:06:53. > :06:58.like a's announcement about 15 minutes ago. Offering a pre-tax loss
:06:59. > :07:03.of around 2.5 billion euros. What's more on this, talking about that
:07:04. > :07:12.diesel scandal, as you mentioned, and then going down as well. We can
:07:13. > :07:20.see news from Barclays, giving their bosses a bumper pay package, making
:07:21. > :07:24.headlines again. Barclays will have a new Chief Executive of the
:07:25. > :07:31.Barclays group. A former chief executive at JP Morgan. Details on
:07:32. > :07:40.his pay deal. Results coming from Nintendo. We can go to Singapore.
:07:41. > :07:46.Sales are up but operating profit is not so good. Yes, we are seeing
:07:47. > :07:52.mixed results from the video gaming giant. Strong sales of its new super
:07:53. > :07:57.Mario game drove its revenue up nearly 20%. But net profit fell by
:07:58. > :08:02.nearly the same amount and was lower than market expectations. These
:08:03. > :08:08.earnings reflected the bumpy ride Nintendo has been on this year. In
:08:09. > :08:12.July the company lost its pioneering Chief Executive to cancer. He was
:08:13. > :08:17.leading the push for Nintendo to start making games for smartphones.
:08:18. > :08:20.That has hurt Nintendo in the past, the decision to ignore mobile
:08:21. > :08:24.devices and focus on gaming consoles. The company said little
:08:25. > :08:32.about its future in smartphone games today, but they confirmed a gaming
:08:33. > :08:36.app was scheduled to be released. Nintendo's numbers out, and it's a
:08:37. > :08:43.busy day for corporate news with Japan closing up by 0.67%. Hong Kong
:08:44. > :08:46.and Shanghai had a bad day. The stocks listed in Hong Kong for
:08:47. > :08:52.China, their biggest drop in a month. It's predicted Wall Street
:08:53. > :08:57.will be given a boost, given the news we had from Apple after the
:08:58. > :09:03.closing bell last night, and it could give a real boost to Wall
:09:04. > :09:06.Street when they open later. In Europe, we have mentioned
:09:07. > :09:16.Volkswagen, Barclays confirming a new boss taking over. We had numbers
:09:17. > :09:22.from Lloyds, BT and EE merging. As well as drinks giants merging. These
:09:23. > :09:26.markets are fairly flat. And the Federal reserve has its meeting
:09:27. > :09:32.today, its announcement of what interest rates will be. European and
:09:33. > :09:36.Asian markets are treading water in many ways ahead of news from the US
:09:37. > :09:45.Federal reserve. With more from the US. The central Bank of America
:09:46. > :09:50.wraps up its annual meeting with a statement at 2pm Eastern time. Few
:09:51. > :09:57.are expecting interest rates to go up, and it could be December, if not
:09:58. > :10:01.next year, before we get any move. Hilton worldwide reported its
:10:02. > :10:06.third-quarter earnings. The hotels have benefited from the US economic
:10:07. > :10:10.recovery. Rivals, Starwood hotels, making most of its money outside
:10:11. > :10:15.America, the strong dollar might be a drag for them. The results, a day
:10:16. > :10:20.after reports that at least three big Chinese companies are vying to
:10:21. > :10:27.buy the hotel chain. Don't forget to check out the make-up of Oreo
:10:28. > :10:35.cookies, as well as PayPal also reporting this Wednesday. Plenty of
:10:36. > :10:40.people reporting. Richard Dunbar, investment director at Aberdeen
:10:41. > :10:45.Asset Management is with us. A flurry of earnings. What has caught
:10:46. > :10:49.your eye. We are trying to see the aggregate, particularly of the US
:10:50. > :10:53.earnings, halfway through the third-quarter earnings results, a
:10:54. > :10:56.little bit better than expected, albeit expectations that had been
:10:57. > :11:02.downgraded. We are watching the banks closely to see what happens
:11:03. > :11:08.there. The tech companies are being watched closely. Some are good and
:11:09. > :11:13.bad. Microsoft and Google have been good, Twitter and others, less good.
