01/08/2017 BBC Business Live


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


The energy giant BP delivers another strong profit


Live from London, that's our top story on Tuesday the 1st of August.


With BP's focus moving from old projects to new ones


and a massive writedown in Angola profits still came


Sony takes it to another level as it look at its biggest


The electronics giant has been selling lots of Playstations


We have all the details ahead for the trading day. And, do businesses


really know their customers? And we'll be getting


the inside track on how you build customer loyalty as your business


grows with the boss of Enflux, Anthony scurried she is fired after


ten days in the job, we want to know what the shortest job you have ever


had is... -- Anthony Scaramucci. Keep your comments coming in, use


the hashtag. I worked in a garden centre for five hours watering


hanging baskets, it was boring, short and paid a little bit of


money. Much like that, I was able to reach the top of the hanging


baskets. Good morning, let's make a start.


In the last hour and a half one of the world's largest energy


producers, the London listed BP has been telling us how much


money it's been making, and pension funds everywhere will be


relieved to see they are in the black.


Profits for the three months from April to June


came in at $684 million, that's using what's known


as the the replacement cost measure - and it's better than expected.


But - it's been hit by some big costs too.


It wrote off just over $750m for a gas project in Angola


that the company decided wasn't worth developing.


That tells you a lot about BP's broader strategy.


It's being more selective about its investments


The price of oil is down 10% compared to last year.


And it's also keeping costs down using data.


It's invested heavily in sensors to collect five million bits


of information from its facilities every single minute -


and it's using that to make those facilities run more efficiently.


Cailin Birch, Commodities Analyst at the Economist Intelligence


Good morning, thank you for coming in. Ben was going through the


numbers, give us your take on those results? As you said, they were


better than they expected, based on company surveys and market


expectations, it will boost BP in the near term, in what is a negative


time and uncertain for oil prices coming off quarter to. We have two


remember that this is lower than profits in the same quarter of 2016


when oil prices were much weaker. Then we were expecting this year. We


have seen a significant impact on that right down. And that loss in


Angola continues to hurt BP, and whether it will improve


significantly? Costs have been going down, they have written off those


obligations for five years. What is important to notice is for companies


across the sector, efficiency will be key. Cutting down costs and


trying to be as efficient as possible, in investment and


operation expenditure, BP has a weight of debt to pay off and other


companies are not struggling. That is an issue, other oil majors have


become leaner and meaner, Shell is making more money and other


investors are looking at Shell or others as an alternative to BP? Some


are concerned that BP cannot stick to promises like dividend payments?


It is a real risk, BP has obligations to pay off and in the


medium term it will weigh on profitability which is why we see


the strategy we are looking at where BP has been shedding a lot of


profitable assets and the right thing in Angola is on the bottom


line -- the writedown. Every time they get a project which would


further add to their spending bill in the medium to long-term, they


become more efficient. Thank you very much indeed, an analysis of BP,


their shares are up over 2% on the news. And we


will take a full look at what the markets are doing later in the


programme. Let's take a look at some


of the other stories How prepared are banks


and insurance firms for Brexit? The newly-appointed head


of the UK parliament's Treasury Select Committee has


demanded the information, in one of her first moves


since taking on the role. In a letter to the bank's


Prudential Regulatory Authority, she asked for the key risks facing


the industries if there's no deal with the EU -


the so-called 'hard brexit'. Toshiba's shares have been


demoted to the second tier of the Tokyo Stock Exchange


because the value of everything it Toshiba, originally known


for its consumer electronics products, has faced a series


of financial difficulties, with the biggest the huge losses


at its US nuclear power division. Apple and Google have removed over


300 so-called binary trading applications


from their online stores. That's after intervention


by the Australian Securities Investments Commission,


which said it made the request to the companies after numerous


cases of fraud involving unlicensed The apps encourage consumers to make


bets on whether shares A really busy day for earnings and


among them is the Japanese technology giant Sony.


period, leaving it on course for its highest annual


It's interesting, we have talked about their woes for so long.


