Bathstore hit by tough retail environment
Bathstore has become the latest retailer to be hit by the difficult trading environment to veil the UK.
According to Sky News, the accountancy firm BDO has been selected to handle the possible administration.
Whilst BDO has refused to comment, Bathstore could not be reached.
Hundreds of jobs will be put at risk if the company does collapse.
Bathstore, which has 168 stores and roughly 700 employees, is based in Welwyn Garden City.
If a deal cannot be reached, the company will join the selection of British retailers to fall victim to the high street crisis and collapse.
Across the sector, several well-known retailers have suffered from the tough trading conditions to veil the UK, whilst store closures and job cuts prevail.
According to PwC, almost 2,500 high street stores closed in 2018. The figures were led by banks and financial services, followed closely by fashion retail stores.
As for job losses, it was reported that the UK’s retail sector slashed 70,000 jobs in the final months of 2018.
Names such as House of Fraser, Debenhams, John Lewis and Partners and New Look also hold a place on the list of struggling retailers.
Only yesterday, the luxury handbag maker Mulberry swung to a £5 million annual loss for the 53 weeks ended 30 March.
Government initiatives have been introduced to attempt to regenerate the high street, with a £675 million fund announced in December aiming to create “community hubs”.
Earlier in March, Bathstore’s rival Better Bathrooms collapsed into administration, with over 300 jobs lost.
Dixons Carphone shares plunge as “more pain” expected
Dixons Carphone posted a statutory loss before tax of £259 million on Thursday, warning that UK mobile will continue to make a significant loss.
The company said that “more pain” is expected in the next year.
Shares in Dixons Carphone (LON:DC) plunged just over 18% on the announcement.
The leading multinational consumer electrical and mobile retailer and services company revealed in its preliminary results for the 12 months to 27 April that statutory loss before tax amounted to £259 million, compared to the £289 million profit it posted a year earlier.
Dixons Carphone, which employs over 42,000 people across nine countries, also said that group like-for-like revenue was up 1%.
In December of last year, the struggling retailer revealed a £440 million loss for the six months to October. Its third quarter sales posted in January increased, despite a fall in mobile sales.
“In UK mobile, the market is changing in the way we described in December, but doing so faster. So, we’re moving faster to respond: we’ve renegotiated all our legacy network contracts, we’re developing our new customer offer, and are accelerating the integration of Mobile and Electricals into one business,” Alex Baldock, Group Chief Executive, commented on the results.
“This means taking more pain in the coming year, when Mobile will make a significant loss. But accelerating our transformation provides certainty that this year is the trough, as during next year the legacy contractual constraints on our Mobile business lift, and the integration cost benefits build. We expect Mobile will at least break even within two years, and beyond that, equipped with a stronger and unconstrained offer, we will of course aim to do better. In any case, cash generation from Mobile will be strong,” the Chief Executive Continued.
The business has been struggling with a slow down in sales of mobile phones, as consumers repurchase handsets less often than before. Just last year is revealed that it would close 92 of its 700 stores.
Shares in Dixons Carphone plc (LON:DC) were trading at -18.23% as of 09:19 BST Thursday.
Monsoon Accessorize seeks landlords’ approval amid rescue deal
Monsoon Accessorize is hoping landlords will agree to its rescue plan, as it struggles to compete amid an increasingly difficult trading environment for retailers.
Monsoon Accessorize owner Peter Simon has agreed to share a portion of up to £10 million of future with landlords and creditors, in a bid to secure approval for seeking a company voluntary arrangement (CVA).
In order to commence the procedure, the retailer must gain the approval of at least half of creditors and landlords.
It is also understood that £34 million is also set to be invested in the chain to keep the business afloat.
Monsoon Accessorize is looking to restructure its finances amid sliding sales and the pressure of falling footfall levels.
Back in 2017, the group reported a loss of £10.5 million before tax in 2017, despite sales of almost £424 million.
The proposal had been postponed amid the much publicised difficulties faced by Arcadia in securing support for a similar rescue deal.
Last week, Arcadia faced a battle for survival as it fought to convince landlords, narrowly avoiding administration.
