26/04/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson and Sally Bundock.


BP slumps to a loss of almost 500-million dollars for the first


It's blamed the collapse in oil prices.


Live from London, that's our top story today, Tuesday


The tumbling price of oil and ongoing costs of the Gulf


of Mexico spill takes its toll on giant BP but shares are headed


Also in the programme....Three US tech giants reveal how much money


they've been making - we'll be looking at the little blue


bird and why it's facing some serious headwinds.


Mozilla's Firefox goes head to head with Microsoft and Google -


but can it ever stand out in the crowd?


The boss of Mozilla will be here to tell us why and OPEN


And as Twitter prepares to unveil its latest


In the last hour or so BP has reported its first quarter


results and they don't make for pretty reading.


The tumbling oil price has taken its toll on energy


companies around the world - and BP is no exception.


The group reported a replacement cost loss of $485 million -


but when you take into account some adjustments the figure comes


in as a surprise profit of just over half a million dollars.


This was better than expected and BP shares opened higher this morning.


Still the year before the company reported a profit of more


And the massive fall in profits were caused, in part,


by costs relating to BP's oil spill in the Gulf of Mexico.


The Macondo blowout occurred 6 years ago, but still continues to affect


the business' performance in first three months of the year,


Shareholders haven't had an easy ride.


Since their peak in 2014, the value of the company has slumped 30%.


Investors have been so dismayed at the company's performance


that they voted against Chief Executive Bob Dudley's


proposed pay rise earlier this month.


Explain this to us? First of all, The oil price has fallen, that is


the main reason for the loss. There's also the money that they've


had to accrue for the spill. That explains the difference, the


non-accounting issues that are not appearing in the profit and loss,


they are not related to the oil price that account for the profit.


This really is the raw end of what we have heard so much about, the


persistently falling oil price that seems to be going nowhere fast. We


have seen BP and Shell cutting production, exploration and R D to


try to balance the books in this era? That is one of the reasons why


BP is in a better position. They have got rid of their worse


operations, so they are quite well placed, they are quite lean and


efficient. Once they have drawn a line under the well spill, which the


recent consent decree suggests they may well be able to do that in the


near future, then they can move forward. That is why they were able


the maintain the dividend at 10 cents. They lost a lot less on an


ongoing basis. Things are improving for them. The oil price is rising.


The IAEA is of the opinion that the huge oversupply not that long ago,


six million barrels a day, it's now about one-and-a-half, so we are


moving back into balance. A word on that strategy because Bob Dudley,


the Chief Executive, talking this morning about the challenging


environment, saying we are driving towards our near term goal of


rebalancing BP's cash flows and it's exactly that, rebalancing in this


era. Things were very different a couple of years ago? The oil price


was then seemingly on a relentless march north and really it collapsed


mainly due to shale production. The US jumped from being the third


producer to the largest producer in the world. That was entirely due to


shale production in places like Texaco and North Dakota. The oil


price crashed to below the cost of production in these places so people


aren't sinking new wells in Texas and North Dakota so the US


production is starting to roll over the wells that were sunk a couple of


years ago and no longer being sunk and the oil price is rising. Thank


you very much for explaining all of that.


Apple is about to report its earnings later on Tuesday -


with investors closely watching out for its latest sales numbers.


The last time the company put out its financial results it warned


we could see the first-ever decline in iPhone sales in 2016.


China has been a major growth area for the company.


of Justice has approved Charter Communications purchase


of cable operators Time Warner Cable and Bright House networks.


The deal will create the second largest cable broadband provider


Charter had to agree to not stop its content providers


from separately selling shows online, as part of the approval.


This is the point where we take a look at the Business Live page,


dominated by BP this morning but also many other stories. British


American tobacco always in the Spotlight, always a controversial


one, it tells us cigarette sales grew by %, it's interesting if you


look at where they increased. The company always looking for new


markets around the world, it seems it's found them. Grew by %.


contract has been announced in the last few hours.


Lets take you to our Asia Business Hub in Singapore,


Tim McDonald is following this for us.


Malcolm Turnbull described this as a momentum endeavour. It has a price


to match, it will make it one of the biggest projects. The winner is a


French firm, DCNS, it will build subs like the Barracuda. There'll be


12 in all and the contract covers upkeep. The project will create


about 2800 jobs in Adelaide where it will be built. Japan had been a


front runner in the contest and has called the decision regrettable and


is seeking an explanation from the Australian government and a separate


German bid also missed out on that. Let us have a look at the markets


around the world. We have got the Federal Reserve


having its monthly meeting as the Central Bank decides on the cost of


borrowing, also the Bank of Japan. Many markets are risk averse,


treading water ahead of the Central Bank meetings. Let's look at Europe.


We have mentioned lots of earning stories out that do affect the


markets. BP shares higher, helping the FTSE 100, a big weighting on the


London Stock Exchange. Results out from Whitbread better than expected.


