Below are the key afternoon headlines from today’s papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Brexit deal could destroy Britain, says former Bank governor. The former governor of the Bank of England launched a blistering attack on the government this morning, likening Theresa May’s proposed Brexit deal to the appeasement of Nazi Germany in the 1930s. Lord King of Lothbury, who ran the Bank from 2003 to 2013 and is a Brexit supporter, said that the compromise plan was the worst of all worlds and that Britain was now facing a deep political crisis. In an opinion piece for Bloomberg, Lord King said that the government would never be forgiven if it approved the deal, which was the result of “incompetence of a high order”. “There have been three episodes in modern history when the British political class let down the rest of the country: in the 1930s, with appeasement; in the 1970s, when the British economy was the “sick man” of Europe and the government saw its role as managing decline; and now in the turmoil that has followed the Brexit referendum. In all three cases, the conventional wisdom of the day was wrong.”
IG Group Holdings (IGG) revenue slide has accelerated since a European crackdown on the market, the firm admitted today. Restrictions on borrowing, which can massively magnify client losses , were introduced in August. The company expects first-half revenues to be 6% lower than last year in the six months to November, worse than the 5% registered in September. The firm is looking to side-step the crackdown as more of its UK and EU clients take on “professional” status by meeting stricter criteria on their wealth and the number of trades they place. Professional clients account for 70% of revenues since the new regime came in, but the number of new clients in its European business has slumped 30% to 8200
Sir Martin Sorrell has made a second acquisition for his new advertising firm, buying an American digital agency for $150 million. S4 Capital (SFOR) , the former WPP chief’s new venture, is swallowing up MightyHive, a Californian company that helps clients buy internet ads. The deal comes months after he bought Mediamonks, an agency based in Amsterdam that creates online advertising companies. The €300 million deal exacerbated tensions with his former employer, which had also been bidding for Mediamonks.
Go-Ahead Group (GOG) will not be stripped of its Govia Thameslink franchise, but will have to fork out £15million for service improvements and will make no profit this year after May’s disastrous timetable changes, the Government said today. The Department for Transport said it is ‘holding GTR to account’ for its role in the disruption caused by the new timetables, but was letting Go Ahead continue run the franchise as a termination would ‘cause further and undue disruption for passengers’. Train companies, including Govia Thameslink – which runs Thameslink, Southern, Great Northern and Gatwick Express services – overhauled their timetable in May. The changes caused widespread disruption and delays across the rail networks
The boss of Greencore Group (GNC) has warned Britons could face fewer sandwich options in the event of a chaotic withdrawal from the European Union as the catering company begins stockpiling ingredients such as frozen prawns. Patrick Coveney, chief executive, said that the main concern was “the availability of fresh produce” if there was a “no-deal” Brexit and problems at the border. The company, which makes sandwiches for Marks & Spencer and around half of all the brands on Britain’s high street, sources around 20pc of ingredients from outside the UK. It has already started stockpiling “a few weeks’ worth” of frozen prawns and tomato paste. Prawn sandwiches have regularly been voted as the UK’s favourite.
Builders merchant Travis Perkins (TPK) could offload its Wickes DIY chain as part of plans to focus on trade customers in an overhaul of the company which also includes a sale of its plumbing and heating division. In a stock market announcement ahead of an analyst meeting Travis Perkins said that it is executing a “significant cost reduction programme” at Wickes while also “looking to review the options for maximising the value of Wickes in the medium term.” It is understood one of these options is a sale. Wickes has suffered from falling sales as it has faced intense competition from rival B&Q and a steady decline in the wider DIY market which has dragged the profits for its consumer division lower. Last month the retail business posted a 7.7% slump in half-year sales as operating profits were dragged down by £14m to £29m.
Ferguson (FERG) has continued a run of good growth in the first quarter of its financial year as its booming US business more than offset troubles in its home UK market. The plumbing and heating distributor’s trading profits grew 10% to $432m (£338m) in the three months to October and revenues rose 8.5% to £5.5bn despite a contraction in the UK, where it has been shutting stores and exiting low-margin wholesale business. The FTSE 100 giant, which began life as a maker of sheep shearing equipment in 1887, changed its name from Wolseley last year to reflect the fact that the US, where it trades under the Ferguson brand, is now by far its largest market.
White van man supplier Northgate (NTG) will slow down its sell-off of old vans in the event of a no-deal Brexit, the company said on Tuesday. The van hire firm, which buys vehicles from European manufacturers, said it was “well positioned” to manage a possible shortage from disruption at the border if the UK crashes out of Europe with no deal. “If there is a supply chain issue we would in the short term reduce the disposals of our fleet so we can continue to meet growing demand,” said chief executive Kevin Bradshaw. The business, which counts 20% of its business in the South East, hiked vehicle hire targets today to double digits but half-year underlying profits were down 13.6% to £29.2 million despite a rise in revenues .
The already intense pressure on Thomas Cook Group (TCG) increased again on Tuesday when the shares plunged another 15% leaving shareholders nursing huge losses. The 177-year-old veteran of the travel sector has embarked on a charm offensive in the City, meeting investors to reassure them that the future is solid and that it will not breach banking covenants. Chief executive Peter Fankhauser has met several top-10 shareholders in the past few days after a third profit warning in just a few months last week. Shares crashed 25% then and have kept on falling. On Tuesday they were down another 4p at 19.5p, which leaves the company equity valued at just £307 million. Shares were 140p as recently as May.
Argo Mining (ARB) – The recent sharp fall in cryptocurrency prices hasn’t hurt the firm, which today said its software products are being snapped up. The company said sales of its packages, which allow subscribers to mine for the currencies, had risen 146% since October after it successfully sold out of a new batch of products. Mike Edwards, co-founder and director, said: “Our mining packages are being snapped up as quickly as we make these available and demand continues to exceed supply.”
