House Prices See Biggest Annual Fall in Over 10 Years

Here we are already in March. I hope you are smashing it and really embracing being Brave, Bold & Brilliant in your business and personal life.

Every week I’m here to bring you the latest business news of what’s going on both in the UK but also globally. Feel free to let me know if there’s anything specific you’d like me to cover in future updates.

In the meantime happy reading!

GENERAL

British factories on the mend as recession u-turn gathers pace?- S&P Global and the CIPS - The Chartered Institute of Procurement & Supply final purchasing managers’ index (PMI) for the UK manufacturing sector nudged higher from an earlier estimate to 49.3 points last month. That reading was above the consensus forecast but still below the 50 point threshold that separates growth and contraction, meaning factory activity dropped in February.

House prices see biggest annual fall in over 10 years - UK house prices fell by 1.1% in the year to February, as higher mortgage rates and living costs made homes less affordable. Aside from a small drop at the start of the pandemic, this was the first annual fall in property values since November 2012, according to Nationwide . Prices slipped on a monthly basis too, falling by 0.5% from January. The building society said it would be "hard for the market to regain much momentum in the near term".

Food and drink prices rise at record pace of 17.1% - The price of food and drink in shops is rising at a record pace, research suggests, putting more pressure on household finances. Prices in the four weeks to 19 February rose by 17.1% from a year earlier, research firm 凯度 said, the highest rate since its records began in 2008. Kantar said one in four shoppers were now struggling financially. It added that households faced an ￡811 increase to their annual grocery bill if they did not change shopping habits.

FTSE bosses braced for wave of takeovers as foreign firms hunt for bargains - Bosses at the UK’s top firms are braced for a wave of takeovers this year as foreign buyers continue to swoop on cheap London-listed companies amid a rebound in dealmaking, new research has found. Nearly 90% of FTSE 250 directors said they believed UK firms were vulnerable to foreign takeovers this year, with a weak pound and falling valuations making firms an appealing prospect for buyers, according to research from investment bank and broker Deutsche Numis .?

ON THE UP

汉莎航空 's earnings rebound as it flags further gains in 2023 - Germany's Lufthansa has returned to what it called a "clearly positive result" for 2022 as air travel bounced back and said it expected an significant improvement in earnings this year. Passenger numbers doubled and net revenue almost doubled last year from 2021, although the figures remain short of pre-pandemic levels. The company reported a full-year operating profit of €1.51bn, compared to a loss of €1.6bn the previous year. Fourth-quarter profit swung to a profit of €575m from a loss of €42m, in line with expectations.

Qantas to create thousands of new jobs as air industry moves 'from recovery to growth' – The airline expects to hire 8,500 staff over the next decade as the airline industry "moves from recovery to growth". Australia’s flag carrier, which last year asked senior executives to work as baggage handlers due to the acute labour shortage in the country, pledged to create new high-skill jobs in roles ranging from pilots, engineers and cabin crew to airport staff. This follows the orders it made last year for 12 next-generation widebody Airbus A350s aircraft and up to 299 narrowbody aeroplanes for delivery over the decade, which it said would "reshape" the group.

Higher profits to ￡241.3m at Rightmove as it squeezes agents hard for extra revenue - Rightmove has revealed perky results for 2022 in its annual accounts published today including a 9% jump in revenue year-on-year to ￡333m and a profits jump of 7% to ￡241.3m. It’s also been squeezing agents hard – average revenue per advertiser (ARPA) is up 11% to ￡1,314 per month, the second-highest year ever for ‘absolute’ ARPA growth. The portal has pinned these increases on agents continued to upgrade their packages and to increase their use of digital products – although some agents may be surprised to hear of this; Rightmove steeply raised its listing fees in December 2021, much to the ire of several leading agents on Twitter.

Flutter Entertainment revenues up over 25% - Group revenue and adjusted EBITDA for Flutter grew 27% year-on-year. 2022 group revenue reached ￡7.7bn, up from the ￡6bn posted for 2021, while group EBITDA was ￡918m for 2022 in comparison with ￡723m in 2021. Flutter said the acquisitions of tombola and Sisal drove the growth, while expansion into Maryland and Ohio helped the group in the US. Flutter’s igaming proposition driving market share gains improved to 21% in Q4.

IN THE DOLDRUMS

HS2 (High Speed Two) Ltd rail line could be further delayed to cut costs, says boss - Mark Thurston, the Chief Executive of HS2, said that soaring inflation had resulted in significant increases in the price of materials, raising the already ballooning cost of the much-delayed project to link London, the Midlands and the north of England. Discussions are under way with the government over the timing and phasing of the project, which employs 30,000 workers, with the first stretch between London and Birmingham 40% complete.?

Costco Wholesale misses quarterly revenue estimates as demand slows for discretionary goods - Amid persistently high inflation, its shares were down about 3% in after-hours trading. Major U.S. big-box retailers are seeing a slowdown in demand for discretionary items such as toys, electronics and home goods as higher interest rates and surging food prices force consumers to look for more needs-based consumable goods that are pocket-friendly. The company's total revenue for the quarter rose 6.5% to $55.27bn, but fell short of estimates of $55.54bn, according to Refinitiv data.