It is really interesting, so many well-documented problems for Sony


and now it appears that they are on the up again? It is a first for the


Japanese company, they beat analyst expectations with a threefold jump,


with operating profits of almost $1.5 billion, due to its strong


demand for smartphones, healthy sales of the PlayStation for


consoles and games, and in the box office they see success with


Spiderman Homecoming, so hopes that earnings will be strong for the film


division. As you mention, this comes after a tough year for the company


including an earthquake which crippled camera chip production and


a $1 million writedown of the film division. We will keep an eye on


that, on track for their best figures in nearly 20 years, whether


it will play out we will find out. Those good figures from Sony -


and a similar update from Panasonic wasn't enough


to keep their shares afloat. Toshiba down 2.2%, after reporting


a rise in profits, but sales fell But the overall market


ended the session higher as earnings season picked up -


and investors reassured that there's Earnings season too in the UK -


engine maker Rolls-Royce telling investors that engine deliveries


rose sharply helping it report a pre-tax profit of ?1.94 billion


for the six months to June, that's a reversal of a loss


of #2.15 billion loss over In the US later, we'll hear


from Apple and Pfizer - Samira has those


details from New York. The big news for Tuesday will


certainly be Apple, due to report earnings after the bell and the key


metric investors will be looking at our sales of the iPhone. Sales for


the iPhone seven and seven plus have been really strong which is likely


to boost revenue for the company. But there is some worry that


customers may delay upgrading their phones in favour of the next device.


Apple usually releases a new smartphone in September but that


could be delayed until October. Also reporting on Tuesday, pharmaceutical


giant Pfizer, demand for breast cancer treatment and rheumatoid


arthritis drugs will lift earnings for the company but the looming


patent exploration of drugs like Viagra has investors focusing on


plans to resuscitate the great engine and whether deals are on the


table. Some era patent expiring on Viagra, write


your Aston 's please!? Joining us is Richard Fletcher,


business editor at The Times. It's good to see you. Let's talk


about a couple of stories in the news, British American Tobacco, this


Serious Fraud Office are launching an investigation? A long-running


enquiry, Panorama had a programme about what the business and some of


its agents in Africa were up to, with internal investigations they


tried to play down allegations at the time that there was an


announcement at the time that the Serious Fraud Office is going to


look at this, a lot of UK companies have been caught up by what has


happened overseas but it is another blow for the business. The FDA and


the US announced on Friday that they want to reduce nicotine to


nonaddictive levels in cigarettes, they cannot ban them but they can


reduce the levels of nicotine which hit producers around the world,


including VAT, they continue to sell off yesterday. I looked a moment ago


and they are up a fraction -- BAT, but it is another blow. The White


House saga continues in America, we love the drama but the dollar


doesn't? The president was tweeting yesterday about a record high.


Markets, but not the dollar. A fifth monthly decline for the dollar, the


worst since April 20 11. The markets are split by two things, the chaos


in the White House and what it means not only for his reform and


infrastructure spending and tax reform... This is the firing of


Anthony Scaramucci, the communications director? It is the


latest in chaos, and they are spooked by the fact it looks like


the Fed isn't going to do reforms and we will not get a rise in


September. Some in government like a weaker dollar, that is a good thing?


It is 10% down on the year. What is the shortest job you have ever had?


I got a tryout for the milkman, I did a paper round, the milkman said


that he would pay me more, I did today, I dropped too mini bottles, I


was never invited back! We've heard about yours... There is a food theme


going... Mine was five hours doing hanging


baskets! We have some brilliant tweets from


you, Christian, not even a day in a cheese factory, I was sick on the


shop floor, straight out the door and never to return. I agree! And


another Ben, two days of Strawbridge picking with my leg in plaster as a


teenager -- strawberry picking. My mum said I could not laze around for


the summer. And Stevie, putting the colour labels on lipsticks when I


was a teenager, I lasted two hours until tea break. Where is your


staying power? Send us in more! Thank you so much for coming in


today, Richard. Do businesses really know their


customers? We get the inside track. How do they keep customers loyal?


