Domino's Pizza says Budget will cost it £3m - and it's big news for 38,000 workers

Retail & Consumer

Debenhams makes first profit since Boohoo rescue despite sales halving

Debenhams, acquired by Boohoo from administration in 2021, has reported a turnaround to profitability even as revenues experienced a more than 50% reduction. In the period ending 29 February, 2024, the retailer recorded a pre-tax profit of £4.5m, contrasting sharply with a pre-tax loss of £732,000 in the previous year. Revenue declined to £39.7m from the earlier figure of £87.1m. Looking back further, Debenhams' revenue was £56.9m, alongside a pre-tax loss of £11.7m, as reported by City AM. Nonetheless, the company's gross merchandise value saw a considerable increase to £359.6m — a 65% rise — and its EBITDA also doubled, reaching £10.4m. UK sales decreased from £73.5m to £39.7m, while international revenue streams dried up, having contributed £13.5m in the preceding financial cycle. The workforce size at Debenhams also dropped significantly, falling from 115 employees to just 24 over the course of the year. The numbers detailed belong solely to DBZ Marketplace Online Ltd, operating under the Debenhams name, not to be confused with Debenhams Brands Online Ltd, which includes such labels as Burton, Dorothy Perkins, Wallis, and Oasis within the Boohoo portfolio. This newer entity, incorporated in May 2023, achieved sales totalling £138.6m and a pre-tax profit of £950,000 for the year ending on 29 February, 2024. Dan Finley, CEO of Boohoo and Debenhams, commented on the results: "Debenhams is an iconic British heritage brand. ". The company behind the revival of Debenhams has expressed optimism about its transformation into "Britain’s online department store." A spokesperson for the firm stated: "We bought it out of administration and are making great progress transforming it into Britain’s online department store." They added, "The market place model is stock-light, capital-light and highly profitable, as these results show. There is lots of opportunity ahead and we are focused on realising that for the benefit of all shareholders." The positive sentiment was further underscored by the announcement: "We have previously announced that the current year started strongly for Debenhams." These latest updates on Debenhams follow the disclosure of financial outcomes for other brands under the Boohoo umbrella towards the end of November. Notably, Prettylittlething reported a shift from a pre-tax profit of £22m to a loss of £6.5m, with revenue dropping from £634.1m to £475.8m. While Boohoo regularly reports its group results to the London Stock Exchange, detailed financial accounts for its individual brands are only made public annually via Companies House filings.

Retail & Consumer

Avanti West Coast achieves £1bn turnover despite ranking low on UK reliability charts

Despite being named one of the least reliable rail operators in Britain, Avanti West Coast's turnover exceeded £1bn last year. The train operator, a joint venture between Firstgroup and Italian rail firm Trenitalia, reported a turnover of £1.01bn for the 12 months to 31 March, 2024, an increase from £967.4m. However, Companies House filings reveal that pre-tax profit dipped from £12.8m to £12.3m over the same period. Avanti, which took over the west coast mainline from Virgin Trains in December 2019, is 70% owned by FirstGroup and 30% by Trenitalia, as reported by City AM. It operates services between London Euston and several cities including Birmingham, Liverpool, Manchester, and Glasgow. The accounts also show a dividend of £8.1m for the year, down from £11m. Passenger revenue totalled just over £1bn, up from £808.9m, with passenger numbers at 83% of pre-pandemic levels, up from 67%. Avanti West Coast returned a net payment of £21.9m to the Department for Transport (DfT) during the year, following a subsidy of £92.4m the previous year. According to the Office of Rail and Road, Avanti West Coast had the third worst reliability of all operators in Britain in the year to 31 March, 2024. In the past year, an equivalent of one in 15 trains (6.9%) were cancelled, including pre-emptive cancellations before 10pm the previous night due to crew shortages. Avanti West Coast's contract, which could last up to nine years, may be cut short by the government with just three months' notice after the initial three-year period. Meanwhile, the new Labour administration is devising a strategy to renationalise nearly all passenger rail services within five years. The plan involves transferring private train company contracts to Great British Railways, a new public body, as they expire. Avanti West Coast has expressed a 'singular focus' on service delivery. A board-approved statement read: "The company is working hard with a singular focus on delivering the service that customers expect." It also noted: "The company has reached an agreement with the relevant trade unions on the incremental use of rest day working for train drivers, which helps support operational resilience." Furthermore, the statement highlighted ongoing collaborations: "The company also continues to work with the DfT and other stakeholders on its plans to deliver long term improvements in customer experience and resilience."

