The Dawn Patrol – 01.08.12 – On the Chinese PMI, the European politics. Many more earnings. France 3rd…


Markets seem to be headed down at the opening as we wait for the FOMC tonight. Japan down on earnings disappointments from Komatsu and Sumitomo and a slightly weaker Chinese PMI. Today, our sore eyes will look at the the Eurozone PMI (10:00), the US PMIs and ISM (15:00 and 16:00). Germany will sell €4bn of 5y notes and we’ll try to decipher all these earnings…

Socgen 2Q profit falls 40% to 433m misses estimates, StanChart forecasts FY profits & revs growth above est, BMW beat on EBIT, sales inline and confirm forecast (but cautious on China), AKE 2Q Ebitda beat and confirms outlook, Fresenius 1H earnings top exp, Vinci 1H in line but with a few warning signs of mid-term slowdown, Schneider beat on sales & confirm outlook, SuezEnv 1H net beat, Henkel raises 2012 EPS forecast and2Q Adj. Ebit beats, ENI report poor 2Q net (but announces some Mozambique discoveries).

Telenet Cut To Equalweight VS Overweight at Morgan Stanley

Fiat PT Cut to EU7.8 at Goldman, Kept on Conviction Buy List; PT Raised to Eu3.9 VS Eu3.8 at Morgan Stanley ; still UW.


On the European politics
Apparently there was more positive news last night. There seems to be an agreement endorsed by the Germans wherby Spain will agree for more budget cuts in exchange of bonds assistance. From what I read this morning, there is a growing agreement among economists, that something along the lines of further LTRO with increased collateral assets will be announced.
Also an interesting article on Draghi’s stance: Draghi Reshapes ECB Crisis Pragmatism as Trichet’s Dogma Fades – Bloomberg

On China PMI
The Chinese PMI came in at 50.2 slightly below consensus expectations of 50.5 and below the June number of 50.2. Slightly disappointing, but nothing too scary either as July is often soft and the inventory adjustment seems to be ending. The Markit PMI (smaller companies) came in at 49.3 vs 48.2 in June. On the same subject: Here’s What To Make Of China’s Mixed PMI Numbers – Business Insider




Societe Generale 2Q Net Income Misses Estimates After Writedowns ;2Q Net Eu433 Mln vs. est. Eu695 Mln ; CIB net income EU131m vs est. EU102m ; Sticks to plan for core capital ratio of 9%-9.5% by end 2013 without a rights offer

Standard Chartered 1H Core Tier 1 Capital Ratio 11.6% ; 1H net $2.9b beating analyst est $2.8b, says it doesn’t see Eurozone problems solved anytime soon; Co. says it’s on course for FY double-digit revenue, EPS growth


Deutsche Bank says it’s facing lawsuit over Yen Libor, derivatives

HSBC Asia-Pacific almost done with firings, sales, Bloomberg reports


Atlantia Rated New Neutral At Goldman

Aviva Raised To Buy From Hold at Berenberg

Corio Cut To Hold From Buy at Berenberg

Hammerson Cut To Sell VS Hold at SocGen

UBS PT Cut to Sf11.6 VS Sf12.7 at SocGen After 2Q Results



BMW 2Q Profit Beats Est., Rev. In-Line ; 2Q Ebit Eu2.27 Bln vs est. Eu2.16 Bln ; 2Q Rev. EU19.2b vs. est. EU19.1b. ; 2Q ebit EU2.27b vs. est. EU2.16b. ; Confirms FY outlook; sees risks from Europe and China slowdown; Reaffirms FY Targets

Schneider 1H Net Beats Ests ; 1H rev. EU11.408b vs est. EU11.309b ; Ebit EU1.387b vs est. EU1.337b ; Adj. Ebita EU1.556b ; 1h Net Eu890m vs. est. Eu844m ; EPS EU1.65 vs est. EU1.62 ; says uncertain economy limits near term visibility ; Expects pricing in 2H to be at lower level; was EU141m in 1H


ArcelorMittal is to cut 795 jobs at steel plants in Belgium, L’Echo says

Peugeot Citroen French new car registrations slid 14.5% in July, La Tribune says

Renault French new car registrations fell 16% in July, La Tribune says

Rio TINTO is executing a program of reducing costs in service and support functions across its business as part of a drive to tackle increasing costs, Bloomberg reports


