Yahoo Finance FTSE 100 Live: Lloyds posts annual results, Rio Tinto cuts dividend
Lloyds Banking Group today revealed unchanged annual profits of £6.9 billion as the lender benefited from a year of rising interest rates.
Chief executive Charlie Nunn called it a robust performance as he declared a 20% increase in the total dividend to 2.40p a share, alongside plans for a shares buyback worth up to £2 billion.
The bank also expects house prices to fall 7% this year.
Rio Tinto shareholders, meanwhile, can expect a smaller dividend payment this year after the mining giant declared an award of $4.92 a share. This is 53% lower than a year earlier and represents 60% of underlying earnings.
FTSE 100 Live Wednesday
Lloyds expects 7% house price fall
Rio Tinto slashes dividend
US rate rise fears hit FTSE 100
Gama Aviation shares fly as business agrees £65 million Air Ambulance deal
14:37 , Daniel O'Boyle
Shares in Gama Aviation are up by more than 9% as the AIM-listed aviation support business announced it had won a £65 million contract with Wales Air Ambulence.
Gama will operate and maintain Wales Air Ambulance’s five Airbus H145 emergency medical service helicopters, as well as supplying two of them.
The contract will last seven years from the start of 2024.
Shares in Gama Aviation are up more than 9% to 72p so far today.
Regional Universities rush to grab space in London
14:20 , Jonathan Prynn
Regional universities are rushing to find space in London for new student courses and collaborations with firms, according to a new study.
Figures from property news and data company CoStar show non-London universities have taken 350,000sq ft of office space in the capital over the past three years. That is more than double the 152,000sq ft of the previous three years.
US shares to recover some of yesterday’s declines
13:07 , Daniel O'Boyle
US stocks are expected to bounce back slightly after experiencing their sharpest fall of the year yesterday, but they are still set to remain well below Friday’s levels.
Dow Jones futures are up by 0.2% from yesterday’s close to 33224, while S&P 500 futures are also up 0.2% to 4014 and Nasdaq futures are up 0.4% to 12142.
Within the S&P 500, Garmin is the big pre-market riser, with shares set to open up by 2.6%.
Tomato shortage: Most big supermarkets have not introduced buying limit
12:28 , Daniel O'Boyle
Leading supermarkets have said they would not be following Asda and Morrisons in rationing tomatoes and other fruit and vegetables but customers were warned it will be up to three weeks before stocks are replenished
Restaurant groups have also flagged up potential menu shortages after supplies were badly disrupted by winter storms and cold weather in southern Spain and north Africa where much of Britain’s fresh produce is grown in winter.
Meanwhile the start of the usual UK growing season is likely to be held up by soaring energy bills that has delayed planting under polytunnels.
Site of demolished Earls Court venue to be reborn as new “green neighbourhood”
11:40 , Daniel O'Boyle
The derelict site of the former Earls Court exhibition centre in west London is to be reborn as an £8 billion green neighbourhood with a raised urban park bigger than Trafalgar Square at its heart, a new masterplan reveals today.
The flattened 40 acres of rubble where Led Zeppelin, David Bowie and Oasis once performed, and events such as the London Boat Show, Earls Court Motor Show and the 2012 Olympic volleyball competition were hosted has stood largely unused for almost a decade since the venue closed in 2014.
It was demolished the following year.
Revenue grows for self-driving tech business Seeing Machines
11:19 , Daniel O'Boyle
Computer vision technology company Seeing Machines’ revenue is up more than 50% in the six months to 31 December, the first half of its financial year.
The business - which develops AI for autonomous vehicles - said revenue for the half-year should come to $24.4 million (£20.2 million), up from $15.8 million a year earlier.
The group said it had 701,049 vehicles on the road as of 31 December, almost triple the number from a year earlier.
“We are delighted with the continued growth across the business,” CEO Paul McGlone said. “As the number of vehicles fitted with our technology increases, Seeing Machines is now firmly established as an industry leader in the interior sensing market where our driver and occupant monitoring systems have become mission-critical technology in the quest for greater transport safety.”
Angling Direct sales tick upwards in 2022-23
10:43 , Daniel O'Boyle
Fishing tackle and equipment retailer Angling Direct reported a slight increase in revenue for the year ended 31 January.
The business brought in £74.1 million, which it said was broadly in line with expectations.
“This sales growth has been achieved despite significant consumer headwinds across all of the Company’s key markets including inflation and cost of living pressures,” it added.
In-store salees were up by 6.8% to £41.3 million, while online sales dipped to £32.8 million.
City Comment
10:22 , Simon English
It is unlikely he was any under illusions when he arrived, but if he was Charlie Nunn now knows for sure: running our biggest savings and loans bank is hard.