In particular, Arcadia faced opposition from landlords such as shopping centre giant Intu, who opposed the plan over concerns that agreeing to lower rents proved unfair to other retailers.
Monsoon Accessorize is a private company. It has 270 shops across the UK. Peter Simon founded the brand back in 1973.
However, it wasn’t until 1984 that it opened its first store location in London’s Covent Garden.
Trump officially launches 2020 re-election bid
Donald Trump formally launched his re-election bid in Florida on Tuesday, as he looks to the election in 2020.
The Republican President chose Orlando for the rally, drawing large crowds despite a controversial three years in office.
Florida is a key battleground state for an election, given its swing state status.
Trump is also a frequent visitor to the state, often taking vacations at his Mar-A-Largo resort in Palm Beach.
Winning Florida has often been seen as the key to securing The White House. Notably, back in 2016, Trump won Florida by 49%.
In his speech, Trump chose to criticise the Mueller investigation, which he has repeatedly called a ‘Witch Hunt’.
The President also addressed Immigration, telling reporters: “We believe our country should be a sanctuary for law-abiding citizens, not for criminal aliens,”
He also took the opportunity to discredit his Democrat opponents, stating:
“Just imagine what this angry leftwing mob would do if they were in charge of this country,”
“Imagine if we had a Democrat president and Democrat Congress in 2020. They would shut down your free speech, use the power of the law to punish their opponents, which they are trying to do now anyway.”
He also claimed: “They would strip Americans of their constitutional rights while flooding the country with illegal immigrants in the hopes it will expand their political base.”
Famously, in the run up to the 2016 election, Trump pledged to build a wall between the US border and Mexico – the wall has yet to materialise.
Whilst sitting presidents are often statistically more likely to secure a second term, the unpredictability of recent elections means nothing is certain.
According to the latest poll from Quinnipiac, Former Vice President Joe Biden is ahead of Trump in Florida, with 50%.
Similarly, Independent candidate Bernie Sanders is polling at 48% compared to Trump’s 42%.
However, as the 2016 election proved, polls are increasingly inaccurate in forecasting outcomes.
Nevertheless, Trump has faced persistently low approval rates throughout the course of his presidency. His approval ratings are at 42% according to the latest Ipsos poll.
In the coming months, Trump will be looking to defend the record of his administration.
Thus far, he has been keen to highlight employment figures and economic growth under his Presidency.
His recent visit to the UK also provided a boost to Trump’s re-election campaign, with his team hoping to highlight his capability as a statesman and diplomatic figure.
Nevertheless, the trip was not free from controversy, with Trump’s critical tweets against London Mayor Sadiq Khan making headlines.
PM Giuseppe Conte: Italy will follow EU rules
Italy’s Prime Minister Giuseppe Conte said that his government remains set on avoiding EU disciplinary actions.
The nation is home to the third largest economy in the Eurozone, but is also struggling with a huge amount of rising debt, second to that of Greece.
The Italian Prime Minister, and leader of the right-wing populist League and the anti-establishment Five Star Movement coalition, said on Wednesday that the government intends on following the European Union’s fiscal rules and dodge any disciplinary actions over its debt.
“We are determined to avoid an EU infringement procedure and we are convinced about our economic policies,” Prime Minister Giuseppe Conte said to the Chamber of Deputies, according to Reuters.
“Italy intends to respect EU rules,” the Prime Minister added, whilst also emphasising that the rules themselves must be revised in order to deliver a better “balance between stability and growth and (between) the reduction of risks and the sharing of risks.”
Last year, Rome experienced an unprecedented conflict with the European Union concerning its budget as it breached rules on government borrowing.
The nation also slipped into its third recession in a decade at the start of the year, as GDP figures revealed that the economy had decreased by 0.2% in the last three months of 2018. This followed a 0.1% fall from the third quarter, with two successive quarters of decline considered a “technical” recession by analysts.
The short recession was ended as the economy later grew by 0.2% compared with the previous quarter, but doubts prevail as to how long this will last.
Recent European Union Election results indicate a strong support across the nation for Matteo Salvini’s party and half of Conte’s coalition government. Salvini’s populist League outright won the 2019 elections in Italy, obtaining 34.3% of the vote.
