Sajid Javid to replace Rudd as home secretary
Following Amber Rudd’s surprise resignation, Sajid Javid has been named the UK’s new home secretary.
Announced on Monday morning, Javid is the first home UK secretary that has come from an ethnic minority background.
After Theresa May’s announcement, Javid said that the most pressing task at hand was to get ahold of the Windrush crisis and ensure those affected “are all treated with the decency and the fairness they deserve”.
“We’re going to have a strategy in place that does something the previous home secretary set out last week when she made a statement to parliament – to ensure that we have an immigration policy that is fair, it treats people with respect, and with decency,” he told BBC News.
“That will be one of my most urgent tasks, to make sure that we look carefully at the policy and make sure it achieves just that – fairness.”
Javid is replacing Rudd who resigned after she said she “inadvertently” misled MPs over deportation targets.
The new home secretary has previously expressed anger over Windrush scandal and how it has been handled by the government.
He told the Sunday Telegraph that the Windrush scandal felt “very personal” to him with Pakistani immigrant parents. “It could have been me, my mum or my dad”.
Dianne Abbott said of Javid’s new role: “The new home secretary cannot form another human shield for Theresa May. The prime minister still has serious questions to answer about how this scandal was allowed to happen, and whether she knew Amber Rudd was misleading parliament and the public last week. It’s time Theresa May finally takes responsibility for the crisis she created.”
This was not the only re-shuffle announced by Theresa May this morning. The former Northern Ireland secretary James Brokenshire is returning as the housing, communities and local government secretary. Penny Mordaunt, the International Development Secretary will take Rudd’s other role as the women’s and equalities minister.
Randgold shares edge down as strike affects gold output
Randgold Resources (LON:RRS) saw shares edge down in early trading, after production at its Ivory Coast mine was hit by strikes.
Ongoing strikes at the Tongon gold mine started with employees but then spread to other operations. Operations have now returned to full capacity, but the group said on Monday that disruption would likely impact the mine’s production guidance of 290k ounces for 2018.
Despite this, Rangold said it was “determined” to recover most of the lost output.
“To mitigate the downtime effect and lost plant throughput, Tongon processed ore from the run-of-mine and scats stockpiles during the stoppages and also used the opportunity to upgrade parts of the plant to achieve a higher and more consistent throughput going forward”, it said.
Shares in Randgold are currently trading down 0.30 percent at 5,896.00 (0852GMT).
Old Mutual trading on track for Q1, shares rise
South African wealth management group Old Mutual (LON:OML) reported earnings in line with expectations in March, sending shares up 2 percent at market open.
The dual-listed Old Mutual said continuing operations started the year on a “positive note”, and so far this year trading has continued in line with management expectations.
“Since the year end, shareholder investment returns reflect the impact of lower equity markets in South Africa and particularly in Zimbabwe. Management remains focused on managing the cost base tightly and delivering on its communicated strategy,” Old Mutual said.
Its UK wealth and insurance division, Quilter, saw first-quarter net cash flow rise by 14 percent to £1.6 billion. Its assets under administration fell 2 percent, with Old Mutual are planning to spin off the company later this year.
Shares in Old Mutual are currently trading up 1.77 percent at 259.60 (0834GMT).
WPP shares rise despite revenue fall in Q1
Shares in advertising firm WPP (LON:WPP) rose nearly 7 percent at market open on Monday, despite reporting a fall in revenue for the first quarter.
First-quarter revenue fell 4 percent due to foreign exchange headwinds, seeing an overall decline to £3.56 billion. Howeverm on a constant currency basis the figure rose by 2 percent, and saw a 0.8 percent boost like-for-like.
The advertising firm has been under increasing pressure over the last couple of weeks, suffering a management crisis after long-serving chief executive and founder Martin Sorrell resigned over a misconduct investigation. Mark Read and Andrew Scott have been appointed as joint chief operating officers.
The results come just after the news that CVC Capital Partners are interested in buying Kantar, WPP’s market research arm.
CVC declined to comment on its interest in Kantar but according to the Financial Times, a “person with knowledge of the talks” cautioned that they were at a very early stage.
Shares in WPP (LON:WPP) are currently trading up 6.84 percent at 1,227.00 (0818GMT).
Asda and Sainsbury’s agree to merge in £7.3bn deal
Sainsbury’s has agreed to buy Asda from US-based Walmart for £7.3 billion in cash and shares, in a landmark deal for the supermarket sector.
Walmart would gain 42 percent of the combined group’s shares under the terms of the deal, plus £2.975 billion in cash. It will not, however, hold more than 29.9 percent of the merged entity’s total voting rights.
Both Sainsbury’s and Asda will still be seen on the high street, with the brands to be kept the way they are now, while Ebitda synergies of at least £500 million would be targeted.
The combined company will own more than 2,800 stores, between Sainsbury’s, Asda and Argos, and some of the UK’s biggest websites. No store closures are planned.
Asda’s CEO, Roger Burnley, said the deal may well bring further price cuts.
“The combination of Asda and Sainsbury’s into a single retailing group will be great news for Asda customers, allowing us to deliver even lower prices in store and even greater choice.
“Asda will continue to be Asda, but by coming together with Sainsbury’s, supported by Walmart, we can further accelerate our existing strategy and make our offer even more compelling and competitive.”
The deal between the two rivals will create the biggest supermarket chain in the UK, with combined revenues of around £51 billion.
However, the deal is not yet completely concluded – Sainsbury’s shareholders still need to give their approval, as well as the regulators, who may have concerns over increased pressure on the chains’ suppliers.
