Bonmarche has revealed on Tuesday that its first-half profits nearly halved in the 26-week period to 29 September 2018. During the period, underlying profit before tax fell to £2.3 million from £4.2 million. Additionally, revenue was recorded flat at £97.9 million. Combined like-for-like sales declined by 1%. Moreover, online sales increased by 28.9% and store only like-for-like sales dropped by 4%. Online sales grew to account for 12% of total sales. The results also reveal an interim dividend of 2.5p per share, which remains unchanged from a year earlier.

Bonmarche’s results blame the wider market climate to explain the challenges it experienced during the period.

Despite stores experiencing challenges, almost all of them remain profitable. The company is not the only high street name to see its profits hurt by gloomy trading. In September, John Lewis plc reported a 99% decrease in its profits in the six months to 28 July, coming in at a mere £1.2 million. Additionally, redundancies at the department store were up by 289% compared to the previous 12 months. Commenting on the results, Chief Executive of Bonmarche Helen Connolly, said: “Whilst store trading has been impacted by the general weaker consumer sentiment and footfall seen across the market, we have continued to improve our proposition, particularly our digital capabilities and with a broader, modernised product offer, which is reflected in our strong online performance. We remain focussed on exploiting the opportunity afforded by the increasing demand for online shopping, and are encouraged by customers’ responses to new ranges such as denim, leisurewear and resortwear.” “Providing that sales during the key Black Friday through to Christmas trading period meet expectations, the Board maintains the guidance published in September, being that the underlying PBT for the Group for FY19 will be £5.5m.” “Despite the challenging market, the health and fundamentals of the business remain strong and the Board remains confident in the strategy and in Bonmarché’s long-term prospects. Accordingly, the Board has declared an interim dividend of 2.5p per ordinary share, in line with last year’s interim dividend. The Board’s intention at this time is that the total dividend in respect of FY19 will be maintained at 7.75 pence per share, in line with FY18.” At 10:01 GMT today, shares in Bonmarche Holdings plc (LON:BON) were trading at +0.74%.

Since September, we have seen Rome play what can only be described as a calculated chess game with Brussels. The moves being made by both sides are unprecedented, and the conflict over Italy’s budget remains unresolved. Whilst Brussels have turned their attention to the Brexit-induced chaos veiling the UK, conflict with Rome remains on hold. The markets also remain governed by Brexit with the GBP crashing against the EUR and struggling to hold above 1.2800 against the USD.

What happened?

Italy’s coalition government, formed earlier in June, unites the anti-establishment Five Star Movement and the hard-right League. The coalition government made an overnight agreement to set forth a budget deficit next year equalling 2.4% of Italian GDP. This figure was well above the country’s Finance Minister’s recommendation of 1.6%. After some attempts to compromise, Italy submitted its final budget with only slight revisions of the original draft rejected by the EU. Until now, the Italian government has refused to give into demands from Brussels to lower its excessive spending targets and optimistic growth estimates.

Why did this agitate the markets?

The budget disrupted the financial markets for several reasons. Firstly, the Italian economy is the third largest in the Eurozone following Germany and France. Despite its size, its debt stands at 131% of national output, making government debt second to Greece. Next, its banking system is facing deep fragility after two decades of stagnated economic growth. The yield on 10-year government bonds rose above 3% and the Milan stock exchange suffered. Indeed, the FTSE MIB was at its weakest level in 18 months. Moreover, the flat quarterly reading in the third quarter was the weakest figure since the fourth quarter of 2014.

Why did Italy’s budget prompt EU backlash?

Rome’s deficit plans simply breach rules on government borrowing. The 2.4% figure may be below the EU’s deficit limit of 3%, but it remains far too high for a country whose debt is as big as Italy’s. Under the current budget plan the structural deficit would rise which goes against EU regulations.

“The enemies of Europe are those sealed in the bunker of Brussels,” said vice prime minister Matteo Salvini.

What happens next?

On Wednesday, the European Commission is expected to announce that Italy’s budget breaches EU fiscal rules in a report. This is expected to take place when it issues its opinions on draft budgets in the Eurozone. The Austrian Finance Minister, Hartwig Loeger, has demanded a “clear response from the commission this week”. The Austrian Finance Minister isn’t the only one to express concern. Dutch Finance Minister, Wopke Hoekstra, shared his concerns: “We all are worried about the existing situation,” “This is a matter that not only involves Italy but involves all of us because in the end we are a high-trust society and it’s imperative that the commission does what’s in the interest of all the different European countries.” Italian Finance Minister, Giovanni Tria, has tried to diffuse the tension saying: “We are talking about deviations that are not so huge, so I saw we need to bring the discussion back to reality.” “The discussion goes on. Obviously, the plan of the government doesn’t change, but there’s the intention to carry on the discussion”. On this remark, the yield on Italian benchmark 10-year bonds increased to 3.56%, the highest in over three weeks. Could Italy’s government be a bigger threat to the Eurozone than Brexit? At 10:40 GET, the FTSE MIB (INDEXBIT:FTSEMIB) was trading at -0.68%.

