welcome. you're watching "street signs." i'm louisa bojesen. >> i'm carolin roth. these are your headlines. president trump will be asking congress to add $54 billion in defense spending while cutting money to lower priority programs including the state department. dallas fed governor robert kaplan says the fed shouldn't get behind the curve on interest rates, suggesting a hike should come sooner rather than later. the voting member of the fomc joins cnbc later today for an exclusive interview.

south korean authorities formally charge the heir of samsung, jay lee, with bribery and embezzlement in the corruption scandal that has rocked the country's political establishment. we're minuting away from speaking to the co of apple supplier after warren buffett tells cnbc he has doubled his holding in the u.s. tech jintd. good morning, everybody. good morning. >> good morning. pancake day. >> it is pancake day. >> we're very excited. >> we have a crepe interview in about 45 minutes time. >> we're a global channel, we'll still celebrate. >> any excuse for a pancake. european equity markets flat

as a cpancake this morning. these are flat markets, and buy in large we may be waiting on this state of the union address to come from president trump later today to a joint session of congress. more on his plans to cut taxes, deregulation, infrastructure, possibly also defense spending hikes, he could be talking about that. the issue is whether or not he underwhelms in terms of market expectations and whether there will be a market reaction. but we're very, very flat at the moment. >> valeo shares are trading higher after a higher set of midterm profit and sales forecasts were announced. they are tar getting sales of over 27 billion euros in 2021 as a shift towards autonomous and electric vehicles gains momentum. steve joins us from valeo's investor day conference.

>> thank you very much. had a really nice set of numbers with increased margins, sales, order intake on the 16th of february, now following up with an enhanced set of goals out to 2021. i'm delighted it welcome to "street signs," the ceo of valeo. it's nice to see, a company increasing goals, increasing margin expansion in europe, in your automotive sector. what's going on? >> it's all about innovation. we've been very lucky to be at a very fast growing part of the automotive business. the electrification of the power train, the autonomous car and digital mobility. with innovation, you mentioned it on the 6th of february, we disclose disclosed 23.6 billion, increase of 17% compared to previous year, and 50% of them with

innovations. >> out to 2021, looking out four years, what are the mega trends that will be driving demographically or in innovation in that autonomy? what are the key trends for you? >> the market will grow 2%, 3% per year. it's not a question of volume. you have seen the pollution in the cities, we need electric cars. we have seen autonomous car and self-driving car, all those connected car, that's a mega trend and the digital mobility is something that we transform in depth in cities. we are under 3 mega trends. in years to come, waves of growth, and we sustain the growth for not just the next few years but years to come. >> six years ago i bought what

was supposed to be a smart diesel, perfect, low, co2 emissions, now i don't know if i trust regulators who told me to buy that car. do you think things have to improve on the regulatory front? >> the question is who is the regulators, you have the states, the european commission, the u.s.? on top of that you have the cities. cities are playing more and more a role in what will happen in the cities. in europe, there are 500 cities with regulations that are different from the regulations -- they try to limit the access of old cars, limit the access of diesel cars. the truth is what you think. even though diesel engines are very good engines, but in the public mind it's an outdated engine. it's an engine bringing some pollution. so diseaesel will go down.

when that goes down, you have to go for electrification. we have several regulators, states, cities, we have to take care of all of them. >> do you fear, given what we're about to hear from mr. trump, there will be a change of environmental priorities in the united states? you have a troy, michigan headquarters there. you're expanding in detroit, in oakland as well. do you feel the priorities for lower co2 emissions will change with the administration? >>i think we have several parts. in europe and in china we go for electrification. we don't know what speed. u.s. is not a single market. if you look at california or the eastern states of the u.s., they're focused on reducing co2 emissions and special regulations. so we might see two different u.s. markets. some of them being very much

