After a better-than-expected summer of sales, Next (LON: NXT) has raised its annual profit expectations. The retailer has also said that the biggest threat of a no-deal Brexit would be the queues and delays at ports. Despite this, the group’s boss Lord Wolfson, who has backed Brexit, does not think a no-deal Brexit will be a “material threat”. “It is not yet clear how well prepared HMRC systems, customs and other relevant personnel will be for the upcoming potential increase in workload and data capture,” he said. “We believe that the biggest risk to our business is the external risk of UK ports not coping with the additional volume of customs work they would be required to undertake if no changes are made to the UK’s current procedures… We believe that it remains open to the government to initiate changes in the way customs procedures operate and that such measures could eliminate much of the risk to our ports.” “There are significant challenges involved in preparing for a no-deal outcome and we would not want to understate the work we are doing to prepare for this eventuality. However, we do not believe that the direct risks of a no-deal Brexit pose a material threat to the ongoing operations and profitability of NEXT’s business here in the UK or to our £190m turnover business in the EU,” he added. Sales in Next increased 4.5 percent during the six months to July and the group reported half-year pre-tax profits of £311.1 million compared to the £309 million in the same period the year previously. Full-year profits are expected to be similar to last year of £727 million, despite the volatile high street. Last week, Moss Bros sales had suffered because of the hot summer. The retailer warned of the conditions faced on the high street. “The UK retail market remains volatile, subject to powerful structural and cyclical changes. Many of these headwinds have not abated. As expected, sales in our stores (which now account for just under half of our turnover) continue to be challenging.” “We believe the over-performance in the first half was flattered by the unusually warm summer and we remain cautious in our outlook for the rest of the year.”

Michael Kors (NYSE: KORS) is to buy Versace in a $2 billion deal. The Italian newspaper Corriere della Sera has reported that the US luxury brand is expected to announce the deal with the Milanese fashion house on Tuesday. US private equity firm Blackstone took a 20 percent stake in Versace in 2014, which will also be sold onto Michael Kors. Blackstone injected €150 million of capital into Versace and acquired €60 million in stock in Versace at the time of purchase. A source told Reuters: “They gradually persuaded the family to look into a possible sale and introduced them to a series of buyers, including Michael Kors.” “Blackstone wasn’t going to put any more money into it. They needed a buyer who could make heavy investments.” Michael Kors bought Jimmy Choo, the luxury shoemaker founded in London, for almost £900 million. Michael Kors said the acquisition was expected to deliver “the opportunity to grow Jimmy Choo sales to one billion dollars” and allow “a more balanced portfolio with greater product diversification”. Versace reported sales of €686 million in 2016. The group’s chief executive, Jonathan Akeroyd, said earlier this year that annual turnover was soon expected to be over €1 billion.      

Sky has recommended its shareholders accept Comcast’s (NASDAQ: CMCSA) $40 billion takeover offer. In a statement released on Monday, the UK broadcaster advised shareholders to accept the offer by the October 11 deadline. “As the price of the Comcast Offer is materially superior, it is in the best interests of all Sky shareholders to accept the Comcast Offer,” the company said. “Accordingly, the Independent Committee unanimously recommends that Sky shareholders accept the Comcast Offer, and in order to ensure the successful closing of the Comcast Offer, and given the possibility of a delisting of Sky in the near future, urges shareholders to accept immediately.” Comcast outbid Twenty-First Century Fox (NASDAQ: FOXA) for Sky on Saturday by $3.6 billion. The deal is worth £17.28 per share, higher than Fox’s of £15.67 per share. Martin Gilbert, chairman of the Independent Committee of Sky, said: “We consider the Comcast Offer to be an excellent outcome for Sky shareholders, and we are recommending it as it represents materially superior value. We are focused on drawing this process to a successful and swift close and therefore urge shareholders to accept the recommended Comcast Offer,” Fox now has to decide what to do with the 39 percent of Sky it owns, which it agreed to sell to Disney (NYSE: DIS) along with its entertainment assets in a deal that was approved by both sides in July. The group said it would “make a further announcement in due course.” Shares in Sky (LON: SKY) jumped nine percent to £17.22 in Monday’s early trading. Shares are currently trading up 8.74 percent 1141GMT).  

Randgold Resources (LON: RRS) and Barrick Gold Corporation (NYSE: ABX) confirmed on Monday an $18 billion (£14 billion) merger. The gold mining companies will combine to create the world’s largest group, with Barrick shareholders owning 66.6 percent of the new group and Randgold shareholders owning 33.4 percent. Randgold Resources is based in London and operates mines in Africa whilst Barrick, based in Canada, has mines in the US, Peru, Chile and Argentina. Mark Bristow, the chief executive officer of Randgold, said: “Our industry has been criticised for its short-term focus, undisciplined growth and poor returns on invested capital.” “The merged company will be very different. Its goal will be to deliver sector leading returns, and in order to achieve this, we will need to take a very critical view of our asset base and how we run our business, and be prepared to make tough decisions.” “By employing a strategy similar to the one that proved very successful at Randgold, but on a larger scale, the New Barrick Group will leverage some of the world’s best mines and talent to create real value for all stakeholders.” John L. Thornton, executive chairman of Barrick, said: “Our overriding measure of success will be the returns we generate and not the number of ounces we produce, balancing boldness and prudence to deliver consistent and growing returns to our fellow owners, a truly simple but radical and achievable concept.” “There are no premiums in the merger because we strongly believe in the opportunity to add significant value for our shareholders from the disciplined management of our combined asset base and a focus on truly profitable growth.” The new group will be listed in Toronto and New York, whilst being delisted from the London Stock Exchange. As part of the deal, China’s Shandong Gold (SHA: 600547) has agreed to buy $300 million of shares in Barrick.

