Business

L’Oreal heiress Liliane Bettencourt dies at 94

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Liliane BettencourtImage copyrightAFP
Image caption Ms Bettencourt was the world’s 14th wealthiest person, according to Forbes magazine’s 2017 list

Liliane Bettencourt, the heiress to cosmetics firm L’Oreal, has died aged 94, her family has confirmed.

A statement said she had died at home “peacefully” overnight.

With an estimated 2017 net worth of 33bn euros (£30bn; $40bn), she was the world’s richest woman.

She left the company’s board in 2012 and was rarely seen in public afterwards, but remained in the news because of a high-profile exploitation case following her dementia diagnosis.

In a statement, the company’s chairman and CEO Jean-Paul Agon said: “We all had a deep admiration for Liliane Bettencourt who has always watched over L’Oreal, the company and its employees, and who was very attached to its success and development.

“She personally contributed a lot to its success for very many years. A great woman of beauty has left us and we will never forget her.”

The heiress became embroiled in a public feud with her estranged daughter, Francoise Bettencourt-Meyers, in 2007.

Ms Bettencourt-Meyers filed a lawsuit over concerns that her mother was being exploited by members of her entourage amid declining health.

It was revealed in 2008 that a photographer who had befriended the heiress, François-Marie Banier, was gifted items worth hundreds of millions of dollars – including paintings by Picasso and a 670-acre island in the Seychelles.

Ms Bettencourt-Meyers said she took legal action against Mr Banier after learning from her mother’s household staff that she was allegedly considering adopting him.

Image copyrightReuters
Image caption Ms Bettencourt and her daughter, pictured at a L’Oreal event in 2011

The mother and daughter reconciled their relationship in 2010, and a French judge ordered Ms Bettencourt be put under the guardianship of her family a year later because of her failing health.

But the family exploitation case then escalated to a political scandal after it was claimed that Ms Bettencourt’s financial manager, Patrice de Maistre, had extracted money from her to go towards former French President Nicolas Sarkozy’s 2007 election bid.

The alleged illegal funding was investigated, although Mr Sarkozy consistently rejected all accusations of impropriety and French prosecutors dropped all charges relating to him in 2013.

The rest of the exploitation case was eventually resolved in May 2015 when eight people, including Mr Banier, were convicted and instructed to pay millions in damages to the family.

The L’Oreal empire

Ms Bettencourt’s assets, including her holding stake in the cosmetics company, were placed in a trust controlled by her daughter.

One of her two grandchildren, Jean-Victor Meyers, succeeded her on L’Oreal’s board as vice chairman, and was named to guard her personal affairs.

Her father, Eugène Schueller, founded a hair dye company in 1909, which then turned into the L’Oreal group.

It is now the world’s largest cosmetics company.

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VW diesel car protest: Greenpeace members climb on boat

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Protesters at SheernessImage copyrightGreenpeace
Image caption Protesters are trying to stop the importing of diesel cars from Germany

Environmental protesters have climbed on to a ship at a Kent port transporting diesel cars from Germany.

Greenpeace said campaigners had boarded the ship at Sheerness in Kent and were preventing the unloading of the cars.

The group said it would not leave the ship until Volkswagen agreed to return the cars to Germany. Volkswagen said they were aware of the protest.

More than 40 people are “attempting to immobilise all the VW diesel cars by removing their keys”, Greenpeace said.

Media playback is unsupported on your device
Media captionGreenpeace protesters target VW cars at Sheerness docks

Kent Police said it had received reports of a “peaceful protest” at the Port of Sheerness at 08:52 BST and officers were at the scene.

Greenpeace said 25 volunteers had boarded the 23,000-tonne ship in the Thames Estuary and were now hanging from the 27m-high unloading doors.

The Greenpeace spokesman added: “Simultaneously, 41 volunteers have scaled the fences at Sheerness port in Kent – the intended destination of the ship – and gained access to the vehicle park, where several thousand VW diesel cars are awaiting distribution to suppliers.”

In a statement, a Volkswagen spokesman said: “We are aware of a protest this morning at the Sheerness port in Kent.

“The ship contains a variety of Volkswagen Group vehicles, including petrol, diesel and plug-in hybrid models. The diesel vehicles, which are the subject of the protest, meet strict Euro-6 standards.”

