BUSINESS LIVE Housebuilder profits suffer; Primark sales slow; Boohoo CFO quits

(PA) – Fashion chain Quiz has said shoppers squeezed by higher prices led to a drop in its sales of more than £1million over the critical festive season.

The business said its sales over December fell by 11% compared with the same month the previous year, down £1.1million to total £8.7million.

Consumers have been feeling the pinch, with demand weakening in the face of inflationary pressures pushing up the cost of living, Quiz said.

This resulted in fewer shoppers spending in stores and online during the typically busier Christmas shopping period.

The disappointing festive sales for the retailer, which is known for selling women’s occasionwear including dresses and jumpsuits, follows a weak Black Friday.

Quiz told investors in December its annual sales were likely to be lower than it previously thought, as the loss-making business flagged a “prolonged period of challenging trading”.

But on Tuesday it said it remains confident in achieving the current full-year outlook.

Its chairman Peter Cowgill, who previously led the board at JD Sports, said the firm had launched a strategic review following the weaker financial performance.

There are more entrepreneurs in the UK than ever according to Companies House, which saw registrations reach another record high in 2023.

Data recently published by the Office for National Statistics shows the number of companies registered in the UK climbed to more than 850,000.

The pre-Budget rumour milling has delivered a new plan to solve Britain’s dysfunctional housing market – 1 per cent deposit mortgages.

As first-time buyers struggle to clamber onto the bottom rung of the housing ladder, the concept of government-backed mortgages for 99 per cent of a property’s value has been floated.

For the first time ever, Europe’s most popular new car doesn’t have a combustion engine.

The Tesla Model Y has been named the continent’s best seller in 2023, with over a quarter of a million entering European roads last year, figures show.

A Vistry Group subsidiary has been named the ‘preferred developer’ for a £276million development scheme in North London.

The Greater London Authority and the Mayor’s Office for Policing and Crime have selected Countryside Partnerships to provide 739 new mixed-tenure homes and numerous recreation spaces.

The owner of Mr Kipling cakes and Oxo Cubes has promised to reduce prices across more of its range after scoring its ‘biggest ever Christmas’.

Premier Foods chief executive Alex Whitehouse said the group will extend price cuts to ranges such as Loyd Grossman cooking sauces and Mr Kipling Bakewell slices in the run-up to the end of March.

Investing in smaller capitalisation (small cap) stocks when economic conditions are tough can feel uncomfortable.

Yet, history tells us that this can be a good time to start considering whether these companies deserve a place within a diversified portfolio.

Millennial men working shorter work hours have contributed to labour shortages equivalent to 310,000 fewer people in employment, official figures show.

The typical hours men worked dropped from 36.3 hours in 2019 to 32.5 hours in 2020, amid a general picture of decline over the past 25 years.

The owner of London Southend has warned of ‘significant’ implications for the airport amid demands it repay a loan worth almost £194million by 16 February.

A fund managed by US private equity giant Carlyle Group took legal action against London Southend last year over alleged breaches of the terms of a convertible loan agreement it made with the airport in 2021.

Primark sales growth slowed over the crucial Christmas quarter, but recovered well after unseasonably warm weather impacted trade in the early part of the period.

FTSE 100 Primark owner Associated British Foods told investors that Primark’s like-for-like sales rose 2.1 per cent in the 16 weeks to 6 January 2024, down from 8 per cent in the previous quarter.

Some of Britain’s most prominent home developers have posted much weaker financial performance, following a challenging 2024 for the UK housing sector.

Crest Nicholson reported turnover slumped by 28 per cent to £657.5million in the 12 months ending October, while its adjusted pre-tax profits plummeted by 70 per cent to £41.4million.

The chief financial officer of Boohoo has left the firm with immediate effect, marking the latest blow to the retailer after a tumultuous 2023.

The Manchester-based business, which owns Karen Millen, PrettyLittleThing and Dorothy Perkins, told shareholders on Tuesday that Shaun McCabe had left the firm ‘by mutual agreement’ after just over two years in the role.

Russ Mould, investment director at AJ Bell, comments: he FTSE 100 ticked higher on Tuesday, building on Monday’s gains as US stocks mark new record highs for the second session in a row.

For now, markets have shrugged off their New Year malaise, but investors’ newfound optimism could be tested in the near term with central bank meetings rapidly approaching on the horizon. At some point rates will have to be cut for stocks to maintain their upward trajectory.