:11:14. > :11:16.Same themes running through Europe and Asia. Trying to get a feel for
:11:17. > :11:19.what the corporate sector is thinking about what's going on
:11:20. > :11:24.throughout the world and what we have been talking about in the last
:11:25. > :11:27.few weeks and months. How do you think they are interpreting this,
:11:28. > :11:33.and are you with the majority expecting no news today? I think
:11:34. > :11:37.everybody expects no news today. The debate is whether we get the news in
:11:38. > :11:42.December or whether it is next year. The investors in the market, the
:11:43. > :11:48.consensus is that any rate rises in the US will be pushed into next
:11:49. > :11:53.year. Is that too late? She's reflecting a view on a very strong
:11:54. > :11:57.US economy, but also a view on a slightly weaker global economy. I
:11:58. > :12:00.think she's balancing those factors. If she was purely making the
:12:01. > :12:04.decision on the US, she would perhaps put interest rates up
:12:05. > :12:11.today, but she's taking a wider view, as the Fed is normally done.
:12:12. > :12:15.On the flurry of earnings, beverage firms will be in focus because
:12:16. > :12:25.Heineken reported strong sales growth in America and Europe. Sab
:12:26. > :12:32.Miller is not doing so well. These companies are focused on where they
:12:33. > :12:36.are doing business. Tech three Mac is focused on the e-mail urges.
:12:37. > :12:38.Mergers and acquisitions has been a huge element in the last three
:12:39. > :13:03.months. With Sab Miller and Inbev, they have
:13:04. > :13:08.more time to grapple with that merger. The original 5pm deadline
:13:09. > :13:14.today has been extended until 5pm on the 4th of November, more time to
:13:15. > :13:19.nail down at megamerger. Still to come, a real gem, we will be talking
:13:20. > :13:31.all things diamonds with a leader in the industry, the Chief Executive of
:13:32. > :13:35.De Beers in the studio. First we moved to Lloyds, Europe's second
:13:36. > :13:46.biggest bank by market value, and it has taken another 5.5 million pound
:13:47. > :13:50.charge. It takes its total bill to about ?13.9 billion, more than
:13:51. > :13:55.double any other bank. -- another ?5.5 billion charge. This is the
:13:56. > :14:02.second largest bank in the UK and three of them are reporting this
:14:03. > :14:05.week. Three of the top four. It's an interesting time to look at what is
:14:06. > :14:09.happening in the underlying economy cars banks are a good pre-emptive
:14:10. > :14:13.reflection of that in terms of the lending they are doing and therefore
:14:14. > :14:18.the underlying profits. It's not looking too bad for Lloyds. We had
:14:19. > :14:20.disappointing GDP figures from the UK yesterday, but the underlying
:14:21. > :14:29.growth of the economy is not too bad. What Lloyds had content with
:14:30. > :14:34.was the fact it had to put more aside by far than any other bank to
:14:35. > :14:41.deal with this PPI mis-selling. ?13.9 billion. But the total amount
:14:42. > :14:45.put aside was ?28 billion. It's shouldering quite a bit of the
:14:46. > :14:49.burden. The regulatory environment is a bit clearer now. The regulation
:14:50. > :14:54.of investment and retail banking within the bank, and the amount of
:14:55. > :15:00.capital a bank has to put aside. In the coming months we might see the
:15:01. > :15:03.ability to draw a line under the PPI scandal, and we might see a better
:15:04. > :15:09.reflection of how banking will fare in the future. The regulators hope
:15:10. > :15:12.it will be a lot more boring. Tell us about BT and EE. They are getting
:15:13. > :15:17.the thumbs up regarding their tie-up.
:15:18. > :15:24.It is worth saying BT has about 10 million customer, over 24 million
:15:25. > :15:27.for EE, they are operating in different parts of the market.
:15:28. > :15:30.Clearly the Competition and Markets Authority didn't think that
:15:31. > :15:35.broadband and mobile were going to converge to the degree it caused a
:15:36. > :15:40.competition problem, so it will be interesting and a big tie up. I
:15:41. > :15:47.forgot to tell you what happened with Lloyds. It has gone with the
:15:48. > :15:53.market. Quickly flag up this story trending on the BBC page, a quote
:15:54. > :16:01.from the BT chief executive, saying we are very pleased it has been
:16:02. > :16:07.The enduring demand for the iPhone helps the technology
:16:08. > :16:10.giant defy its sceptics with blockbuster results - with an extra
:16:11. > :16:17.And now let's get the inside track on the very sparkly
:16:18. > :16:20.subject of diamonds - with De Beers CEO Philippe Mellier.