The firm Enflux claim they have 18,000 sources of information about


us. You're with Business


Live from BBC News. Energy giant British Gas is to raise


electricity prices by 12.5% from mid-September -


but gas prices will be kepy on held. from mid-September -


but gas prices will be kept on held. It means the average annual bill


for a typical household will go Ian Conn is the Chief Executive


of parent company Centrica, he explained why to our business


editor, Simon Jack. The reason for this is the


transmission and distribution costs have been going up, as well as the


environmental and social policy costs, and recently we have actually


been selling electricity at a loss. Those are the reasons we've had to


put up prices, beginning in the middle of September. The overall


impact for the average dual fuel bill is 7.3%. Or, ?76. This will


affect 3.1 million of our customers, out of a total of 8.4 million.


Defending that 12.5% rise in electricity prices, business editor


Simon Jack joins us from our business newsroom. What did you make


of what was said and why they are rising prices? We are used to


hearing energy companies say that the main reason they raise prices is


because of the price they pay, the wholesale markets for electricity,


that has gone up and they are passing it along. They acknowledged


this time that since they put on this freeze in prices back in


December, wholesale costs have gone down. They say, it is not our fault


but the fault of renewables and government policy. Renewable energy


at the moment costs a little more than gas generating electricity and


that has been passed on, and also connecting renewable sources to the


grid which brings gas and electricity into our homes, costing


money and the government's historic policy of allowing people to


generate their own electricity and sell it back to the great takes


administering and that costs money too. They say it isn't their fault,


they are selling at a loss but this will be a big blow to 3.1 million


customers but could push up inflation as it is a big component


of many household bills. Simon Jack, thank you. More on that story on the


website. House price inflation continues to


rise. UK house prices up just 0.3% month on month. Full details, as you


can see, on the BBC Business Live page.


You're watching Business Live. Our top story:


Shares in BP are on the up. They posted a second quarter profit of


$684 million. A quick look at what the wider markets are doing.


Reporting season is well under way. We have had a whole raft of figures


this morning as Sally said from BP. We've heard from Toshiba and Sony


and from Rolls-Royce. If you're a small business,


getting to know your customers is pretty easy, but as firms grow -


that gets more and more difficult. But knowing your customers helps


firms build loyalty, So companies are turning to social


media sites like Twitter, Facebook and Instagram to predict


what their customers want. One of the tools to do


that is called Enflux. It says it analyses millions


of social media posts and brings together 18,000


different sources of data. It's just one of many


firms that do the same including Simply Measured,


Brandwatch and Social Bakers Joining us is Avery Booker,


the Chief Executive of Enflux. Good morning. Good morning. So just


tell us a bit about the background here. This company, which you've


started, has been running for a few years. Prior to that you were


working in the luxury goods market. Just talk us through how this all


materialised? Sure. So, one thing I saw as a consultant was that most of


the companies in the world were spending millions and didn't know


the full effects of what they were doing. They were using gut instinct


and data here and there, but they didn't know what was going to be the


next trnd. Really, not knowing the next thing to come will always keep


you one step behind. The started the company to really not use


retrospective data, but to take the data in real-time and shape the


predictions and say this is what we expect to happen in three months or


six months. What your predictions provide for quite a few of your


clients is not just information about what somebody might buy next,


ie the next handbag, it's, they use this data to decide where the next


store be or where they should expand? We have done everything from


telling a company that they have under served markets in America. So


we found six, served under served markets that like your product, but


don't have it. Where should be the next store be? Where should the next


event be? Where does this data come from. We talk about social media, is


it as simple as that person says this person says they want to buy a


bag in Paris. We take all the context that somebody puts out in


the world and it is all public data. So we take the information and put


it in this data engine and we can infer this person lives in Paris and


wants to go shopping in London. How do you make the distinction between


what is maybe wishful thinking? We know social media is always about


presenting a better version of ourselves. So maybe I have lots of


money and I want to buy lots of handbags in Paris. That's not always


the reality? We try to do what we can to see what matters to the


consumers and the brands can put it out in the world. It is the brand's


job to make that sale. Are you going to move into the area of artificial


intelligence as well? Are you already working in that area? We are


already working in that area. A lot of, we need a lot of that because we


are pulling in this real-time data. We can't do that without AI. We are


not doing it in any way that's spooky. That is what worries me. I


have got one of these things in my kitchen and I make sure she is


switched off, from my point of view, she is listening to what everything


I say. We do a bit of that, but not the spooky stuff. We are used to


firms tracking our spending habits and behaviour, be it with loyalty


cards, club cards, credit cards, where does the next ten years take


us? That relationship has changed significantly over the last decade.