EasyJet announced its final results on Tuesday morning for the year ending 30 September 2018. Revealing a 43% increase in proposed dividend, the low-cost airline has had a successful year. Annual profit grew in-line with expectations. Indeed, reported profit before tax increased to £445 million, up from the £385 million figure in 2017. This was supported by a record number of passengers flying with the airline.

The results show that 88.5 million passengers flew with easyJet this year.

This is up by 10.2% from 2017, with a record load factor of 92.9%. From January the airline had been experiencing strong revenue and passenger growth, with shares rising 5%. Moreover, the results also reported a proposed dividend of 58.6p. In 2017 the proposed dividened was at 40.9p. Additionally, with the chaos flyers have experienced with easyJet’s rivals, Ryanair, it is no wonder passenger intake grew in this period. Likewise, in September, EasyJet expected strong profits from the Ryanair strikes.

Headline cost per seat excluding fuel was up by 5.3% to £43.43.

This is as a result of the airline’s expansion into Tegel, higher levels of disruption and crew cost inflation. Commenting on the results, easyJet Chief Executive, Johan Lundgren said: ” easyJet has delivered a great performance during the year, growing headline profit before tax by 41 per cent, once again flying a record number of passengers at our highest ever annual load factor. The integration of new operations at Tegel has also progressed well and our brand consideration in Berlin has grown strongly. Our financial success and increasing customer loyalty demonstrate the resilience of our operations, the underlying strength of our business and our unrivalled customer experience. “Our strategy continues to ensure we are well positioned for the future. We have made considerable progress on our new initiatives in holidays, business and loyalty, which will enable us to grow profitably. While disruption continues to be a major challenge for the industry, we are investing in resilience to help to mitigate the impact on our customers. “Forward bookings are solid, with 50% of seats sold in the first half, in line with the prior year. We are confident in our positioning for the future and are focused on driving future returns, positive free cash flow over the longer term and maximising our headline profit per seat as we continue to deliver value for our customers and shareholders.” At 08:45 GMT, shares in easyJet plc (LON:EZJ) were trading at -2.98%.

The whistleblower who was involved in the money-laundering scandal at Danske Bank has claimed he was offered money to keep silent. Howard Wilkinson revealed at a Danish parliamentary hearing on Monday that Danske Bank and another European lender that he is refusing to identify, attempted to silence him. “We are now here at the back-end of 2018 talking about dirty money from 2007 to 2015, there is no chance in the world… that any of that money is ever going to be tracked down and that any criminals lose a single cent,” he told MPs on Monday, speaking for the first time since the scandal emerged. It emerged earlier this year that thousands of suspicious customers were responsible for €200 billion (£180 billion) of transactions over the past nine years. This is thought to be the largest money-laundering scandal in history. Nienke Palstra, at campaign group Global Witness, said: “Europe has a major money-laundering problem.” “Until we see senior executives held fully accountable for criminal wrongdoing and serious fines for the banks involved, this kind of scandal will continue for decades to come.” Since the scandal emerged, there are enquiries underway in Denmark, Estonia, the UK and the US. Former chief executive, Thomas Borgen, has since resigned. In his resignation statement, Borgen said that the report concluded he had “lived up” to his legal obligations. Jesper Nielsen is Danske Bank’s interim chief executive and has encouraged anyone that might have any information about the scandal to come forward to the authorities. Shares in the lender (CPH: DANSKE) are trading -0.99% at 135.45 (1601GMT).

Grant Thornton has appointed a new chief executive after the former boss Sacha Romanovitch was ousted. The UK audit firm has announced Dave Dunckley as the group’s new chief executive. Romanovitch, who was the first female to run a big City accountancy firm, left Grant Thornton in October after an anonymous memo criticized her leadership skills and accused her of a “socialist agenda”. At the time of the memo’s release, Romanovitch told the Guardian: “A small cadre of partners will find it hard we are making decisions that will depress profits in the short term but will help profits in the long term.” “If profits get unhinged from purpose it might not hurt you now, but it will come back and bite you on the bum,” she added. On her departure, the CEO who capped her own salary, said: “It has been a privilege and an honour to lead this firm. I am proud of what we have achieved in the market, with our people and with our clients, breaking the mould in so many ways.” “We have attracted so many talented people and great clients to our firm due to our purpose and what we stand for.” Romanovitch will be replaced by Dunckley, who has been with Grant Thornton since 1998 and has been a partner since 2007. A spokesperson from the UK’s fifth-largest audit firm has said that the 200 partners employed at the group are “overwhelmingly in favour” of his appointment. “Our brand is the strongest it has ever been, and we will use this to continue to speak out on big themes that impact our industry and society, driving profitable commercial growth whilst ensuring that we continue to have a strong social conscience,” said Dunckley. Grant Thornton carries out the audits for Patisserie Valerie, which almost collapsed last month.  