A spokeswoman for Peel Ports, which owns the Port of Sheerness, said, “We can confirm that Greenpeace protesters have illegally entered secure areas of the Port of Sheerness. These areas are restricted to ensure that UK border security is preserved.

“We are working with the police, Greenpeace and Volkswagen to resolve the situation.”

Image copyrightGreenpeace

The Elbe Highway has since moved from the Sheerness area and is now anchored off Margate.

In September 2015 VW admitted to US regulators it had cheated on emissions tests there using software installed in as many as 11 million diesel vehicles sold worldwide – the majority of them in Europe.

In March the company pleaded guilty to conspiracy to commit fraud, obstruction of justice and entry of goods by false statement as part of a $4.3bn (£3.5bn) agreement with the US regulators over the scandal.

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Man Utd reports record revenues as TV cash soars

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Marcus Rashford of Manchester United scores his sides first goal during the Carabao Cup Third Round match between Manchester United and Burton Albion at Old Trafford on September 20,Image copyrightGetty Images

Manchester United has reported record revenues of £581m for the 2017 financial year, as TV cash soared.

In a year when it won the Europa League and EFL Cup, the club also signed 12 sponsorship deals, and saw commercial and matchday revenues increase.

The club benefitted from a huge rise in domestic TV revenues during 2016-17, the first season in the current three-year UK broadcasting deal.

The Old Trafford club is currently second in the Premier League.

It has the same number of points and goal record as leaders Manchester City.

In the year to 30 June, broadcast income jumped to £194.1m from £140.4m the year before, a rise of 38%.

This season the club is back in the Champions League thanks to its Europa League final victory over Ajax in Stockholm in May. The journey to that final also helped to boost TV revenues during the season.

It is the second successive year they have accrued revenues of more than £500m, recording a figure of £515.3m last year.

It comes after the club returned to the top of the Deloitte money list in January.

Higher wages

“We concluded a successful 2016-17 season with a total of three trophies and a return to Champions League football,” said executive vice-chairman Ed Woodward, referring to them also winning the Community Shield during the season.

“We are pleased with the investment in our squad and look forward to an exciting season.”

Employee wages – including those of players – increased by 13%, “primarily due to an increase in first team salaries”.

Operating expenses for the year were £511.3m, an increase of £74.7m, or 17.1%, on the previous year.

However, net debt fell by £47.8m to £213.1m.

Image copyrightGetty Images
Image caption The club is competing again in the Champions League this season

The club also posted record operating profits of £80.8m, up from £68.9m the previous year.

Commercial revenue rose 2.7% to £275.5m. Money from sponsorship, retail, and licensing was up, but the club said it lost 15% over the year on its digital output.

Match-day revenue climbed 4.7% to £111.6m, but the club said this was “primarily due to playing two more home games in the year”.

Meanwhile, German player Bastian Schweinsteiger’s return to Jose Mourinho’s first-team squad during the year saw him reinstated as an “exceptional credit” item on the annual balance sheet, at a value of £4.8m.

In its results statement the club also said: “Tax expense for the year was £17.3m, compared to £12.5m in the prior year, primarily due to the increase in profit before tax and a reduction in foreign exchange gains on US dollar-denominated deferred tax assets.”

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Ryanair plans to make pilots change holidays

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Michael O'LearyImage copyrightNiall Carson/PA
Image caption Boss Michael O’Leary at the Ryanair shareholder meeting

Ryanair boss Michael O’Leary has said the firm plans to make some pilots delay a week’s holiday as it wrestles with massive flight cancellations.

His comments came at the airline’s annual general meeting in Dublin.

Ryanair is cancelling 40-50 flights every day for the next six weeks, after it admitted it had “messed up” the planning of pilot holidays.

Mr O’Leary said some pilots had been offered a 10,000-euro pay rise in exchange for helping out.

He told the AGM that the offer applied to pilots at London Stansted, Dublin, Frankfurt and Berlin airports.

This is on top of a cash bonus already offered to pilots, which has been given a frosty reception.

Ryanair had offered captains a one-off payment of £12,000 or 12,000 euros, and first officers £6,000 or 6,000 euros, but representatives said they wanted new contracts and better working conditions instead.


Analysis: Simon Jack, business editor

Will the combination of unhappy customers, and the increased cost of retaining pilots, harm the very business model of the airline itself?

Could Michael O’Leary become a lightning rod for staff discontent (the way Willie Walsh did at BA) and have to stand down?

