The Dawn Patrol – 26.07.12 – Too many earnings. DSY looks good. SIE bad. ROCHE good. MS on Chinese margins. More….


Markets indicated to open flat to slightly up as we scramble through European earnings this morning. Macro eyes on the €2.5bn Italian 0% coupon bond, the German GfK consumer climate survey, the US advance report on Durable Goods.

TEF suspends 2012 dvd and missed on revs, FTE slightly better than exp and reiterate FY target, SANOFI beat, STL missed on net, LOGN reported larger losses, BASF positive on 2Q earnings but cautious about Chinese growth, SYNN 1H rev. beats with net inline and sees Ebitda margin rising, SIE 3Q numbers miss consensus & warns on FY, TEC inline, CAP 1H sales look slightly below cons but raise FY tgts, ALU missed on margins and cut 5k jobs, DSY beats on all fronts and raises forecasts, RAND inline, CLN confirm outlook, ROG EPS and Sales inline with cons, ABB missed but a bit more confident about 2H outlook (a surprise acc to JPM – mkt is very short of Industrials), ROCHE up this morning on strong results and guidance.

SANTANDER: The net profit is way below estimates but have to be corrected for huge provisions. The UK and Brazil performance are disappointing.

On DASSAULT SYSTEMS. Just heard the CEO on the Radio this morning and he definitely sounded very confident. Details of the earnings below. The Gemcom acquisition seems like a huge opportunity (mining market). Will have a closer look.


LVS: -4% – Las Vegas Sands 2Q Adj. EPS Misses Est. Las Vegas Sands 2Q adj. EPS 44c, est. 60c.

AKAM: +9% – Akamai 2Q EPS, Rev. Beats Ests. Akamai 2Q adj. EPS 43c, est. 37c, rev. $331m, est. $326.2m.

WFM: +9.1% – Whole Foods Market 3Q Comp Store Sales up 8.2%, Est. up 8.2%. Whole Foods Market raises yr adj. EPS forecast to $2.51-$2.52, saw $2.44-$2.47 in May, est. $2.47; sees rev. growth 15.6%-15.8%, saw 14.8%-15.6% implying $11.60b- $11.69b, est. $11.68b. Shrs gain 8.6% post-mkt.

V: +1.4% – Visa 3Q Adj. EPS $1.56, Est. $1.45; $1b Buyback Set. Visa authorized a new $1b share repurchase program, deposited $150m in litigation escrow; affirms forecast for 2012 metrics including net rev. growth in low double digits, free cash flow >$4b.

ZNGA US – The facebook game supplier shares fall 40% after hours as sales/EPS come in at $332.5/1c vs $343m/6c expected. Not good for some Facebook revenues.


Nothing really new. Greece may leave the Euro, Spain is the focus, global activity is slowing, earngings are not great…


MS (Bartsch and co) Spain and the Psychology of contagion.

Market Access and the Case for Sovereign Support.

Not sure where Elga and Daniele want to take us to with this note… From what I gather, it calls for the provision of official funding for Spain (which would cause a short term positive market reaction) but what Europe really needs is further fiscal integration…

MS (Fels) The Global Macro Analyst
Margin Call

MS calculations show that aggregate US margins of Chinese exporters have shrunk by a cumulative 20 to 30% between 2004 and 2010, or between 4% and 5.6% a year: China’s export com p etitiveness is waning – a point also made recently by MS China Economics team.




– France’s biggest banks are rushing to cut the more than 140b euros they provide their operations in Europe’s troubled economies, seeking to protect themselves against a possible breakup of the euro

– Moody’s changes outlook on 17 German banking groups to negative

– Moody’s downgrades 3 Slovenian banks; Outlook Negative

– Nomura’s CEO Watanabe said to step down on Insider-Leak Scandal


Barclays may take 70% stake in Doux, says Reuters; del Missier Given $14 Million Pay-Off, reports the Telegraph


British Land PT Raised 2% to 610p at Exane; Kept at Outperform

Generali PT Cut to Eu11 VS Eu13 at JPMorgan; Kept at Neutral



ABB 2Q Net Misses Ests.; Sales $9.7b vs est. $9.93b; Ebit $1b vs est. $1.12b; 2Q net $656m vs est. $711m; Basic EPS $0.29 vs est. $0.315; Orders $10b; says cautiously optimistic about meeting targets, more confident abt short-term outlook than earlier, while longer term outlook remains favorable

MAN GROUP Sales EU7.7b, est. EU7.69b ; 1H Op. Profit EU471 Mln vs. Est. EU564 Mln ; Says mkt environment “increasingly difficult” ; Continues to expect slight decline in rev. for group

Randstad 2Q Net Misses Est. ; Sales EU4.3b vs est EU4.31b ; 2Q net EU36.5m vs est. EU58.6m ; says first weeks of July indicated somewhat weaker trend than in 2Q.

