WPP (WPP) boss Mark Read has warned there is a “tremendous amount” still to do to steady the sprawling advertising giant following the dramatic ousting of its founder Sir Martin Sorrell last year. Mr Read, who became chief executive after Sir Martin was sacked amid allegations of misconduct, said the group has sold 36 divisions and spent £68m on redundancies over the past year. Despite the departures he said the company is still hiring between 2,000 and 3,000 people every month. It has a workforce of more than 130,000 people worldwide. “There’s a tremendous amount to do,” said Mr Read. “I’m too busy to know why I’m busy.”
William Hill (WMH) aims to double profits by 2023 by expanding online and ramping up its US operations to become less reliant on its high street betting shops. The FTSE 250 gambling firm said regulatory decisions in both Britain and the US last year had provided the clarity needed for its new five-year strategy. Chief executive Philip Bowcock said it was the only company operating in all seven American states where sports betting was now permitted and was well placed to move in as more lift restrictions. “The opportunity in the US is huge … the Americans love sports and they are taking to sports betting very well,” he said.
London Stock Exchange Group (LSE) new chief executive, David Schwimmer, has unveiled plans to axe 250 jobs and cut costs in his first set of annual results. The former Goldman Sachs banker, who took over last year after Xavier Rolet abruptly departed amid a major boardroom bust-up, said the group will cut 5% of its workforce to save about £30m. Mr Schwimmer, once chief of staff to former Goldman boss Lloyd Blankfein, also hinted at further acquisitions after he said LSE would not hit its 2019 targets because it would focus instead on “further investment”.
Royal Dutch Shell ‘B’ (RDSB) is preparing to face criminal charges in the Dutch courts over the controversial $1.3bn (£980m) Nigerian oil deal from 2011. The energy giant said Dutch prosecutors were nearing the end of an investigation into the deal, which stands at the centre of long-standing allegations of fraud and corruption in the west African nation. Shell told investors it expected the Dutch Public Prosecutor’s Office to bring criminal charges against the company directly or indirectly related to the 2011 oil field purchase.
UK’s biggest investors bet on the British economy in Brexit show of faith. Britain’s biggest investors have all increased their shareholdings in the UK since the Brexit referendum in a show of faith in the economy’s fundamental strengths. Political turmoil and market volatility have not stopped the financial powerhouses from pouring more money into Britain, betting on Britain’s sustained success over the long-term. UK shares have performed relatively poorly since the referendum compared with investments in other countries. Yet investors said these lower prices mean UK assets are now more attractive, encouraging those who are confident in Britain’s long-term future to put more money into the market.
Aston Martin shares tank as ‘eye-watering’ float costs wipe out profits. Aston Martin Holdings (AML) shares tumbled to a record low after it posted a £68m loss in its maiden annual results with profits wiped out by the “eye-watering” costs of its stock market flotation. The luxury car maker fell almost a fifth to £11 on Thursday as investors abandoned the company whose cars are driven by spy James Bond following a warning that underlying profits will fall this year. Aston floated in October at £19 but the shares soon fell to about £12, suggesting the market thought the car maker was overvalued. Cost related to the flotation drove Aston into the red, with the £136m of one-off charges from going public more than wiping out what would otherwise have been a £68m pretax profit for 2018.
‘Prolonged’ London housing slump sends Foxtons Group (FOXT) to first loss since float. Estate agent Foxtons warned it was battling a “prolonged” downturn in the London housing market as it unveiled its first ever loss as a listed company. The number of homes sold in the capital have fallen off a cliff in the past two years because of an increase in stamp duty and uncertainty over Brexit, leaving Foxtons nursing a 15% slump in 2018 sales revenue to £36m. Its lettings business held up more robustly, generating a 1% rise in revenues to £67m. But that was not enough to stave off a pre-tax loss of £17.2m, compared with profits of £6.5m the year before and a high of £42m in 2014.
British American Tobacco hails higher vaping sales. The outgoing boss of British American Tobacco (BATS) has reassured investors about the impact of more stringent regulations in the US and hailed a near-doubling of revenues from vaping. The US Food and Drug Administration is proposing a ban on menthol cigarettes and cutting the amount of nicotine in tobacco products to “non-addictive” levels. However Nicandro Durante said the possible restrictions were “years away” and that BAT “had a long history of successfully managing a period of regulatory change”. The FTSE 100 company, which owns brands including Lucky Strike and Camel, was bolstered by rapid growth in vaping and tobacco heating products as young people shun cigarettes.
