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Wagamama owner expects to be ‘winner’; Balfour repays furlough
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4.30pm: FTSE 100 broadly flat
The FTSE 100 closed marginally lower at 6,725.6 down 4.74 points.
2pm: Next and Reiss tie-up deal
Next is acquiring a 25% equity stake in Reiss which will see Reiss switch its online platform, warehouse, distribution and logistics to the Next platform.
8.15am: FTSE lower
The FTSE 100 fell 60 points at the open in line with forecasts (see below) and was last trading 39 points lower at 6,691.22.
7am: Restaurant Group
Restaurant Group, the owner of chains including Wagamama, Frankie & Benny’s and Brunning & Price, said it expects to emerge as one of the sector’s winners after restructuring actions. It has closed 253 sites (down to c.400) and re-financed the business and said it is well positioned for relaunch when restrictions are eased.
It announced a new capital raise of £175m to enhance liquidity, accelerate deleveraging and support selective growth
Long-term financing was secured last week with £500m of new debt facilities in place and a flexible covenant package.
Statutory loss before tax was £127.6m (2019 loss before tax of £37.3m) including exceptional charges, on total revenues down 57% to £459.8m.
CEO Andy Hornby, who formerly led HBOS, said: “The Covid-19 pandemic has presented enormous challenges for our sector but the TRG team has responded decisively to re-structure our business whilst preserving the maximum number of long term roles for our colleagues.
“TRG is operationally a much stronger business than 12 months ago.
“The capital raise announced today, alongside the debt re-financing announced last week, represents the last important step in our re-structuring process and provides TRG with the long term flexibility to invest in growing our business.
“Whilst the sector outlook remains uncertain, and we are mindful of continuing restrictions across the UK, we are confident that the actions announced today will allow us to emerge as one of the long term winners.”
Online food-ordering company Just Eat Takeaway.com said it expected further growth in 2021 after a surge in online orders during the COVID-19 pandemic helped it meet expectations for full-year 2020 earnings.
Demand for food-delivery services boomed last year as government-imposed curbs shuttered restaurants and customers stayed at home, driving a 42% surge in the company’s orders to 588 million.
Legal & General
Operating profit was broadly flat at £2.2 billion (2019: £2.3bn), with three of five businesses delivering growth.
The full year dividend is maintained at 17.57p per share.
It has set aside an extra £110m in Covid-19 insurance claims due to the emergence of new virus strains.
Balfour to repay furlough money
Infrastructure firm Balfour Beatty is repaying £19 million received to furlough employees.
Balfour Beatty cancelled its final dividend a year ago and did not declare an interim payout last summer, while its senior management also took temporary pay cuts.
The move comes days after a warning from a major investor body that it would recommend voting against boards which paid bonuses to executives for last year if they had taken government money during the pandemic.
Underlying profit from operations came in at £51 million (2019: £221 million), after decision to repay the UK Job Retention Scheme.
The board has recommended a final dividend of 1.5p.
In January the group commenced a share buyback programme, which today is being increased to £150 million for 2021.
The FTSE 100 is expected to open 55 points lower despite yesterday’s tech stock rally in the US.
Nasdaq led Wall Street higher, rising by 3.7% – its biggest single-day rise since 4 November – recouping heavy losses from the previous session as US bond yields retreated and investors mopped up battered technology stocks.
Traders also pushed the Dow Jones Industrial Average to a record intraday high but pulled back from earlier gains at the close.
Car company Tesla jumped 19.6% – the most in almost a year – while Amazon.com and Microsoft Corp posted the biggest single-day gains in five weeks. The tech stars suffered sharp losses in recent weeks as rising yields raised concerns over their high valuations.
Tesla’s rise and the uplift in other tech stocks will ease nerves among shareholders in Scottish Mortgage Investment Trust which has taken a big from the slump.
The Dow Jones Industrial Average rose 0.10%, the S&P 500 gained 1.42%, and the Nasdaq Composite added 3.69%.
The FTSE 100 pulled back from its late morning surge to close just 11.2 points higher at 6,730.34.