Brexit will not hinder AstraZeneca (AZN) ability to attract the world’s best scientific talent to its new £750 million research and development centre in Cambridge, Pascal Soriot, chief executive of the drugs giant, has claimed. “Cambridge has attracted the best brains in the world for the last 800 years. It is going to continue to for a few more,” he told The Times/KPMG regional summit in Cambridge. Mr Soriot said that the imminent exit from the EU had, however, created “more of a challenge”, with staff worried about pension rights, for example. But these were relatively “minor issues”. He added: “We attract American and Chinese scientists, why not Spanish even if the UK [has left]?”
Business confidence has recovered to its highest levels since January because of growing optimism about the outlook for the economy and the prospect of Brexit clarity after the general election. While consumer confidence is stuck in negative territory, business confidence has risen for the third consecutive month, according to the Lloyds Bank Commercial Banking Business Barometer. Confidence rose by three percentage points to 9%. The survey, based on responses from 1,200 companies, suggests that firms are hoping that the election will bring some clarity on Brexit. Business concerns about leaving the EU eased to -16% in November, the least negative since January.
Andrew Tinkler, the controversial former head of Stobart Group Ltd. (STOB), claims that he has garnered support for a £70 million takeover of Eddie Stobart Logistics (ESL), the stricken trucking group, which he also used to lead. Mr Tinkler, 56, who spent much of last year in an unsuccessful High Court battle with the current management of Stobart Group, a business he diversified into aviation and renewable energy, says he has support for a rescue bid. This rivals a plan by another former owner of the haulage group, DBay, a private equity firm formerly known as Laxey Partners.
Britain provides a better environment for small and medium-sized companies than France and Germany, according to research. UK businesses have the best market for credit in Europe, according to analysis of 13 economies by Euler Hermes, while a flexible labour market and low levels of red tape also makes Britain a more attractive place to start and grow a business than some of its prominent competitors. The credit insurance provider analysed six factors, including tax policy, export opportunities and the level of competition, to produce the ranking. Canada was rated the best place to run a small or medium-sized business, followed by Hong Kong and the United States. Germany was placed eighth and France 11th.
Britain’s biggest provider of guarantor loans has been forced to row back on suggestions that the City watchdog had given its business the all-clear. Amigo Holdings (AMGO) corrected a statement it had issued, in which it had reassured investors about the outcome of a Financial Conduct Authority review into the guarantor loans industry. The clarification yesterday came after the authority intervened on Wednesday evening. Amigo issues unsecured personal loans of between £500 and £10,000 with annual interest rates of 49.9% to people who otherwise have difficulty accessing credit. These loans are guaranteed by a family member or friend, who is liable for them if the borrower misses a repayment.
The value of Virgin Money Holdings (UK) (VM.) rose by almost a fifth yesterday after investors bet that the bank is on a sounder footing than previously thought despite racking up an annual loss of £194 million. The bank will not pay a dividend this year after falling to a deeper annual loss owing to a £385 million provision for payment protection insurance mis-selling made in the final three months. Ian Smith, the chief financial officer, said the decision to suspend the dividend was a disappointment, but was taken to conserve capital. The bank will consider resuming payments next year. Virgin Money also owns the Clydesdale and Yorkshire Bank brands. CYBG, the parent company of the pair, paid £1.7 billion for Virgin Money last year.
Problems in Manchester, Oxford and Stuttgart will hold back Go-Ahead Group (GOG) this year. David Brown, chief executive of the bus and train group, warned that profit expectations from its bus division should be “slightly lowered”. The cocktail of problems affecting the trading update yesterday, which covered the first four months of its financial year ending in June, include a slowdown in the rate of growth of bus patronage, traditionally linked to the health of the economy, and larger problems than expected in its takeover of a bus depot in Manchester from First Group. Go-Ahead has also been hit by rising driver costs amid record levels of employment and regulatory changes that forced bus companies to give better holiday pay.
Royal Mail (RMG) biggest union has lost an appeal against a High Court injunction to stop a strike before the general election and holiday season next month. The Communication Workers Union lodged an appeal after the former postal monopoly won the injunction to avert the first national strike by its workers in a decade. Royal Mail, which employs more than 140,000 people in the UK, has been involved in a legal dispute with the union since September over a strike that would disrupt operations at its busiest time of the year. The union said on Twitter yesterday: “The justice system in this country is an absolute farce.”
Robbie Rayne has won a battle over the management of the listed company that manages some his family’s wealth, triggering the resignation of three independent directors. A majority of shareholders in LMS Capital (LMS) yesterday backed his call for the outside fund manager which was in charge of its funds, to be sacked. Some 58% of LMS investors backed a resolution by Mr Rayne to serve notice on Gresham House (GHE). After the vote Martin Knight, chairman, who had argued that it was in the best interest of shareholders to retain Gresham, resigned together with Neil Lerner and Rod Birkett. Mr Rayne is set to be elevated to be LMS’s chairman, as The Times reported on Monday.
Sparkling tea and gluten-free beer have helped Fortnum & Mason, the luxury grocer, defy the retail gloom. The 312-year-old retailer has posted its seventh consecutive year of growth, with sales rising by 12% to £138 million and pre-tax profits increasing by more than a quarter to £12.1 million. Ewan Venters, chief executive, said: “We are very pleased to report another year of strong growth across our business, particularly within the context of the significant challenges facing the retail sector.” Sales at its Piccadilly store rose by 6%, while sales in Hong Kong and Japan were up 16% and 28% respectively.
CVS Group (CVSG) has continued its return to health after a difficult start to the year, prompting analysts to upgrade their full-year forecasts. Like-for-like sales at CVS Group grew by 8%, with its core veterinary practices division up 7.4%. Richard Connell, chairman, said at the annual meeting that the “encouraging start” to the financial year reported at its annual results had continued in September and October, with total sales for the four months to October 31 up 16.8%. Shares of CVS Group, which fell by a third after a profit warning in January, rose a further 72p to £11.05 after the strong update.
A slowdown in global trade is weighing most heavily on the European Union, with exports falling across all major economies, according to the Organisation for Economic Co-operation and Development. Anxieties about Brexit, a downturn in manufacturing and the US-China trade war knocked eurozone exports by 1.8% in the third quarter of this year and imports by 0.4%. France led the slump with a 3.6% drop in exports and a 1.7% fall in imports, according to figures from the OECD, which is based in Paris. Germany experienced a respective 0.4% and 1.8% fall, while Italian trade shrank for the sixth consecutive quarter.
Phoenix Group Holdings (DI) (PHNX) has generated £707 million of cash this year, just above its annual target. It estimates that £540 billion of people’s savings is tied up in books of business that insurance companies no longer have open to new customers. Of that, about £380 billion is believed to be in the UK. The aim of its model is to throw off cash as capital held against policies freed up when they expire. It delivered £1.3 billion cash generation in 2017 and 2018 and says it is well placed to grow. Phoenix’s target for 2019 had been between £600 million and £700 million in cash.
