Newspaper item 24: Hair Cosmetics Help Increase Henkel Profits

1. Translate the newspaper item from English into Russian. Use the wordlist and a dictionary.

Henkel, maker of household products including Persil washing powder, Loctite glue and Schwarzkopf hair colourants, said yesterday it was on track to boost full-year profits by at least 10 per cent despite sluggish consumer spending.

Henkel, which has pledged to focus on personal care after getting out of speciality chemicals last year, said strong sales growth, particularly in eastern Europe and the Middle East, and hair cosmetics helped drive a sharp increase in second-quarter profits.

Henkel confirmed it expected full-year sales to grow to 'almost' €10bn ($9.8bn), up from €9.4bn in 2001. Its second-quarter operating profit rose 11.5 per cent to €168m on sales of €2.49bn, up 2.7 per cent on a year earlier.

'We take the figures as an encouraging sign,' WestLB Panmure said in a research note. Henkel's results bettered those of Beierdorf, its German rival, which posted a 19 per cent fall in first-half operating profits.

Despite higher profits, Henkel said it suffered from low demand in the USA electronics industry, which hampered industrial adhesives sales, and the weak Latin American and Japanese economies. Henkel still has a long way to go if it wants to catch industry giants such as Unilever and Procter and Gamble. With acquisition targets thin on the ground and limited organic growth potential, analysts are slightly worried about Henkel's next step.

'If Henkel feels pressured to act, there is a real danger that it may overpay,' said Michael Otto at Helaba Trust.

Following the sale of chemicals, Henkel has pledged to grow its remaining divisions, particularly cosmetics and toiletries, where it lacks critical mass globally and has a widely dispersed portfolio.

With about €7bn available to spend, Henkel has said it wants to break into the top five from its current number 19 position in cosmetics.

Regardless of the dangers, industry experts say Henkel has chosen the right time to grow its personal care division. 'It makes a lot of sense to profit from the baby boomers' coming of age.' Mr. Otto said. 'They are going to need more and more anti-aging products.'

Wordlist

to pledge		заверять, ручаться, давать слово
to drive (drove, driven)		1) ехать; 2) преследовать; 3) совершать, вести
sign		знак
to suffer		страдать
to hamper		препятствовать, мешать
to lack		испытывать недостаток, не хватать
regardless of		независимо от

Newspaper item 25: Ford Succeeds in Defusing Credit Unit Time Bomb

1. Translate the newspaper item from English into Russian. Use the wordlist and a dictionary.

It is not often a chief executive admits he fears a major part of his business is 'a time bomb waiting to explode'.

But that is how Bill Ford, chief executive of Ford Motor Company, described how he felt towards Ford Credit, the group's financing arm, back in January.

Ford Credit is the world's largest automative financing group with 20 per cent of the US market for vehicle financing. It provides loans to car buyers and owns vehicles which it leases to retail consumers and fleet operators.

At the start of the year, the business was reeling from rising credit losses, the result of an ill-fated attempt by Mr. Ford's predecessor, Jac Nasser, to transform Ford Credit into a global finance group offering anything from residential mortgages to loans for second-hand vehicles.

Such was the damage that Ford Credit stopped paying a dividend to its parent and reported a loss in the fourth quarter of 2001 – the first in its 42-year history.

But eight months on, Ford Credit appears to be on the road to recovery, reporting a net profit of $330m in the second quarter. Mr. Ford now says the business is 'one of the great stress relievers in my life'. Risky lending has been curbed and tighter standards are in force on new business. Losses as a percentage of receivables – the principal and interest associated with a vehicle loan – have been reduced to 1.4 per cent from a historic high of 1.76 per cent in the fourth quarter of last year.

Ford Credit has also reduced the losses the company had been suffering on the sale of residuals, or vehicles returned once lease agreements expire. The losses were incurred as Ford Credit misjudged the extent to which second-hand car values were falling.

Greg Smith, chief operating officer and a 29-year veteran of Ford, said he intended to maintain the current total loan portfolio at $214bn, having dropped previous management target of growing the loan book to $245bn by 2006.

Wordlist

to succeed		1) следовать за; 2) наследовать; 3) преуспевать
to defuse		обезвредить
to explode		взрываться
to lease		сдавать в наем / аренду; брать в наем / аренду
to reel		кружиться, чувствовать головокружение
loss		потеря, убыток
fate		судьба
predecessor		предшественник
mortgage		1) заклад, ипотека; 2) закладная
damage		1) вред, повреждение; 2) убыток, ущерб
damages		убытки, компенсация за убытки
to lend		давать взаймы, ссужать
to curb		сдерживать, обуздывать
tight		плотный, сжатый; трудный; скудный
to be in a tight place / corner		быть в затруднительном положении
money is tight		мало денег
receivables		дебиторская задолженность, счета дебиторов
principal		основная сумма долга (на которую начисляется процент)
residual		остаток
to expire		истекать, кончаться
to judge		судить; оценивать; считать