Retail & Consumer

British Gas owner Centrica adds £300m to share buyback plan amid nuke boost

FTSE 100 stalwart Centrica has bolstered its share buyback initiative with an extra £300m, taking the total shares repurchased over the past two years to a staggering £1.5bn. In a trading update today, British Gas's parent company signalled that it foresees its full-year earnings and net cash for 2024 mirroring market expectations, as reported by City AM. Analysts project an adjusted earnings per share of 18.5p for Centrica in 2024, alongside an anticipated net cash position of £2.6bn. "The usual uncertainties remain for the balance of the year, including weather, commodity prices and asset performance," the energy firm highlighted. Since commencing in November 2022, Centrica's ambitious share buyback plan is on track to acquire roughly 20% of its stock by September 2025. Just last week, the company announced the extension of the operational life for four of its nuclear reactors until March 2027 – a year longer than previously planned. Nuclear output in the United Kingdom has been incrementally rising throughout 2024, registering a 2% increase since the year's start, as per analysts from Jefferies. In another sector insight, domestic gas consumption in UK households was six per cent higher than the three-year average from September to November. Coinciding, electricity and gas prices have surged by 20-30%. These updates surrounding its nuclear ventures contributed to a 12.7% rise in Centrica's share price over the past month. Despite this jump, the company's shares are still trailing seven per cent behind since January started.

Retail & Consumer

Marie Claire and Go Compare owner sees profits dip but returns to revenue growth

Publishing giant Future Plc has reported a dip in profits for the financial year but saw its revenue return to growth over the period. The Bath-based company, which owns brands including Marie Claire, Country Life and Go Compare, said it had made "good strategic progress" over the year ended September 30. Adjusted operating profit at the firm was £222.2m - down from £256.4m the year before. Revenues were broadly flat at £788.2m, with +1% organic growth. UK revenue grew by 6% on an organic basis, with "very strong growth" in Go.Compare, the company said on Thursday. Future reported business-to-business growth of +2% although business-to-consumer saw a 6% decline, impacted by market conditions and the weight of magazines. Meanwhile, the company's US revenue fell by 6% on an organic basis. Future said profitability remained in line with expectations. Jon Steinberg, who is stepping down as Future's chief executive next year, said: “We launched our Growth Acceleration Strategy one year ago and have made good strategic progress. We have invested in sales and editorial roles, successfully diversified and grown revenue per user, and we have further optimised our portfolio. "Importantly, the group has returned to organic revenue growth during the year, underpinned by a strong H2 performance. The execution of our strategy combined with our strong financial characteristics, including a flexible cost base and highly cash generative profile, creates further optionality and positions the business well." The announcement comes a year after Future launched its Growth Acceleration Strategy in a bid to capitalise on opportunities in "attractive and growing markets". The business said two-year investment programme of £25m-£30m had helped it return to growth.

Retail & Consumer

Manchester Airport owner reports record passenger numbers - but warns of challenges ahead

Manchester Airports Group (MAG), which encompasses Manchester, London Stansted, and East Midlands airports, has flown to new heights with its pre-tax profit hitting £139.6m for the first half of their financial year ending on 30 September, 2024. This marks an increase from the previous £115.9m, buoyed by a 6.9% rise in traffic to 37.3m passengers, as reported by City AM. MAG's success story also includes its subsidiary travel services business CAVU contributing to a revenue surge to £768.5m from £705.6m. Notably, Manchester Airport celebrated a milestone, managing 17.8m passengers during this period and reaching an unprecedented annual total of 30 million travellers in September for the first time ever. In comparison to international counterparts such as La Guardia New York and Melbourne Airport Australia, Manchester Airport establishes its stature by entering their league. Meanwhile, London Stansted broke its own record for passenger numbers in a half-year with 16.7m visitors. MAG also witnessed its busiest day on record during October when it serviced 107,000 passengers within a single 24-hour timeframe. Additionally, East Midlands Airport saw a steady flow of 2.8m individuals over the six months. Despite facing increased taxes and operational costs, MAG CEO Ken O'Toole highlighted the group's achievement stating: "Across the summer, one in five UK air passengers chose to fly through a MAG airport for business, leisure, to study or visit friends and family." "This is testament to the strength of our route networks, our commitment to providing great choice and value to all our customers, and to always striving to deliver a positive passenger experience." "While our industry faces challenges both in the UK and globally, such as increasing taxation and rising costs linked to the push towards full decarbonisation of air travel, MAG’s strong financial and operational performance makes us well-placed to drive forward our investment programmes as we continue to grow."