It will be a real day for results and corn rat numbers because we are


going to hear from Apple and also Twitter, its first quarter earnings


are coming out as well after the market close in the US. Shares in


the company are down some 66% from the peak. So what has Jack got


planned for the company now, can he revive the little blue bird?


Michelle has more from New York. We can't stop sharing. Just stop and


think how many times a day do you check and interact on social media


sites? Why isn't Twitter more popular? What's the problem? I've


got a few different social media platforms that I use and I


personally don't find a great need for Twitter. Do you use it? No. It


appeals to a younger audience and Facebook is more user friendly for


people who are more accustomed to being online. Brevity is key to its


appeal, June like Facebook, blogs are limited to 140 characters. The


number of people using it has grown over the past four years, but as you


can see from this graph, the pace of that growth is decelerating,


grinding to a halt last quarter. A far cry from when the stock first


took flight in November 2013. It's now 35% below the $26 a share it


commanded on that first trading day. Twitter went out to Wall Street in


2013 and said we are going to be this size. It's told advertisers, we


are going to be this size and reach this many people. It's not just a


matter of Wall Street getting it, advertisers at some point are going


to say, wait a minute, if we want to reach a lot of people, we are going


to go to Google, Facebook, we don't need to go to Twitter. Could the NFL


save Twitter? It will screen ten National League games this season on


Thursday nights, extending its content beyond the posts of


journalists, politicians and celebrities. Twitter's core users


are loyal and vocal. The problem for Wall Street is, there aren't enough


of them. And, with its share price doing poorly, some investors may


unfollow the micro-bloging site if it fails to grow its user base.


Joining us is Nick Hungerford, CEO of Nutmeg Investment Management.


What are we expecting from Apple? This could be the first quarter in


51 quarters that we see declining revenues from Apple. That will be an


absolute disaster for Tim Cook, not in terms of analyst expectations but


in terms of the reputation. He hasn't seen a decline in quarter


since he's been at the helm of the company. Why is that? You have the


problems they have with the i watch which hasn't taken over really as


the big new gadget. You have issues in China where the iPhone was meant


to be expanding sales and it was going to be the great hope for


Apple. They have been a bit slower than expected. I don't know the


numbers off the top of my head, but the amount of money they make each


quarter, it's a big number isn't it? Yes. If it comes down a bit... They


are not losing sleep over this are they do you think or are they? It's


a shame for Apple in terms of, you see their star somewhat waning and


other tech companies, maybe not Twitter, but Facebook especially


taking on that mantle of perhaps being Silicon Valley's favourite son


and that is a shame for Apple. From all the excitement of tech which we


all enjoy talking about, let's talk Central Banks. The Are you not


excited by that? No! In a word, no. We have got the Bank of Japan and


the Federal Reserve in the US talking about interest rates. The


Federal Reserve has been forecasting and tipping us off that interest


rates are going to rise probably twice this year, although they have


speculated it might be up to four times. So if they are going to do


something, they need to move this month which is very unlikely, or


they need to signal that they are going to move in June which is


probably more likely. The Bank of Japan will take their lead from


that, but they are in negative interest, their currency is


appreciating when they want it to depreciate. We should send you to


Washington! You could be on Fed Watch? I've spent many an hour stood


there, I have to say, that is probably why!


Mozilla's Firefox used to go head-to-head with


Microsoft's Internet Explorer in the battle of the web browsers.


Now, thanks to the rise of Google Chrome, Mozilla has been


We'll speak to the company's Executive Chairwoman,


Mitchell Baker, about the future of Firefox.


You're with Business Live from BBC News.


Costa Coffee and Premier Inn, says full year profits rose


Coffee chain Costa saw Like for like sales up 2.9%


and the hotel business saw a rise of 4.2% on the same time last year.


Chief Executive Alison Brittain says she's "confident of making good


As well as announcing a great set of results with sales up 12% which is


lovely, I'm also talking about the growth strategy for the business and


I am going to confirm today that we will continue to grow out to 2020,


we are looking at 20,000 more respects for the hotel business and


the best part of ?1 billion for Costa. To do that, we are going to


have to do things differently, grow and innovate in our UK business. We


are going to have to focus our strengths on growth in the


international business and we are going to have to put some


infrastructure in and capability that will help us be efficient and


productive. Clearly Costa is a big growth area four-year. In China you


have big expansion plans. China is a good long-term opportunity. We have


put in place a good local team building the brand, voting in local


food and Logistics and Supply. Which is what you have to do when you are


overseas will stop we already have 380 stores there, we plant on having


700 in the near term. We have to leave it there.


Alison Brittain, the Chief Executive of Whitbread.


If you need any more details about the results being announced today,


go to our page on the BBC website. To prove it is live, there is our


interview of a few moments ago. A busy morning for corporate results.


BP dominating things. Also the story of ScottishPower, paying a fine,


pledging and apologising for leaving customers out of pocket as a result


of an ID upgrade. Cobham's shares crashed.


You're watching Business Live - our top story...


