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(Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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BP posted a significant swing to annual loss in a year which saw oil demand hammered by the coronavirus pandemic. The London-based oil major said that for 2020, it swung to a replacement cost loss of USD18.10 billion from a RC profit of USD3.52 billion in 2019. Revenue for the year was USD183.50 billion, down 35% from USD282.6 billion the year prior. This was despite a more positive performance in the fourth quarter which saw BP swing to a RC profit of USD825 million from a loss of USD644 million in the third quarter of 2020 and a loss of USD4 million in the fourth quarter of 2019. BP said its performance during the year was driven by lower oil and gas prices, significant exploration write-offs and refining margins and depressed demand. Referring to Covid-19's impact on the world in 2020, BP Chief Executive Bernard Looney said: "We expect much better days ahead for all of us in 2021."
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SSE affirmed its annual earnings forecast and said it expects a Covid-19 profit hit in the middle of a GBP150 million to GBP250 million range. The company added that its disposal programme is on track and it has called on banks to review options for SGN, with SSE considering a sale of all or part of its stake in the gas distribution business. The Perth, Scotland-based gas & electricity company said it still expects adjusted earnings per share for the year ending in March to be in its previously guided 85 pence to 90p range. "The impact of coronavirus on full-year operating profit being towards the middle of the GBP150 million to GBP250 million range originally estimated in SSE's full-year results in June 2020," the company said.
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DCC backed achieving "good growth" in annual profit that will top market forecasts. "Notwithstanding the disruption and uncertainty caused by the global pandemic, the group recorded strong organic operating profit growth, whilst also benefiting from acquisitions completed in the prior year," DCC added. The DCC LPG unit - a liquefied petroleum gas marketing business - saw "modest organic profit growth" despite reduced volume demand amid lesser activity in the sector. Meanwhile, DCC Technology posted "strong organic operating profit growth in the third quarter". In the B2B arm, market conditions were tricky, however, with DCC citing continued Covid-19 restrictions. Home-working and strong demand for consumer and audio products was a helpful tailwind for DCC Technology, the company noted.
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UK grocery sales growth accelerated as Britons were forced to stay at home by the reintroduction of national lockdown restrictions, research agency Kantar said. Kantar said take-home grocery sales rose 12% in the 12 weeks to January 24, marking an acceleration during the Christmas period and immediate aftermath, as fresh virus restrictions forced the closure of restaurants and pubs. In January alone, shoppers spent GBP1 billion more on supermarket food and drink items compared to the same four-week period last year. In the 12-week period, Wm Morrison Supermarkets recorded the fastest sales growth of the 'Big Four' UK grocers, recording an increase of 14% while its market share edged up to 10.4% from 10.3%. Tesco had another strong month with sales rising by 12%, in step with the overall market to maintain its market share at 27.3%. J Sainsbury posted a 12% sales increase but its market share edged down to 15.7% from 15.8%. Ocado's sales surged 37% - making it the fastest growing retailer in the period - and its market share rose to 1.7% from 1.4%.
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Moonpig Group shares began trading in London on Tuesday, with the online greeting card retailer sizing up inclusion in the FTSE 250 index. Moonpig priced its initial public offering at 350 pence per share, issuing 5.7 million new shares, raising GBP20 million, with existing investors selling 134.6 million shares. This meant the total offer size was GBP491.2 million. Immediately following admission, the company said it would have market capitalisation of around GBP1.2 billion. "Subject to admission and satisfying the appropriate criteria, the company may be eligible following completion of the offer for inclusion in the UK's FTSE 250 Index," the company said.
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MARKETS
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London shares were amid amid hopes that US President Joe Biden's ambitious financial aid package will come to fruition. Precious metal miner Fresnillo was the worst blue-chip performer, down 4.1%, as the price of silver eased from an eight-year high. BP was down 3.5%. US stock market futures were pointed higher ahead of earnings from Amazon and Alphabet after the market close in New York.
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FTSE 100: up 0.7% at 6,514.06
FTSE 250: up 0.9% at 20,583.12
AIM ALL-SHARE: up 1.2% at 1,184.24
GBP: up at USD1.3684 (USD1.3666)
EUR: down at USD1.2036 (USD1.2076)
GOLD: down at USD1,849.25 per ounce (USD1,860.90)
OIL (Brent): up at USD57.63 a barrel (USD55.82)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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UK house prices growth slowed in January as buyers anticipate the end of the government's stamp duty holiday at the end of March, according to the house price index data from mortgage lender Nationwide. On an annual basis, house price growth slowed modestly to 6.4% in January, from 7.3% in December. On a monthly basis, house prices fell by 0.3% after posting growth of 0.9% in December. The average UK house price stood at GBP229,748 in January, down from GBP230,920 in December.
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A door-to-door testing blitz of 80,000 people in England is aiming to find "every single case" of the South Africa coronavirus variant in a bid to stop the spread of the more infectious strain. Eleven cases of the variant identified over the past week were in people who had no links to travel, prompting concerns the mutation may be spreading in communities. Mobile testing units and home testing kits will be deployed to areas where the variant has been discovered as the UK government looks to prevent it getting a foothold. Meanwhile, UK Prime Minister Boris Johnson is reported to have asked ministers to ramp up preparations for the reopening of schools. The Daily Telegraph said he is expected to announce further measures to help children catch up after almost a year of disruption.
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US President Joe Biden met Monday with a group of Republican senators who are pushing an alternative to his massive Covid-19 relief plan, but no agreement was reached. Biden, who campaigned on restoring bipartisanship in Washington, wants to spend USD1.9 trillion to revitalize the world's largest economy after the pandemic caused waves of layoffs, but Republicans in Congress have said they won't support such a large package. On Sunday, a group of 10 Republicans detailed a measure costing USD600 billion, and Biden responded with an invitation to the White House to discuss the idea. But no agreement was at hand following the meeting, which Republican Senator Susan Collins described as "frank and very useful", if not conclusive. The senators released a statement Monday night saying the meeting was a "very productive exchange of views" and that they would continue to talk with the Biden administration and other senators "in the coming days" to reach an agreement on a bipartisan relief package.
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The eurozone economy shrank at the end of 2020 as restrictions across the euro area hindered economic activity, figures from Eurostat showed. In the fourth quarter of 2020, seasonally adjusted gross domestic product decreased by 0.7% in the euro area and by 0.5% in the EU, compared with the previous quarter, according to a preliminary flash estimate published by Eurostat, the statistical office of the EU. For 2020 as a whole, based on seasonally and calendar adjusted quarterly data, GDP fell by 6.8% in the euro area and by 6.4% in the EU. Compared with the same quarter of the previous year, seasonally adjusted GDP decreased by 5.1% in the euro area and by 4.8% in the EU in the fourth quarter of 2020, after falling by 4.3% in the euro area and by 4.2% respectively in the EU in the third quarter of 2020.
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