25/07/2016 BBC Business Live

This is Business Live from BBC News with Ben Thompson

It's flying high, but are there be headwinds on the horizon?

Ryanjet says profits are up,

but warns of more Brexit uncertainty.

Live from London, that's our top story on the 25th July.

Ryanair releases their latest results, but the shadow of Brexit

looms large over their plans for the future.

We'll be speaking to the company's top man money man in just a moment.

Also in the programme, what goes up, must come down.

Shares in Nintendo, the company behind Pokemon GO tumbles in Tokyo,

we're going to find out why investors have cooled on last week's

This is what the markets are doing this morning. Optimism on the

European markets, after a good session last week. In Asia and the

US. We have the details. Augmented reality technology has

already swept the globe thanks to the smash-hit smartphone game

Pokemon Go. So we'll get the Inside Track on how

real-time imaging is revolutionising And as one of the UK's

biggest newspapers slumps to a record loss of ?180m,

we want to know, do Let us know, just use

the hashtag #BBCBizLive. It's a good job it's written in

about five places on the screen. The world's second largest budget

airline, Ryanair says the UK's decision to leave the EU means

that it will "pivot" growth away from the country's airports

and instead focus on growing The company made the comments as it

announced its latest numbers, a modest a 4% rise in profits

for the first quarter of the financial year,

bringing in Euro 256 million, But the company insists that it's

on track for its best ever year despite the uncertainty surrounding

the Uk's vote to leave the European Union, but warned

there could be further implications if the UK is unable

to negotiate access The referendum result has seen

a 10% drop in the value Although Ryanair is an Irish

airline, it still makes a lot of its money

in pounds and they just aren't worth It's not just the exchange rate

that's been affected British airlines still benefit

from the EU's single aviation market, giving them

unrestricted access to cities The referendum could potentially

make it more difficult for companies like Ryanair to fly to Europe

from its London-based airports. Neil Sorahan, Ryanair's Chief

Financial Officer, joins us now. The big-money man. Good to have you

with us. How are you? I am fine. I will let you do some positive at the

beginning, some have been telling us this morning, and I know for a fact,

Ryanair have a fairly decent, flexible model. The beauty is that

if you have a downturn in one area, you can up sticks, move those planes

to another area that is doing relatively better, right? Yeah, we

operate in 33 different country with just over 350 aircraft in the fleet.

The beauty of the model is that we have a low-cost model, more airports

searching for our business and aircraft available. We have a lot of

flexibility built into the model. There is the positive, flexible

business model. I am not too sure how flexible it is going to be when

the UK is out of the EU. Something like almost 40% of your flights, I

can imagine close to nearly half of your revenue, involves flights in

and out of the UK. I would correct you, 28% of our revenue, 21% of our

cause offsetting that. It is not as big a financial impact. 28%. Let's

rounded up, 30%, that is a big chunk. Almost 40% of your flights,

not your revenue but 40% of your flights in and out of the UK, that

will be a bit tricky once the UK is out of the EU. No, if you look at

it, Aaron, if they leave the EU and they have two negotiate bilaterals

with the EU negotiation to travel rights, what would be impacted would

be three domestic routes in the UK stopped 1800 routes in the entire

network in three of those would be under question. At that stage we

would have to decide whether we keep them operating or not or whether we

would just get a UK air operated certificate. In the context of 1800

routes the network, not hugely significant. UK-based airlines, it

does become a bigger issue for them. In as far as a lot of their traffic

would be into the EU. Unless the correct bilaterals are put in place,

to makes it difficult for them to travel around in Europe. What I am

interested in is this concept of pivoting away as we talked about

earlier. What it means on the ground. Does it mean less investment

in the UK? Yes, as we take delivery of 52 aircraft, they are issuing

another 50 next year. The growth rate we would have planned for the

UK will lowdown, somewhat. This winter, we will start moving some

capacity out of Stansted. We are already a couple of years ahead of

our long-term deal with them. While we don't plan to close any routes

this winter, we will reduce frequencies on a number of different

routes out of Stansted over the winter. Future growth and future

revenue growth, bottoms on seats, it is a good number. Other airlines

would like it. 95%. That makes it very difficult to grow, you don't

have more seats on the plains to sell. Where do you look at growing

future revenue? We have a lot of opportunities around Europe. As you

said, we have an eye watering load factor, 95% on aircraft in the last

quarter. We will consider new to see those load factors being maintained

throughout the year, 93% load factor for the year. 2019, we start taking

delivery of the Boeing 737, the game changes, as we call them, 4% more

capacity, eight extra seats. We can spread our cost of a more passengers

and enhance ancillary opportunities. No short places to grow around here.