:16:21. > :16:23.Founded in 1888, the De Beers group is a driving force in the diamond
:16:24. > :16:25.industry with activities in exploration, mining, retail, trading
:16:26. > :16:27.They're the largest supplier of diamonds onto
:16:28. > :16:31.the global market in the world by value and responsible for about 35%
:16:32. > :16:35.The company operates in 28 countries with mines in Botswana, Namibia,
:16:36. > :16:38.But all that glitters is not gold - or diamonds.
:16:39. > :16:41.Production fell 27% year on year to September and sales have fallen
:16:42. > :17:16.Philippe Mellier, chief executive of De Beers Group is here.
:17:17. > :17:27.Welcome. Thank you. I just want to take this back, because you joined
:17:28. > :17:31.De Beers as CEO five years ago, prior to that, looking through your
:17:32. > :17:35.CV you were a cars man, what attracted you to diamondses and what
:17:36. > :17:40.attracted diamonds to you? And train, also, I was selling trains. I
:17:41. > :17:44.was head hunted by the family at that time. They were looking for
:17:45. > :17:49.somebody without any diamond knowledge, because all the CEOs
:17:50. > :17:53.before me were coming from debeer, mostly South African and we are
:17:54. > :17:57.living in an era where De Beers was very strong, was the only player in
:17:58. > :18:03.the world of diamonds. Now, we are only 35% of the market, we are the
:18:04. > :18:07.leader, and we are opening the company to competition. Not only
:18:08. > :18:11.from our competitors from Russia and elsewhere but competition from other
:18:12. > :18:14.luxury goods. It was important to position the company and to do a
:18:15. > :18:18.little bit of a rebirth of company for the future, so that we can be
:18:19. > :18:24.the leader for the next 100 years. Was it a steep learning curve for
:18:25. > :18:30.you? Oh yes it was. I could bring some management skills coming from
:18:31. > :18:33.a, having run big global companies before, I was pretty aware of
:18:34. > :18:37.Government relations which is very important, because I have a
:18:38. > :18:42.government on my board, but I didn't know diamonds. My wife knew quite a
:18:43. > :18:47.bit about it! I had to learn, and I think today I am OK. I want to ask
:18:48. > :18:50.you about some of the initiatives you have brought in. One that
:18:51. > :18:54.interests me, the mine to demand ethos, talk me through that It is
:18:55. > :18:59.very important. It's a luxury product. We mine to deMonday and,
:19:00. > :19:05.and this is something -- demind, it is something we thought could be
:19:06. > :19:09.possible but in the mining world we have huge investment it is difficult
:19:10. > :19:14.to adapt. Since I arrived we have put in place in the mine, that is
:19:15. > :19:19.very technical ways of scaling down the production when there is, the
:19:20. > :19:24.demand is softening, we have what we call tailing plants we are can
:19:25. > :19:30.process material that has been mined before. We can switch them on or
:19:31. > :19:35.off. We have our own 30% flexibility in mines today. We can cope with any
:19:36. > :19:39.demand. That is flexibility, that is key to success now with, you know,
:19:40. > :19:45.the modty markets in the state they are in, many -- commodity. Many
:19:46. > :19:48.competitors in mining, they are battling and being able to be
:19:49. > :19:53.flexible is not something they can do. Depending on what they are
:19:54. > :19:58.getting out of the ground. We are a mining company but not... We are not
:19:59. > :20:02.comparing apples with apples We are consumer driven. Any type of
:20:03. > :20:05.consumer driven company you have to adapt what you produce, manufacture
:20:06. > :20:09.with the demand. This is what we are trying to do, in a mining company
:20:10. > :20:13.which is a bit of a special world. We are getting there. Are you
:20:14. > :20:16.worried about what is happening in the commodities market at the
:20:17. > :20:22.moment? Of course, there is the slow down in China that we talk a lot
:20:23. > :20:25.about, but also, there is becoming an increasing scarcity of diamonds
:20:26. > :20:30.in the world. You and another company are if a real race to try
:20:31. > :20:36.and find new diamond fields to explore, you are using technology, I
:20:37. > :20:41.have been reading reports we saw a strong performance in 2014. They
:20:42. > :20:45.think diamond sales will peak in 2017 but then they might drop off a
:20:46. > :20:49.cliff No new mines have been found in the last 20 year, we are looking
:20:50. > :20:54.for the next big mine. Some small ones have been found but not big
:20:55. > :21:01.ones. The largest was in 1995. In Canada Yes, it was one of our mine,
:21:02. > :21:08.so, since then, we are working with existing mines, so at constant rate
:21:09. > :21:13.of production, after a window of three years we will see the
:21:14. > :21:19.production going down, we are o lucky because De Beers have a long
:21:20. > :21:22.life, most of them, but it is a bit worrying yes. Unfortunately we are
:21:23. > :21:27.running out of time. I have one question for you, you are French,
:21:28. > :21:31.you operate with debeer, of course, which is heavily involved in South
:21:32. > :21:35.Africa and Canada, who did you support during the rugby World Cup?