I imagine there is huge changes on the way. The companies are going to


know much more about us in ten years than they do today, that's the


spooky part. What is going to happen, right now companies are


using this data, but in ten years, consumers will use this data, if


they want to get in shape, they will be using more big data to figure out


where should I go, what should I do? Do you have to do the same technique


on your own business to make sure you're still around in ten years? We


are taking a bit of our own medicine, that's true. There are a


lot of companies like that you that offer Burberry the same service? I


think that services are a bit different. A lot of people use the


data to shape today, but we use today's data to shape what we expect


to happen tomorrow and that's a more difficult proposition. Thank you for


coming in. Your shortest job? I painted fences for a week in Texas


in the summer time. That must have been... That was a rough one. It was


pretty boring. That sounds pretty rough to me. I will reveal mine in a


few minutes. Stay with us. Stay tuned for that!


The UK Government is challenging the likes of Facebook,


Twitter and Google to do more to remove online extremist content


online which it says is fuelling terrorism.


The Home Secretary Amber Rudd has been meeting the companies


at a technology summit in San Francisco from


Organised police say with the help of social media.


So companies here in Silicon Valley are being told they must do more


to prevent the spread of extremist content online.


What I need them to acknowledge is that the enemy, who is really


trying to move swiftly online, to radicalise people


in their own homes, are really stepping their game up


and we need our response stepped up as well.


And there is also a concern that new measures might mean a loss


It's not possible to say we're going to monitor


all communications on our platforms, but still preserve users privacy.


They may attempt to minimise the impact on users privacy.


They have to face up, people who might oppose this,


They're trying to weaponise people at home.


Another worry as security experts will tell you is that terrorists


could simply move to harder to reach parts of the internet.


Nice to see you Dominic. So the papers, online media, all over the


firing of Scaramucci after just ten days as communications director in


the White House. Your thoughts? Well, the wider impact is, of


course, about the end of the Trump bump and how business is losing


confidence in Trump's ability to deliver. Turmoil in the White House


is not good for the dollar. The dollar had its worst run of the year


in the last week because this turmoil speaks to turmoil's ability,


make America great, reinvestment in the US manufacturing base. People


now doubt that those things can actually happen. That those prom us


will be made good and the departure of Scaramucci is another example of


this turmoil and it has hurt the dollar. The conspiracy theorists


would have it is just a distraction. The problem is what's the evidence


of that? Although there is the other school of thought is that Trump is


all and in his business life has been destruction to create the


other. You go in and you shape things up and change the way of


doing things and build again the way you want it and it pays off. That


might be true in the business world, if you are a new Chief Executive,


you can sack everybody. It is not as if he inherited these people in the


White House. He built them up. There is the new Chief-of-Staff who says


you're fired. It wasn't Trump, remember. We think that. Your


shortest job? A couple of weeks in a bakery job. Why a few weeks? There


were issues with management! LAUGHTER


Did buns fly around in the rage? Buns were flying! What's yours? I


was the boss's daughter. So, of course... Oh, here we go. I never


got the sack. He ran his own printing factory. He could have


sacked me many, many times, but I stayed fort duration. It cost him, I


think, his earnings were lower than expected due to bad issues, family


issues! Let's take some more from the viewers. Simon, "One shift in a


chicken factory. The smell was sickening, I didn't go back." I


lasted one day at a call centre. I saw the supervisor mooching around


so I thought I was allowed to and I was not! " Dominic, thank you for


your time. Nice to see you. Thanks for your company and thanks for your


comments. We will see you tomorrow. Have a really good day. Bye-bye.


Good morning. It is the first day of August and the weather is looking


pretty unsettled for the first week of the month. Low pressure is in


charge of our weather. There is another area of low pressure pushing


in tomorrow bringing more wet and windy


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