British Land has posted profits for the second half of the year thanks to improved rent collection.
The firm posted post-tax profits of £8370m, which was up from a £730m loss a year earlier.
Chief executive Simon Carter said: “Demand is firmly focused on the very best (office) space, with an emphasis on sustainability, wellness, shared and flexible space and excellent transport connections.”
Richard Hunter, Head of Markets at interactive investor, said: “As the property landscape evolves and with specific challenges in London, British Land is redesigning its portfolio to reflect the new environment.”
“The first relates to the inexorable rise of online shopping, boosted further during the pandemic, and the scarring this may leave on physical shopping centres and, indeed, the high street in general in future years. In addition, the longer term impact of hybrid working is yet to wash through, with staff at some companies not returning to the office at all and others on a limited basis.”
“These shadows have forced a redefinition of British Land’s strategy and there are some encouraging signs that the group is beginning to move ahead of the curve,” he added.
UK inflation has jumped to a 10-year high of 4.2%.
Inflation has risen 3.1% in September and is higher than analyst expectations.
The inflation rate was driven higher by the cost of electricity, gas and other fuels. Also driving up inflation was petrol prices. Average petrol prices in October were 138.6 pence per litre, which is an increase from 113.2 pence per litre a year earlier.
“In April 2020, the energy price cap had been reduced causing electricity, gas and other fuels’ contribution to the CPIH headline rate to fall to negative 0.20 percentage points. But this fall was reversed in April 2021 with rises in gas and electricity prices,” said the ONS.
“The further price rises in October 2021 have compounded the April 2021 increases, resulting in 12-month inflation rates of 18.8% for electricity and 28.1% for gas. These are the highest annual rates for these classes since early 2009.”
Commenting on the rise in inflation, ONS chief economist said: “Inflation rose steeply in October to its highest rate in nearly a decade. This was driven by increased household energy bills due to the price cap hike, a rise in the cost of second-hand cars and fuel as well as higher prices in restaurants and hotels.”
“Costs of goods produced by factories and the price of raw materials have also risen substantially and are now at their highest rates for at least 10 years.”
Danni Hewson, AJ Bell financial analyst, commented on the latest figures: “Anybody responsible for paying the household bills won’t be surprised by today’s inflation number. 4.2% might be slightly above where it had been predicted to fall for October but just look at the prices motorists are paying at the petrol pumps, the demand for used cars sky-rocketing and of course the wholesale cost of gas which continues to put small suppliers out of business.”
“The energy cap which protects consumers from those price hikes was itself a contributor to this month’s inflation figures as it rose substantially just as the temperatures began to fall and nights closed in.”
Totally (Aim: TLY) reported Interims for the 6 months to September. Its turnover increased 14% to £61.1m with an increase in EBITDA to £3.3m from £2.3m while Gross Profit Margins also increased to 18.8% from 17.8%. Since September, TLY won and extended a few contracts for its range of healthcare services.
The Integrated Urgent Care services and Urgent Treatment Centres (UTC) won £22m worth which run for between 6 and 12 months. Also, the Insourcing Division, which supports the NHS in reducing waiting lists has new contracts in Blackburn, Rotherham, and Sheffield across multiple cl...
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“This data will put further pressure on the BoE and members of the MPC to make a decision around rising interest rates as Governor Andrew Bailey recently mentioned that the only missing economic data was how the UK labour market would react after the end of the furlough program,’ said Jesús Cabra Guisasola, Associate at Validus Risk Management.
The next instalment of jobs data will come just days before the Bank of England meet in December and will be one of the most anticipated readings of UK jobs activity in the last decade.
Despite Sterling’s jump this morning, the pound has been under pressure against the dollar since late October falling from highs around 1.3830. The pound had also fallen against the Euro in early November but has now recouped most of the losses.
“Sterling climbed against the dollar on the back of the positive data and is currently testing 1.345. Nevertheless, we continue being cautious around the UK economy as inflation continues rising, with Covid and the negotiations between the UK and EU also weighing on the pound to the downside,” Jesús Cabra Guisasola cautioned.
Whilst the news was positive for GBP and the UK economy, the FTSE 100 underperformed peers as the FTSE 100’s inverse relationship with the pound once more came into play.
“Holding the index back a bit was strength in the pound, hitting the relative value of its dominant overseas earnings, as stronger than expected unemployment figures suggested Bank of England Governor and ‘unreliable boyfriend’ Andrew Bailey might deliver the promised rate rise in December,” said AJ Bell investment director Russ Mould.
Diageo has revealed an enthusiastic set of growth targets as part of their capital markets day which includes sales growth of between 5% and 7% for fiscal years 2023 and 2025.
It also set out bold plans to capture 50% of the alcoholic drinks market by 2030.
“Diageo has declared it is party time as far as its growth ambitions go,” said AJ Bell investment director Russ Mould.
“Often considered to be a pedestrian company with slow but steady revenue gains each year, Diageo has now announced bold ambitions for a 50% increase in its share of the alcoholic drinks market by 2030.”
Diageo brands include Captain Morgan, Smirnoff, Jonnie Walker, Baileys and Gordon’s.
Ivan Menezes, Chief Executive, Diageo explained the groups strategy to active their goals which included spending on staff and marketing.
“Since our last Capital Markets Day, we have continued to invest in our brands, sharpened our focus on accelerating growth and quickly responded to shifts in consumer behaviour. We have also launched ‘Society 2030: Spirit of Progress’, our ten-year sustainability action plan, building on our strong track record of doing business the right way, from grain to glass.
