A rebound in travel demand and passengers’ tendency to choose lower fares amid a cost-of-living squeeze seems to be helping discount specialist EasyJet. The airline said this morning it’s seeing strong bookings into the crucial summer period. Pharmaceutical giant GSK, meanwhile, announced a $2 billion all-cash deal for a Canadian biotech firm that will give it access to a promising cough drug.
(Bloomberg) — A rebound in travel demand and passengers’ tendency to choose lower fares amid a cost-of-living squeeze seems to be helping discount specialist EasyJet. The airline said this morning it’s seeing strong bookings into the crucial summer period. Pharmaceutical giant GSK, meanwhile, announced a $2 billion all-cash deal for a Canadian biotech firm that will give it access to a promising cough drug.
Here’s the key business news from London this morning:
In The City
EasyJet Plc: The airline said bookings remain strong into the coming months, prompting the company to upgrade its earnings target for a second time this year.
- The discount specialist now expects to beat revised market expectations that foresee a pretax profit of £260 million this year, according to trading update. That’s up from a previous goal of beating pretax profit expectations of £126 million
- Discount carriers including EasyJet and bigger rival Ryanair Holdings Plc are benefiting from a combination of rebounding demand for summer travel alongside travelers trading down during the cost-of-living squeeze
GSK Plc: The pharmaceutical powerhouse agreed to buy Canada’s Bellus Health Inc. for about $2 billion to bolster its pipeline of experimental medicines.
- The takeover will bring GSK a drug candidate to treat chronic cough that’s shown promising results in clinical trials and has advanced through much of the research process
THG Plc: The online retailer, the target of fresh takeover interest, expects revenue growth to slow this year as it completes a three-year investment program.
- THG also said it’s forging ahead with plans to move its listing to London’s premium market later this year after pressure from an activist investor
- The shares soared 45% on Monday after THG said it had received a non-binding takeover proposal from Apollo Global Management Inc.
Labour Market: UK wage growth accelerated unexpectedly in the three months through February, adding to inflationary pressures that are concerning the Bank of England.
- Average earnings excluding bonuses rose 6.6% compared with the year-earlier period, the Office for National Statistics said
In Westminster
The government’s plans to corral retirement savings to fund domestic investment are “misguided and dangerous,” writes Bloomberg Opinion columnist Stuart Trow. Chancellor Jeremy Hunt’s idea is that by consolidating pension savings into fewer, larger funds, costs can be lowered and returns will be higher. “The problem is that the evidence for both claims is thin,” Trow says.
Meanwhile, Margaret Thatcher’s adviser on money supply — Tim Congdon — said the Bank of England is making an error in identifying the war in Ukraine as one of the main drivers of inflation and that the UK is headed for a recession as a result.
In Case You Missed It
“Will Apollo offer THG a way out of its troubles?” Bloomberg Opinion’s Andrea Felsted takes a closer look at how the retailer could benefit from going private.
One of Justin Trudeau’s senior cabinet ministers said the Canadian government is monitoring Glencore Plc’s attempted takeover of Teck Resources Ltd., pointing out that the country benefits from having the headquarters of major companies. Teck shares surged on Monday, exceeding Glencore’s per-share takeover offer price for the first time, as other major mining companies show interest in acquiring the Canadian firm’s metals operations.
Looking Ahead
Tomorrow morning will see an update from miner Antofagasta Plc. On the macro front, Britain’s latest inflation data for March will be closely watched for signs that the unexpected rise in February’s headline inflation rate was a temporary blip, according to Bloomberg Economics.
For a more considered take on the UK’s economic and financial news, sign up to Money Distilled with John Stepek.
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