oriented towards the reduction of pollution. maybe the rest being more open to traditional engine. it will be ambiguity. >> that a sad day for the guys in your r & d department? that is a step backwards if the u.s. drops those emission priorities, isn't it? >> i don't think it is. those states are one-third of the north american market. some cities may take decisions that are different from the overall american federal state. so it's something which makes our life more difficult, because we have to adapt ourselves to several regulations, but as a matter of fact, you will decide what you want out of a car. we have to adapt. we do a lot of inquiries, not directly with customers, of course we have permanent dialogue with customers, but

inquiries with final customers and the trends towards cleaner cars, the trends towards autonomous car is real trend in the market. >> let's go back to europe. you will be aware as much as the rest of us about the extraordinary change that could happen. peugeot on the front foot. gm europe could well become part of the psa group. do you think these changes are for the better and that the oems in europe will make more money and cut the problem of overcapacity? >> i think we have two separate problems. we are in a time where both our customers and suppliers are making quite a lot of money. europe is getting betterment that's for sure. you have seen the results disclosed by peugeot, renault recently, they're in improvement. so the opel deal or gm deal in

europe is one of them. the question is why is gm stepping out of the european market? european market is second biggest market in the world. it's a great market and a growing market. >> i think the answer is the historic lack of profitability. you have given us targets out to 2021, will you stay independent for that period? >> we will? >> stay independent? >> i hope so. we are the fastest growing automotive supplier in the world, and probably one with increasing profitability the quickest. we have to find the difference between growth and profitability. >> thank you. have a great investor day.

back to you in the studio. >> thank you, steve. very interesting. we need to move on. apple shareholders will be gathering for the annual meeting in cupertino today. the stock surged by 20% this year. warren buffett revealed he more than doubled his holding in the tech giant in january. the sage of omaha explained to cnbc what makes apple so attractive. >> apple strikes me as having quite a sticky product. and an enormously useful product that people use it. which i don't. tim cook is always kidding me about that. future earning power of apple when you get down to that. tim has done a terrific job and has been very intelligent about capital deployment. i don't know what goes on inside their research labs or anything of the sort. i do know what goes on in their customers' minds. because i spend a lot of time talking to them. karen is at the world mobile congress in barcelona, the mobile world congress, as it is

called. when everybody is loving apple all of a sudden on the back of what warren buffett is doing. you would think it would benefit some suppliers? >> apple has become the stock to own, but interesting here. the industry is moving so quickly. the internet of things, i want to talk more about the internet of things. that's such a dominant feature of this show. joining me is simon segars. this is the first time we had a chance to catch up since the company has been folded into softbank. how has life changed for you? >> in some ways not at all. still focused on building the devices that will go into the next generation of chips that will power the next smartphones, the next networks and power the iot devices. what's changed is not being a standalone company, i and my

team have more time to think about long-term strategy to accelerate the deployment of all the cool stuff. >> you have a whole bunch of companies coming up with devices connected to 4g, but the future is 5g. so what do you put into the new internet of devices? >> are so many different uses for oit. smart city is such a broad category. it could be a shared bike that gets locked up somewhere by one person and used by somewhere else. there you need to track location, you need a billing system it could be in a building where you have stationary objects, which have less processing capability. so there is no one size that fits all. you need a range of solutions. different transmit capabilities. so very wide range of implementations of chips will be

needed. >> is that different from mobiles which have been more standard, even though what we use is different customer by customer? it's a big step away from that. >> it is different. in mobile we looked to put more graphics performance, more video performance into a smartphone platform and then deliver different user experiences. essentially smartphones, while usage does change, in iot applications could be as diverse as a tiny sensor in a field somewhere when crops need watering to something that is high bandwidth data in a city where the implementation of that is completely different. >> there's always been a first mover advantage about this type of technology. where do you want to be in the future as more devices become connected? do you want to have more real estate with your licensed

products? >> what we're doing is actually on a number of fronts, we're providing more capability into the semicon ducter industry. so last week, we announced narrow band i.t. modem connection. so any device in order to have end to end security, security in a device that evolves as security threats change, we need to have those. that would allow all iot devices to be connected. >> so like a traffic grid? is that what we're talking about? >> you may think who may try to hack my toaster, but hackers do break into dvrs, home security cameras to launch a denial of service attack it does matter