Fiat PT Cut to EU7.8 at Goldman, Kept on Conviction Buy List; PT Raised to Eu3.9 VS Eu3.8 at Morgan Stanley

Norsk Hydro Raised To Neutral VS Sell at Goldman

Syngenta PT Raised 8% to Chf328 at Exane; Kept at Neutral

Tenaris PT Raised to EU17 vs EU15.5 at Banca Akros



Arkema 2Q Ebitda Beats; 2 Q sales EU1719m ; 2Q Rev. EU1.72b vs est. EU1.64b; 2Q Ebitda EU306m vs est EU272.6m ; Adj. Net Income for continuing operation EU151m (-25.6% compared to 2011 2Q); Remains confident in ability to deliver a “very solid year in 2012” with Ebitda target close to EU1b; est. EU965.3m ; Targets 2012 Ebitda In-Line With Est.

ENI 2Q Refined Product Sales to Europe Fell to 2.74mt ; 2Q Adj Net Eu1.46 Bln vs. Est Eu1.52 Bln ; Operating profit EU4.24b vs est. EU4.2b. ; Dividend EU0.54 ; Sees continuing opex investments in line with 2011

Fresenius 2Q Ebit Beats Est.; 2Q rev. EU4.82b vs est. EU4.81b ; 2Q Ebit EU772m vs est. EU757.3m ; still convinced of merits of Rhoen Klinkum deal, continues to assess options; Confirms FY forecast of sales growth of 12%-14% in constant currency, adj. net income up 14%-16% in constant currency

Fresenius Medical 2Q Ebit Beats Est.; 2Q net sales $3.43b, up 9% Y/y ; 2Q Ebit $589m vs est. $473.5m ; confirms FY forecast ; Co. said targets 2012 rev. ~$14b, sees net income attributable ~$1.14b; sees ~$700m capital expenditure, ~$1.8b spending on acquisitions in 2012

Lundin Petroleum 2Q Pretax Profit $217m vs Est. $187m ; 2Q Net Income $65.1m vs. est. $50.1m ; Ebitda $271m vs est. $240m.

UCB 1H Core EPS Meets Estimates; 1H rev. EU1.71b vs est. EU1.54b ; 1H adj. Ebitda EU347m vs est. EU393.5m ; 1H core EPS EU1.09 vs est. EU1.10 ; 1H net EU137m vs est. EU144.7m ; sees full-year revenue exceeding EU3.2b vs about EU3.1b before; sees core EPS of about EU1.70 vs EU1.60-EU1.70 before.

Suez Environnement 1H Ebitda Misses Est. ; 1H sales EU7.32 down from EU7.36b Y/y ; 1H Ebitda EU1.13 vs est. EU1.14b ; 1h Net Eu40m vs est. Eu26.4m ; Net debt EU7.88b at end of June, up from EU7.56b at end of Dec. ; Affirms 2012 targets of stable rev., Ebitda vs year-earlier, dividend equal to or higher than EU0.65 per share on 2012 earns ; The company will increase its cost cutting program by EU40m, reduce net investment expenditure by EU100m, after volumes at its Waste Europe division hurt by decline in industrial production.


Bayer’s Yasmin Lawsuit Settlements Rise to $402.6 Million; the company has resolved nearly 1,9000 Blood-clot, Bloomberg reports

BHP Billiton said that it’s focusing on cutting costs as commodity prices fall and operating expenses rise, including a review of its overhead costs and the sequencing of its major project, Bloomberg reports

Eni’s gas discovery at Mamba North prospect adds 10tcf to Area 4

Shell sells onshore oil site to Nigerian Petroleum, Bloomberg reports


Bayer PT Raised 9% to Eu63 at Exane; Kept at Neutral

BP Cut to Hold From Buy at Jefferies; PT Lowered 10% to 450p

Snam PT Cut 5% to Eu3.6 at Exane; Kept at Neutral



JCDecaux 1H net rev. EU1.24b vs EU1.17b Y/y. ; 1H Net EU82.4m vs EU95.1m Y/y ; 2Q organic growth “slightly lower than expected” on Europe, after “solid’’ 1Q; Anticipates 3Q organic rev. growth broadly in line with 2Q, reflecting rev. decline in Germany, other northern/eastern European countries