RSA aims for better year after UK woes drag down profits. RSA Insurance Group (RSA) insisted it could change course after the FTSE 100’s struggling commercial lines business dragged down profits last year. Bad weather and losses in the UK operations had exposed the business to “more volatility than expected”, sending underlying profits down a fifth to £492m, below the £523m expected by analysts. Chief executive Stephen Hester said: “The UK commercial lines performance has been disappointing for at least a decade so I’m not sure we’re very proud of that. But I’m not sure the evidence is that it’s getting worse.”
British Airways revives fleet with Boeing order as profits surge. The owner of British Airways has revealed plans to replace the airline’s ageing fleet of Jumbos with Boeing 777 planes as it posted better than expected annual profits on Thursday. International Consolidated Airlines Group SA (CDI) (IAG) said pre-tax profits surged 40% to €3.5bn (£3bn) on revenues 6.6% higher at €24.4bn. The figures beat analysts’ estimates but it warned that profits this year would be flat, as long as fuel prices stayed steady. Chief executive Willie Walsh said the bottom line would have been higher had fuel costs, European air traffic control disruptions and currency headwinds not held them back.
Peppa Pig and Bear Grylls help Merlin attract record visitor numbers. New attractions including a Peppa Pig theme park in China and a Bear Grylls adventure centre in Birmingham helped Merlin Entertainments (MERL) attract record visitor numbers last year. The leisure giant, which also owns Alton Towers and Madame Tussauds, welcomed 67m people through its doors in the year to December 29, sending pre-tax profits up 5% to £285m. Revenues ticked up 4% to £1.65bn. However, like-for-like revenues at its previously fast-growing Legoland parks slipped 0.3%, which it blamed on relatively low levels of investment and the lack of a new Lego film last year.
Bovis bounces back from faulty homes scandal. Profits at soared by almost a half to their highest level on record as it bounced back from a faulty homes scandal that had left its reputation in tatters. The housebuilder revealed it had regained a four-star rating in the respected Home Builders Federation satisfaction survey, up from two stars just one year ago, and has been averaging the maximum of five stars in the first few months of this year. Having been dented by the cost of repairing faulty homes last year, profits rose from £114m to £168m on revenues of £1.1bn. Greg Fitzgerald, who was brought in as chief executive two years ago to lead the company’s turnaround, said: “That is a stellar performance even if I say so myself.”
Rolls-Royce pulls out of Boeing competition after engine problems. Rolls-Royce Holdings (RR.) has pulled out of a competition to build engines for Boeing’s new mid-size airliner after racking up huge costs from problems with its Trent 1000 turbines. Chief executive Warren East used the FTSE 100 engineer’s annual results to say he had taken the “brave decision” to not develop a new engine for Boeing’s “middle of the market aircraft” (MMA), the only significant new airliner programme at the moment. Rolls is facing a total of £1.5bn of costs spread over five years for dealing with reliability problems with its Trent 1000 engines used on Boeing 787 aircraft.
Food firm Bakkavor leaves a bitter taste. Hummus and ready meals maker Bakkavor Group (BAKK) suffered its worst day since its IPO after its warning of shrinking margins left a bad taste in investors’ mouths. The FTSE 250 company, which makes pizza and salads for the likes of Tesco and Marks & Spencer, told investors to brace for “limited growth” in the UK amid “subdued consumer confidence and inflationary pressures”. Bakkavor admitted that margins will decline in the first half of the year before the outlook brightens in the second half. Higher wages and shoppers reverting to “more cautious spending patterns” were taking their toll.
Nick Hugh appointed GoCompare director. Nick Hugh, chief executive of Telegraph Media Group (TMG), has been appointed as a non-executive director of Gocompare.com Group (GOCO). Mr Hugh has been at the helm of TMG since June 2017, having been its chief operating officer since January of that year. The news comes as GoCompare reported a 2.3% rise in revenue to £152.6m for 2018.