Retail & Consumer

Procook shares dip as kitchenware retailer posts first-half losses

Kitchenware retailer Procook says it is “confident” in delivering growth after reporting an underlying operating loss of £1.8m for the first half of the year - up from £1.5m a year earlier. The Gloucestershire-based firm said it had “outperformed” the market over the 28 weeks ended October 13. Revenue over the period increased 7.5% to £28.3m, with underlying revenue up 4.2%. In the first eight weeks ending December 8, including Black Friday and the early part of Christmas trading, total revenue increased by +7.5%, with like-for-like revenue up 0.9%. The company opened four stores in the period, with plans in the pipeline for 10 new sites in total over the financial year. But shares in Procook fell 16% on the news of its increased first-half losses. Lee Tappenden, chief executive, said Procook had delivered a "strong performance" in the first half and had grown the company's customer base. “We have made good progress against our strategic priorities and continue to invest carefully in the areas that will support profitable growth in the medium term," he said. “We are pleased with trading results in the first half of the year. Whilst the important Q3 trading period had a subdued start in the early weeks coinciding with the Budget event, and a later Black Friday year on year, we are well positioned to take advantage of the improved momentum we are now experiencing, supported by our Christmas campaign, new product launches and strong inventory levels." Procook's expectations for the full-year remain unchanged. It added that it anticipated a "typical second half weighting" of revenue and profitability.

Retail & Consumer

Train company says 'do not attempt to travel' as multiple lines closed

Train services in parts of England and Wales remain disrupted following Storm Darragh, with several lines closed due to fallen trees and debris. Great Western Railway said passengers should “not attempt to travel” between Swansea and Carmarthen until at least noon, or on the Looe, St Ives and Gunnislake branch lines in Cornwall until at least 11am. The Barnstaple and Okehampton branch lines in Devon are expected to be open by 8am following safety checks. Westbury and Chippenham stations in Wiltshire have reopened following storm damage, and services have resumed on the Falmouth branch line in Cornwall. Passengers who choose not to travel on Monday can claim a full refund on their ticket or travel on Tuesday. Damage caused by Storm Darragh means the railway line between Stafford and Stoke-on-Trent remains closed. This is affecting London Northwestern Railway services between Stafford and Crewe, and CrossCountry trains connecting Manchester Piccadilly with stations such as Paignton, Bournemouth, Southampton Central, Bristol Temple Meads and Birmingham New Street. London Northwestern Railway passengers can use rail replacement transport between Wolverhampton and Crewe. Affected CrossCountry services will be diverted via Crewe and will not call at Stoke-on-Trent or Macclesfield. Rail replacement transport is operating between Stafford and Stoke-on-Trent. Transport for Wales said all railway lines are blocked on 11 routes, such as between Swansea and Milford Haven, between Swansea and Shrewsbury, between Birmingham International and Shrewsbury, and between Chester and Holyhead. Following major disruption from Storm Darragh over the weekend, National Rail Enquiries warned “services may be busier than normal today and experience severe overcrowding”. West Midlands Railway is unable to operate on the line serving Bromsgrove, Redditch, Birmingham New Street and Lichfield Trent Valley because of damage to overhead electric wires. Passengers were warned to expect cancellations and delays to train services on the West Coast Main Line between London Euston and Scotland early on Monday. Network Rail said this is because it is completing repairs to overhead line equipment in Polesworth, Warwickshire. Services are being diverted via Birmingham while the work is taking place. Chris Baughan, Network Rail’s West Coast South route operations manager, said: “Storm Darragh has wreaked havoc on the railway this weekend and we are very sorry to passengers for the disruption to train services this morning on the West Coast Main Line as frontline teams continue with emergency repairs and the clean-up.

