Below are the key headlines from today’s updated papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
City relief as EU gives no-deal green light for clearing houses. Europe stepped up preparations for a no-deal Brexit on Monday after giving key parts of the City of London temporary access to EU customers in the event of a cliff-edge departure. The European Securities and Markets Authority, the EU financial regulator, has granted three UK-based clearing houses — LCH, ICE Clear Europe and LME Clear — licences to carry on doing business with European-based customers over the next 12 months even if politicians fail to strike an agreement. London dominates clearing for derivatives traded by European customers and clears nearly all over-the-counter derivatives, mainly interest-rates swaps, traded in euros. Clearing houses are a vital part of the financial infrastructure and ensure stability by acting as the buyer or seller of last resort in the event of a customer default.
Footasylum shares soar as JD Sports buys stake. Britain’s biggest sports retailer acquires 8.3% in struggling smaller rival. JD Sports Fashion (JD.), Britain’s biggest sports retailer, has acquired an 8.3% stake in Footasylum (FOOT) , sending shares in its struggling smaller rival surging by more than 80%. JD Sports said it had bought the stake in the footwear and hoodie chain for investment purposes and was prepared to increase its holding to 29.9% – the maximum level permitted without triggering a bid – but that it had no intention of making an offer. The stake was acquired from one major institutional shareholder at a price of 50p a share. Footasylum responded by saying that it “continues to operate its business as usual and remains focused on delivering its differentiated, product-led, multi-channel proposition”.
Shoe Zone should be shoe-in for dividend hunting investors. This is not the glamorous end of the shoes market — no £500 Louboutins in sight. But Shoe Zone (SHOE) is fast becoming a solid little earner for small-cap investors, providing a reliable dividend and strong earnings. At its results last October it recorded a profit of £11.3 million, an 18.4% increase on the £9.5 million recorded the year before. Investors will be hoping it can do the same again for the year ahead as 60% of profits are paid out in dividends. The firm also has a strong debt-free balance sheet which could appeal to a predator. But the real key to its success is its ability to control its rents. Shoe Zone’s average lease length is just two years, meaning it has frequent chances to renew. The question is whether the firm will continue to grow. It is also focused on developing its website. Last year online revenues contributed £9.8 million to overall sales, a marked 19.9% increase on the previous year. Nevertheless, analysts have warned that customers still prefer to buy shoes in store. Still, while the high street crumbles, Shoe Zone shows that with sensible pricing and a low cost base any firm can still compete.
Reckitt Benckiser brushes off Brexit in £105m UK research centre spend. The boss of Reckitt Benckiser Group (RB.) on Monday cheered sales growth and signalled that the consumer goods giant has no regrets about opening a new £105 million UK research centre in post-Brexit Britain. Rakesh Kapoor made the comments as Reckitt Benckiser, which is behind the Durex, Dettol and Nurofen brands, posted a 10% jump in full-year revenues to £12.6 billion. The FTSE 100 firm first unveiled plans to invest in a science and innovation centre in Hull in 2014. It has had a presence in the Yorkshire city since 1840.
Fishing equipment retailer Angling Direct (ANG) said it is well stocked to weather any disruption to supply due to Brexit as it unveiled a strong rise in sales. In a pre-closing trading update, the company said it has structured the company in preparation for Brexit given ‘the very high percentage of stocks coming from the Far East’. ‘Inventory numbers in general are good and the business does not foresee any disruption to supply throughout the next few months, regardless of any Brexit outcome,’ the company said in a statement.
Convenience store chain McColl’s Retail Group (MCLS) said it is still suffering from the collapse of supplier Palmer & Harvey as it reported falling profits and sales and slashed its dividend by more than half. McColl’s, which has around 1,600 convenience stores and newsagents around the UK, also said sales may fall further in April and May if the UK leaves the European Union without a deal as supply chains are disrupted. The expected weak annual results follow two profit warnings and an 80% slide in the small cap firm’s share price in a year.
A gold mining veteran will take over at Petra Diamonds Ltd.(DI) (PDL) boss as the struggling miner seeks to dig its way out of a hole. South African-born Richard Duffy, former chief financial officer of AngloGold Ashanti, will become chief executive on April 1. He previously held roles at Anglo American and is running a renewable energy company in southern Africa that he also co-founded. Mr Duffy replaces Johan Dippenaar, who announced his departure last year after Petra was forced to raise £125m from investors to tackle its teetering debt pile. Tyler Broda, an analyst at RBC, said Mr Duffy “appears to be a very solid hire with 27 years’ experience in mining across a wide range of roles”.