Severfield Share Discussion Threads

[jadeticl] 19/9/2011 21:41

What concerns me most is that management said in 2009 that they were confident that 2010 would be the low point and we would see slow recovery in this business from there. They now say something quite different. We all know that 2010 did not see any recovery, and neither will 2011, and management don't know when we will.

I am in this in a big way, but wish I had done as edmundshaw did and sold out at the sharp upturn to 330p. I could then afford to be as relaxed as he is trying to decide at which very low price he will return. I am hoping they hold at the 170p level.

[ariane] 15/9/2011 19:39

Swiss Central Bank Pledges Action on Franc as Benchmark Rate Held at Zero
QBy Klaus Wille - Sep 15, 2011 11:10 AM GMT+0200 .
inShare.3
More
Business ExchangeBuzz up!DiggPrint Email ..Enlarge image
SNB Keeps Rate Near Zero Gianluca Colla/Bloomberg
The headquarters of the Swiss National Bank are seen in Bern.

The headquarters of the Swiss National Bank are seen in Bern. Photographer: Gianluca Colla/Bloomberg
.The Swiss central bank said it's ready to take "further measures" if needed to stem gains in the franc against the euro as it left its benchmark interest rate at zero to ward off the threat of a recession.

The Swiss National Bank, led by Philipp Hildebrand, kept its three-month Libor target rate at zero after unexpectedly lowering the benchmark from 0.25 percent last month. That's in line with the forecasts of all 21 economists in a Bloomberg News survey. The Zurich-based central bank also reiterated it will defend its currency ceiling with the "utmost determination" and forecast economic growth to come to a halt in the second half with consumer prices falling in 2012.

The SNB imposed ceiling of 1.20 against the euro on Sept. 6 and pledged to purchase foreign currencies in "unlimited quantities" to protect the economy. The franc's ascent to a record last month has hurt some of the country's largest companies including foodmaker Nestle SA (NESN) and sparked an economic slowdown in the second quarter.

"They are very, very pessimistic," said Ulrike Rondorf, an economist at Commerzbank AG in Frankfurt. "Forecasting deflation for next year seems far-fetched to me. It might merely serve as a justification for introducing a cap."

The Swiss currency, which is considered a haven in times of turmoil, reached a record of 1.0075 against the euro on Aug. 9 on investor concern that European governments may be unable to contain the region's debt crisis. The franc has remained above 1.20 versus the single currency since the SNB imposed the cap, and was little changed at 1.2079 at 11:05 a.m. in Zurich today.

'Acute Threat'
"With these measures, the SNB is taking a stand against the acute threat to the Swiss economy and the risk of deflationary development that spring from massive overvaluation of the Swiss franc," the central bank said. "If the economic outlook and deflation risks so require, the SNB will take further measures," it said without elaborating.

With the franc's ascent hurting exports, the economy may expand between 1.5 percent and 2 percent this year, the SNB said. It had previously forecast economic growth of about 2 percent. Inflation may average 0.4 percent in 2011, down from a previous forecast of 0.9 percent, it said. In 2012, consumer prices may drop 0.3 percent before rising 0.5 percent in 2013.

'Downside Risks'
The SNB, which aims to keep inflation below 2 percent, forecast annual consumer-price growth to reach 1 percent in the second quarter of 2014. In June, it had estimated inflation at 2.6 percent in the first quarter of that year.

"In the foreseeable future, there is no risk of inflation in Switzerland," the central bank said. "There are, however downside risks for price stability, should the Swiss franc not weaken further."

With exports accounting for about half of gross domestic product, the Swiss economy may fail to gather strength after expanding 0.4 percent in the second quarter. That's the weakest since a 2009 recession. The KOF economic indicator dropped to the lowest in almost two years last month and manufacturing growth weakened. Investor confidence also slumped in August.

"The SNB expects growth to come to a halt in the second half of the year," it said in the statement. "Without the stabilizing effect of the minimum exchange rate, there would be a substantial threat of recession."