Marston’s is the latest hospitality company to toast a good Christmas, suggesting people might have prioritised a night out over a trip to the shops during the festive period. With costs coming down, a sector which has endured an extremely difficult time over the last four years is gradually picking itself off the floor.

Closing down the Port Talbot blast furnaces is, without question, a tragedy.

Tata Steel’s decision to close the Abbey Works in South Wales will lead to 2,800 jobs going over the next 18 months but also thousands more will be lost in the supply chain.

The grocer’s banking arm offered a range of cards, loans and savings accounts, and its customers, of which there are around 1.9million, may be wondering what happens to these products now.

Christine Lagarde is ‘woke’ and ‘arrogant’ and not the right person to lead the European Central Bank, according to a survey of staff.

A damning poll of more than 1,100 of the institution’s 5,000-strong workforce found 50.6 per cent rated her performance ‘poor’ or ‘very poor’ amid concerns she is too ‘political’.

Richard Hunter, Head of Markets at interactive investor:

‘At this stage, AB Foods expects the impact of events in the Red Sea to have limited disruption to its supply chain and will monitor the situation.

‘In the meantime, the group has pointed out that the improvement in product margin which Primark is currently enjoying should insulate the group against the costs of such supply chain disruptions, should they arise.

‘Stock levels are currently in a healthy position and the store opening programme and incremental improvements to its offering, particularly online, offer an enticing glimpse into what could be another year of strong recovery at the retailer, where so many competitors are finding the going increasingly tough.’

Wall Street hit a record high last night amid an artificial intelligence-inspired tech boom.

On a bumper day for investors, the Dow Jones Industrial Average surpassed 38,000 points for first time while the S&P 500 and Nasdaq extended recent gains.

It came as a strong run among tech giants such as Apple, Google owner Alphabet and Facebook parent Meta pushed the indexes to set records.

Boohoo’s chief financial officer has quit with immediate effect, the embattled clothing retailer revealed on Tuesday.

The group has hired former Betfair and Zoopla finance chief Stephen Morana as its new CFO, replacing Shaun McCabe.

Confirming that trading was in line with market expectations, Boohoo said that McCabe’s departure was ‘by mutual agreement and with immediate effect’.

Primark sales growth slowed during the crucial Christmas quarter and owner Associated British Foods warned it could face additional supply costs due to the disruption in the Red Sea.

Primark’s like-for-like sales rose 2.1 per cent in the 16 weeks to 6 Janusary, its fiscal first quarter, a slowdown from growth of 8 per cent in the previous quarter.

Total sales were up 7.9 per cent over the period which ABF said was marked by ‘a slow start given the unseasonal warm weather, and strong Christmas trading’.

AB Foods said it now felt more confident in Primark delivering an improved adjusted operating margin in the 2023/24 financial year, driven by a further improvement in product gross margin.

‘This should insulate us well against potential additional costs of supply due to the disruption in the Red Sea should they arise,’ it said.

Endeavour said an investigation into its former boss who was sacked due to ‘serious misconduct’ will be completed ‘as quickly as possible’.

The gold miner’s board fired Sebastien de Montessus as chief executive this month amid a probe into a £4.6million ‘irregular payment instruction’ he issued.

Last week the board stripped the French businessman, who had led the company since 2016, of more than £23million in pay and bonuses.

Housebuilders experienced a difficult 2023 as rising interest rates and a weaker UK consumer weighed on property sales, with Crest Nicholson, Henry Boot and Watkin Jones all reporting weaker earnings on Tuesday.

Crest Nicholson posted an adjusted pre-tax profit for the year to 31 December of £41.4million, down from £137.8million a year earlier and missing forecasts of £44million.

Henry Boot said it was on track to deliver 2023 profit before tax of £37.2million, in line with forecasts, down from £45.6million the prior year.

Watkin Jones slumped to a pre-tax loss of £2.9million, compared to a profit of £48.8million the prior year, though this was largely as a result of a £35million provision for building safety remedial works.

Alex Pease, CEO of Watkin Jones, said ‘Significant cost inflation and volatility in real estate funding markets meant that FY23 represented a period of unprecedented challenge for the business.

‘However, I am pleased that against this backdrop the Group demonstrated resilience and agility, taking a number of important actions operationally.’