Ryanair warns of Brexit risks as fare price war buffets profit. Ryanair Holdings (RYA) issued a second profit warning in less than four months on Friday after a winter air fare price war and overcapacity in the market took their toll. Outspoken chief executive Michael O’Leary admitted cutting prices to stay competitive had hurt the budget airline. Fares had been expected to fall 2% on last year over winter but are likely to be down 7%. It is currently offering flights to Spain from London for just £9.98. The airline, which has been grappling with strikes, lowered its full-year forecasts to a range of between €1 billion and €1.1 billion. That is down from between €1.1 billion and €1.2 billion. O’Leary said Ryanair cannot rule out further price cuts or another downgrade “if there are unexpected Brexit or security developments which adversely impact yields between now and the end of March”. He added there is short-haul overcapacity in Europe this winter.
‘Nimble’ Miton doubles up as it pulls in £1bn of savers’ money. Fund manager Miton Group (MGR) attracted a record £1 billion from savers last year after financial advisers started to divert more cash to more “nimble” stockpickers. The boutique firm, which is shunning the sector’s merger fever, said net inflows rose 106% from £494 million due to the strong performance of its funds. “Financial advisers and discretionary managers who buy our funds really do like active funds that help them manage their client portfolios in performance terms, but also do something different,” said chief executive David Barron. “You’ve got to have a model of scale where you go for very large assets and big scalable funds, or you’ve got to be more active and specialist and nimble like us.”
Canadian investor Realstar on Friday ignored Brexit jitters in the residential market, and revealed it has agreed to create £200 million of new rental homes in London. It has just inked a deal with Balfour Beatty (BBY) and housing association Places for People to acquire a plot by the Olympic Park in Stratford. It will also fund a project being built by FTSE 250 business Redrow in Southall, west London. Realstar will build more than 300 homes on the sites, and the Southall project will be run by its new residential brand called Uncle. The firm’s UK boss Ryan Prince said he wants to “aggressively” grow Uncle, which aims to create high-quality rental homes, filled with Made.com furniture, free on-site gyms, and no-letting fees to estate agents. At present there are around 2000 existing or under construction Uncle flats, mostly in London.
Shoppers ignore panic price cuts. Retailers are cutting prices at the fastest rate in almost two years as nervous shoppers rein in spending, official figures revealed on Friday. The Office for National Statistics’ latest figures on the crucial month of December showed an overall 0.9% drop in retail sales, while annual sales growth also slowed. While some sales were pulled forward to November by Black Friday promotions, December’s slide came despite desperate price cutting. The ONS’s annual sales deflator, its measure of how much prices have gone up or down in the past year, fell to 0.4%, the lowest since January 2017. The biggest price-cutters were clothing and retail stores, where prices fell 0.5% on a year earlier.