According to shareholders I spoke to today, the answers are no, no and no.

Read more from Simon in his business blog


Mr O’Leary said the airline had “some goodies” to propose to pilots, but added: “If pilots misbehave, that will be the end of the goodies.”

He dismissed talk of possible industrial action, including reported plans for a work-to-rule, saying: “There isn’t a union.”

He also accused unions of trying to give the company “a bloody nose” and said staff did not want union representation.

What should I do if my flight is cancelled?

Flight cancellations in full

Has your flight been cancelled? Get in touch: haveyoursay@bbc.co.uk

Mr O’Leary told the AGM that Ryanair was facing a “significant management failure” and the cancellations had cost the airline about 25m euros (£22m).

He said pilots who had a four-week block of holidays coming up in the next few months because of rota changes, would be told to take three weeks off instead and have the other week in January.

This partial reversal of the policy announced earlier in the week applied to 500 of the airline’s 4,200 pilots, he said.

Arguing that Ryanair did not need the pilots’ agreement to these further changes to their holiday arrangements, Mr O’Leary said: “There won’t be more cancellations because of the rostering issues.”


Analysis: Richard Westcott, transport correspondent

Image copyrightGetty Images

The Ryanair pilots I’ve spoken to say they’ve never known anything like it.

Across Europe, I’m told, staff reps from more than 30 bases are talking on Whatsapp, co-ordinating a plan to get a better deal from their employer.

Until now, they say, they’ve been scattered and isolated, making them much less powerful.

Over the past few days, several have said to me how unhappy and disrespected they feel at work, yet they’ve never had a unified voice to bargain for a better deal.

They seem to have found that voice. One used the word “revolt”.

It’s hard to say where this might end up, but Ryanair really needs these people on side right now, to help it through a messy few weeks of cancelled flights.

If these pilots refuse to work extra days, more cancellations could be on the way.


‘Greener pastures’

In a letter seen by the BBC, pilot representatives from 30 of the company’s 80 or so European bases turned down the cash bonus offer.

They wrote: “The pilot market is changing, and Ryanair will need to change the ways which the pilots and management work together to ensure a stable and common future for everyone.”

New contracts, the letter said, should help stop the large number of colleagues who are leaving for “greener pastures”.

Separately, some Ryanair pilots have spoken to the BBC about a “toxic” atmosphere and how they felt “undervalued”.

Ryanair has said it expects to have re-accommodated more than 95% of the 315,000 customers affected by cancellations by end of this week.

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What is Google thinking with HTC deal?

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Yet it was a quotation that sprang to mind on learning that Google is paying $1.1bn (£820m) for parts of the Taiwanese handset maker HTC.

Because it seems like only yesterday – in fact, it was in 2011 – that Google was spending $12.5bn for Motorola Mobility.

The deal was a flop and the business was offloaded to Lenovo, the Chinese technology company, for just $3bn only four years later.

So what is Google up to? Well, in a word, renewing its efforts to take on Apple.

Apple dominates the global smartphone market and, in order to keep up with it, Google appears to have concluded it simply has to have a meaningful presence in hardware.

Android, devised by Google, is the world’s most popular mobile operating system.

It is in getting on for two-thirds of phones, tablets and related devices worldwide, twice the market share of Apple’s iOS, yet it is Samsung – which of course uses Android – that is the primary competitor to Apple.

So having its own manufacturing capability and being able to develop hardware and software together will be a major attraction to Google.

Android has been a profitable product for Google – but licensing it out to other handset and tablet manufacturers, like Samsung, has led to a lack of consistency in the way it is used and, possibly, has prevented all of Android’s strengths and benefits from being showcased in one product.

This is understood to have been a cause of frustration to Google.

Accordingly, if Google can build up its own handset operation, it can have more control over Android’s destiny, even if this does along the way put at risk its relationships with other companies, such as Samsung, ZTE, Huawei and LG.

One of Apple’s strengths, which Google will hope to replicate, has been the way it has been able to develop hardware and software alongside each other, even if it has contracted out the manufacturing of its devices to Foxconn, the Chinese company.

The 2,000 people being acquired by Google as part of this deal includes the team that helped develop Google’s Pixel smartphone – which, the company will now be hoping, will now be further differentiated from other smartphones on the market using Android.

This transaction will also have the added benefit of lessening Android’s reliance on Samsung which, if the latter builds up its own presence on software, will be essential.