SNB Rates
Nestle, the world's largest foodmaker, said on Sept. 1 it will seek to offset the franc's impact through productivity gains. Holcim AG, the world's second-biggest cement maker, said on Aug. 18 that currency effects shaved 203 million francs ($231 million) off operating profit in the second quarter and Swiss chemicals maker Clariant AG (CLN) cut its full-year earnings targets on Sept. 5 partly on a stronger currency.

SNB policy makers unexpectedly cut borrowing costs last month and boosted liquidity to money markets to help weaken the franc. Hildebrand said on Sept. 6 that while costs of the currency ceiling may be "very high," doing nothing "would almost certainly inflict tremendous long-term damage" to the economy.

"The SNB will do whatever it costs to fulfil its commitment," said Julien Manceaux, an economist at ING Group in Brussels in an e-mailed note. "It becomes very unlikely to see any rate hike in Switzerland any time soon."

The central bank last introduced a currency cap in 1978 to stem gains versus the Deutsche mark.

To contact the reporter on this story: Klaus Wille in Zurich at [e-mail]

To contact the editor responsible for this story: Craig Stirling at [e-mail]

[grupo guitarlumber] 03/9/2011 10:23

SNB May Have to Buy Euros to Stem Franc Heading for Record Weekly Advance
QBy Klaus Wille - Sep 2, 2011 4:49 PM GMT+0200 .
inShare.5
More
Business ExchangeBuzz up!DiggPrint Email ..Enlarge image
SNB May Use 'Nuclear Weapon', Franc Climbs Against Euro Gianluca Colla/Bloomberg
While the Swiss National Bank has so far avoided currency purchases in its latest bid to keep a lid on the franc, it may soon have no alternative but to follow through on its threat to intervene, economists and strategists said.

While the Swiss National Bank has so far avoided currency purchases in its latest bid to keep a lid on the franc, it may soon have no alternative but to follow through on its threat to intervene, economists and strategists said. Photographer: Gianluca Colla/Bloomberg
.The Swiss central bank may need to ready its "nuclear weapon" of buying euros as the franc heads for the biggest weekly advance on record against Europe's single currency.

While the Swiss National Bank has so far avoided currency purchases in its latest bid to keep a lid on the franc, it may soon have no alternative but to follow through on its threat to intervene, economists and strategists said.

"The SNB will fire its nuclear weapon and start interventions if the franc reaches parity," said You-Na Park, a strategist at Commerzbank AG in Frankfurt. "The current franc levels really hurt the economy."

The SNB, led by Philipp Hildebrand, is under pressure from executives including Swatch Group AG (UHR) Chief Executive Nick Hayek and lawmakers such as Swiss People's Party Vice President Christoph Blocher to weaken the franc to keep companies from cutting jobs and moving production sites abroad. The currency's 16 percent ascent against the euro over the past year is hurting exports and raising the risk of an economic recession.

While the franc has weakened against the euro since Aug. 3, when the SNB cut borrowing costs to zero and boosted liquidity to the money market to fight the currency's appreciation, it has reversed losses over the past three days.

Debt Crisis
The franc, considered a haven in times of global turmoil, has gained 6.4 percent against the euro since Aug. 30, putting it on track for the biggest weekly gain since the introduction of the single currency in 1999. It was at 1.1133 at 4:46 p.m. in Zurich, up 1.9 percent on the day.

"Pressure on the franc remains as long as the euro area's fiscal problems drag on," said Cornelia Luchsinger, an economist at Zuercher Kantonalbank in Zurich. "Should the currency strengthen to 1.10 or less versus the euro, the SNB might feel obliged to intervene."

The franc reached a record 1.0075 on Aug. 9. Switzerland's currency is 39 percent overvalued against the euro, based on purchasing power parity as calculated by the Organization for Economic Cooperation and Development.

"The SNB will intervene in times of low trading volumes to have the biggest possible impact," said Ursina Kubli, an economist at Bank Sarasin in Zurich. "That could be Sept. 5, as it's a holiday in the U.S." and markets are closed.

SNB 'Options'
The Zurich-based SNB in June 2010 abandoned 15 months of intervention efforts after quadrupling its currency holdings. The policy led to a record loss of $21 billion last year and sparked lawmaker calls for Hildebrand to resign.