:21:36. > :21:39.I lost the French team quickly. I was fully behind the South African
:21:40. > :21:44.team. You were behind the Springboks. Yes. Thank you so up
:21:45. > :21:46.many for coming in. It has been a fascinating conversation. Many
:21:47. > :21:50.We'll be talking to Brian Duffy, chief executive of Aurum Holdings,
:21:51. > :21:52.which runs Watches of Switzerland stores.
:21:53. > :21:55.So who's buying expensive wrist pieces and is this the best time
:21:56. > :22:15.Here's a reminder of how to get in touch with us.
:22:16. > :22:21.The Ben page is where you can they ahead. We will keep you up-to-date
:22:22. > :22:25.with the latest detail, with insight and analysis from the BBC's team of
:22:26. > :22:30.editors right round the world. We want to hear from you too. Get
:22:31. > :22:37.involved on the BBC business live web page.
:22:38. > :22:43.Or on Twitter. You can find us on Facebook as well.
:22:44. > :22:49.Business Live on TV and online whenever you need to know.
:22:50. > :22:57.Some of you have been getting in touch. This has come from Twitter. I
:22:58. > :23:02.have had a message from Sebastian, this was in response to our question
:23:03. > :23:08.where we asked you how much of a tech addict or Luddite you are. Do
:23:09. > :23:12.you have to have the latest update? Sebastian said utility work, if it
:23:13. > :23:19.does what I want it to do and I am a heavy phone user that is great for
:23:20. > :23:25.me. I use a Samsung A5. Richard, are you a technology dinosaur, where are
:23:26. > :23:29.you? I am at the dinosaur spectrum. Is your mobile phone this big? I am
:23:30. > :23:34.happy with what I have got. Is Let us look at some of the other
:23:35. > :23:39.stories. Is This caught our eye. So looking at the gulf news at the
:23:40. > :23:43.economy section. Is World Bank has brought out this list, ranging the
:23:44. > :23:50.best places in the world to do business. On the overall list,
:23:51. > :23:54.Singapore scored number one, but this article looking at particularly
:23:55. > :24:01.in this region, the Middle East and North Africa has done badly. It, the
:24:02. > :24:06.UAE scored highly They are looking at things like title to assets,
:24:07. > :24:11.these areas that make it easy or difficult to do business. The UAE
:24:12. > :24:15.does well. The Middle East as a whole doesn't do as well as they
:24:16. > :24:20.would like. I would suggest given the travails in that part of world,
:24:21. > :24:27.both politically and economically, with the falling oil prices... The
:24:28. > :24:30.UK came sixth. So that is not bad. Above the US and. And Germany.
:24:31. > :24:35.George Osborne will be interested about that. Some much-needed good
:24:36. > :24:39.news for him. Let us look at the Wall Street Journal. This is
:24:40. > :24:43.interesting. So Facebook, in recognition of the fact that a huge
:24:44. > :24:48.proportion of their business lies in emerging markets, where most of the
:24:49. > :24:53.people they have to rely on 2 G connections. It is making its
:24:54. > :24:59.employees work with 2 G internet. For an hour. To quote this article,
:25:00. > :25:04.using 2 G is so onerous they couldn't subject it on their
:25:05. > :25:08.employees for any longer. I suspect some of their developed world
:25:09. > :25:11.customers have to put up with that performance, so maybe they are doing
:25:12. > :25:16.it more for their total customer base. It is interesting firms like
:25:17. > :25:19.that can be miles ahead of their, the bulk of their consumers and that
:25:20. > :25:23.is what they are saying. Most of growth will be in the developing
:25:24. > :25:26.world and they don't have the access to the speedy technology we
:25:27. > :25:31.allegedly do. Quickly Richard, we have about 20
:25:32. > :25:36.second, BP is in all the paper, we have a lot of oil giants coming,
:25:37. > :25:40.there is a real theme there Poor results not surprisingly giving the
:25:41. > :25:44.halving of the oil price. We will see more of that as the results run
:25:45. > :25:49.through this sector. We will have to leave it there.