We appreciate your time, thank you very much for joining us. We will

talk to you sometime soon. Bank you. Reports say US telecoms giant

Verizon is to buy Yahoo's search and advertising operations

for $5 billion. Yahoo announced in February

it was looking at "strategic alternatives" for its core internet

business, but Verizon has declined A formal announcement is expected

later today before US markets open China's Huawei has reported a

40% jump in first half sales and says it's confident the growth

will continue in the The telecoms equipment maker is also

China's biggest smartphone maker. But, the company is currently

being sued by rival Samsung, which accuses it of

copying its designs. Who isn't suing everybody in that

industry? You said it so well. European Commission President

Jean-Claude Juncker has poured cold water on any ideas of a quick

accession of Turkey to the EU. Speaking earlier on French

television, Juncker said that Turkey is in no situation to become

a member of the EU any time soon. He added a stern warning,

saying that if Turkey re-introduced the death penalty,

accession talks would be halted Shares in Nintendo have fallen

sharply after the Japanese gaming giant said Pokemon Go's success

would have a limited impact At one point it was down 18% in

Tokyo. Our Business Correspondent, Tim

McDonald is in Singapore with more. I'm getting caught under the desk.

But to see you. I don't know if they had to make this statement, we had

to say. Did they not think this has got legs to carry it further? It's

not a matter of Pokemon not being a huge global hit and phenomenon, it

is the investors worried they won't see much money from it. Nintendo

itself is a bit more removed from Pokemon and perhaps many investors

realise. The game is a collaboration between the Pokemon company which

owns the licensing rights, it is Pickachu and the US game studio with

Nintendo holding it states in those companies. Nintendo reports its

first quarter is this week and says the game will not have that much of

an impact. Investors are not happy. Nintendo stocks plummeted almost 18%

in trading today. Lowest since 1990. It needs to be kept in perspective.

Even with today's sell-off, the shares are still up about 60% in the

game launched in the US, Australia and New Zealand on July sixth. Thank

you. It's my favourite joke, how would you get Pikachu on a bus? You

Pokemon. Japan's Nikkei paring back its early

gains and ended flat at the start of the week as investors cashed

in with abit of profit taking. That is why the numbers in Asia are

down slightly. Hopes that the Bank of Japan

will unveil more stimulus later this week also boosted the numbers

earlier this week. For markets in Europe,

they're coming off four consecutive weeks of decent gains,

largely driven by the expectation that interest rates are likely

to stay lower for longer. Economic data has been

better than expected in the last couple of weeks,

despite some worries, We'll talk more about that

in a moment, but here's Michelle with the details about the day

ahead on Wall Street. Prepare for an action-packed week,

Wall Street gets a peek at the growth in the second quarter,

where GDP figures are released this With the US economy showing signs

of improvement, after a weak start to the year, will America's

central bank raise interest rates? The Federal Reserve announces

its decision on Wednesday. Most investors consider a rate hike

unlikely at this time. This Monday, chip-maker

Texas Instruments report The recent drop in

iPhone sales could put We will hear more from

the tech sector this week when big names such as Apple,

Facebook and Amazon, among others, Joining us now is Brenda Kelly,

an independent market analyst. A familiar face and our friend.

Great to have you with us. The big central bank seen again, it

continues will stop American central bank meeting this week. Expectations

will it do something? Also, bank of Japan, is it going to... I don't

know, more stimulus? Negative interest rates already in Japan,

despite the fact that you have Corroda lined negative interest

rates were possible three days before invoking them. At this

particular point it is hard to know what the bank of Japan can do.