Since then, politicians have called on the SNB to step up efforts. The Swiss government pledged on Aug. 31 to spend 870 million francs ($1.1 billion) on an economic stimulus package to help counter the impact of the franc's strength.

At a meeting in Bern today, the government and leaders of all five ruling-coalition parties welcomed the SNB's measures to weaken the franc, according to an e-mailed statement. Economy Minister Johann Schneider-Ammann informed participants about the economic situation and called the exchange rate volatile.

For its part, the SNB has refrained from stepping up efforts after boosting liquidity over three consecutive weeks. Vice President Thomas Jordan has said the bank is assessing "a whole range of options" to weaken the franc and remains ready to act if needed.

Exports Slump
A slump in exports and company spending sparked an economic slowdown in the second quarter, with gross domestic product rising 0.4 percent, down from 0.6 percent in the previous three months. That's the worst performance since the economy emerged from a recession in 2009. Foreign sales account for about half of Swiss GDP.

ABB Ltd. (ABBN), the world's largest maker of power-transmission gear, has called the strong franc a "headache" and responded by buying more parts from euro-region suppliers to feed its Swiss factories. Holcim Ltd. (HOLN), the world's second-biggest cement maker, said on Aug. 18 currency effects shaved 203 million francs off operating profit in the second quarter.

"If the franc appreciates and remains at parity for a while, a severe recession would be inevitable," said Alexander Koch, an economist at UniCredit Group in Munich. "They can't let this happen because once you decide to move a plant to the euro zone, it's unlikely that it will ever come back."

Geoffrey Yu, a foreign-exchange strategist at UBS AG in London, said the SNB may consider setting a floor of 1.10 or 1.15 against the euro. While some economists expect SNB council members to take additional measures when they meet for their quarterly assessment on Sept. 15, Geoff Kendrick, head of European currency strategy at Nomura International Plc in London, disagrees.

"I don't expect the SNB to come in," he said. "Their optimal strategy is to keep talking. That works quite nicely for them."

To contact the reporter on this story: Klaus Wille in Zurich at [e-mail]

To contact the editor responsible for this story: Craig Stirling at [e-mail]

[ariane] 27/8/2011 08:18

Franc Slides on Bernanke, Concern That Swiss Banks May Charge for Deposits
QBy Anchalee Worrachate and Lucy Meakin - Aug 26, 2011 7:12 PM GMT+0200 .
inShare.2
More
Business ExchangeBuzz up!DiggPrint Email ...The Swiss franc slid against all its major counterparts after Federal Reserve chairman Ben S. Bernanke stopped short of signaling further stimulus, suggesting the world economy isn't as weak as some analysts had suggested.

The currency also extended a third weekly loss against the euro on speculation Swiss policy makers will introduce new measures to cap its gains, and local banks may start charging customers for franc deposits. Bernanke said the Fed has tools to deal with the economic slowdown but didn't announce another round of so-called quantitative easing.

"What Bernanke said suggested was perhaps the world's economic weakness is not so bad that it warrants another round of QE, and that helped to damp demand for the franc," said Jeremy Stretch, head of currency strategy at Canadian Imperial Bank of Commerce in London. "There has also been speculation about the SNB's possible further action on the franc, which makes the market cautious."

The franc slumped 2.6 percent to 1.1697 per euro at 5:56 p.m. in London. The currency fell 1.8 percent to 80.76 centimes per dollar, extending a weekly decline to 2.9 percent, the most since the week ended Jan. 7. It slid 2.8 percent to 94.98 yen.

While Bernanke sought to reassure investors and the public that U.S. growth is safe in the long run and that the Fed still has tools to aid the recovery if needed, he stopped short of indicating the central bank will introduce a third round of government bond-buying.

'Range of Tools'
"The Federal Reserve has a range of tools that could be used to provide additional monetary stimulus," Bernanke told central bankers and economists at a conference in Jackson Hole, Wyoming. He said a second day has been added to the next Fed meeting in September to "allow a fuller discussion" of the economy and the central bank's possible response.