The market power that comes with being the biggest player also comes with a huge amount of social responsibility. Lloyds Bank can’t be seen to chuck struggling customers under metaphorical buses in search of shareholder value.
On this Nunn speaks well. He does an awfully good impression of a modern, thinking, banker. Maybe it’s not an impression.
Like his predecessor Antonio Horta-Osorio, one of his problems remains a stubbornly inactive share price.
Lloyds shares have gone from nothing much to nowhere in five years and there is no particular reason to expect that to change. You might buy a few for your grandchildren. Assuming your expectations for them are low.
Aside from overseeing the nuts and bolts of the bank, Nunn’s plan for growth is to sell wealth management services to a group called the mass affluent.
That’s anyone who earns more than £75,000 or has the same amount to invest.
There are loads of those people, but it’s not obvious why they would choose Lloyds. Most of them are surely savvy enough to have all that sorted already.
Of this plan, Gary Greenwood the banks analyst at Shore Capital, said: “It all sounded very familiar to me, which was basically a case of ‘we’re going to sell more products to the same people and we’re going to use technology to enable that’. I’ve heard that repeatedly over 23 years covering the sector.”
And it hasn’t really happened, is Greenwood’s point. It’s a tough nut for Nunn to crack.
FTSE 100 off 1% on US weakness, BP shares down
10:19 , Graeme Evans
Wall Street’s worst session in two months today caused the FTSE 100 index to fall 1% or 70.87 points to 7906.88.
The mood has soured on concerns that the Federal Reserve will keep interest rates high for longer, reducing the chances that the US economy can achieve a soft landing following last year’s inflation shock.
Weak forward guidance from retail giants Home Depot and Walmart added to Wall Street’s jitters over the potential impact of higher borrowing costs, meaning the S&P 500 last night lost 2% in its worst performance since December.
The selling spread to European markets, with the uncertain global outlook putting pressure on commodity-focused stocks at the top of the FTSE 100 fallers board.
In a session when Rio Tinto became the latest miner to announce a big dividend cut, Glencore lost 13.7p to 489.6p and De Beers owner Anglo American fell 84p to 3070p ahead of its annual results tomorrow.
A drop in the Brent Crude price to just above $82 a barrel added to the FTSE 100 squeeze as BP fell 9p to 541.3p and Shell dipped 27.5p to 2458p.
The FTSE 250 index lost 1%, declining 201.79 points to 19,649.06 as shares in retailer Currys gave up recent gains and Domino’s Pizza also lost around 4%.
Primary Health Properties, the GP surgeries landlord, fell 1.9p to 106.9p after annual results showed a 3.3% increase in its rent roll to £145.3 million. It also announced its 27th year of continued dividend growth, with an increase of 4.8% to 6.5p.
Among smaller stocks, AIM-listed Science in Sport rose 1p to 13.5p as it revealed revenues rose in line with expectations by 1.5% to £63.5 million in 2022.
The sports nutrition business, which has partnerships with Tottenham Hotspur and the Ineos Grenadiers cycling team, said margins aso strengthened following the opening of a new manufacturing facility in Blackburn.
Moo hails resilience of the business card after posting record profits
09:47 , Simon Hunt
The founder and CEO of Moo has hailed the resilience of the humble business card after the printing firm posted record profits.
The Camden-based company, which now makes most of its turnover in the US, said pre-tax earnings for 2021 topped $10 million (£8.4 million), while sales climbed 12.1% to $93.2 million. Revenues for 2022 were expected to jump 26% to $118 million – still short of the $140 million the firm achieved prior to the pandemic in 2019.
Moo founder and CEO Richard Moross told the Standard that to his amazement, business cards were still the company’s most popular product.
“People ned to make high quality interactions in a challenging macroeconomic environment.
“We’re not seeing any softening in demand because those moments are more valuable than ever, people really want those meetings to count.”
Moross said the company had experienced cost inflation in all areas of the business, but had mitigated some of this through increased automation.
Neil Woodford funds scandal moving to an end as Waystone bids for Link
09:27 , Simon English
The funds boss looking to buy Link, the administrator still embroiled in the Neil Woodford affair, says he hopes a deal can bring peace to many thousands of investors.
Derek Delaney of Dublin’s Waystone Group is in exclusive talks to buy Link Fund Solutions, for an undisclosed amount.
Link was the administrator of two funds run by Neil Woodford, a one-time stock picking star who saw his £10 billion empire collapse as investors raced for the exit on poor returns.
Sanderson shares rocket on Next licensing deal
09:05 , Daniel O'Boyle
Shares in high-end home furnishing company Sanderson Design rocketed as it agreed a £2.6 million deal with Next to sell its Clarke & Clarke line of products at the retail giant’s shops.