Sainsbury’s & Asda to reveal details of £15bn merger plans
Sainsbury’s (LON: SBRY) and Asda will reveal details of a new shock deal between the two supermarkets.
Revealed on Saturday, the pair is in talks over a £15 billion merger that could result in a retailer more powerful than the current leader, Tesco.
The proposed deal triggered fears of job losses, with Joe Clarke, the acting national officer of the United union, calling the deal an “absolute shocker”.
“Staff are already facing uncertainty through restructuring and changes to contracts at [Sainsbury’s]. Sainsbury’s bosses need to give workers clarity over what the future could hold and assurances over jobs as matter of urgency,” he said.
The deal between the supermarkets could lead to thousands of job losses as the two chains cut out duplication. Both Asda and Sainsbury’s have already axed thousands of jobs in recent cost-cutting drives.
In a statement released on Saturday, Sainsbury’s confirmed it was in talks with Walmart (NYSE: WMT), which has owned Asda since 1999.
“Sainsbury’s confirms that it and Walmart Inc are in advanced discussions regarding a combination of the Sainsbury’s and Asda businesses.”
The deal will trigger an investigation into the new competition as the enlarged Sainsbury’s and Tesco would control almost 60 percent of the UK grocery retail market.
“This is profoundly not in the public interest. It’s going to have negative consequences for consumers and all the along the grocery supply chain,” said Andrew Simms, the co-director of the New Weather Institute thinktank and the author of Tescopoly.
A senior supermarket executive said the proposed deal would be too difficult to get past the CMA, saying: “This will be much more difficult to get through than the Tesco/Booker deal as it will effectively create a duopoly with 60 percent of the UK grocery market. Last time they made it very clear that the big four [supermarkets] could not become three. It will be a long and challenging process to win approval and could force a lot of store disposals.”
Sainsbury’s will publish a statement describing in more detail the terms of the agreement on Monday morning at 7 am.
Amazon profits soar as US sales rise
Amazon (NASDAQ:AMZN) profits surged 43 percent in the first quarter of the year, driven by online sales in the US.
Sales at the online shopping giant rose to $51 billion in the three months to March, well above analysts forecasts, with net profit rising to $1.6 billion from $724 million in the same period last year. The performance was largely fuelled by its North American business, which saw sales rise $30.7 billion from $20.9bn in the same period last year. Profit also rose to $1.1 billion from $596 million previously. The company are also set to hike the cost of their Amazon Prime service, which now has over 100 million users. The cost of the subscription, which allows customers free next day delivery as well as access to music, books and its video streaming service, will increase to $119 per year, effective from 11 May for new subscribers and to renewed subscriptions from 16 June. Amazon also strong growth at its highly profitable cloud computing division, Amazon Web Services, which hosts the likes of Netflix and Airbnb. The division reported a 49 percent increase in sales to $5.44 billion.Merlin Entertainments continues to feel impact of London terror attacks
Entertainment site owner Merlin (LON:MERL) said trading had been subdued in 2018 so far, impacted by the ‘seasonally quiet’ period as well as weaker demand in the wake of the 2017 terrorist attacks.
Its major London sites, Madame Tussauds and the London Dungeon, reported weaker visitor numbers than the year before, with Merlin saying it reflected “the strong trading in the comparative period and continued impact from the 2017 terror attacks.”
Its major theme parks, including Alton Towers and Chessington World of Adventure, were also impacted by adverse weather conditions in February and March. However, the group confirmed that overall trading within the Theme Parks Operating Groups was in line with expectations.
The company added that its 2018 new business development programme is on track, with all 644 accommodation rooms and one of the nine planned new Midway attractions now open.
The group said that it “remained confident of a recovery over time”.
Shares in Merlin Entertainments (LON:MERL) are currently trading up 0.72 percent to 349.20 (0834GMT).
RBS profit triples in Q1, boosted by falling costs
The Royal Bank of Scotland (LON:RBS) trebled its profit in the first quarter of the year, after a fall in restructuring and running costs paved the way for further recovery.
Attributable profit for the three months through March rose more than three times, up £259 million on-year to hit £792 million.
Pre-tax operating profit rose 70 percent to £1.21 billion, and the group benefitted from not having to set aside any more money to cover costs for payment protection insurance (PPI) mis-selling claims.
However, despite this months strong performance the bank still has the threat of a bit US fine for mis-selling mortgages, that could run between $1 billion -$9 billion.
Ross McEwan, chief executive, said: “This is a good set of results, showing the progress we are making, despite a more competitive market. Our income is up, costs are down and our capital has strengthened again.”
Despite the strong performance, shares in RBS (LON:RBS) are currently trading down 1.54 percent at 269.20 (0822GMT).
Travis Perkins shrugs off adverse weather with strong sales
Britain’s biggest building supplier Travis Perkins (LON:TPK) reported a 2.4 percent rise in first quarter sales on Friday, despite the adverse weather conditions that had a negative impact on similar companies.
On a like-for-like basis sales rose 3 percent, with the group confirming that expectations for the full year 2018 would remain unchanged after raising prices to cover rising commodity costs.
Its plumbing and heating division saw like-for-like sales jump 19.7 percent, but general merchandising sales fell 1.9 percent. Contracting sales rose just 0.9 percent.
Chief executive John Carter said despite the Beast from the East having an impact on figures, predictions for the full-year reman on track and “are supported by our actions to reduce costs”.
“Whilst the mixed trading conditions in our markets are expected to continue in the near-term, we remain confident in the longer term outlook for the building materials market, with opportunities to grow and outperform through the investments we are making to develop or extend our strong customer propositions.”
Shares in Travis Perkins are currently trading up 0.86 percent at 1,296.00 (0811GMT).