Retail & Consumer

Channel 5 loses £160m in major blow ahead of major rebrand

Channel 5 has maintained that its operating model remains stable despite revealing a loss of nearly £160m in 2023. The channel, which is set to rebrand as '5' in April 2025, attributed the loss to a £273m impairment in the value of its investment in Viacom Interactive, a subsidiary of parent company Paramount Global, and not to Channel 5’s trading business. This led to a pre-tax loss of £159.5m for 2023, following a pre-tax profit of £78.1m in 2022. Recently filed accounts with Companies House show a rise in turnover from £370m to £398m, boosted by a payment of £80.9m, plus £9.1m in interest, from Channel 5’s sales partner due to a correction in that firm’s internal reporting between 2017 and 2023, as reported by City AM. Excluding this payment, the channel’s turnover totalled £318m. The channel’s operating profit increased from £80.1m to £112.4m in the year. However, excluding the payment, its profit totalled £22.7m. The 2023 results were made public after being filed with Companies House on 6 December, past the 30 September deadline. A statement approved by the board said: "Despite the tough commercial environment, Channel 5’s portfolio – which includes 5STAR, 5USA, 5Select and 5ACTION – achieved a fifth consecutive year of share growth (five per cent), making it the only public service broadcaster (PSB) to increase its total share of the UK viewing audience." "In addition, Channel 5 was the only commercial PSB to increase its audience share in peak time (one per cent) as well as its share of ABC1 viewers in peak time (four per cent)." "For a fourth consecutive year, My5 achieved growth in its viewing, reflecting the success of the free streaming service and the appeal of Channel 5’s content to a streaming audience." On its future, the business added: "Looking ahead, the business continues to work to future proof its offering and enhance the experience for viewers, advertisers and content partners."

Retail & Consumer

Amazon buys rights to Warhammer 40,000 games

Amazon is poised to launch a series of films and television shows based on the popular game Warhammer 40,000 from Games Workshop. In a stock exchange announcement this morning, Games Workshop confirmed it had established "creative guidelines" and secured a deal with Amazon to bring the Warhammer 40,000 universe to life in film and TV adaptations, along with associated merchandising rights for any Amazon-produced content, as reported by City AM. "This update was largely expected, but it is the important final step in bringing Warhammer to a global audience," commented Peel Hunt analysts Charles Hall and Andrew Ford. Set to join the FTSE 100 later this month, Games Workshop boasts an extensive library of intellectual property that has only recently started to be exploited commercially. According to the company's latest financial results, licensing revenue soared by 150% year-on-year to £30m, significantly surpassing analyst predictions and enhancing profitability. "This push into licensing is a big part of the company’s future growth strategy," said Susannah Streeter, head of money and markets at Hargreaves Lansdown, in a discussion with City AM. Today's agreement grants Amazon exclusive rights to any Warhammer 40,000 film or TV project, with the option to license similar rights in the Warhammer fantasy realm following the debut of an initial Warhammer 40,000 screen adaptation.

Retail & Consumer

Tui profit soars but shares slide as holiday giant warns growth will slow

Tui, Europe's largest tour operator, has reported a significant increase in profit for the last financial year, with underlying earnings before interest and taxation (EBIT) rising by 33% to €1.3bn, up from the previous year's €977m. This comes as more than 20 million customers chose to travel with the package holiday provider, as reported by City AM. Revenue also saw an increase, climbing 12% to reach €23.2bn. Tui's CEO, Sebastian Ebel, praised the company's performance, describing it as a "very good year" and stating that the firm is "well positioned" for future success. Despite this, shares in the company fell by over 5% in early trading due to slower growth forecasts for the upcoming year. The company's guidance for full-year revenue growth currently stands at 5-10%, with underlying EBIT expected to grow by 7-10%. Tui, which recently switched its London listing for Frankfurt, also reported an increase in prices throughout the year, with costs for winter and next summer predicted to rise by 5% and 3% respectively. Aarin Chiekrie, an equity analyst at Hargreaves Lansdown, commented: "Consumers continue to prioritise travel, meaning more customers have been willing to pay higher prices to enjoy a break away from everyday life." Chiekrie also highlighted the diverse nature of Tui's business, which includes an airline, cruise ships, hotels and resorts, as a factor in its resilience to wider trends.