that everything is secure. you can only be secure at any moment in time against the threats you know. it's always changes. so you need to push into every device. >> i want to ask about robotics. it's been no secret that softbank sees that as part of a future. does that mean a lot of your technology is geared towards some big softbank initiatives? . we look at robotics as another class of devices that needs sensing, processing, taking the data and figuring out what special to do with it. that's no different than other applications. we've been in industrial control applications for decades now. robotics is a sexy subject at the moment. use cases are evolving all the time. we will see more products used in there, but we're not tailoring the products specifically for that. >> do you think robots should be taxed? >> i don't know. we clearly will see robotics in all sorts of life.

it will be a long time before robots are wandering around amongst us and interacting with people. there's huge advantages of robotics in surgery applications, industrial applications. the economics of it is probably running behind the technology. >> thank you for joining us, simon segars. that wraps up our morning coverage from here, but we have a big panel coming your way shortly on stage. we'll step away from this stand and talk to regulators from both sides of the bonds about 5g, how to get ready, get ready for privacy concerns, and the industry will weigh in. orange will be with me and liberty global. stay tuned for a robust discussion on stage. >> we'll have some coverage of that panel. looking forward to it. e-mail the show, the address is streetsignseurope@cnbc. tweet us directly

at @carolincnbc or @louisabojesen. what are you up to? >> crepe affair. we have lots of stuff to look forward to i'm here with daniel, managing director of crepe affair. in my day, we would make pancakes simply. this is quite accelerated stuff. >> oh, yeah. it it's -- gone are the days of butter, sugar, lemon. today we do them for breakfast, lunch, dinner. >> we have pancake day upon us. we'll see you right after the break.

samsung plans to shut down its controversial strategy office due to a political corruption scandal that claimed the heads of multiple

executives. the tech giant announced that a number of top officials including the president of the electronics business has resigned, this after south korean prosecutors indicted jay lee and four other executives with bribery and embezzlement charges. let's get more on this with pauline who joins us from singapore what did the stock do today? >> the stock rose off the back of this news. investors we talked to had said that they believed samsung electronics and several subsidiaries are still strong companies despite the scandal going around. let's recap what has happened. the special prosecutor indicted jay y. lee, the de facto head of the samsung group, and the question is whether $38 million given to charity donations to choi soon-sil, whether that amount of money constituted bribes for the government

backing of the merger of samsung and cnt two years ago, which locked jay lee's hold on samsung electron electronics. what did the group do? samsung electronics rallied up 1%, so did the battery company and engineering as well. as for the broader asian markets, the kospi ended up. the nikkei ended at the flat line. a lot of momentum early on in the morning session from the record close on wall street from the dow, but saw some of that momentum lose steam. the asx 200 ending down 0.2%. that's a look at how we ended this tuesday. guys, back to you. >> pauline, thank you very much. the dollar strengthened after the dallas fed president, robert kaplan repeated his calls for the fomc to hike rates sooner rather than later. the fed may need to raise rates in the near future to avoid

falling behind the curve on inflation. cnbc's interview with robert kaplan takes place at 13:30 cet. john baker joins us this morning. good morning. welcome. we had a guest on yesterday who said the political environment and the elections in europe at the moment are a red herring. there's still value to be found in the equity markets. >> that would always be our core thesus. i think q1 this year is interesting. for the first time in many, many years we're seeing positive earnings revisions at the market level and within specific sectors. valuations are attractive relative to other markets and their long-term history.