The franc tumbled in afternoon trading on speculation Swiss banks may begin charging for deposits in francs. UBS AG said it may levy a temporary excess balance fee to stem the inflow of francs into its customers' cash clearing accounts.

The Swiss lender cited "the prevailing market conditions which in particular affect the Swiss Franc." It made the comment in a note to clients sent via the Swift system and confirmed to Bloomberg.

'Jittery' Market
"The market is very jittery on the franc right now because of potential negative interest rates," said Geoffrey Yu, a currency strategist at UBS in London. "Investors are not distinguishing between different forms of deposit accounts. The cash clearing accounts will potentially be impacted by deeply negative interest rates in money markets. However, I think there's close-to-zero chance any major Swiss bank will penalize normal depositors."

If there were to be excess balance fees, it may become less attractive to hold the franc, said Jens Nordvig, managing director of currency research at Nomura International Plc.

"The currency has attracted a lot of inflows," New York- based Nordvig said. "There are very few securities to buy. Most of the money ends up in deposits in some form. If you are going to have to pay for the privilege to have that deposit, that's going to disincentivize them."

The Swiss currency weakened earlier after an index of leading indicators dropped more than economists forecast, adding to signs the currency's recent strength may be damaging the nation's growth.

The monthly gauge that aims to predict the economy's direction about six months ahead fell to 1.61 for August from a revised 1.98 in July, the KOF Swiss Economic Institute said. Economists forecast a decline to 1.8, according to the median of 14 estimates in a Bloomberg News survey.

SNB Measures
The central bank has taken a number of steps in recent months to counter the currency's gains. It boosted liquidity in money markets and increased the cash available to banks after the franc's appreciation made the nation's exports less competitive. The Swiss manufacturers' association Swissmem said this week the country may face serious economic damage unless a "clear weakening" of the currency begins soon.

Switzerland's currency has strengthened 12 percent this year, the best performer among a basket of the currencies of 10 developed nations, according to Bloomberg Correlation-Weighted Currency Indexes.

Swiss government bonds rose, pushing 10-year yields down seven basis points to 1.01 percent.

To contact the reporter on this story: Anchalee Worrachate in London at [e-mail]

To contact the editor responsible for this story: Daniel Tilles at [e-mail]

[ariane] 24/8/2011 18:50

Swiss Manufacturers See 'Broad Decline' Unless Franc Weakens
QBy Leigh Baldwin and Paul Verschuur - Aug 24, 2011 11:47 AM GMT+0200 .
inShare.0
More
Business ExchangeBuzz up!DiggPrint Email ...The Swiss manufacturers' association Swissmem said the country could face serious economic damage unless a "clear weakening" of the Swiss franc begins soon.

"If that doesn't happen, many companies will have to take drastic decisions in the fall," the industry group said today in a faxed statement. 'What's looming is nothing less than a broad decline of Switzerland's industrial base.''

The franc's "massive over-valuation" led to a decline in orders for the first time since 2009, said the association, whose members include ABB Ltd. and Sulzer Chemtech AG. Orders fell 2.6 percent in the second quarter of 2011, compared with the same period a year earlier, the statement said.

Last week the Swiss government announced a 2 billion-franc spending plan to ease the pain to industry caused by the surging franc. The Swiss National Bank on Aug. 3 cut key interest rates to near zero. The central bank also increased sight deposits almost seven-fold to boost liquidity. That might not be enough, Swissmem said.

"Swissmem expects the SNB to continue along the path it has laid out," the statement said. "If necessary, it will have to take even sharper measures."

So far, the central bank has declined to set a target exchange rate for the franc, which traded at 1.1420 to the euro at 11:29 a.m. in Zurich.

To contact the reporters on this story: Leigh Baldwin in Zurich at [e-mail]; Paul Verschuur in Zurich at [e-mail]

To contact the editor responsible for this story: Angela Cullen at [e-mail]

[m.t.glass] 23/8/2011 19:07

Partly depends on when. If it gets to that level quickly, too soon for the outlook to have altered, I might place it on my buy watchlist but wouldn't immediately buy. The company has already indicated they are looking at a year or two of slow progress. There are livelier places for investors to park their money in the meantime.

