Fleeing customers dim lights at British Gas as price cap hits. Shares in British Gas owner Centrica (CNA) suffered a major power failure on Thursday as hundreds of thousands more customers deserted the firm and it took a £70 million hit from the looming cap on household bills. Production hiccups at Centrica’s oil and gas production and nuclear arms added to the woes of the FTSE 100 group, dragging down the stock more than 8%, or 11.95p, to 133.8p. Ofgem has confirmed that the cap on standard variable rate bills will be set at £1137 for direct debit customers in the first quarter of next year. This is £68 lower than British Gas’s current standard variable tariff, which 3.1 million of its customers currently pay, leading to a “negative near-term impact on earnings and cash flow”.
Toymaker Hornby (HRN) has signalled to a brighter future today as its losses narrowed in the last six months. The firm, best known for its model trains, trimmed its half-year losses to £3.2million, compared with £5.7million at this point last year, after ‘slamming the brakes’ on an aggressive discounting strategy that was eroding sales.
Johnston’s pension dump highlights pre-pack perils. This time last year the Norwegian businessman, Christen Ager-Hanssen and then the biggest shareholder in Johnston Press (JPR) , warned “This company is in deep s***. It needs to be taken over. That needs drive and energy. That board doesn’t have it. I have it.” Ager-Hanssen appears right about one thing: the Johnston board doesn’t look to have had either the drive or the energy. As of last Friday night, Johnston Press ceased to exist when the management applied to the courts to put it into a pre-pack administration process. The deal wiped out Ager-Hanssen’s majority 25% shareholding, along with stakes owned by three other big investors who held between them another 27%, as well as hundreds of small investors even though the firm was worth £2.9m when shares were suspended.
Berkeley denies claims of bribery from former finance director. Berkeley Group Holdings (The) (BKG) has denied claims of bribery from a sacked former finance director, which emerged in court documents on Thursday. The documents relate to a High Court battle between Nic Simpkin, who was fired in 2014, and the major London builder, led by industry veteran Tony Pidgley. The High Court papers revealed by the Guardian and Finance Uncovered relate to two cases brought against the firm by Simpkin, who had options over 3.5 million shares worth tens of millions of pounds when he was ousted.
Majestic Wine to get £8m of booze in for hard Brexit. Majestic Wine (WINE) on Thursday admitted it will bring in extra bottles of wine and spirits from France, Spain and Italy to guard against a disorderly Brexit. The company said it will stockpile up to £8 million worth of booze, joining the likes of Mr Kipling owner Premier Foods and chocolate maker Cadbury, which have taken similar measures. Businesses fear ports will grind to a halt if Britain crashes out of the EU with no deal. Chief executive Rowan Gormley added he won’t hike prices for now although some increases have already crept into the market since the referendum.
Stricken retailer Mothercare (MTC) blamed ‘market uncertainty’ and negative press coverage today for another six months of falling sales. The baby specialist’s UK sales crashed 14.3% in the last six months – news that sent its languishing shares down a further 8% to just 16p in early trading. Mothercare warned that its performance will remain ‘volatile’ in its domestic market while it ploughs ahead with store closures.
Mitie has trimmed its order book to concentrate on higher value deals for large companies as the outsourcing sector remains under scrutiny. The company said its order book declined by £255m to £3.9bn over the last six months as a result of its becoming “more disciplined” in its bidding process over the last year. Mitie Group (MTO) is one of a number of outsourcers treading more carefully in the wake of the collapse of Carillion, which fell into liquidation in January, amid wider concerns about the health of the sector.
Fewer people placed financial bets over the summer as they were distracted by the World Cup and the hot weather, City tycoon Peter Cruddas has said, as profits at his online trading company plunged. Former Conservative party treasurer Mr Cruddas, dubbed the City of London’s richest man, said his business CMC Markets (CMCX) has been knocked by regulatory changes, subdued markets and a slowdown in client activity. Pre-tax profits dived 76% for the half-year.