>> in particular you find opportunities in a number of sectors. any that stand out? >> i guess the best earnings momentum is coming from value cyclical industries. these industries are most sensitive to economic developments in europe which is d distinctly improving. semens comes to mind as an economically sensitive stock but also one restructuring its portfolio and releasing value. material stocks are another obvious source of earnings upside and indeed many financials. >> we just heard from valeo, a major auto parts supplier, also very active in the autonomous space. you also mentioned autos. these cyclical plays, they have had an incredible run over the past years. valeo is a prime example. do you want to chase these

gains? >> we believe there is further potential for upside. valuations are not stretched. also it is quite clear, at least on the basis of the economic indicators that we're seeing, the rise in consumer confidence that the demand for cars within europe in particular continues to accelerate and most importantly coming in ahead of analyst expectations, which, of course, sets you up for earnings upgrades, which will drive valuations. >> what is the prime driver of the stock outperformance? in the beginning of the interview, you said evaluation as opposed to the overall picture. now you're pointing to rising consumer confidence. so it is gdp and the economic after all that is driving stocks, too. >> yes, of course. the economy is important. the economy is important fore r driving those earnings upwards and it provides an interesting sentiment back drop as well. we would certainly argue, yes, it is valuations that are

absolutely critical. you have to buy the stock at right price. you have to correlate that with the earnings momentum of the stocks. so it's an interplay of all three. jo >> john, we have to leave it here. thank you so much for your time. we need to take a short break. check out world markets live, our blog. it runs throughout the entire trading day. lots of good stuff on there. we'll be back. on the other side of the break, we'll talk about cybersecurity and crepes, pancakes coming up in 15 minutes.

hello. welcome. you're watching "street signs." i'm carolin rothment. >> i'm louisa bojesen. your headlines this morning. president trump will be asking congress to add $54 billion in defense spending while cutting money to lower priority programs including the state department. dallas fed governor robert kaplan says the fed shouldn't get behind the curve on interest rates, suggesting a hike should come sooner rather than later. the voting member of the fomc joins cnbc later today for an exclusive interview. south korean authorities formally charge the heir of samsung, jay lee, with bribery and embezzlement in the corruption scandal that has rocked the country's political establishment. to the moon and back. elon musk's private rocket company, spacex, plans to send

two tourists around the moon next year. the first time in 45 years that humans will return into deep space. good morning. let's have a quick peek at u.s. futures. we're looking more negative. the s&p 500 seen off by roughly two points. the dow jones could lose four and a half and the nasdaq five points after we saw another record close for the dow yesterday. the 12th consecutive record close. that is the longest streak since 1987 for that particular index. the s&p 500 closing at another record. i guess today, though, when it comes to global markets, trading will be more subdued given that we are waiting for president trump's speech before congress, waiting for any more details on tax and infrastructure. as long as we don't have that, i would probably stay on the

sidelines. the cac 40 is flat. the xetra dax under a bit of pressure. ftse 100 just treading water at 7,250. a look at the fx markets and the uncertainty ahead of the trump comments in play here, too. some buying in the japanese yen. safe haven buying and the dollar losing a bit of ground against the safe havens. euro/dollar essentially flat. president trump is preparing for his much anticipated address to congress during which he is expected to provide details of his tax plan and historic defense spending hikes. any update on the border tax adjustment will also be closely watched. the future of the affordable care act could be a subject as congress has been keen to repeal and replace the legislation by next month. cnbc will have live coverage of this address, starting at 3:00

cet or 9:00 p.m. eastern. that's 3:00 in the morning cet. eamon javers filed this report from the white house. >> reporter: a surprise visitor to the press briefing room today, omb director, mick mulvaney, who will be in charge of slashing the federal budget for nondefense discretionary spending. he explained a lot of cuts we'll see coming from the trump administration will come from his speeches and from his campaign rhetoric. >> when you see these reductions, you'll be able to tie it back to a speech the president gave or something the president said previously. we are taking his words and turning them into policies and dollars. >> reporter: here's the spending that was laid out. in defense spending they'll have about $603 billion. that will be a $54 billion increase over the previous year. no specifics on what exactly they'll spend that moan on. in materials of nondefense discretionary spending, $462

billion, that's a $54 billion cut. of course, the devil will be in the details here of what exactly this administration wants to cut. each of these spending programs has an adamant defender up there. someone who really loves that program up on capitol hill or in the public. all of them will fight to save those programs. once the trump administration signs off on this budget, releases the details, it is not necessarily a guarantee that the president will get everything that he wants. >> the president and ceo of unisys joins us here in the studio. peter, good morning. thank you for coming to visit. >> thank you for having me. >> you must be hoping more and more of this money overtime is redirected towards cybersecurity. i know you also won a contract with the u.s. customs and border protection with regards to technology and updating technology. how efficient is the technology at the moment? >> you're right about our emphases on cybersecurity an security as a whole.