Helicopter money is one of those areas that has been banded around

for a while. It has never been tested, he has denied it is a

possibility but loss of credibility in respect of other monetary policy

decisions in the past, it could happen. For the time being, Japan's

exports were a bit better than were expected in terms of the fall but

they have fallen for nine consecutive month in a row. Strong

currency we have seen as a result of the risk of in equity markets has

led to a strong yen. It did not help exports. Nine consecutive months in

April of declining exports in Japan, something will need to happen.

Indeed. It will, I should say. We will have to leave it there. Time is

short but you will take us through the newspapers. Helicopter money is

the bank of Japan injecting money into people's personal bank

accounts. These phrases we learnt in the course of this job. We will keep

you up-to-date. Still to come,

we'll take a closer look at the future for

augmented-reality technology. We'll be speaking to the co-founder

of a business which hopes to revolutionise the way we search

for information online. You're with Business

Live from BBC News. And now a look at some

of the stories from around the UK. MPs who've examined

the collapse of BHS have called its former owner,

Sir Philip Green, the "unacceptable

face of capitalism". A joint report by the Business

and Work and Pensions committees accuses Sir Philip of making

"incredible wealth on the back of BHS",

and in doing so reducing its ability Our Economics Correspondent

Andrew Walker joins me now They can say all of that, but can

they do anything about it? I didn't hear you. They can say all of

this... Accusations against Philip green, but can they do anything? Can

they claw back money, can he lose his knighthood? They can certainly

make life very uncomfortable for him, do a great deal of damage to

his reputation but they have very limited powers. But they can put a

certain amount of moral pressure, if you like, on authorities that do

have some powers. You mentioned his knighthood, that, we know, is under

review. The decision on whether or not it should read stripped from him

is one that is basically a recommendation that can be made by a

committee of very senior civil servants.

It would then be sent on by the Prime Minister to the Queen, who

makes the final decision on whether that would happen. It certainly has

been, something that has been done on a number of occasions in the

past. Fred Goodwin, former chief executive of RBS was one example,

but then he was seen by some people as a central player in the near

collapse of the British financial system. Other examples have tended

to be people convicted of criminal offences, but that is undoubtably an

option for the government to consider and I think the strong

language of this report does, I suppose, pushed them a little bit

further in that direction. OK, good stuff. Andrew, thank you as always.

All the data and information we are getting through from those BHS

comments are on the business live pages. That damning report by MPs

and the collapse of BHS. The important thing at the moment is the

staff involved who are not just currently working there, but their

pensions. Thousands of pensioners with their money saved in BHS, what

future for them? There is a black hole of ?570 million was that many

employees with an uncertain future. You're watching Business Live.

Our top story: Europe's largest airline by

passenger numbers, Ryanair, has reported its latest set of financial

figures following Britten's decision to leave the EU.

It's net profit rose by 4% compared to the same quarter last

year to 256 million Euros, that's $281 million.

A quick look at the market boards. Not a huge amount of movement in the

markets. It is in Asia where the attention is focused. The exchange

rate their... Wall Street had another record close

as well. Chances are, you'd never heard

of augmented reality until this And now everyone's talking

about it, all thanks to the smartphone game Pokemon Go,

which has hit the headlines and sent The technology superimposes virtual

images onto a real-life feed captured, using a smartphone

camera or 3D headset. Aside from games, it's hoped that AR

can help provide relevant information to people

out-and-about in the real world. When consumers use an app called

Blippar, they can point their camera at an object,

for example a dog, and the software will provide information

about the dog. The company behind Blippar hopes it

will provide an alternative Jess Butcher, co-founder

of Blippar is with us. Welcome to the programme. Great to

have you with us. It sounds... You showed me in the green room what it

is. I have to say it is amazing, but what is also amazing... A unicorn.

For the uninitiated a company valued at $1 billion before you even go to

market. Yes. That is pretty impressive. It is a pretty fluffy

term. We don't really discuss our valuation but we are proud to be

part of a very small groups of businesses in Europe, and of British

tech companies. Most of the big names and big verbs in technology

are all West Coast businesses. Our aspiration is there will be a

British business to become the next big verbs and we will be Blipping

before we know it. We had a go at explaining how it works, talk us

through it and why it is so important. We have seen the big rise

in Nintendo shares, not just because of the game but the commercial value

and what they can do with it. Blippar is a real-world visual

browser. You can point a camera at anything in the physical world

around you and instantaneously satisfy your curiosity about that.

