Afternoon Financial Press Review
Below are the key headlines from today’s updated papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
InterContinental Hotels Group cheers London sales growth. Holiday Inn-owner on Tuesday shrugged off “gilets jaunes” protests weighing on Paris demand, as it cheered bumper sales growth in London. The FTSE 100 hotelier gave the Europe update as it posted a 12% rise in full-year group sales to $1.9 billion (£1.5 billion). Revenue per room rose 2.5%. In Paris there was softer demand in December. Finance chief Paul Edgecliffe-Johnson said: “We think some [customers] were put off by some of the social unrest.” However he pointed out that despite the anti-government protests, revenue per growth of 3% was still achieved in France in the final quarter. Edgecliffe-Johnson was more upbeat as he revealed London revenue per room jumped 10% in the fourth quarter, and was up 3% for the whole of 2018.
Success of vegan sausage roll gives surge in sales. Bakery chain upgrades profit expectations for third time in three months. Greggs has credited the fanfare of publicity around its vegan sausage rolls for a surge in sales that has sent the value of the company to an all-time high. The UK’s biggest bakery chain said it had made “an exceptionally strong start to 2019” with sales climbing nearly 10% in the seven weeks to 16 February. The Quorn-filled vegan alternative to the traditional meat pastry – which was developed after 20,000 people signed an online petition organised by animal welfare group Peta that called on the baker to produce a vegan version of its bestselling item – went on sale on 3 January. It had taken more than a year to perfect and its launch coincided with Veganuary, a growing movement that encourages people to try plant-based diets during January
City turns sour on ‘poor’ HSBC as profits miss. disappointed the City on Tuesday with some lacklustre results and warned that the US and China trade war was a threat to future growth. Europe’s biggest bank made profit for the past year of almost $20 billion (£15.5 billion), a rise of 16% that was well short of analysts’ expectations. A collapse in revenues in the fourth quarter was largely responsible for the miss, and chief executive John Flint said the start of this year has been much better. But he acknowledged that a threat by President Donald Trump to put 25% tariffs on Chinese goods would be problematic. “Ten per cent was digestable,” he said. “If we get to 25%, that’s a very different order of magnitude. That could really start to disrupt supply chains.”
Cobham forks out £160m to end long-running row with Boeing. Aerospace supplier took a £160 million hit on Tuesday to settle a long-running row with US planemaker Boeing over supply delays. The UK company, which has struggled in recent years, will pay £86 million compensation to the Chicago-based giant and £74 million to finish work on an aerial refuelling pod. Shares rose 1% to 117p as the market cheered Cobham for finally drawing a line under the dispute. The row centres on Boeing’s KC-46 air tanker used by the US Air Force to refuel smaller jets mid-air. Cobham promised to make two refuelling systems for the jets but both were delivered later than expected, annoying Boeing.
Asda, the UK’s third biggest supermarket, unveiled its seventh consecutive quarter of sales growth today, but the rate of growth halved to 1% as the chain battled with a ‘highly competitive market’. The performance pips Asda ahead of its main rivals: Tesco’s sales nudged up 0.7% over the all-important Golden Quarter, while suffered a 1.1% sales fall. Boss Roger Burnley said sales were driven by higher demand for the grocer’s own-brand products, especially its premium Extra Special range. The firm, which is the subject of a proposed takeover by UK’s second biggest supermarket Sainsbury’s, admitted it was a ‘challenging year’. He said: ‘2018 was another challenging year for the retail market and the pace of change shows no sign of abating. ‘It’s clear that retailers have to be prepared to innovate and challenge their status quo if they want to continue to remain relevant and deliver for their customers who rightly demand great value.’
– British Gas and Scottish Power are the latest Big Six energy suppliers to announce they are increasing their standard variable tariffs after Ofgem upped the price cap. British Gas is raising its prices by 10.5%, which will see the average dual fuel bill increase by £119.12 a year – costing the average SVT customer £1,254 a year. cottish Power is also raising its prices by 10% – £117 a year – meaning its standard plan will also cost on average £1,254. The price rise will come into effect on 1 April and will hit nearly 5million households – 3.9million British Gas customers and 900,000 Scottish Power customers.
The mining industry needs a “nuclear level of safety” at tailings dams around the world after the deadly collapse in Brazil last month, the boss of has said. Andrew Mackenzie admitted the industry “needs to do more” and backed calls for a “credible, independent, international review body” to inspect dam standards and operating procedures. He called on miners to boost investment in research after admitting that the industry’s understanding of dam collapses around the world fell short of what was necessary. “These dams do fail with a certain regularity, which I think is unacceptable. We have to acknowledge the deficiencies in the science – it has to have a nuclear level of safety now.
Bus and rail operator is in deadlock with the Government over a contractual row about one of Britain’s biggest rail networks. The sprawling South Western train franchise remains a thorn in the side of the transport giant, causing sales growth to slow over the last final four months. While problems on the network quickly became an open secret across the industry last summer, it was not until November that FirstGroup said it was in talks with the Government about renegotiating terms on the country’s fourth-largest rail franchise.
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