“Our culture of everyday efficiency is embedded in our business and we continue to challenge ourselves to achieve more. In fiscal 21, despite the challenges created by Covid-19, we delivered strong organic net sales growth, drove an improvement in organic operating margin and delivered strong cash flows, while continuing to invest in long-term sustainable growth.
“We believe our sales growth trajectory has accelerated, underpinned by the strength of our advantaged position across geographies, categories and price tiers. TBA is a large, growing and attractive sector of which Diageo currently has a 4% value share. With continued investment in marketing, digital capabilities and our people, we have significant headroom for growth. This gives us the confidence that we can grow Diageo’s value share of TBA from 4% in 2020,1 to 6% by 2030.”
Imperial Brands has released full year results in which reported revenues rose 0.7% to £32.8 billion.
The group’s rise in revenue was attributed to excise duty, however, the group did manage to grind out a 4.8% increase in operating profit as losses were reduced on their new generation products.
“In what has been an eventful year for all businesses, Imperial Brands today announced a set of sturdy FY results for the year ending 30th September 2021. Organic adjusted revenue was up 1.4%, with tobacco growth of 1.5%. Tobacco price mix was up 4.4%, more than offsetting volume declines of 2.9%,” Sara Welford, Director Consumer, Edison Group.
Imperial Brands shares fell over 1% in early trade on Tuesday following the release of their results.
Imperial Brands have embarked on a change of strategy in the past year which CEO Stefan Bomhard commented on along side the release of the full year results.
“This has been a year of important progress and significant change, as we begin to deliver on the new, focused strategy we announced in January 2021,” commented CEO Stefan Bomhard
“We have substantially refreshed our leadership team, making new hires to strengthen our consumer-facing capabilities, while building on our existing deep tobacco experience. We have changed the way we work, placing the consumer at the centre of our decision making. We have simplified the organisation, creating efficiencies for reinvestment. And we have introduced more rigorous performance management, enabling better prioritisation of resources.”
“This approach is already delivering improved operational and financial outcomes. In tobacco, our sharper focus and increased investment in the top-five priority markets have begun to stabilise the aggregate market share performance. This is encouraging early progress in addressing the long-term historical declines. We will build on this foundation in the coming year, with further investment in brand building and sales execution.
New data from Rightmove has found that the average house price on the market is £2,000 lower this month.
The cost of an average home is 0.6% lower than in October and now stands at £342,401. This is the largest monthly decline since January, which was 0.9%.
“New sellers have given buyers an early Christmas present by dropping their average asking prices by 0.6%” said Tim Bannister, director of property data at Rightmove.
“We expect this downward price trend to be relatively short-lived, though sellers who are in a hurry will continue to need to attract buyers for most of December as well.
“As soon as Christmas Day is out of the way, there’s a boom in people searching for property on Boxing Day, perhaps with time available during the holiday season and a resolve to enjoy their next Christmas in new surroundings.
“That is likely to push prices higher again, and increase the competition from other buyers.”
December is traditionally the quietest month in the housing market.
“With the holiday season coming up fast, sellers planning to enter the market might be tempted to put off beginning the process of putting their home on the market until the New Year,” explains managing director at Thomas Morris Sales & Lettings, Simon Bradbury.
“However, Boxing Day is historically the start of a busy period of both new sellers coming to market, and a resurgence of prospective buyers browsing properties. So, if they wait until January to begin the selling process, they may have missed out on a valuable period of time to attract buyers,” he added.
Shell announced the streamlining of their share structure on Monday which would see the removal of A/B share classes.
The energy giant said the move was necessary to facilitate simpler distributions back to shareholders and help the business transition to Net-Zero.
Shell will also now align its tax residence with the UK and now locate their CEO and CFO here.
Shell’s Chair, Sir Andrew Mackenzie, said: “At a time of unprecedented change for the industry, it’s even more important that we have an increased ability to accelerate the transition to a lower-carbon global energy system. A simpler structure will enable Shell to speed up the delivery of its Powering Progress strategy, while creating value for our shareholders, customers and wider society.”
Shell will remain listed in London as part of the proposals as well as keeping listings in Amsterdam and ADR access in New York.
“Shell’s proposed a change to the way it’s organised, eliminating its share classes and unifying its tax home to the UK. Ultimately, the new structure would be a net positive for shareholders as it will streamline the company and make it easier to manoeuvre moving forward,” said Laura Hoy Equity Analyst at Hargreaves Lansdown.
“Aside from the fact that the shares they hold will no longer come with a ‘Royal’ designation, this new alignment won’t change much for investors. The long-term growth story for Shell still rests heavily on the oil price. For now, buoyant oil prices are keeping the group’s cash coffers topped up, which has had a positive impact on debt and given the group the means to boost shareholder returns. However, with the inevitable shift to more sustainable energy picking up steam we suspect the need to invest in greener operations will keep a lid on what the group can pass on to shareholders.”
Amazon has announced plans to open 260 grocery markets in the UK.
All of the supermarkets will be cashierless, with the first 60 to open in 2022 and then further 200 to open before 2024.
“In 2022, we assume a broader rollout of 2 store launches per week by the end of [the] year, targeting 60 total openings,” wrote Amazon in their internal documents.
“In 2023 and 2024, we are planning 100 store launches per year, in line with more aggressive opening programmes achieved by convenience stores in the UK in the last five years, Tesco’s, Sainsbury’s and Co-op have all exceeded 100 openings per year.”
The group hopes to take on UK supermarkets Tesco and Sainsburys. It will also open supermarkets in Germany and Spain next year.
