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.
Dixons Carphone swings to huge loss after writedowns. Retailer Dixons Carphone (DC.) has revealed plans to slash costs by £200m after tumbling to a half-year loss following a near-£500m hit on its mobile business and store estate. The group’s shares dropped 14% after it swung to a £440m pre-tax loss for the half-year to October 27 against profits of £54m a year earlier after charges of £490m, largely due to a writedown on the value of its Carphone Warehouse arm. It also said it was set to see full-year costs surge to £190m – including a £17m hit from the cyber attack revealed in June that saw 5.9 million bank card details and 10 million personal data records hacked last year. But the group offered a dose of cheer to staff with plans for a share incentive award scheme that will see more than 30,000 employees given at least £1,000 in shares each over the next three years.
‘Worse than expected’ results and another profit warning sent struggling Superdry (SDRY) stocks tumbling by more than 32% today. The fashion firm, which has seen its shares crash 81% across the year, came clean today about a massive 49% decline in half-year profits, as well as poor store sales and deteriorating margins. It also warned that its earnings for the full-year will fall short of the mark. The half-year numbers were worse than analysts predicted and triggered a sharp sell off, taking the firm’s share price to below £3.74, lows not seen since 2012. AJ Bell investment director Russ Mould said: ‘Expectations were already low for Superdry given mild weather having a negative impact on coats and jackets. ‘However, its half year results are even worse than expected, prompting questions as to whether the business has really lost its way.’
Lenders do brisk business with homeowners and new buyers. Mortgage lenders enjoyed a bumper October thanks to bounces in numbers of first time buyers and of homeowners renewing their deals. Remortgaging came close to a ten-year high as fixed-rate deals expired and households sought cheap deals in what is a highly competitive market, UK Finance, the industry group, said. The Bank of England has signalled that rates are likely to rise in the coming months and homeowners are looking to lock in current rates to keep costs down. Affordability has been a problem, particularly in London where prices are falling, but a slowdown in house price inflation appears to be reinvigorating parts of the market.
Sainsbury’s and Asda demand judicial review of competition probe timeline. Sainsbury (J) (SBRY) and Asda are challenging the competition watchdog in court for more time to be given to the probe into their £12bn mega-merger on the grounds of its “unprecedented scale and complexity”. The two supermarkets are to apply for a judicial review of the Competition and Markets Authority (CMA) investigation into their proposed tie-up, as they request more time to consider the evidence. But the watchdog has said it will defend its position in court, and is “not willing to compromise on the thoroughness or objectivity” of the investigation. The application, lodged on Wednesday with the Competition Appeal Tribunal, will request a review of the CMA’s timetable and process.
Rolls-Royce promises higher profits after engine difficulties. Rolls-Royce Holdings (RR.) picked its shares up from the 18-month lows to which they had dropped, promising investors that profits for the year will come in above £450 million. During months of fretting over the financial impact of Rolls’s problems with its Trent 1000 engines for the Boeing 787 Dreamliner, which has been grounding aircraft fleets operated by the likes of British Airways and Norwegian, the engineering group said that earnings and cash inflow would both be in the upper half of previous guidance. Rolls had previously said that it expected operating profits to be £100 million either side of £450 million and cashflow to come in £100 million either side of £400 million. In 2017, operating profits came in at £321 million and cashflow £273 million.
Oil price volatility means fewer contracts for Wood Group. Shares in Wood Group (John) (WG.), the engineer, fell sharply this morning after it warned that oil price volatility might slow the pace of contract awards and that earnings could be at the lower end of expectations. The company expects revenue to be up more than 10 per cent this year to between $10.9 billion and $11.1 billion. The shares were down 7% at 598.6p at 11am. The group, based in Aberdeen, is best known for its presence in oil services, where it is involved in a variety of areas, from large-scale engineering and design projects through to the building, maintenance and monitoring of pipelines and other infrastructure.
Warring Tories were labelled “beyond parody” by business leaders on Wednesday as Theresa May faced a vote of no confidence in her leadership. The attempt by Conservative Brexiteer hardliners to oust the PM with the country just 15 weeks away from Brexit — and no deal in place — was greeted with scathing disbelief by a host of senior organisations and bosses. Bookmakers make her the favourite to win the vote tonight, which would secure her as leader of the party for another year. Nick Varney, chief executive of Madame Tussauds operator Merlin Entertainments, said: “The whole situation is moving beyond parody. Everybody just wants clarity and certainty. I don’t think our politicians are covering themselves in glory.” Michael Bruce, chief executive of online estate agents Purplebricks, said: “Ultimately the quicker they make the decision about who is leading the country, the better.” The British Chambers of Commerce’s director general Adam Marshall greeted the no-confidence vote with “utter dismay”, adding: “It is unacceptable that Westminster politicians have chosen to focus on themselves, rather than on the needs of the country… History will not be kind to those who prioritise political advantage over people’s livelihoods.”
International property investors are still choosing to make debut London purchases despite political uncertainty, it emerged on Wednesday as a Kuwaiti firm spent £39 million in the City. Soor Capital said it has agreed its first UK deal with the acquisition of office building 23-26 Austin Friars. Abdulaziz Alduweesh, a partner at the firm, said the company is attracted to long-term income and “strong property fundamentals”. The 55,850 square feet block, which was bought from a private client of agent JLL, is fully-let to Avanta Serviced Office Group, part of IWG. It is a short walk from Liverpool Street station. The deal comes despite wider jitters in the commercial property market about rental growth prospects and tenant demand after Britain leaves the EU.
