Market report

Barclays profits soar | Aston Martin | Heathrow | Metro

REFRESH PAGE FOR UPDATES

5pm: Markets remain tense

Stock markets remained nervous, though the FTSE 100 has spent most of the day in positive territory. It closed 3.97 points ahead at 7,498.18.

Steelmaker Evraz, which counts Russian billionaire Roman Abramovich as a major shareholder, tumbled 12.6% on fears of sanctions

Brent oil was quoted at $97.90 a barrel at the London equities close, up from $96.70 late Tuesday. Oil prices have been boosted in recent weeks on fears an escalation of tensions over Ukraine could lead to supply disruption.

Barclays helped the FTSE 100 edge into the green, with shares ending 3.1% higher on higher profits.

Aston Martin tumbled 8.7% despite reducing its losses. Ted Baker rose 9.8% after the upmarket clothes retailer reported robust sales growth and improved margins in its fourth-quarter. Sales in its fourth-quarter ended 29 January increased 35% compared to the same period a year before. Sales also rose 18% from those reported in the third quarter.

US markets opened in the green a day after the S&P ended in the correction territory amid escalating geopolitical tensions between Russia and Ukraine, leading the US to impose sanctions against Moscow.

The S&P 500 recovered its losses, gaining 0.5%, while the Dow Jones Industrial Average gained 0.2% and the tech-heavy Nasdaq Composite was up by 0.2%.


9.45am: GDP falls in December

Scotland’s onshore GDP is estimated to have fallen by 0.4% in December when Omicron took hold. Output remains above the pre-pandemic level of February 2020 by 0.1%.

Full story here


7am: Barclays profits treble

Barclays

Barclays posted a near-trebling of profits on the back of a strong performance from its investment bank and a sharp fall in bad loan charges.

Profit before tax for 2021 came in at £8.4 billion, from £3.1bn in the previous 12 months and just ahead of the consensus forecast of £8.1bn.

The bonus pool jumped 23% to £1.9bn with more than £667m being paid as deferred bonuses.  

Barclays said it would buy back £1 billion of its own shares and proposed a total dividend of 6p, substantially higher than the 1p paid out in 2020. 

The figures are the first since CS Venkatakrishnan took over as chief executive following the abrupt departure of Jes Staley in November following revelations of his ties with the late convicted sex offender Jeffrey Epstein.

Barclays confirmed that Mr Staley, was paid £2.1m last year, down from £4.2m in 2020. He did not receive any bonuses for the year.

Share awards currently worth around £19m to Staley have been frozen, as he contests findings by the Financial Conduct Authority and Prudential Regulation Authority over the way he represented his relationship with Epstein to the bank.

Barclays announced that Tushar Morzaria has decided to retire as group finance director from 22 April. He will be succeeded by his deputy Anna Cross.


7am: Metro loss

Metro Bank suffered another heavy loss last year as it put aside cash to cover fines imposed on it by UK regulators.

The bank cut its pre-tax loss for 2021 to £245.1 million from £311.4m loss a year earlier.

But the figures were no match for its high street rivals which have seen profits soar.

Metro said it had put in place cost-cutting measures and controls to improve the institutions, and it remains on track to reach break even.

Total underlying revenues rose 17% to £397.9m, with deposits up £370m to £16.5 billion.


7am: Aston Martin Lagonda

Aston-Martin-DBX-at-Archerfield

Luxury car manufacturer Aston Martin Lagonda posted a reduced operating loss of £76.5m for the year to the end of December against £322.9m in the previous 12 months.

It said it achieved strong pricing and closed the year with dealer stock at optimum levels.

Chief executive Tobias Moers said: “We also started delivery of the once-in-a-generation Aston Martin Valkyrie hypercars. This was achieved despite the technical ambition of the product, supply chain constraints and with no compromise on quality, resulting in fewer cars than originally planned shipping in 2021.”

The company said it is on its way to achieving its medium-term targets of c.10,000 wholesales, c.£2bn revenue and c.£500m adjusted EBITDA by 2024/25.

It will deliver the first two vehicles from the new management team, DBX707 and the V12 Vantage, with improved profitability compared with prior models as well as price adjustments across the full portfolio, given the pricing power of the brand.   

In addition, 75-90 Aston Martin Valkyrie programme vehicles are planned for shipment.

Supply chains globally continue to experience disruption and our teams remain focused on mitigating any impact on production. Q1 is expected to be the smallest quarter of the year, given the timing of product launches (DBX707 in Q2 and V12 Vantage in Q3) and as we focus on refining the production process for Aston Martin Valkyrie programme vehicles with a focus on quality.


7am: Heathrow

Heathrow said it was the only hub airport in Europe to see a reduction in passenger numbers in 2021, due to the UK’s tougher coronavirus travel rules. Just 19.4 million people travelled through the west London airport last year, representing the lowest annual total since 1972.

Cost savings of £870 million were achieved in the past two years, but pre-tax losses still came in at £3.8 billion due to high fixed costs and low passenger numbers.

Chief executive John Holland-Kaye described 2021 as “the worst year in Heathrow’s history”. But he said demand is “starting to recover”.

Terminal 4 will reopen for the peak summer season when passenger numbers are expected to increase.


Global markets

London was expected to open slightly higher following a positive day in Asian equity markets.

The Shanghai Composite was up 0.8%, while the Hang Seng index in Hong Kong was up 0.7%. The S&P/ASX 200 in Sydney closed up 0.6%. Financial markets in Japan were closed for the Emperor’s Birthday holiday.

Wall Street recorded losses as investors returned from Monday’s holiday and responded gloomily to the latest tensions in Ukraine.

At the close the Dow Jones Industrial Average was down 1.42%, while the S&P 500 was 1.01% softer and the Nasdaq Composite saw out the session 1.23% weaker.



Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.