Clarke & Clarke bedding, towels, tableware, furniture and lighting will be available in Next stores and online from Spring/Summer 2024, as part of a five-year licensing deal.
This is the first major licensing agreement for the Clarke & Clarke brand.
“We are delighted to sign this master licensing agreement with NEXT for Clarke & Clarke, marking a significant strategic development for the brand,” Sanderson CEO Lisa Montague said.
Sanderson shares were up 12% to 132.7p this morning.
British-Ukrainian car finance startup Carmoola raises £103.5 million
09:03 , Daniel O'Boyle
British-Ukrainian car financing startup Carmoola has raised £103.5 million between a series A funding round and a new debt facility, which it will use to grow its team.
The business raised £8.5 million in series A funding led by fintech investment fund QED Investors, plus a debt facility of up to £95 million from NatWest.
The Series A funding will be used to scale the business up and increase its staff headcount to 20.
Carmoola was founded by Aidan Rushby, Amy McKechnie, Roman Sumnikov, and Igor Gordiichuk. It providers a budget for car buyers, generates a history check and facilitates payments both online and in a showroom via a virtual card.
Rental income improves at Primary Health Properties
08:30 , Joanna Bourke
Primary Health Properties, the GP surgeries landlord , today said annual rental growth has improved.
The FTSE 250 company, whose real estate portfolio currently stands at just under £2.8 billion and comprises surgeries and health centres, also revealed this will be its 27th year of continued dividend growth.
The firm, which gets most of its rental income via the NHS, saw its rent roll increase 3.3% to £145.3 million in 2022.
Chief executive Harry Hyman said: “We are encouraged by the rental growth experienced in the year from rent reviews and asset management projects.”
FTSE 100 under pressure, shares in Lloyds and Rio fall
08:27 , Graeme Evans
The FTSE 100 index is down 0.6% or 48.72 points at 7929.33, with shares in Lloyds Banking Group and Rio Tinto off 2% in the wake of their annual results.
Grocery technology stock Ocado, which is vulnerable to pressure from higher interest rates, fell 2% or 13.2p to 614p and Scottish Mortgage Investment Trust lost 8.2p to 715p.
In the mining sector, Rio fell 119p to 6085p and Anglo American lost 60.5p to 3093.5p ahead of its own results tomorrow.
Blue-chip risers included media and advertising group WPP, which lifted 8.5p to 1019.5p, while pest control firm Rentokil Initial improved 4.6p to 513.2p.
The FTSE 250 index has dropped 89.08 points to 19,761.77, with Moonpig the biggest faller following a decline of 2.6p to 106.8p. Digital publisher Future lifted 20p to 1457p after announcing the appointment of a new chief executive.
Lloyds Bank house price warning
08:24 , Simon English
Profits are flat at Lloyds Bank and it expects house prices to fall 7% this year.
The bank made £6.9 billion in profit for 2022, the same as the year before, even though margins are rising thanks to higher interest rates.
The biggest high street bank set aside £1.5 billion to cover bad debts and admits that some customers are already in trouble.
CEO Charlie Nunn said: “20% of customers are having to take difficult decision, cancelling subscriptions, moving towards value brands. We are focussing in on those customers who are going to have an income shock.”
Nunn was paid £3.8 million, but that is down from a year ago when he got compensation for shares he gave up when leaving previous employer HSBC.
The fallout from Liz Truss’s disastrous mini-budget in September continues, will all banks increasing the cost of loans.
Nunn is optimistic that, that issue now in the past, future borrowers will get cheaper deals.
Nunn thinks that while this year will be tough for many, it will be “nothing like the financial crisis, more like recessions we had nearer the start of the century”.
Lloyds shares opened today at 49p. Over five years they are down nearly 30%.
Lloyds shares fall despite £2bn buyback
08:15 , Graeme Evans
Lloyds Banking Group shares are a penny lower at just above 50p as the banking industry’s results season continues to get a cool reception.
Analysts at Jefferies said the fourth quarter results and forward guidance by Lloyds ticked the right boxes, but that the £2 billion buyback looked a little light as it still left £1.3 billion of excess capital.
Richard Hunter, head of markets at Interactive Investor, added that the challenge for Lloyds was to maintain momentum after fourth quarter numbers raised expectations.
He added: “The group’s own outlook comments are notably understated and conservative, and may be a nod to the challenging UK economic backdrop which remains very much in evidence.
“Indeed, the tendency to tar Lloyds with the brush as a UK economy barometer may have impacted the share price performance.”
FTSE 100 seen lower, S&P 500 slides on rate worries
07:34 , Graeme Evans
European markets are set for a weak start to the session after the S&P 500 index fell 2% last night on fears that US policymakers will continue hiking US interest rates.