Quartix rallies on meeting full-year earnings expectations
Commercial GPS tracking manufacturer Quartix Holdings Plc (LON: QTX) said that it was to ‘at least’ meet market expectations for full-year earnings and cash flow.
This news comes with the company posting its latest trading update, which confirms increased sales and installations of tracking equipment on-year, alongside development of its new 4G telematics system and a continued reduction of its lower-margin insurance tracking operations.
Trading update
“Management expects to report revenue, adjusted EBITDA and free cash flow for the First Half of approximately £12.6m, £3.5m and £3.0m, respectively. This has been delivered alongside a continuation of the increase in investment in sales and marketing activity which commenced during the last financial period.” said the company in its update.
“As a result, management’s expectations for the full year are that revenue will now be at least £25m and that adjusted EBITDA and free cash flow will at least meet market expectations* for the year.”
Comments regarding fleet expansion,“This increased investment has driven strong growth in the Company’s core fleet business: total new installations are approximately 45% ahead of the same period last year, and excellent progress has been made in each of the Company’s existing markets (UK, France and USA). Fleet revenue in the First Half is expected to have grown by £1m to just over £10m.”
“The fleet subscription base is expected to reach 137,000 vehicles by the end of the First Half and the value of the base (which is an indicator of future revenues) has also shown accelerated growth.”
In response to the positive update, Company Chief Executive Officer Andy Walters, said,“We are delighted with the expansion of our fleet subscription base in the First Half. We significantly increased investment in customer acquisition and achieved a substantial improvement in growth, and are now confident of at least meeting expectations for revenue, profit and cashflow for the year.”
“We are well positioned for future growth in our fleet business and continue to review the opportunities to invest in this further. We look forward to updating shareholders on our progress on 24 July.”
Quartix investor update
On the posting of the update, the company’s shares rallied 10.59% or 27p to 282p a share. Analysts from finnCap have reiterated their ‘Corporate’ stance on Quartix stock.IAG orders 200 Boeing 737 Max planes
British Airways owner IAG has signed a letter of intent to place a large order for 737 Max planes, in a massive boost to Boeing.
Boeing is currently developing a software fix for its 737 Max planes, after two deadly crashes led to the planes to be grounded worldwide.
In March, an Ethiopian Airlines flight crashed, killing 157 people.
Just five months before, 189 people were killed on a Lion Air flight when a Boeing 737 Max also crashed.
The order for 200 planes from the IAG group will be a welcome show of confidence in the embattled aviation manufacturer.
Alongside British Airways, IAG operates Aer Lingus, Iberia and Vueling.
Should the deal go ahead, the planes would be delivered between 2023 and 2027.
The order of 737-Max 8 and 737-Max 10 planes would cost $24 billion at list prices, however it is understood that IAG have negotiated a substantial discount.
IAG chief executive Willie Walsh said: “We have every confidence in Boeing and expect that the aircraft will make a successful return to service in the coming months having received approval from the regulators”.
Nevertheless, it could still be a long way until regulators allow the 737 Max to return to the skies.
The US Federal Aviation Administration official said that Boeing 737 Max aircraft could be grounded until the end of the year, until faith is fully restored in the safety of the plane.
Boeing shares (NYSE:BA) were boosted by the news. Shares are currently +5.37% as of 11:53AM (GMT).
Meanwhile, shares in IAG fell, suggesting investors prove less confident of the airline group’s decision to add the controversial plane to its fleet. IAG shares are down 3.76%.
Mulberry posts £5 million annual loss
Mulberry posted a loss before tax of £5 million on Wednesday for the 53 weeks ended 30 March.
In 2018, the luxury handbag maker revealed a profit before tax of £6.9 million, now swinging to a £5 million loss.
Mulberry’s revenue amounted to £166.3 million, decreasing from the £169.7 million figure a year earlier, with international up 7% and UK down 6%.
Its global digital revenue continued to experience strong growth, rising by 27% to £36.9 million. This was driven by Mulberry’s strategic partnerships in the second half of the period, including johnlewis.com.