BSkyB agrees to five-year Scottish games deal, reports Reuters

Mediaset sees worse ad trend in July/Aug., no visibility for Sept., bloomberg reports

Tele2 may start Austria mobile service via Hutchison, Bloomberg reports

Unitech Wireless is to auction India Telecom services business; Auction of India mobile telecommunications business and liabilities is the “only logical way to proceed,” the company says


Mediaset PT Cut to EU2.5 vs EU3.9 at JPMorgan ; PT Cut to Eu1.1 VS Eu1.3 at BofA, Kept at Underperform; PT Cut 10% to Eu1.3 at Barclays, Kept at Equalweight; PT Cut to EU1 vs EU1.3 at Deutsche Bank

Telecom Italia Kept as Barclays Preferred Southern Europe Telco

Telenet Cut To Equalweight VS Overweight at Morgan Stanley



Henkel 2Q Adj. Ebit Beats; Rev. EU4.21b vs est. EU4.22b; 2Q adj. Ebit EU609m vs est. EU592.2m; sees 2012 EPS growth ~15% vs prev. forecast of at least 10%; reiterates sees organic sales growth 3%-5%, adj. Ebit margin 14%; Raises 2012 EPS Forecast


Ab-inbev PT Raised 4% to Eu53 at Exane; Kept at Underperform

Hugo Boss Cut To Neutral From Buy at Nomura



Duerr 2Q Rev., Ebit Beats Ests; 2Q rev. EU600.0m vs. est. EU561.8m ; 2Q Ebit EU42.7m vs. est. EU36.7m ; 2Q net EU26.8m ; 2Q EPS EU1.51 ; Reiterates 2012 forecasts; said June 21 it sees 2012 rev. of EU2.3b, incoming orders of at least EU2.5b, Ebit margin reaching 6.5% – 7%

FINMECCANICA Rev. EU8b vs est. EU8.1b; 1H adj. Ebita EU459m vs est. EU417.4m; Net EU53m vs est. EU80.4m ; Net debt EU4.66b (June end) vs est. EU4.35b ; Order backlog EU46.1b vs yr ago EU44.98b ; Confirms forecasts prepared at time of 2011 report: Revenue of EU16.9b to EU17.3b; adj. Ebita ~EU1.1b ; FOCF to be positive due to op activities before investing, which will generate cash flows exceeding EU900m; Says 1H, 2Q results show encouraging improvement in main indicators, recovery profitability; Confident will achieve targets for 2012, turnaround process demanding

Melexis 2Q Net Rises 10% to EU11.8 Mln; 2Q sales increase 7.7% to EU62.1m; Adj. EPS EU0.29/shr vs est. EU0.30/shr; Sees 3Q sales up 4%-5% vs 2Q; Sees FY sales up by high single digits; Sees FY gross profit margin above 45%, operating margin 23%; Interim dividend EU0.65/shr

Parmalat1H net rev. EU2.28b vs EU2.15b Y/y.;1Q Ebitda EU163.3m vs EU149.3m Y/y ; 1H Net EU82.5m vs EU76.5m Y/y ; Confirms forecast for 3% FY rev., Ebitda growth at constant FX

Sanoma 2Q EPS, Net Miss Ests.; 2Q Net Sales Eu646.5 Mln vs est. Eu645.8 Mln ; 2Q Net Income Eu135 Mln vs. est. Eu144 Mln; 2Q EPS Eu0.83 vs. est. Eu0.873/shr; Cuts 2012 sales, EPS guidance; sees sales at 2011 level or growing “slightly,” EPS ex-items to be “somewhat below” 2011 level vs growth forecast earlier


Kontron closes the sale of American manufacturing factory, Bloomberg reports


Erg Cut To Underperform From Neutral at BofA

Finmeccanica Kept at Sell at Deutsche Bank on Execution Risk; Cut to Neutral from Outperform at Mediobanca

Freenet Raised To Buy From Hold at Berenberg

Buy Imtech, Shares Pricing in No Future Growth, ING Says

Hornbach Rated New Buy At Deutsche Bank, PT Eu70

Hunting Rated New Neutral At Nomura

Mediolanum PT Cut to Eu4.3 VS Eu4.5 at BofA; Kept at Buy

Usg People PT Cut to Eu7 VS Eu8.5 at ING, Stays Buy


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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