BP's numbers falling as it grapples with a much lower oil price, and the


costs of the oil disaster mounting up this year. On top of all that,


that slump in the price of oil hitting them. Two Isco, three is a


crowd. -- two is company. Can we trust the tech companies


with our personal data that we readily hand over?Mitchell


Baker is a Silicon Valley pioneer, and boss of


the not-for-profit company Mozilla. It's best known for its


Firefox web browser. But its a tiny player


in the land of giants. It has just 4% of the market,


compared to Google's Chrome browser which takes a quarter of the market


and Microsoft's 39%.But that hasn't stopped Mitchell Baker pushing


for a more open, sharing web, rather than one driven


by corporations and profits. It is a tough market we are


fundamentally different, we are not-for-profit organisation trying


to build openness and freedom. And understanding in opportunity into


life. We worked differently. Hopefully if you are using our


product and you love it, you are not always noticing that. The values and


the reason Mozilla exists shows in our product. I wanted to ask you


about the concept of the open web. It is an important one. It touches


on many things, differentiating you from your rivals. Can you tell us


about that? It is the idea that the web belongs to all of us. If you are


a business, you can build a business on the web without needing to go to


one company given you permission or one government. The open Web is the


idea that we as citizens have a piece of the web, and the Internet


or the network, the path we call the web is important, not just because


of an economic engine, it is important for citizens and the


technology should reflect those things. It was news to me today that


Mozilla Firefox is a non-for profit making organisation. I assumed it


was like its rivals. Functioning in the same way. How do you operate in


that way and stay in the game? The likes of Google making enormous


amounts of money, ploughing it back in, making the user experience


better and better. How do you stay in the game if you're not making a


profit? We are hybrid organisation. Part of being nonprofit means there


is a global network of people who assist us. We have a core of


employees, a large number of volunteers around the world who are


important. On the business side we try to do something similar. Not try


to make ourselves the centre of the world. Trying to build a platform


where partners, businesses work with a level playing field. How do you


struggle to get people on board? People investing, advertising?


Actually, the philosophy draws people. People sometimes ask, hiring


in silicon valley is hard, can you hire anyone? We hire great talent.


Great technology, the mission and the impact and influence. Because of


our goals, we're not trying to be the most popular, common, to have


the most users to make the most money. We are trying to have people


interested in security to meet user experience we provide, enough


involvement in marketing and mind share to change the industry. We


have been quite effective in that. A big part of what you do is


discussion over privacy and data protection over the Internet I am


interested in that row between the FBI and Apple. Apple refusing the


FBI access to the iPhone of terrorists. Where do you stand on


that? First of all, I want to reframe it. It is often framed by


privacy against security. Our belief is it is wrong. It is all about


security. The encryption on your phone, you're all my ability to keep


my financial information or location information away from other people


is a security issue. We think it is all a security issue, personal


security, national security. We are trading off one former security for


another. In our physical lives we are used to trading security for


convenience. My security for my kids' security. The security for


each one of us is fundamental. Our own ability both as citizens and


consumers, if your business is insecure you cannot function in the


same way. If we begin dismantling security across-the-board we will


all suffer in ways we don't understand. Particularly, more and


more data is growing. Everything will be transmitting data. Security


is very fundamental. Really lovely to speak to you. Thank you for


explaining that. Nice to have you on the programme. Some breaking news


about Mitsubishi motors. Admitting to using improper fuel tests since


1991. This has been taking place at a news conference in Tokyo. They say


they will set up a special committee made up of external experts to


investigate the fuel economy manipulation issue. A lot going on


there. Since 1991 this falsification has been ongoing. We not expecting


in earnings forecasts from Mitsubishi even though it was


scheduled. They are not sure there which states will have an impact for


them -- in which stage will have an effect on their results. Admitting


improper fuel tests since 1991, huge implications for the business. I


would imagine that will be our top story tomorrow.


What other business stories has the media been


The first ten stories were about BHS. You have even got to that. We


should mention it. Viewers around the world, it is a big retailer in


the UK. A mainstay of the high street for so long. Perhaps no more


in administration. The two previous owners of BHS, the current owner and


the previous owner, Sir Philip Green are getting a lot of stick for this.


This is a global issue, not just the British one. The gap that has been


created in the BHS pension fund, over ?500 million. There will be a


lot back to see whether or not any impropriety has taken place over the


last decade or so in filling that fund. This is a problem affecting so


many people. Let's squeeze in one more. Parroting no one hates their


job any more? I assume you don't, you are the boss? It is tough if I


did. A US survey, 80% of people enjoy and are satisfied by their


job. The real inspiration, why you like your job, not necessarily your


pay, it is the respect other people give you. That is the conclusion in


the report? The most important thing in that report. It strikes me that


the bosses have come up with that, it is not the pay! It does help.


There will be more business news throughout the day


on the BBC Live webpage and on World Business ReportWe'll


Very unseasonable, the weather at the moment. Basically another day of


sunshine and showers. That is not the full picture. Turning


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