The impact of higher borrowing costs on consumer demand was also highlighted in a cautious outlook statement by Walmart alongside annual results by the retail bellwether.
Susannah Streeter, Hargreaves Lansdown’s head of money and markets, said: ‘’Investors are waking up to a stark realisation that the Fed’s work is not done, and that interest rates may have to be hiked even higher to cool hot inflation.
“Waves of exuberance, which have propelled equities higher since the start of the year, have turned into tides of disappointment and apprehension about the difficulties that still may lie ahead for the mighty US economy.”
The FTSE 100 dropped 0.5% and the FTSE 250 fell 1.2% yesterday, even though business activity figures showed further resilience in the UK and Europe. CMC Markets expects the FTSE 100 index open 20 points lower at 7957.
Future hires ex-Daily Mail US boss Jon Steinberg as new chief exec
07:34 , Simon Hunt
Media and publishing business Future has hired ex-Daily Mail executive Jon Steinberg as its new CEO, replacing Zillah Byng-Thorne, who announced her intention to stand down last September.
Steinberg was CEO of DailyMail.com North America before founding news business Cheddar News in 2016. Cheddar was subsequently bought by billionaire Patrick Drahi’s Altice group, whereupon Steinberg was appointed president of Altice USA’s News & Advertising Division.
Steinberg was also previously President & Chief Operating Officer of BuzzFeed news.
Capco-Shaftesbury merger set to close on 6 March after CMA approval
07:30 , Daniel O'Boyle
The Competition and Markets Authority has approved the £5 billion merger between Covent Garden landlord Capital & Counties Properties (Capco) and Soho landlord Shaftesbury.
The all share deal will create a new company to be called Shaftesbury Capital that will have a portfolio of around 2.9 million sq ft of lettable space.
With CMA approval achieved, the deal is now expected to close on 6 March.
Rio Tinto slashes dividend after profits hit by lower metals prices during China lockdown
07:25 , Michael Hunter
FTSE 100 mining giant Rio Tinto has slashed its annual payout to shareholders by more than half after a drop in iron ore prices in 2022 hit profits.
A slowdown in demand in China for the year, amid severe Covid control measures in the world’s top steelmaking nation, sent metals prices tumbling. Rio’s full-year earnings slumped 38% to $13.3 billion (£11 billion).
After a record payout last year gave Rio shareholders one of the biggest dividends in the history of the FTSE 100, the company cut its dividend by more than half to $2.25. It’s total payout per share for the year was $4.92, higher than predictions made by City experts.
Last year’s payout totalled almost $17 billion, worth just over £12 billion then, including a one-off special dividend. It followed a year of recovering metals prices as much of the world dropped pandemic restrictions. It was the second highest ever FTSE 100 payday for shareholders, just behind Vodafone’s return of £18.bn, some of the proceeds from its $130 billion sale of its stake in Verizon Wireless of the US.
Rio hit the headlines last month for losing a highly radioactive capsule during transportation from one of its Australian mines, which was used in measuring procedures and later safely recovered.
It also cut it capital expenditure forecast for 2023 to $8 billion, from a range of between $8 billion and $9 billion.
Lloyds lifts dividend, plans £2bn buyback
07:20 , Graeme Evans
Lloyds Banking Group today posted an unchanged annual profit of £6.9 billion, with net income of £18 billion up 14% due to a recovery in customer activity and the impact of rising interest rates.
The profit figure includes an impairment charge of £1.5 billion, which compares with a significant write-back in 2021. Lloyds said asset quality remained strong and the portfolio well-positioned in the context of cost of living pressures.
Chief executive Charlie Nunn added: "While the operating environment has changed significantly over the last year, the group has delivered a robust financial performance with strong income growth, continued franchise strength and strong capital generation, enabling increased capital returns for shareholders.”
The bank’s capital buffer of 14.1% remains well ahead of its ongoing target of 12.5%.
It has recommended a final dividend of 1.60p a share, resulting in a 20% increase to 2.40p across the financial year. Given the strong capital position, it has also announced its plans for a share buyback programme of up to £2 billion.
Recap: Yesterday’s top stories
06:39 , Simon Hunt
Good morning. Here’s a summary of our top stories from yesterday.
HSBC moved to fend off pressure from one of its biggest shareholders to break up the group and return chunks of cash to investors.
The funds boss looking to buy Link, the administrator still embroiled in the Neil Woodford affair, says he hopes a deal can bring peace to many thousands of investors.
UK private sector firms’ output increased on a month-on-month basis for the first time since July 2022, according to a survey of businesses conducted by S&P Global.
Coming up today we have:
Lloyds results
Rio Tinto results
Primary health properties results