Mulberry said that in the UK, performance was materially affected by House of Fraser entering into administration during August 2018, in addition to the wider weakness of the UK retail environment, causing revenue to decline.
The difficult trading conditions to hit the UK high street have been highly reported by several brands, with store closures and staff cuts prevailing.
“The Group has delivered results in line with expectations and is making good progress in advancing its International strategy and direct to customer model whilst managing a challenging UK market,” Thierry Andretta, Chief Executive Officer of Mulberry, commented on the results.
“We have established new subsidiaries in Japan and South Korea and introduced important digital partnerships in China. International and omni-channel sales, driven by our customer centric focus, are increasing as a result,” the Chief Executive Officer added.
“Looking ahead, we anticipate that International and Digital sales will continue to grow whilst UK retail trading conditions are expected to remain uncertain. The Group plans to invest further in its new Asian entities during this development phase, enhance its global digital platform and optimise the UK network.”
Mulberry was founded in Somerset in 1971 and has 103 owned stores and 22 franchise partner stores across 25 countries.
Shares in Mulberry Group plc (LON:MUL) were up 4.67% as of 09:06 Wednesday.
Whitbread’s Premier Inn hotels hit by Brexit uncertainty
The owner of the Premier Inn brand, Whitbread, revealed in a trading update on Wednesday that it is cautious of the impacts of Brexit on market conditions.
The British multinational hotel and restaurant company said that weaker business and leisure confidence has continued, coinciding with continuous political and economic uncertainty in the UK.
The uncertainty surrounding Brexit has had an impact on domestic hotel demand, particularly in the regional business market, where most Premier Inn hotels are located, Whitbread added.
This weaker demand has caused Premier Inn’s UK total accommodation sales to drop by 1.5% for the first quarter.
The company, which sold Costa to Coca Cola, added that though it is difficult to predict how business confidence and business investment will evolve over the next year, it continues to closely observe the impacts this will have on the market.
“Our expansion into Germany is firmly on target. Our new hotel opening in Hamburg is performing above our expectations and our hotel in Frankfurt continues to perform well. We will open another two organic sites during this financial year and complete the first tranche of the 19-hotel Foremost Hospitality acquisition, with 13 being rebranded to Premier Inn in the first half of next year,” Alison Brittain, Chief Executive of Whitbread plc, commented.
“Whilst we are cautious about short-term market conditions, we are confident in our plans given the significant growth opportunities in the UK and internationally,” the Chief Executive continued.
“Given our strong balance sheet, efficiency programme and robust business model, we are in a strong position and we will continue to invest in order to maintain Premier Inn’s competitive advantages and to capitalise on our structural growth opportunities.”
In addition to its update concerning market conditions, the company also said that it expects to add between 3,000 to 3,500 rooms in the UK and over 2,000 in Germany.
As of 09:49 Wednesday, shares in Whitbread plc (LON:WTB) were trading -0.8% lower.
AstraZeneca shares rally after securing EU approval for Lynparza
AstraZeneca shares rallied on Tuesday after company revealed it had received approval from the European Union for its Lynparza drug.
The British-Swedish pharmaceutical company said the drug, which has been developed to treat advanced ovarian cancer, will become available in the EU thanks to the approval.
Dave Fredrickson, Executive Vice President, Oncology Business Unit, commented:
“This approval sets the stage for a new standard of care in the EU for women with ovarian cancer and a BRCA mutation. The goals of front-line therapy have always been long-term remission and even cure, yet currently 70% of patients relapse within three years of initial treatment. The progression-free survival benefit of Lynparza observed in SOLO-1 represents a major step forward in our ambition to help transform patient outcomes.”
AstraZeneca is listed on the London Stock Exchange, as well as the New York Stock Exchange and the OMX Exchange.
The firm was formed following the merger of Astra AB, a Swedish company and UK-based Zeneca Group.
The company develops various pharmaceutical drugs to treat gastrointestinal issues as well as cancer and respiratory issues. It is a constituent of the FTSE 100 Index.
Shares in AstraZeneca (LON:AZN) are currently trading +2.48% as of 13:59PM (GMT).