European earnings wrap

February 28, 2002 Posted: 1331 GMT

LONDON (CNN) -- A raft of European companies are reporting results and providing guidance for the year ahead.

Below are a selected group, ranging from hotel operator Hilton to newspaper publisher Trinity Mirror.

Hilton Group (HG-), the British hotel and gaming company, said 2001 pretax profit before cost rose 1.3 percent of £280.2 million ($397.3 million),

in line with analysts' expectations.

The operator of Hilton hotels outside the United States and Ladbrokes betting said it expects market conditions to recover in the second-half of the year as the global economy rebounds.

"The effects of September 11 were not as bad as most feared, and trading conditions never went down as much as after the Gulf War. What we see is occupancy levels recovering to last year's levels by the second half," said Chief Executive David Michels.

Its stock fell 4.2 percent 222.75 pence in midday London trading on Thursday.

France's Lafarge (PMMB) , the world-biggest cement maker, posted a 3.3 percent rise in annual profit to 750 million from 726 million a year ago.

The company, which weathered a U.S. recession that began in March last year, said there had been no improvement in market trends at the start of 2002 but expected to benefit from improving profitability and cost savings at its newly acquired British unit Blue Circle.

Lafarge shares were down 1.8 percent at 46.87 in midday Paris trading.

UK life assurer Legal & General (LGEN) said on Thursday 2001 pretax operating profits rose 10 percent to £751 million, driven by strong increases in new business, particularly in life and pensions.

"We have had good growth in sales in 2001," said Group Chief Executive David Prosser in a conference call. "We are growing our market share and have had good growth in dividend."

Its shares rose 1.3 percent to 149.75 pence in midday London trading.

Germany's Linde (FLIN), the world's fourth biggest industrial gas producer, said its 2001 EBIT (earnings before interest and tax) came in at 687 million ($594.3 million), up 2.8 percent on the year but below analysts' expectations.

It said trading in industrial gas slowed in the fourth quarter amid the gloomy economic climate across the Atlantic. In industrial gas, Linde ranks behind France's Air Liquide, Britain's BOC Group and U.S. Praxair.

Linde's stock, which has risen about 45 percent since its September 2001 low, slipped 1.6 percent to 52.50.

Rentokil Initial (RTO), which provides pest extermination services to Queen Elizabeth, said pretax profit came in at £374.3 million, beating expectations.

The British company said it expected further strong growth in 2002 and plans to spend up to £1 billion on share buybacks. Earnings per share in the year to end-December rose 13.6 percent to 13.3 pence against consensus analyst estimates of around 13.2 pence per share.

Rentokil's stock rose 1.5 percent to 265 pence in midday London trading.

Royal Bank of Scotland (RBOS), Britain's second-biggest bank, said annual pretax profit rose 32 percent to £5.801 billion in 2001 from £4.401 billion in the previous year.

The profit was in line with expectations as the company benefited from the acquisitions of rival NatWest in 2000 and expects cost savings to reach £5.5 billion by 2003, higher than expected.

Its stock slipped 0.6 percent to 17.20 in midday London trading.

British insurer Royal & Sun Alliance (RSA) said 2001 profit was wiped out after the company more than doubled its reserves for asbestos claims. The company also faces losses of about £215 million from the terror attacks on the World Trade Center.

"2001 was a very difficult year for us, and we are disappointed with the results," said Chief Executive Bob Mendelsohn. "We have taken a number of tough actions to deal with reserving issues and underperforming businesses, and enter 2002 on a much stronger footing."

The insurer plans to sell businesses to release capital worth £800 million this year. Royal & Sun posted an operating profit of just £16 million for 2001, from a restated 462 million pounds the year before

Royal & Sun dropped 5.6 percent to 258.9 percent in midday trading on Thursday.

British newspaper publisher Trinity Mirror (TNI) said 2001 pretax profit rose less than 1 percent to £155.5 million as it experienced one of the toughest trading periods in recent history.

Trinity, whose Daily Mirror tabloid won the industry's "Newspaper of the Year" award said the difficult and declining advertising market had continued into January and February, and the company expected this to remain the case for most of the year.

Trinity rose 1 percent to 415 pence in midday London trading on Thursday.