[edmundshaw] 23/8/2011 18:55

120 sounds a reasonable kind of target now. If we reached 120, though, would you buy or say "maybe 100p actually...".

150p to 160p was my point to start watching this again. Window shopping for me, though, until something changes.

[owenski] 23/8/2011 17:13

SFR's outlook for UK wasn't encouraging. The India JV is the beacon of hope here but it is still fledgling.

This is a shame to see, SFR has done me well in the past, I'm still not inclined to buy at these levels, as a play on India eventually taking up the slack I'd be interested at 120 also, still think its a tad pricey at mo for me.

[m.t.glass] 23/8/2011 16:27

I would be inclined to agree. I was ready to close my latest downbet if it bounced at 160p and was a bit surprised it didn't.
I have held upbets on SFR in the past and expect to do so sometime in the future.

[hyden] 23/8/2011 15:56

I view 120p as a good entry price. A lot of risk priced in at that price, imo.

[m.t.glass] 23/8/2011 15:07

Now testing that October 2009 low of 160p

Next support if that goes is 120p (March 2009)

[stevemarkus] 23/8/2011 10:06

Yes, I'd tend to agree with jonwig. I don't like the debt figure particularly, but give them the benefit of the doubt on that, with working capital increases. Order book up a bit on the previous year is positive, and they are obviously focusing their efforts where they feel they are most likely to win work. They do mention some positive signals somewhere in the report.

India looks good, although there seem to have been delays - hopefully that will work through in the second half and we will see some decent figures from the JV. It will be interesting to see what margins are like there.

Wasn't there an Abu Dabi office announced not too long ago? No mention of it in these results. I wonder what's happened there.

Must admit I looked at these results this morning and briefly thought of selling, but I intend to hold for now. Perhaps we are at an inflexion point? I hope so!

Cheers,
Steve.

[m.t.glass] 23/8/2011 09:10

jonwig - I agree that some of the negative stuff was anticipated and shows in the recent price fall already. I do think some people had presumed that all the negatives were priced in, and that the figures might at least be comfortable enough to generate a bounce, with perhaps a few brave souls buying. I had already closed my recent downbets because of that possibility. But so far this morning that hasn't happened, and shorters will be weighing whether further falls are likely instead. Your point about rivals being wiped out is one area from which SFR might gain some good-margin near-term work to fill gaps if major contracts of their own are deferred.

[jonwig] 23/8/2011 08:50

But are the results surprising? Wasn't it all signalled? I must say I expected worse, after the bashing the share price has taken this month.

The debt position is very volatile, as is the working capital stock - I don't think it's part of a trend.

Maintaining market share is a brutal process - maybe more competition will vanish before the upturn.

India is making positive noises ... let's hope they haven't got too deep into corruption over there!

Not a 'buy' at this level, but I'm holding.

[jadeticl2] 23/8/2011 08:41

Looks a dismal set of results at first sight. I am very disappointed in the scale of the dividend decrease. I had expected them to hold interim at 5p.

[alter ego] 23/8/2011 07:48

www.investegate.co.uk/Article.aspx?id=201108230700148301M

[jadeticl2] 22/8/2011 22:13

Interims soon? What will they tell us?

[waldron] 20/8/2011 14:37

Vineyard Vacation
The president arrived on Aug. 18 for a 10-day vacation in Martha's Vineyard, Massachusetts, where his aides say he will be working on a new plan to create jobs that includes a mix of tax cuts and infrastructure spending. Obama, who will also offer his own suggestions for making steeper cuts to the nation's debt, will lay out the proposals in a speech shortly after the U.S. Labor Day holiday, which is Sept. 5.

"We're coming through a terrible recession; a lot of folks are still looking for work," Obama said. "A lot of people are getting by with smaller paychecks or less money in the cash register."

[alexisk] 17/8/2011 10:25

Great news today re steel contract for the "Cheesegrater" building. Can't help to be good for the company to be involved in such a prominent and prestigious project.

[mafia music] 16/8/2011 21:38

anyone read the holding rns. Someone is disposing some of his holding

[waldron] 14/8/2011 13:08

cheers maxk


i'am going to ask for my swiss pension be paid in gold