The new tariffs imposed by the US and China have gone into effect. The US has imposed tariffs on $200 billion (£152 billion) worth of Chinese goods, whilst China retaliated with $60 billion of US goods. Soon after the tariffs went into effect, Beijing accused Washington of engaging in “trade bullyism”. Beijing also said it could restart trade negotiations if the talks are “based on mutual respect and equality”. Matthew Goodman, senior vice president at the Asian economics at The Center for Strategic and International Studies, said: “It’s hardly surprising the Chinese have called off these talks, they don’t really know who to talk to or what to talk about since the Trump administration has sent very mixed signals about what they want.” In total, the US has introduced three rounds of tariffs on Chinese products this year, which totals $250 billion worth of goods. This is half of all Chinese imports to the US. The new taxes will affect handbags, rice and textiles. Some items including smart watches and high chairs are exempt. Donald Trump has threatened further tariffs on Chinese goods. He said that taxes on another $267 billion of goods were “ready to go on short notice” Steven Yue, the sales manager at Hebei Huayang Steel Pipe (HHSP), told the BBC: “The Chinese government will not just sit back.” “The US has many big enterprises with a lot of vested interests and investments in China. If the US begins to attack the Chinese, then it will have a big impact on American businesses operating here – not just against China.” “Whoever has the will win. But for now, I still believe China has the ability to keep things under control,” he added.    

Three House of Fraser stores are set to close, said Sports Direct (LON: SPD) tycoon Mike Ashley. After failing to agree on terms with the store’s landlords, the department stores in Edinburgh, Hull and Swindon will close. Ashley was understood to be demanding low or even zero in rent, yet called landlords greedy. “I am disappointed that in my opinion a small number of greedy landlords still refuse to be reasonable,” he said. After buying House of Fraser in August, Ashley hoped that most of the department stores would remain open. A fourth store in Bath is also at risk of closure but 20 House of Frasers are to remain open, saving 3,500 jobs. Some of the stores to remain open are based in Altrincham, Aylesbury, Camberley, Carlisle, Darlington, Doncaster and Plymouth. The hundreds of staff based at the three closing outlets are to now go through redundancy consultation. “We’ve shown what we can achieve on the British high street when we work together with landlords,” said Ashley. “I would like to thank those landlords who have helped us to rescue approximately 3,500 jobs at the stores we have saved to date.” “I am calling on everybody to pull together, including landlords and local authorities in order to help to save as many House of Fraser stores and jobs as possible on the great British high street,” he added. Chief executive of the British Property Federation, which represents landlords, said: “What has been taking place is negotiations between House of Fraser and its landlords – a two-party process – where each party will have its own interests and one party simply can’t cry ‘unfair’ in the media when it doesn’t get what it wants.” “There will be a range of factors to consider on a store-by-store basis but what property owners won’t be doing is simply leaving stores empty for the sake of it, that would be in no one’s interests.”      

Osirium Technologies plc has announced a contract win with a major British multinational clothing, footwear and home products retailer. Osirium Technologies is one of the fastest growing parts of the cyber-security market. Additionally, it is a leading vendor of the Privileged Access Management software. By using cloud-based products, the company prevents cyber-attacks of IT assets, infrastructure and devices. Indeed, the retailer has appointed Osirium to deliver its full product offering, initially supporting 100 devices. Chief Executive Officer, David Guyatt, commented on the win: “We are delighted to have won another contract with a leading retailer.” “Our role is to provide solutions to protect the retailer’s critical core infrastructure from third party and international cyber-attacks and we look forward to working with them.” At 10:12 GMT today, shares in Osirium Technologies plc (LON:OSI) were up 0.7%.

The UK’s ability to secure an exit deal from the EU is dwindling. The informal EU summit in Austria has humiliated Theresa May as EU leaders rejected her Brexit proposals. EU leaders said they would push for a Brexit deal next month. However, they warned May that she must compromise on trade and the Irish boarder. European Council president Donald Tusk did highlight some positive elements to the Chequers plan. But, he fundamentally deemed it unacceptable in its present form. That said, all sides have emphasised their determination to reach a deal before the Brexit focused summit in November. Dominic Raab, the Brexit secretary, told the BBC’s Politics Live: “We’ve revved up the motor of these negotiations, I’ve been out there a lot more frequently to get motoring, to make progress and the EU have just yanked up the handbrake.” “For the negotiations to go forward they’re going to have to take their hand off the handbrake.” The Times has set out the five options that May can now pursue. The most likely of these options is for the PM to keep going and persist. But they also include walking away with a no-deal and the least likely option of resigning. The PM has released a statement on the Brexit talks: “Yesterday Donald Tusk said our proposals would undermine the single market. He didn’t explain how in any detail or make any counter-proposal. So we are at an impasse.” “At this late stage in the negotiations, it is not acceptable to simply reject the other side’s proposals without a detailed explanation and counter proposals.” “So we now need to hear from the EU what the real issues are and what their alternative is so that we can discuss them. Until we do, we cannot make progress.” “In the meantime, we must and will continue the work of preparing ourselves for no deal.” The pound is now on course for its biggest one day drop this year against the dollar.