Whether it is pets, food, works of art, buildings, the natural world,

you can find out whatever your general curiosity will be about that

image or object. That is very powerful, a new form of discovery, a

new form of search and one that doesn't require language. In

traditional searches you need to type in the question to find the

answer. Blippar allows the ability to look at anything and bring it to

life. That has massive ramifications for how people go about their daily

lives, simply extracting information and putting the Internet on the

physical world around us. For brands and advertisers who on much of that

physical world, there is a huge opportunity for very contextually

putting their message in that place at that time, whether it is a dog

food next to a dog, for example. Our priority is to make sure the

information the consumer is getting his most relevant and likely to

answer whatever that spontaneous curiosity might be. How much of this

is a change of mindset? To get people away from searching by text?

I suppose it is just a habit, to get people to hold up their phone to

search for something? Sure. There is a new behaviour and that is our

biggest challenge, to get people looking and unlocking the world in

that way. The phone is a visual medium, it is all ready out. The

photo -based businesses are the most successful in the world right now.

We are taking selfies, snapchatting. We are a very visual human race and

looking at everything. It is not that big a leap of faith that

behaviour will happen. Pokemon go is massive. It must've been a godsend.

A game changer for us in terms of adopting AR and understanding what

it is. Our biggest complaint about the AR space is it won't get there

until Rivera VR headsets on the hardware has come up to scratch. We

wasted the phone is capable of this. Pokemon Go, there has never been so

many downloads. Can I just ask you, you, co-founder, five years, how did

you get into this? Have you always been a techie? I studied ancient

history! So no, but I love technology, I love disruption and

disruption is happening in tech right now. My desire is to affect

behavioural change and that is what Blippar is trying to do. I'm all

about the translation of that tech in a way that is meaningful for

translators. I am the marketer and communications expert on our team,

with some very smart technology people behind me. Blipping, I love

it! We will continue the conversation later on Facebook live.

But for now, thank you, Jess. In a moment we'll take a look

through the Business Pages, but first here's a quick reminder

of how to get in touch with us. Stay ahead of the breaking news,

we'll keep you up-to-date with the latest details with insight and

analysis from the BBC's team of editors from around the world. We

want to hear from you. Get on the BBC live web page. You can also get

in touch on Twitter, and on Facebook. Business Live on TV and

online whenever you need to know. Michelle with the details on how to

get in touch. Brenda is back to talk us through some of the papers. The

Guardian, an important newspaper, one of the biggest newspapers in the

UK. Expected to see a record loss of ?170 million. We asked people at the

start of the programme to get in touch, and see if you still buy a

newspaper. One says I don't buy one but its very one that the

supermarket. She said it is great for a paint job or wrapping things.

Another says, I have bought the express for the last 60 years. Let

us know. Do you? I do on a Sunday, I prefer a Sunday newspaper. Every

single day I would be more about online. The Guardian is free online.

And it is out of date so quickly. The way news changes these days, if

you're looking at it on Facebook or Twitter, it is out of date. Yes, I

look at social media as well. I prefer the feel of a newspaper or a

book in hand, but it is starting to bite. It will have a record loss of

?173 million, the Guardian group, when it announces on Wednesday.

Despite the fact there has been a lot of cost-cutting and taken

restructuring charges and tried up the ante in of digital advertising,

they are still seeing a massive fall off in its normal print advertising.

It will be interesting for the newspaper story here. Even the FT is

likely to see a drop back and there Brexit scenarios likely to impact

there advertising revenue as companies hold off. Switching gears

but staying somewhat, this is the challenge the print. If we talk

about Yahoo. They mention of February they wanted to flog its

core business. The US telecoms giant, we are expecting an

announcement today, $5 billion. Is it a good deal for everyone involved

Chris Wratt Yahoo have lost a lot of market share. They haven't really

had a lot of focus, despite the fact they have been through several CEOs

and the last few years. It with seem to have reached the end of its line.

It will sell part of its company to Verizon. It is going to be quite a

big company and it will take advantage of a lot of content Yahoo

already has. Yahoo and AOL, two massive names. Yes. Thank you for

your company today. Same time and place tomorrow with business Live.