SIEMENS 3Q Income Misses Ests.; Rev. EU19.54b vs. est. EU18.94b ; 3Q income from cont ops EU1.23b vs. est. EU1.41b ; EPS from cont ops EU1.37 ; says reaching FY earnings target has become “clearly more ambitious,” sees moderate FY organic sales growth

Syngenta 1H Rev. Beats, Net in Line; First-Half Sales $8.265 Billion; 1H rev. $8.27 vs est. $8.19b.; 1H EBITDA $2.27b vs $2.15b ; 1H operating income $1.84b; Net income $1.5b vs est. $1.46b; EPS $17.17; Says focus now on Latin America where outlook is positive given record soybean prices; Says FX headwinds likely to diminish in 2H; Sees 2012 ebitda margin rising at constant FX; Sees substantial free cash flow generation in 2012

THALES 1H Adj. Net Tops Est.; 1H sales EU6.41b vs est. EU6.18b ; 1H Ebit EU338m vs est. EU329.3m ; 1H adj. net EU175m vs est. EU166m ; Order book EU30.69b vs yr ago EU25.8b ; Defense & Security EU3.23b vs est. EU3.47b ; Aerospace & Transport EU2.69b vs est. EU2.71b ; Keeps objective of 6% EBIT margin for 2012 ; Over FY expects decline in military orders (ex any exceptional export contract), which commercial orders are expected to offset only partially;: Says book-to-bill ratio may be slightly below 1; revenue, at constant scope, should increase slightly

Technip Sales EU2.05b vs est. EU1.97b; sales rose 23 % Y/y ; 2Q Net EU134m vs Est. EU136m ; Order intake EU2.5b ; EU1.5b of backlog to be executed in 2012; EU2.1b in 2013, EU2.4b in 2014, beyond; Maintains outlook 2012 sales guidance EU7.65b-EU8b; subsea operating margin ~15%; onshore/offshore margin 6%-7%


Lufthansa may confirm today it’s closing LTQ Engineering aircraft maintenance facility in Melbourne with loss of more than 150 jobs, the Australian reported


Air France-KLM Rated New Sell at Cheuvreux, PT Eu2

ARCELORMITTAL cut to hold at ING

MAN Cut to Sell From Hold at Berenberg

Peugeot Rating cut to Ba2; may be cut further, Moody’s says; About EU5.6b of debt affected, ratings co. says; S&P Lowers Peugeot To ‘BB’ On Rapid Cash Burn

Deutsche Bank Keeps Saipem at Buy; Expects Solid Set of Results

Tenaris Priced for Good Quarter, Credit Suisse Says



BASF 2Q Ebit Ex-Items Beats ; 2Q Rev. EU19.48b vs est. EU18.87b ; 2Q Ebit Ex-Items EU2.49 Bln vs. Est. EU2.37 Bln ; Reaffirms outlook

Roche 1H rev. CHF22.4b vs est. CHF22b; 1h Net Income Sf4.37 Bln vs. Est. Sf5.52 Bln ; 1H Core EPS Sf6.94 vs. Est. Sf6.95; confirms FY forecast; sees low to mid-single-digit sales growth at constant exchange rates for Group, Pharmaceuticals in 2012; Diagnostics to grow above market; target of high single-digit core EPS growth; Seeks Small, Mid-Sized Acquisitions, CEO Schwan Says

Sanofi 2Q Business EPS, Rev. Beat Ests ; 1H In-Line With Forecast; 2Q rev. EU8.87b vs est. EU8.68b; 2Q Business EPS Eu1.48 vs. Est Eu1.40; continues to see 2012 Buisness EPS 12%-15% lower at CER vs 2011

Statoil sales NK186.5b vs est. NK174b ; Pre-tax profit NK59.5b vs est. NK47b ; 2Q Adj. Net Nk11.5 Bln vs. Est. Nk13.18 Bln; Entitlement production up 20% Y/y to 1.786mboe; Planned maintenance to affect ~110kboe/d production in 3Q; 2012 equity production to grow 3%; 2013 to be around 2012 level; Sees production >2.5mboe/d in 2020; 2%-3% CAGR of output 2012-2016


Bayer CropScience gains in Mumbai after 1Q Profit jumps 78%

Endesa May Transfer Assets to Enersis in Record Chile Share Sale

Fresenius‘s CEO Ulf Schneider, Asklepios owner Bernard Broermann and Rhoen Klinikum founder Eugen Muench met in person at least twice since Fresenius offer for Rhoen failed last month, FTD says

Roche says that it is on track to file for EU, U.S. approval of T–DM1 (trastuzumab emtansine) in aggressive form of breast cancer during 2H of year

FDA gave Novartis’ Afinitor (everolimus) orphan drug status for proposed new use in cancer