New figures from Rightmove have shown UK house prices to fall by over £5,000 in the past month. According to the website’s survey, prices have fallen in November at the fastest rate since 2012. Asking prices have fallen at an average of 1.7%, with the fastest falls occurring in London in the south of the country. The typical asking price fell in London by £10,793 and by £8,647 in the south-east. Miles Shipside from Rightmove said: “Seven years ago price rises started rippling out from the capital into the commuter belt in the South East. That ripple effect has now been reversed, with some of the London market price readjustment reverberating out into the commuter belt.” “Higher-end, former hotspot towns are now among the biggest annual fallers with Rickmansworth (-7.1%), Esher (-6.4%) and Gerrards Cross (-6.0%) now cold spots following price rises of nearly 40% over the seven preceding years.” According to Rightmove, sellers are lowering house prices in the run-up to Christmas in order to lessen the pre-Christmas “buyer humbug” effect. Ahead of Christmas, house prices are likely to remain subdued. However, Shipside remains positive for growth. “With the supply of new-build houses remaining tight, a low interest-rate environment combined with near record employment, and average wage increases now rising faster than both CPI inflation and average property prices, the underlying fundamentals for a stable property market remain sound,” he said. Sarah Coles from Hargreaves Lansdown said that potential remained from quick buyers. “The property market hates uncertainty, so regardless of what happens next in Brexit terms, buyers may lose some of their enthusiasm, sellers may be reluctant to put their homes on the market, and we could see continued sluggishness in the market,” she said. “It’s a buyers’ market, so you should be able to get the kind of discount that shields you from the risk of further drops in the market.”  

Greg Clark, the business secretary, has said that extending the Brexit transition period is an “option”. Clark told the BBC Radio 4’s Today programme on Monday that the transition period could extend until the end of 2022, giving the UK two more years to negotiate a relationship. “Businesses, especially small businesses, have said very clearly that they would much prefer to have one change, rather than have to change things twice, to two different regimes,” said Clark on Monday. “It would be at our request, and that would be a maximum period. But it would be for this purpose – if the negotiations are making good progress but haven’t quite been finalised, to have the option – and it would be an option for us, and there is value in having an option – in rather than going in for a temporary period into the backstop and having a second change, to have the option, if the UK wanted, to extend the transition period,” he added. The business secretary did not rule out an extension and said: “The point is that if we have the option we don’t have to use it. Our strong preference is clearly to complete the negotiations.” Currently, the plan remains the same and the UK is still on track to leave the EU on 20 March 2019. Prime Minister Theresa May will go to Brussels this week, whilst hoping to garner support for the deal from her own party who hope to remove her this week. Last week saw the appointment of a new Brexit Secretary after Dominic Raab resigned on Friday. Stephen Barclay said he was “delighted to accept” the role. “We now need to keep up the momentum to finalise the withdrawal agreement and outline political declaration and deliver a Brexit that works for the whole UK,” said the former minister of state in the health and social care department. “Looking forward to working with a talented team of ministers and officials to do just that.”

Debbie Crosbie has been named as the new TSB chief executive after Paul Pester stepped down in September. Crosbie is leaving CYBG where she has been the chief operating officer since January 2015. She will start her new role next year. Pester stepped down earlier this year following the IT meltdown that took place in April this year, which left 1.9 million customers locked out of their accounts. The meltdown cost the group £176 million and also the loss of thousands of customer accounts. Crosbie’s salary will be £914,000 and she will also be eligible for a bonus scheme. Richard Meddings, who has been temporarily running TSB since Pester stepped down, said: “In an impressive field of candidates, Debbie stood out. With over two decades of experience, superb retail and SME banking expertise, and a genuinely open and engaging style of leadership, we have found an outstanding new chief executive.” “Debbie’s appointment is another step forward against the three priorities we set out in September, namely: completing the work of putting things right for customers; achieving full functionality across all TSB products and services and appointing the right chief executive for the next chapter of the group. As we look to the new year, TSB can now look forward with renewed ambition.” The new chief executive said: “The exciting thing about TSB is just how much potential the bank has to redefine banking to better serve customers and their changing financial needs. Thanks to the skill of TSB Partners, the strength of TSB’s network, and the capabilities within the bank to deliver, TSB has all the right ingredients to be the leading challenger bank in the UK.” The banking group used to be owned by used to be part of Lloyds Banking Group (LON: LLOY) but was bought by the Spanish group Sabadell (OTCMKTS: BNDSY).