Hotel Chocolat begins formal redundancy consultation placing jobs at risk - Hotel Chocolat plans to take the business in a “leaner and more competitive direction”. The official consultancy process began on 21 February when staff were notified that their roles were at risk due to the process which “may lead to changes or to them leaving the business”.

National Express LTD hails "significant process" despite losses widening - Pre-tax losses widened in the face of a "uniquely challenging" operating environment. The Birmingham-headquartered company has reported a revenue of ￡2.8bn for the year to 31 December 2021, up from ￡2.17bn in 2021. However, statutory pre-tax losses widened from ￡84.9m to ￡209.9m, though underlying profits increased from ￡39.7m to ￡145.9m. National Express noted that it experienced a 23% jump in passenger journeys across the group.

ITV warns over ‘challenging’ ad outlook as annual profits fall - The group reported underlying pre-tax profits of ￡672m for 2022, down from ￡774m in 2021, as total advertising revenues fell 1% and it spent heavily on content and its ITVX online hub. ITV cautioned over a “challenging” ad spend outlook amid economic uncertainty in the UK, predicting ad sales to plunge by around 11% year-on-year in the first quarter – falling by as much as 16% in March – and to remain down by between 10% and 15% in April.

Just Eat Takeaway.com reports wider 2022 loss after booking $4.87bn impairment -The $4.8bn impairment in its accounts was due to past equity funded acquisitions. The Amsterdam-headquartered food-delivery group TKWY, -7.47% said that it continues to actively explore the partial or full sale of Grubhub , while cautioning that there is no certainty any deal will be agreed, or any timing thereof.

Persimmon Homes sees lower completions in 2023 denting margins - The FTSE 100-listed housebuilder announced revenue in the year to 31 December 2022 of ￡3.82bn, up from ￡3.61bn, although pre-tax profits fell to ￡730.7m from ￡966.8m, reflecting a ￡275m increase in a provision for building safety remediation to ￡350m.

Travis Perkins profits fall 16% as it reveals it axed 400 jobs and closed 19 branches last year - Britain’s biggest supplier of building materials, which owns the Toolstation chain, said it was forced to take some “difficult decisions” to slash costs by ￡25m this year. It shuttered 19 branches in its general merchant and Benchmarx divisions in the final quarter of 2022, with 400 jobs being lost due to the site closures and across central support functions. This week the business posted a 20% drop in pre-tax profits to ￡245m for 2022.

Ocado Group blames “macro economic and political headwinds” for a drop in sales and widening losses of ￡500m - Online grocer Ocado has reported a 3.8$ fall in sales, claiming its business model has been “tested” in 2022. In its results for the full year year, Ocado posted retail revenues of ￡2.20bn, down from ￡2.28bn the previous year. The firm also posted a harrowing loss before tax of ￡501m for 2022 up from ￡176m the prior year. Overall group revenue lay broadly flat up at ￡2.51bn, up 0.6% from ￡2.48bn in 2021. Despite this, Ocado saw logistics revenues soar 13% to ￡802m – bolstered by 12 sites opened globally.??

ONES TO WATCH

Taylor Wimpey plc warns home completions to fall by a third - Taylor Wimpey has joined Persimmon in warning that housing completions this year are set to fall dramatically as it aligns build programmes with sales rates against an already challenging planning backdrop. Reporting strong results for 2022, the number two ranked house builder said that home completions could fall by as much as a third in 2023. Pre-tax profit last year jumped 22% to ￡828m from revenue ahead 3% at ￡4.4bn. The improvement saw operating margin edge up to 21% from 19% previously.

JLR owner ‘seeks ￡500m UK subsidy to build battery factory’ - Jaguar Land Rover’s owner, Tata Motors, has reportedly asked the UK government for more than ￡500m in state subsidies to build a battery factory in Somerset, in a move seen as crucial to the future of the British car industry. Tata, the Indian conglomerate that owns Jaguar Land Rover (JLR), has asked for the money in the form of grants and support packages such as assistance for energy costs and research funding.

Purplebricks launches formal takeover process - Purplebricks Group plc has officially launched a formal sale process under the takeover code following a strategic review that commenced in February, the tech-led real estate agency business announced. The news comes after to AIM-listed company issued a February profit warning due to dwindling instructions amid the recent housing market dip.

酩悦·轩尼诗-路易·威登集团 looks to acquire 卡地亚 - The French conglomerate LVMH, which currently owns Louis Vuitton and Tiffany & Co, is considering adding Cartier to its portfolio. According to a report from the Swiss newspaper Finanz und Wirtschaft, LVMH is eyeing a takeover of competitor Richemont. If the deal does not succeed, LVMH will look to acquire Cartier from Richemont, as a complement to Tiffany & Co, which it bought in 2021.

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