There is a view that, with the likely growth of Artificial Intelligence (AI) and other tech trends such as Augmented Reality (AR), it is going to be ever more important to be able to knit together hardware and software development.

This was highlighted when, at the launch of Apple’s new iPhone X last week, the new gizmo’s AR capabilities were showcased.

Then there is the price. At $1.1bn, this acquisition is clearly less expensive and less of a financial gamble for Google than Motorola Mobility was, even if HTC’s share of the global handset market has fallen from 9% just six years ago to less than 1% by the end of last year.

The other big contrast with the Motorola Mobility deal is that, with the benefit of hindsight, that transaction was really all about Google seeking to get its hands on a lot of Motorola patents.

So, while this does on the face of it look like doing the same thing and hoping for a different result, Google genuinely is up to something quite different this time around.

Or so its investors must hope.

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Capita shares hit as profits fall

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Traders in LondonImage copyrightAFP

A big rise in the value of shares in the specialist metals and chemicals firm Johnson Matthey was the highlight of the London stock market on Thursday.

Its shares closed 15% higher at £4.32 after it announced plans to invest £200m in developing batteries for electric cars.

The firm said this might lead to more than $30bn in sales when battery driven cars accounted for 10% of all vehicles.

The FTSE 100 index closed eight points lower at 7,264.

In the FTSE 250 market shares in the outsourcing group Capita fell 12% to £5.70 after it reported lower profits and gave a weaker than expected forecast.

The company said half-year pre-tax profits had fallen by 26% to £28m, after it sold its specialist recruitment arm and shut down its events operation.

However, it said that “underlying” profits were expected to “rise modestly” in the second half of the year.

Shares in Irish building materials firm CRH rose 2.4% after it agreed to buy the US cement maker Ash Grove Cement for $3.5bn (£2.6bn), in order to expand in North America.

On the currency markets, the pound rose 0.5% against the dollar to $1.357 and was barely changed at 1.136 euros.

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Deliveroo makes huge loss on food delivery business

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Deliveroo delivery bags and driverImage copyrightAFP

Losses have risen sharply at the gig economy food delivery firm, Deliveroo, according to its latest accounts.

The company, incorporated under the name Roofoods, made a worldwide loss of £129m in 2016, up from £30m in 2015.

Deliveroo made sales of £128.56m, up from £18.1m, but the cost of getting the goods to customers was £127.47m, leaving it a wafer-thin profit margin.

On top of that the company has been funding an international expansion plan.

Deliveroo is now in 12 countries, including Germany and Singapore.

It connects thousands of bike couriers to customers wanting food from restaurants that do not have their own delivery system.

Deliveroo does not employ its riders directly, but pays them per delivery – hence the term “gig”.

In July the company said it would pay sickness and injury benefits to its 15,000 riders in the UK if the laws were changed.

Deliveroo said UK employment rules should be changed so that people who work for companies like Deliveroo can receive enhanced benefits and not lose the flexibility to work when they want.

‘Heavy investment’

Last year the number of Deliveroo riders worldwide rose from 5,700 in 2015 to 26,500, a number that has carried on rising.

That rapid expansion was behind rising administrative expenses, which ballooned to £142m last year.

Its accounts also show it raised £208m from shareholders in 2016, representing 29% of the company.

A company spokesman said in a statement: “Deliveroo is investing heavily in new technology and new sites across the world.

‘We are extremely proud that in only four years Deliveroo now works with over 30,000 riders and 20,000 restaurants to deliver great-tasting food in over 140 cities around the world.”

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Manchester United predicts 2018 profit fall

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The Premier League Club – controlled by the American Glazer family and managed by Jose Mourinho – reported profits just shy of £200m in the 12 months to 30 June.

The record figure came on the back of an all-time high revenue performance – the club raking in £581m.

It was aided by proceeds from a new Premier League TV rights deal and the lifting of the Europa League trophy, as broadcast revenue soared by 38% to £194m.

United said it made a £10.9m profit from transfers in the period compared to a loss of almost £10m in the previous 12 months.

Mourinho won the Europa League in his first season as Manchester United manager
Image:Jose Mourinho won the Europa League in his first season as United manager

Net debt fell 18.3% to £213.1m.

The club, whose top players include Paul Pogba and Romelu Lukaku – the latter signed from Everton in the last summer break for an initial £75m – are currently joint top of the Premier League with local rivals Manchester City.