Tullow Oil PT Cut 12% to Gbp15 at Exane; Kept at Outperform

Verbund Raised To Neutral VS Sell at Citi; Raised To Hold From Sell at ING



Alcatel-lucent 2Q Gross Margin Misses Est. ; 2Q sales EU3.55b vs est. EU3.56b ; 2Q gross margin 31.7% vs est. 32.7% ; 2Q adj. operating loss EU31m, 2Q reported loss per shr EU0.11; 2Q net debt EU236m vs net debt EU753m at end-March; seeks additional EU750m in cost cuts, total EU1.25b by end-2013.; 2H FY adj. op. margin better than 1H

CAP GEMINI 1H Rev. In Line with Est; 1H rev. EU5.15b; est. EU5.1b; 1H oper. profit EU237 vs EU240m ; 1H oper. margin 6.4% ; 1H group profit EU143m ; 2Q marked by dynamic activity in outsourcing Services business; Sees 2012 like-for-like growth of >1%, saw zero growth; Confirms increase in 2012 oper. margin

DASSAULT SYSTEMS beats rev., EPS Ests; 2Q non-IFRS, IFRS rev. EU502.9m vs. est. EU486m; 2Q non-IFRS EPS 76c vs. est. adj. EPS 75.5c ; Sees 3Q non-IFRS rev. of EU480m to EU490m; est. EU480.75m ; Raises 2012 Forecasts

France Telecom 1H Sales Beat Ests. ; First-half Sales Eu21.84b vs. Est. Eu21.72b; 1H Ebitda EU7.0b vs est. EU7.03b; 2Q French sales fall 2% to EU5.43b ; reiterates target of op. cash flow close to EU8b in 2012.

Logitech 1Q Rev $469m vs est. $463.6m; 1Q loss $52m vs. est. $20.3m loss; Expects improved performance starting 2h FY13

Reed Elsevier 1H Rev., Adj. EPS Beat Est.; 1H rev. up 5% to GBP3.05b vs est. GBP3.02b; Adj. net income +11% to GBP561m vs est. GBP539m; Adj. EPS +11% to 24.7p vs est. 23.7p; Interim div. increased 6% to 6p; Sees underlying rev, profit growth in 2012 in line with expectations

TELEFONICA 2Q Oibda, Sales Beat Ests.; 2Q sales EU15.47b vs est. EU15.39b. ; 2Q Oibda EU5.35b vs est. EU5.28b ; 2Q net income EU1.33b vs est. EU1.38b ; 1H Europe organic sales fall 7.1% to EU15.08b; 1H LatAm organic sales rise 6.4% to EU14.96b; suspends dividend, cuts pay as Spanish crisis deepens; revises down revenue goal for 2012 and reiterates OIBDA margin goal for same year.; ‘Dividend Sabbatical’ sensible, Morgan Stanley Says


Alcatel-lucentseeks to cut 5,000 more jobs globally

FRANCE TELECOM’s CEO Stephane Richard says that there are several JV deals with German’s Deutsche Telekom in an attempt to cut costs, FT reports; he further says that says there is “definitely no plan for a merger”


KPN May Bounce Back in Short-Term to EU7-EU7.5, Morgan Stanley; Reinstated at Neutral at Goldman, PT Eu7.8



Casino 1H Rev. In-Line; 1H rev. EU17.3b, est. EU17.4b.; 1h Net Group Share Eu125m vs. Estimate Eu181.9m ; 1H trading profit from continuing ops. EU638m, est. EU634.5m ; Reiterates 2012 objectives


Colruyt’s Luc Rogge sells 20,000 shares for avg. EU37.05 a piece


Morrisons Raised To Hold From Sell at Berenberg



Aixtron 2Q sales EU46.1m vs est. EU47.0m; 2Q gross margin 32% vs est. 33.1% ; 2Q Net Loss EU11.6 Mln vs. Est. EU6.4 Mln loss; says that it may not be able to turn Ebit profitable in 2012, as prevailing mkt uncertainty makes the magnitude, timing of equipment demand pick up difficult to forecast; Says expects to return to profitability in 2H of FY12

ASM Intl. 2Q Rev. Beats Ests.; 2Q rev. EU378 vs est. EU356.7m. ; 2Q net income EU17.7m vs est. EU21.1m ; Sees 3Q increase in front-end sales, a “sound quarter” in back-end ops

Clariant 2Q Rev. In Lin ; 2Q sales rise 8% in local fx, gain 6% in Swiss francs to SF1.98b vs est. SF1.96b. ; adj. Ebitda SF233m vs est. SF240.3m ; Net SF70m ; Net debt rises to SF1.98b; Sticks to forecast, sees 2012 sales rising in local fx, sees “sustained profitability” for 2012 vs 2011 ; to Buy Rest of JV