we actually serve governments around the world as well as the private sector, both on the security and nonsecurity side. so we have an interest in all of that. with respect to the efficiency of current cybersecurity efforts, it's like being on a treadmill that gets faster and faster an faster. so there are always more and more ways to try to attack a system. and the current approach is really not to leave one cell vulnerable to a single mode of defense. you don't want to rely on fire walls. you want to rely on a host of systems that work outside and more importantly inside your fire walls. that's where we're focused. >> more and more of the focus being on the biology part of it. the eye recognition, and -- >> so biometrics is an increasingly important part. we have systems that work with mobile phones that we're using with financial institutions. some of the security around that is not only that you have the

phone with you, but how you use it how do you input numbers? how do you hold it? are you walking while using it? all of the special techniques built into mobile phones now, that we think are creature comforts are actually security comforts as well. it's an exciting time to be developing the next generation of the way we protect people in their digital lives. >> peter, i want to come back to the u.s. and spending for defense that's been outline by donald trump. border security is your biggest client. so you are bullish about this and about your sector. i do wonder isn't there a conflict of interest in the sense that you see all these policies being put forth, like the immigration plan, even though it's not going ahead as it was being put forward by donald trump. the crackdown on illegal immigration. isn't there a part of you that says, hey, wait a minute, i'm actually employing a lot of immigrants. this makes my company great. on the other hand you're benefitting from it. >> issues like border security

are not related only to the u.s. we do border security work for countries around the world. we do some in the eu, in the uk, and asia pacific and latin america. we don't look at one geography. so you're right. someone's entrance is somebody else's exit. which is why all of these companies actually have very, very similar interests. because, you know, stopping someone from leaving a country that you might want to detain stops someone from having to find that person on their way into another country. there's more similarity than differences in terms of border security. everyone is interested in a better understanding of who is leaving and entering companies. >> peter, you were a former member of the obama administration's national security, telecommunications advisory committee. you served on that for about a year. that was a crucial year for cybersecurity. that's the year when russia essentially hacked the dnc.

also when we saw it influence the election. trump has denied all of this. but there are now calls for a special prosecutor to look into this. would you support that? >> i did join last year and am privileged to serve on it. that's not a political commission, it was founded 34 years ago. it goes through administrations. its primary purpose is to look at infrastructure and protecting the national infrastructure g d grid, cybersecurity is a particular focus, but it does not focus into specific areas of whether the dnc was hacked or not. >> a final question about your company. it's really almost been lost in obscurity a couple years ago. then you were brought in two years ago. how do you feel this transformation is going towards clouds, mobility and big data? >> it's interesting. all companies have to evolve.

great companies have to evolve greatly. when we look at unisys, it was -- it goes back to 1873. it invented remington typewriters and the first adding machine. in the 20th century it invented the first general purpose computer and the first commercial computer. now it is at the forefront of cybersecurity and protecting peoples digital lives throughout the world. it's another step in the evolution. that's what great companies do. >> just a final one on russia and the potential involvement there with regards to hacking. how do you think something like that should be handled? if you were advising the government directly, which you to some parts are. what is your advice? >> you know, i think it's pretty clear that cybersecurity attacks are everywhere all the time. they're measured in the hundreds of billions and trillions now.