It forecast revenue in line with that of the last financial year but said it expected profits to come in between the range of £175m and £185m.

The lower figure was partly blamed on the prospect of bonus payments to players because of Champions League qualification.

United’s executive vice chairman, Ed Woodward, said: “We concluded a successful 2016/17 season with a total of

three trophies and a return to Champions League football,” adding: “We are pleased with the investment in our squad and look forward to an exciting season.”

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Fake website fools Equifax staff

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Equifax logoImage copyrightEPA

Credit rating firm Equifax has apologised after it mistakenly directed some customers to an imposter website via its Twitter page.

The firm recently disclosed a data breach affecting more than 143 million people, and set up a new website to share information with customers.

But it mistakenly tweeted the wrong web address several times, leading some customers to a fake website.

One security researcher told the BBC it was a “massive faux-pas”.

Image caption The fake Equifax website looked just like the real thing, but was critical of the company

Following its data breach, Equifax set up a new website – equifaxsecurity2017.com – to let people find out more information.

The website also let people register for a credit monitoring service, by entering personal details into a form.

Many security researchers said Equifax should have hosted this information on its main website – equifax.com – rather than setting up a new one.

They pointed out that the new web address looked like one a scammer might set up to try to fool victims.

Security researcher Nick Sweeting tweeted: “Yeah… no thanks… it would take me literally 20 mins to build a clone of this site.”

He then did exactly that, creating an almost identical version of the website at securityequifax2017.com.

His fake version of the website also let people fill in their personal information – but then told them they had been “bamboozled”.

Staff operating the Equifax twitter feed shared the fake website with customers several times.

Image copyrightTwitter.com/Equifax
Image caption The incorrect tweets have since been deleted

In a statement, Equifax said: “All posts using the wrong link have been taken down. We apologise for the confusion.

“Consumers should be aware of fake websites purporting to be operated by Equifax. Our dedicated website for consumers to learn more about the incident and sign up for free credit monitoring is equifaxsecurity2017.com and our US company homepage is equifax.com.”

Faux-pas

“Clearly, the social media team has not been thoroughly briefed,” said Ken Munro from the security firm Pen Test Partners.

“That’s a massive faux-pas, they should not be pointing people to a website that is not the real one.

“They are lucky the person behind it was a well-intentioned security researcher, it could easily have been somebody harvesting credentials.”

Criminals often use a widely-publicised data breach to try and fool victims into handing over more of their personal data.

“People have to be careful after a data breach. Hackers often email victims trying to spoof the affected organisations,” said Mr Munro.

“You might get phone calls from people pretending to be from the support team. We see this all the time – be on your guard.”

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Government borrowing at lowest August level for 10 years

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Piggy bankImage copyrightPA

Bumper VAT receipts have helped government borrowing to fall to its lowest August level since 2007, according to official figures.

The government’s deficit narrowed to £5.7bn last month, compared with £7bn a year earlier, the Office for National Statistics (ONS) said.

VAT receipts rose by 5.6% from last year to £11.6bn, a record for August.

For the financial year to date, the government has borrowed £28.3bn, down £0.2bn from the same point last year.

The monthly deficit for August was lower than analysts had forecast and followed a £0.2bn surplus in July, which was the first such surplus for that month since 2002.

However, the government’s total debt – defined as public sector net debt (excluding public sector banks) – stood at £1.77 trillion at the end of August, equivalent to 88% of gross domestic product.

That also represents an 89% rise in the stock of the national debt since the start of the current decade.

‘Wiggle room’

Howard Archer, chief economic adviser at the EY Item Club, said: “The public finances were boosted in August by record VAT receipts for the month… which ties in with strong retail sales growth.

“The ONS also reported that taking July and August together, receipts from income-tax self-assessments were up £0.4bn to a record £9.4bn.

He warned that the public finances might take a turn for the worse in the coming months, due to the slow growth of the economy and higher government interest payments.

“Nevertheless, it looks increasingly like the chancellor will have some wiggle room in November’s Budget,” Mr Archer said.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the improvement in August’s deficit reflected government spending cuts, rather than a strong economy.

But he said borrowing for the current financial year “appears to be on track to come in at about £50bn, clearly below the OBR’s [Office for Budget Responsibility] March forecast”.

At the Budget in March, the OBR had forecast borrowing for 2017-18 would be just over £58bn.

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