Below are the key morning headlines from today’s papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Jaguar driven to cut costs in £2.5bn turnaround bid. Investment slashed as sales slide and losses mount in ‘perfect storm’. Britain’s largest automotive group has launched a £2.5 billion turnaround plan involving cost-cutting and reductions in planned investment after losing millions of pounds a day in recent months. Jaguar Land Rover wants to cut costs by £1 billion in the next 18 months as well as to reduce investment in new models and technologies by £500 million to £4 billion in this financial year and next, as well as trimming inventory and working capital by £500 million. JLR workers are already suffering from 1,000 job cuts in the West Midlands this year, an unscheduled shutdown this autumn of the Solihull plant and the Castle Bromwich factory going on a three-day week until Christmas.
Shingrix vaccine is shot in the arm for Glaxosmithkline. The launch of a shingles vaccine and delays to copycat versions of a blockbuster helped GlaxoSmithKline (GSK) to achieve strong quarterly results. Revenue at Britain’s biggest pharmaceuticals company rose by 6% to £8.1 billion and pre-tax profit by 5% to £1.7 billion in the third quarter. Trading was boosted by sales of Shingrix, the shingles vaccine, in the United States and from the performance of Advair, its inhaler, which rival companies are struggling to copy.
NHS is driving Britain into debt, says Moody’s. The national debt will increase unless taxes rise or the NHS is reformed to make it affordable, Moody’s has warned. The £84 billion earmarked in the budget for the NHS for the next six years underlined the choices that the country must make because the escalating cost of healthcare would only “intensify the UK’s long-term fiscal pressures”, the credit ratings agency said. Monday’s budget delivered the biggest fiscal relaxation in eight years as the chancellor found money to pay for the NHS giveaway. A big improvement in the underlying forecasts allowed Philip Hammond such generosity without causing the deficit to deteriorate. Moody’s, which rates Britain as AA2, its third highest grade, said that the budget “does not change our credit view”. However, it warned about a deteriorating debt position under a no-deal Brexit and over the long term as a result of the NHS.
Crawshaws suffers unkindest cut with fall into administration. A chain of butchers has fallen into administration weeks after issuing a profit warning as it continued to haemorrhage sales, partly because of the rise of discount retailers. The collapse of Crawshaw Group (CRAW) means that up to 600 jobs are at risk in the Midlands and the north of England. Crawshaws said in a statement on its website that although it had been in talks with new and existing investors, it had been unable to raise enough capital and, as a result, did not have “sufficient cash resources” to carry out its proposed restructuring.
Centrica defies investors with new leader. Britain’s biggest energy supplier has hired the chairman of a Scottish engineering group to lead its board, shrugging off potential concerns about overboarding. Centrica (CNA) , which owns British Gas, said that Charles Berry would become its chairman in February and would continue to hold the same role at Weir Group. Mr Berry, 66, will succeed Rick Haythornthwaite, who has led Centrica’s board since 2014, at a critical time for the company. Iain Conn, its chief executive, is under pressure as Centrica slashes thousands of jobs and battles to stay profitable under the government’s cap on energy prices.
Santander UK’s customer numbers falter and profits slide as it’s weighed down by mortgage book performance. Banco Santander S.A. (BNC) pre-tax profits fell by 13% to £1.4billion in the nine months to 30 September. By the end of the third quarter the bank had 4million retail customers, admitting to investors it was ‘not on track’ to meet its 2018 target of 4.7million customers. In its results, the bank said: ‘Ongoing customer demand for higher interest rate products, and some consolidation of savings into current accounts, has impacted loyalty conversion.’
Standard Chartered shares up as FTSE 100 bank bemoans escalating trade war but reveals it made as much profit in the last quarter as in all of 2016. Shares in Standard Chartered (STAN) are up over 4% after the bank posted a 31% rise in underlying third quarter profits. The 150-year old British-based bank said it had made ‘as much profit in a quarter as we did in all of 2016.’ But the FTSE 100 firm, which has an emerging markets focus, warned that tensions linked to a trade war between China and Donald Trump’s US were starting to bite.
Mothercare culls 200 head office jobs as retail woes continue. Mothercare (MTC) is to cut 200 jobs at its head office in Watford in a bid to meet a £19m cost-saving target as it battles a crisis on the UK high street. The struggling retailer said the company restructure, initially announced in May, would result in 150 net job losses and 50 new roles, and that staff would be redeployed where possible. It said it would be “supporting colleagues throughout the consultation process”. A spokesman added: “We have today been communicating with our staff regarding the next stage of Mothercare’s transformation to ensure we have a sustainable, global brand which can be the leading global specialist for parents and young children.”
EasyJet makes fresh approach for Alitalia. easyJet (EZJ) has submitted a revised bid for Italy’s Alitalia as Europe’s airlines prepare for a winter of consolidation amid rising fuel costs. Alitalia has been under special administration since last year after workers rejected a rescue plan. EasyJet, Lufthansa and Wizz Air have submitted previous submissions of interest. In July Italian transport minister Danilo Toninelli said 51% of Alitalia should be kept in Italian hands. EasyJet made its latest submission “in response to the new government’s ongoing sales process”, the company said on Wednesday evening.
Shares in superyacht firm GYG (GYG) sink further after profit warning. Shares in superyatch company GYG tumbled 36% after it warned full-year revenue and profit would be “significantly below expectations” after a “very disappointing year”. The Mallorca-based company now expects adjusted losses of €1.2m (£1.06m) before interest, taxes, depreciation and amortisation for the 12 months ending December 2018. Full year revenue will be approximately €44m. This compares to revenue of €62.6m and earnings of €7.2m the year before. GYG, which sources parts for superyachts, paints vessels and carries out other maintenance on them, blamed the profit warning on delays to existing projects.