so the most important thing one can do is have a multi layered, multi-faceted defense posture to prevent those attacks from being successful. that's what companies like ours and others are most involved in. making decisions on what government should do more affirmatively is really to the what we're trying to do. >> peter, thank you very much. the president and ceo of unisys. let's get back to earnings. thales has posted full-year results which narrowly beat expectations. they reported an 11% increase in operating earnings for 2016 despite registering a 13% decline in orders. we spoke to the cfo of thales and asked him for his view of the performance of the company in 2016. >> all of our businesses are driving better growth in 2016 as

compared to 2015. >> japanese air bag maker, takata has pleaded guilty to knowingly covering up flaws of its products. >> the firm took the step as part of a deal with the u.s. justice department. a settlement of a billion is expected, which includes compensation towards affected carmakers and victims and a $25 million fine. takata has sold off three subsidiaries to raise the funds needed. takata had hoping to win the settlement to open the doors to fund an investor who will start the turnaround. key safety systems has been the favored candidate to help the firm. automakers among takata's largest creditors have express

t ed happiness with the move. gains tapered off at the end of the day and shares ended lower. back to you. space tour iism, i was thinking about space tourism. >> you were. just randomly? >> yes, right? would you want to go to space? >> no. no. i don't know whether i'd ever come back. >> i know, i feel the same. but space scientists think we're crazy to turn down an opportunity like that if you got an opportunity like that. space tourism is apparently upon us. spacex will be launching a crude mission beyond the moon for two private customers according to an announcement made by the company. customers paid significant deposits. spacex has said it has not been authorized to reveal their names. the mission will take place at some point in late 2018. i like my feet planted solidly on the ground. >> i'm not sold on this at all.

>> neither am i. could be space travel in 10, 20, 50 years i'm. once you're in space, it will take an hour to go anywhere as someone explained to me. this comes on the back of this discovery that -- earlier this week that new planets of life were found, potentially life on other planets. >> yes. suddenly queue aliens. how to make the perfect pancake on pancake day. that's coming up after the break. don't miss it.

welcome back to "street signs." the boss of the hong kong stock exchange says he will rely on his role to the gateway of the chinese capital to delist saudi

aramco. in an exclusive interview, trans lee toexplained why saudi aramco should invest in hong kong. >> we can potentially bring substantial chinese demand on to a very large ipo if we are able to extend into primary connect. and that -- if that can happen, that is the most important energy company, investors from the largest energy consumption countries that is, indeed, a match made in heaven. >> annette is in berlin at the conference. what are some main talking points? >> the main talking points again are the trump effect on the

industry. whether it's a net positive, a net negative. also another talking point is what brexit means for investing in the uk and again europe, whether it's a good time to invest in europe or not. another industry specific talking point is the event of strategic buyers for the industry. of course traditionally the buy out industry was dominated by private equity firms and not necessarily strategic buyers like other corporates. now in these days where corporates have so much cash on their balance sheet, they are starting to outbid private equity players, which is a headache for the industry. i early on spoke to a partner at bane & company, the head of private equity, and i was asking him whether what he thinks is the impact of these strategic buyers on the private equity industry, whether this also

means that multiples go up, that the industry has to pay higher prices. take a listen. >> very important to have a look at what the field is as you go into an investment process. if there's a strategic acquirer, corporate acquirer that will be well placed, maybe that's a deal not to spend too much time on. spend your time on ones where the corporates won't be so competitive. if you can, yes, find a corporate to team up with. we've seen an increasing amount of that. but the whole thing that corporates have got is the opportunity of putting businesses together, synergies. private equity investors are doing more of that from existing portfolio companies. >> let's talk about exits. they are also down. i think it's astonishing that ipo levels are not very high. are you expecting this year to be better for ipos or the political uncertainty also killing these? >> and the public markets are clearly difficult for the private equity industry for ipos

in general. there are plenty of exit routes available for private equity. people queueing up for secondaries and the corporate acquirers. the fact it's more difficult is not hampering exits for private equity firms. >> so the bulk of the ipos which are the pipeline of big corporates are not going to happen, at least not in the first half of this year. perhaps not even in the second half of this year, but it will be pushed into the first quarter of next year. that's, of course, because at least in germany, it's election year. nobody knows the outcome here, what that means for the markets, and also france is crucial for investors. i guess everybody is waiting with the public markets until there's a foreseeable time of more -- more visibility. for now, ipos are not the flavor

