(Alliance News) - Royal Mail on Friday said its General Logistics Systems arm has agreed to buy Canadian logistics company Mid-Nite Sun Transportation for GBP210.5 million.
Mid-Nite operates as Rosenau Transport, with a "strong presence" in western Canada. It generated revenue of CAD175.0 million - around GBP102.5 million - and earnings before interest, tax, depreciation and amortisation of CAD41.6 million in the 12 months to August 31.
GLS is Royal Mail's parcels unit in Europe and North America. It entered the Canadian market in 2018 with the acquisition of Dicom, and now GLS Canada operates a network of 2 hubs and 27 depots, with around 1,400 employees.
"The combination of the two businesses will create a network stretching across Canada which will enable GLS to cover the vast majority of the Canadian population and deliver further growth and synergies," said Royal Mail.
Royal Mail shares were up 3.5% early Friday, outpacing the wider FTSE 100 index.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.3% at 7,097.67
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Hang Seng: up 0.2% at 24,757.21
Nikkei 225: closed up 1.3% at 28,048.94
DJIA: closed up 337.95 points, or 1.0%, at 34,754.94
S&P 500: closed up 36.21 points, or 0.8%, at 4,399.76
Nasdaq Composite: closed up 152.10 points, or 1.1%, at 14,654.02
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EUR: down at USD1.1546 (USD1.1566)
GBP: down at USD1.3597 (USD1.3625)
USD: up at JPY111.89 (JPY111.45)
Gold: down at USD1,758.98 per ounce (USD1,759.45)
Oil (Brent): up at USD83.09 a barrel (USD81.76)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
1100 BST Ireland live register
1200 BST UK Bank of England quarterly bulletin
0830 EDT US monthly jobs report
1000 EDT US monthly wholesale trade
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The UK has embarked on a 14-week consultation on a future trade deal with the Gulf Co-operation Council, seeking the views of the public and business before International Trade Secretary Anne-Marie Trevelyan hopes to begin talks in 2022. The GCC comprises of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates, and it is one of the UK's largest trading partners. Total bilateral trade was worth over GBP30 billion in 2020 and an accord with the six monarchies is seen as a key target for post-Brexit Britain.
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Ireland's 12.5% corporate tax rate is to be increased to 15%, Finance Minister Paschal Donohoe confirmed. He made the announcement following a Cabinet meeting on Thursday, where it was agreed the new tax rate would apply to companies with turnover in excess of EUR750 million. This will affect 56 Irish multinational companies employing 100,000 people. It will also affect 1,500 foreign-owned multinationals employing 400,000 people. Ireland has come under increasing pressure to sign up to the Organisation for Economic Co-operation & Development deal on global tax reform. The finance minister said he had sought changes to the deal to secure "certainty and stability". He added: "I believe we have now reached that point. This is the right decision. It is a sensible and pragmatic decision.
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Germany's trade surplus declined both annually and monthly in August, according to data from Destatis. Europe's largest economy registered a trade surplus of EUR13.0 billion in August, fading 27% from EUR17.7 billion in July and also 14% below the EUR15.1 billion from a year earlier. In addition, the EUR13.0 billion surplus also missed FXStreet cited consensus of EUR15.8 billion, which would have been an annual hike. Exports were down 1.2% monthly at EUR104.4 billion in August, although this represented a 14% yearly rise. Imports were 3.5% higher monthly at EUR93.8 billion and up 18% yearly.
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US President Joe Biden on Thursday championed Covid-19 vaccination requirements, determined that the roughly 67 million unvaccinated American adults must receive the shot even as he acknowledged that mandates were not his "first instinct". Biden had ruled out such requirements before taking office in January, but they now are a tactic he feels forced into using by a stubborn slice of the public that has refused to be inoculated and has thus jeopardised the lives of others and the nation's economic recovery. "There is no other way to beat the pandemic than to get the vast majority of the American people vaccinated," Biden said in suburban Chicago at an event promoting the mandates. "While I didn't race to do it right away, that's why I've had to move toward requirements."
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BROKER RATING CHANGES
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PEEL HUNT RAISES MARKS & SPENCER TO 'ADD' ('HOLD') - TARGET 190 (150) PENCE
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HSBC RAISES PENNON TO 'HOLD' ('REDUCE') - TARGET 1,180 (1,160) PENCE
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BARCLAYS RAISES ASCENTIAL TO 'OVERWEIGHT' ('EQUAL WEIGHT') - TARGET 500 (450) PENCE
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COMPANIES - FTSE 250
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Unite Group warned that full-year earnings per share will be at the lower end of guidance due to a reduction in occupancy and rental income. The student accommodation firm said 94% of bed spaces are now let across its total portfolio as the lettings cycle for the 2021-22 academic year enters the final stages. This is up from 88% the year before but down from 98% two years ago - and below management expectations for 95% to 98% occupancy. Unite warned it expects 2021 earnings per share of around 27 pence to 30p, at the lower end of guidance. It added that lower rental income in terms two and three of the 2021/22 academic year will reduce rental income for the 2022 financial year by around GBP8 million to GBP10 million compared to management's previous forecasts. "We will seek to mitigate this impact on 2022 EPRA EPS through ongoing sales activity by targeting international students who may delay their arrival to the UK until the new year and the reintroduction of summer business in 2022. In addition, we are targeting cost savings from operational efficiencies resulting from lower occupancy," the company said.
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Electrocomponents said trading has been ahead of expectations and raised full-year guidance, though noted supply chain issues are set to persist. For the first half ended September 30, like-for-like revenue jumped 31% on a year ago, and was 22% higher compared with two years prior. "Our trading has remained very strong across all regions as we have worked closely with suppliers to ensure our product availability, delivery and service offer remain robust, which has driven further growth in both customers and average order value. This has led to our financial performance to date being stronger than expected," said Chief Executive Lindsley Ruth. However, Electrocomponents said it has continued to see higher outbound freight charges and labour inflation, which are "showing no signs of abating". This has partly offset improvements made in its gross margin. Nonetheless, the electronic and industrial components maker now expects full-year revenue growth and adjusted operating profit margin to be slightly ahead of previous guidance. Back in July, the firm guided to low double-digit to mid-teens like-for-like revenue growth for the financial year ending March 31, 2022.
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COMPANIES - GLOBAL
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China will strengthen supervision of the online payments industry and continue its anti-monopoly crackdown, the governor of the central bank said, indicating Beijing will press ahead with a regulatory crackdown on the country's technology firms, such as Alibaba, for alleged monopolistic practices and aggressive harvesting of consumer data. "We will continue to cooperate with anti-monopoly authorities to curb monopolies and actively deal with algorithm discrimination and other new forms of anti-competition behaviours," People's Bank of China Governor Yi Gang said in a keynote speech at a Bank for International Settlements conference on regulating the sector. He added that the central bank will strengthen supervision of the payments industry and ask all financial services companies to be licensed. "Top platform companies in China have acquired massive data from users," said Yi, adding that their "winner-takes-all nature...could lead to market monopoly and compromise innovation efficiency".
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Alphabet's Google will prohibit climate change deniers from being able to monetize their content on its platforms, the company announced. A new policy for advertisers, publishers and YouTube creators will prohibit ads for, and monetization of, content that "contradicts well-established scientific consensus around the existence and causes" of climate change, the company said in a statement. "This includes content referring to climate change as a hoax or a scam, claims denying that long-term trends show the global climate is warming, and claims denying that greenhouse gas emissions or human activity contribute to climate change," Google said.
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Friday's Shareholder Meetings
Baker Steel Resources Trust Ltd - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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