Below are the key morning press headlines, featuring the The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
The total bill for Prudential (PRU) plan to split itself in two has been put at more than £430 million in the first year, Paul Manduca, the Prudential’s chairman, said in a letter to shareholders that he expected the total cost to the Prudential to hit £350 million, while its demerged M&G business would incur at least an extra £80 million a year of head office costs. Mr Manduca also warned shareholders that the post-deal Prudential would receive “a materially lower quantum of tax recoverable” because its interest and head office costs would be lower going forward.
Some of the world’s richest businessmen have lost almost £400m in just five months after stepping in to shore up ailing Metro Bank (MTRO) . Billionaire hedge fund chief Steven Cohen was among those to bag what analysts dubbed “a bargain” during the bank’s cash call in May when it issued stock at 500p a share. But Metro’s shares plummeted again this week after the bank was forced to cancel a bond sale due to a lack of investor interest. The stock is now worth just 187p, a record low – meaning backers have suffered a further plunge in the value of their stock.
Sainsbury (J) (SBRY) is to close about 125 supermarkets and Argos stores, stop selling mortgages and cut costs as it sets for the future after its failed tie-up with Asda. Up to 70 high street Argos stores will be shut as the company relocates 80 into its supermarkets over the next five years. It will also close ten to 15 supermarkets and 30 to 40 convenience stores, but will open about ten supermarkets and 110 convenience stores. Mike Coupe, 58, chief executive, yesterday played down speculation that his departure was imminent, saying that he was “committed to the business . . . there is plenty to be doing”.
BAE Systems (BA.) has won a multibillion-dollar American government defence contract for production of the Advanced Precision Kill Weapon System. The $2.7 billion deal will support US military and foreign military sales of an upgrade to the 2.75in Hydra 70 unguided rocket system to make it a semi-active laser-guided precision weapon. This will include sales to the governments of Iraq, Lebanon, Netherlands, Jordan, Afghanistan, the United Kingdom, Tunisia, the Philippines and Australia, the Pentagon said last night.
Tesco (TSCO) is axing the first Jack’s a year after the supermarket giant unveiled the discount chain that is meant to help it take on the likes of Aldi and Lidl. The Rawtenstall store was opened earlier this year to see if a so-called “bulk buy store” would attract shoppers. A Tesco spokesperson said: “All colleagues currently employed by Jack’s will transfer over to Tesco with new additional roles also available.” The grocer, which has 10 Jack’s stores at present, said it was opening a new Tesco store in Rawtenstall “that will better serve customers in this area”. It will open three more Jack’s by the end of the year.
Babcock International Group (BAB) enjoyed one of its best days on the stock market after a trading update revealed that the operator does not expect to let down its investors this year. Fresh from winning a £1.25 billion contract to build five cut-price Type 31e frigates for the Royal Navy at its shipyard at Rosyth near Edinburgh, Babcock said it expected to hit its targets for revenues, operating profits and cashflow for the year to the end of March. As the financial year started, it guided analysts to expect revenues of £4.9 million, down from £5.1 million, operating profits at between £515 million and £535 million, down from £588 million, and cashflow above £250 million but down from £323 million.
Aston Martin Holdings (AML) shares fell after the car maker raised $150million (£121million) through a bond sale in a bid to boost its finances and help develop and build its first SUV – the DBX. The group is going to have to pay 12% interest on the bonds each year until they mature in 2022, at which point it will have to pay back the full amount. The car maker also has an option to receive another $100million (£81million) at a rate of 15 per cent interest if needed. But the move has raised questions over the health of the group’s finances, sending shares falling 5.2% to 544.8p in afternoon trading. Russ Mould, investment director at stockbroker AJ Bell, said the ‘very high’ borrowing rates were a sign that the company really needed the money and ‘had to bow to investors’ demands’.
Hornby (HRN) is finally getting its mojo back, issuing a tongue-in-cheek update after its sales climbed between April and August. Hornby, which dates back to 1901, took a swipe at British politics as it said it regretted not producing a Brexit-themed model. It said: ‘Our new grasp of social media has shown us that people are passionate about sharing their views on the topic [of Brexit]. ‘If the situation persists, we have plans for a locomotive that reliably gets stuck between stations.’
Sales at Boohoo.com (BOO) surpassed £1billion over the past 12 months as the company continued to defy the retail sector gloom with an ‘outstanding’ performance. The fast fashion company posted another set of stellar results and boss John Lyttle said Boohoo was entering the second half of the year ‘well placed and confident’. Sales rose to £564.9million in the six months to the end of August, helping full-year revenues top the £1billion mark, while pre-tax profits surged to £45.2million. Lyttle said it had been a ‘fantastic’ first half of the year for the group. ‘We have delivered significant market share gains across all of our key markets, and for the first time in our history, revenue has exceeded £1billion in the last 12 months.’
Safestay (SSTY) shareholders will have enjoyed a good night’s sleep after the hostels operator reported a 24% increase in sales for the first six months of the year. Revenue jumped to £8.1 million in the first half.