of the industry here in berlin. back to you. >> thank you very much for that. speaking of flavor, we have something really exciting for you. it's time to grease up those pans. it's the one day of the year where you can get away with eating fatty, greasy food. it is pancake day after all. >> though, it is not really fatty, greasy, is it? >> it's not fatty and greasy. depends on what you put on to it. >> we have the founder and managing dreshgt of crepe affair with us. you have a different background. you're not a chef by training. you worked in banking consultancy at a fast consumer goods. why come up with this idea and make crepes for a living? >> i wanted to do something real for once. i enjoy food. that's my hobby. really it was about setting out to take -- create a scalable business model, taking a loved and known product and build a

system and brand around it. and we have achieved that. it's -- a crepe is a versatile product. it is an envelope, depending on what you put in it. it works in various formats. it's a business. >> what do you have here? >> here we have a selection of some breakfast products. an egg florentine? >> should i cut into it? >> you should. >> we have a selection of vegetarian and obviously sweet products. it is really an in between impulse sweet product but a savory meal solution. >> dig in, loouisa. >> you want to increase sales by a whopping 70%. >> that's right. >> where is that groetd cowth c from? >> growth is coming out of the

uk with new store openings. we enjoined double digit growth in 2016 and that's continuing. and we're developing outside the uk. we have presence in europe, the netherlands. we opened in kuwait and are expanding there. we just signed a very large contract as well in another gulf country, in saudi arabia, for up to 50 units over the next five to eight years. >> is this cultural? in the middle east they love this stuff. you go to amsterdam, you have crepes, they're everywhere. it's fantastic. are you choosing based on culture? >> yeah. i think that the two key criteria are, first of all, does the consumer like our type of product? you're right about holland and the middle east. there is a real propensity to consume particularly sweet products. we're not all about sweet, there

is also savory. the second is infrastructure. we are not just a high street concept, if you look at infrastructure in the middle east, many shopping malls, leisure centers where our product which is very much a family product does well. >> i'm thinking along health lines. you know, gluten-free, dairy-free, egg-free. more an more you go into restaurants and that's what people want, right? >> good point. >> do you make an offering in that area? >> yeah. we do. and effectively it's not all about grease. that's the traditional background of pancake day, but we offer a healthy product. our flour is organic. and we use only fresh ingredi t ingredien ingredients. we recently launched a fully gluten-free offer made with buckwheat flour.

which is 100% vegan. gluten-free and organic. >> how worried are you about inflation? how does that affect your cost base? >> it is starting to affect our cost base. many of our ingredients come from outside the uk. we're managing it. we are able to keep our prices at the time, at a level that is a great value for money type of product. we do not have a real concern at this moment. we actually are benefiting to a certain extent from effects of the lower pound in terms of influx of tourism into the uk. >> i'm just producing saliva galore. >> salivating. >> that's what happens. >> does smell tremendous. >> this is delicious. >> daniel, thank you very much.

>> thank you very much. >> thank you very much. >> now back to markets. back to the futures. >> u.s. futures a couple hours away. the implied open relatively flat ahead of the state of the union address given by donald trump later on today. we'll have full coverage of that, of course. >> we have a very special panel coming up from the mobile world congress. we'll talk 5g in barcelona with a host of interesting guests. we'll bring that to you in a few minutes time. that's it for this show. >> i think we need to at least cut up the pieces for people in the gallery. >> let's do it. >> lovely having you with us. we'll see you tomorrow.

good morning. market alert. the dow notches its 12th straight record close. a bold agenda. that's what the house is promising president trump will deliver in his first congressional address tonight. a preview from washington straight ahead. and astronaut. details of spacex's ambitious plan to fly two tourists to the moon. it's tuesday, february 28, 2017. "worldwide exchange" begins right now. ♪ good morning. welcome to "worldwide exchange"