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THG plummets | EasyJet sees recovery | Calnex guidance


5pm: THG shares take big hit

THG, formerly The Hut Group, saw its shares plummet 35% after shareholders were told at its first capital markets day since its IPO last September that it is facing concerns over proposals to separate its beauty arm and tech platform.

Shares fell from Monday’s closing price of 437p, to close at 285p, wiping £1.85 billion from its value to leave it worth £3.48bn.

The Manchester-based e-commerce company floated last September at 500p a share. But it has tumbled since announcing results for the first half and announced plans to split off its Ingenuity technology division from its beauty and nutrition divisions.

Investors were spooked today after hearing that Japan-based Softbank would not be exercising an option to buy a 20% stake in its technology division.

Gas prices may have eased off a little from their peaks last week, but traders still worried about inflation on Tuesday, sending European stocks into the red.

The FTSE 100 ended down 0.2%, dropping 16.62 points to end the day at 7,130.23.

EasyJet was a big faller despite saying it could see a recovery in business.

IAG, owner of British Airways was down 3.4% in a negative read-across from peer easyJet.

GlaxoSmithKline closed up 0.9% after Bloomberg reported the drugmaker’s consumer arm was drawing interest from private equity firms.

10.40am: New flights

Glasgow Airport has announced a second route to Paris Orly Airport in a week. AirFrance/KLM Group’s low cost airline Transavia will operate three services per week to Paris Orly Airport from April.

Spain’s low-cost airline Vueling last week announced direct flights on the same route starting early next month.

8.15am: Blue chips fall

The FTSE 100 fell at the open in line with forecast, trading 53.5 points lower at 7,093.36.

7.10am: Job vacancies rise

The number of job vacancies in July to September 2021 was a record high of 1,102,000, an increase of 318,000 from its pre-pandemic (January to March 2020) level.

Full story here

7am: easyJet sees recovery

Edinburgh airport Easyjet

Short haul airline EasyJet said business travel and city breaks were returning alongside growing demand for leisure travel from customers looking for flights and holidays to popular winter sun destinations including Egypt and Turkey.

October half term bookings have been strong, and the company has increased its capacity to the Canary Islands by about 140% of FY19 levels.

The headline loss before tax for the year ended 30 September 2021 is likely to be between £1.14 billion and £1.18bn in line with expectations, it said in an update.

During the fourth quarter it flew 17.3 million seats, operating 58% of FY19 capacity with a stronger performance on intra-European and UK domestic routes, whilst demand for international routes from the UK continued to be impacted by UK Government travel restrictions.

Johan Lundgren, CEO of easyJet, said: “During the quarter easyJet significantly ramped up its flying which meant we were the second largest airline operating in Europe this summer while also halving our Q4 losses versus last year.

“We are encouraged to see positive booking momentum into FY22 which has led us to increase our capacity plans for Q1 to fly up to 70% of 2019 levels.”

7am: Calnex lifts guidance

Tommy Cook

Telecoms testing company Calnex Solutions has upgraded its guidance after experiencing continued strong levels of trading in the first half of the year.

In a trading update the Linlithgow-based company said it expects this trend to continue through the second half of the year and that revenue and profits for the full year will be materially ahead of previous expectations.

The robust cash position has allowed it to bring forward planned investment in the team to increase operational capability, in line with order growth.  

In the six months to the end of September the group has seen a return to pre-COVID customer spending patterns in all regions, other than in China where demand has been in line with the previous year.

Calnex has not experienced any negative impact from the ongoing global semiconductor shortage to date on the ability to manufacture and ship product, although the board continues to monitor the situation closely.

Tommy Cook, chief executive and founder, said the board had “confidence that the full year revenue and profits will exceed that of the record prior year and mark another considerable step forward for Calnex, as we continue to capitalise on the industry’s transitions to 5G and the growth of cloud computing.”

7am: Stagecoach unchanged

Transport group Stagecoach said its outlook for the year ending 30 April 2022 is unchanged from when it announced full year results in June.

The company said bus passenger journey numbers are in excess of 70% of equivalent 2019 levels by the end of September. It is operating vehicle mileage at around 94% of 2019 levels.

Discussions with National Express over a merger are ongoing it said.

Retail slowdown

UK retail sales growth slowed sharply in September as consumer confidence was hit by fuel shortages.

The 0.6% year-on-year rise in sales was well down on August’s 3% growth. Apart from a 1.3% annual decline in a lockdown-hit January, it was the weakest sales performance for the sector this year.

September saw the slowest retail sales growth since January, when the UK was in lockdown, according to the data from the British Retail Consortium-KPMG monitor.

Global markets

Surging energy prices and inflation worries are causing jitters among equity traders and were expected to see the FTSE 100 dip.

Overnight, Wall Street stocks finished on a low, with all three indices diving into the red, with the Dow Jones dropping 0.7%, and the S&P 500 and Nasdaq by 0.6%.

Oil prices were up, with Brent crude 0.3% higher at $83.91 barrel.

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