Comdirect 2Q pretax EU23.9m;2Q Net EU17.5m; Targets FY pretax EU85m-EU90m ; cites “not very active market environment,” says cut marketing payments in 1H to counter; Says targets 2012 pretax EU85m to EU90m

Ipsos 1H Rev. EU837m vs Est. EU823.3m; 1H net EU12.6m ; 1H oper. profit EU48.2m vs est. EU46.3m ; Sees stable organic rev. in 2012, with 2H rev. at least EU1b, barring euro-zone “financial disaster”

Jazztel 2Q Net Income Falls 30% to EU19.1 Mln From Year Earlier; 2Q sales climbed 24% to EU223.8m from year ago; says 2Q Ebitda climbed 30% to EU44.2m from year ago; 2Q net income fell 30% to EU19.1m from year earlier; 2Q net debt dropped 48% to EU61.9m from year ago; reached 1.25 million ADSL broadband customers, or a 27% increase from the same year-earlier period

Kemira 2Q Sales Beat, Profit Misses Ests. ;2Q Net Sales Eu562.3 Mln vs. Est. Eu554.4 Mln ; Net income EU29.8xm vs est. EU31.5m ; Pretax profit EU40m vs est. EU41.7m ; EPS EU0.20/shr vs est. EU0.205/shr ; Keeps guidance; sees FY rev, operative EBIT in 2012 at 2011 level; Starts global efficiency improvements program with EU60m annual cost savings target, one-time costs EU85m

Nutreco 1H Rev. In-Line; 1H rev. EU2.35b, est. EU2.36b; organic vol. growth 4.7% ; 1H Ebita EU103.6m; 1H net EU81.7m ; Interim div. EU60c, BDVD forecast EU70c ; Sees FY Ebita before exceptional items ~EU260m vs 2011 EU231.6m; aims for EU400m Ebita by 2016

Sika’s 1H Sales Higher by 6.4% in Local Currencies; Profit SF126.1m; 1h EBIT margin 8.5%; Growth in N. America likely to continue; trend in Europe difficult to assess

SEB 1H Rev. EU1.80m vs. Est. EU1.79b; 1H net EU74m vs EU93m Y/y ; targets “slight increase” in rev. for FY, op result from activity close to 2H11

TF1 1H rev. up 1.8% to EU1.3b ; channel advertising rev. fell 5.9% to EU713.2m. ; 1H Net Falls 21% to EU93.5m; Operating profit down 28.2% to EU134m ; Says Rev to Be Stable in 2012

YIT 2Q Sales, Net, EPS Beat Analyst Ests.; 2Q Pretax Profit Eu61.6 Mln vs. Est. Eu57.1 Mln; 2Q net sales EU1.22b vs est. EU1.16b ; Net income EU46.9m vs est. EU40.8m ; Pretax profit EU61.6m vs est. EU57.1m ; EPS EU0.37/shr vs est. EU0.33/shr ; Keeps guidance; sees FY rev. on par with 2011, op. profit to grow (Note : 10 buys, 5 holds, 1 sells, avg. PT EU17.33)

Wincor Nixdorf 9M Net Almost Halves; 9M rev. EU1.70b; 9M Ebita EU69m ; 9M net EU42m ; Says banks delay bigger investments ; Confirms FY forecast, sees FY operating profit (Ebita) ~EU100m, sales at last yr level of 2.3b


GALENCIA says that the FDA fails to approve Injectafer Treament

Gildemeister plans higher dividend for 2012

Grenkeleasing says that 1H net interest income rose by +17% to EU52.2m; loss rate in 2Q remained at 1Q level.

Macintosh declines to give 2H, FY forecast of sales, profit

Saft cuts FY Sales Outlook, confirms FY Ebitda margin forecast


Acciona PT Cut 26% to Eu31 at Exane; Kept at Underperform

Capital & Counties Cut To Neutral VS Buy at UBS

Drax Raised To Neutral VS Sell at Citi; Raised To Neutral VS Reduce at Nomura; Raised To Overweight From Neutral at HSBC

EDP Renovaveis PT Cut to Eu2.8 VS Eu3.5 at ING, Kept at Hold; PT Cut 22% to EU2.5 at Exane

Konecranes Cut To Reduce VS Buy at Swedbank

PagesJaunes Groupe PT Cut 47% to EU1 at Exane

Pop. Milano PT Cut to EU0.3 at Deutsche Bank; Kept at Hold; PT Cut 4% to Eu0.46 at Exane, Kept at Neutral

Wacker Chemie Raised To Neutral From Underperform at BofA

Max Kamir

Louis Capital Markets UK,LLP

Authorised and regulated by the FSA and Banque de France

39-41 rue Cambon

75001 Paris

T +33 (0)1 53 45 10 74

E mkamir


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