Want to celebrate the weekend in style but not spend a fortune going out? Having an upscale bottle of booze at hand looks like an increasingly common compromise for many people, as Johnnie Walker maker Diageo can attest. It reported a jump in sales, with high-end brands driving two-thirds of the growth. Also uplifting in this morning’s slew of corporate news: Travel companies are seeing a surge in summer bookings.
(Bloomberg) — Want to celebrate the weekend in style but not spend a fortune going out? Having an upscale bottle of booze at hand looks like an increasingly common compromise for many people, as Johnnie Walker maker Diageo can attest. It reported a jump in sales, with high-end brands driving two-thirds of the growth. Also uplifting in this morning’s slew of corporate news: Travel companies are seeing a surge in summer bookings.
Here’s the key business news from London this morning:
In The City
Diageo Plc: The liquor giant’s sales rose more than expected in the six months to December, helped by the end of pandemic restrictions and resilience in the face of higher inflation which has stretched consumer budgets.
- Sales in the six months to December rose 9.4% organically, compared with 8% growth expected by analysts
Wizz Air Holdings Plc: The discount carrier expects business to return to pre-Covid levels by the middle of the year and for the airline to become profitable again in 2024 after narrowing its operating loss in the most recent quarter.
- “We continue to see evidence of solid fare environment as average fares are trading above 2019 and 2022 levels,” Wizz Chief Executive Officer Jozsef Varadi said. “As we reach the end of January, we are seeing booking volumes coming in ahead of 2022, which is in line with expectations”
JET2 Plc: The holiday company now expects to exceed current average market expectations and report group profit before foreign exchange revaluation and taxation for the year ending March 31 of £370m to £385m. That’s as Winter 2022/23 forward bookings continued to strengthen throughout December and January.
International Distributions Services Plc: The company expects Royal Mail’s adjusted operating loss around the mid-point of the existing £350 million to £450 million range.
- The firm said 18 days of strikes is six more than was previously anticipated in its outlook, but its outlook is in the middle of the range due to tight control of costs and strike contingency measures
In Westminster
Rishi Sunak’s cabinet will gather at the prime minister’s countryside residence of Chequers today to discuss his government’s priorities and the electoral prospects of the Conservative Party. But among those due to attend is one major distraction: Tory Chairman Nadhim Zahawi and his tax affairs.
In this week’s In the City podcast, reporter Alex Wickham discusses the damage being done to the Tory party’s popularity as a result of the scandal. As Wickham puts it, the incident “feeds into the narrative that the Tories just don’t get it during a cost of living crisis.” You can listen here:
Meanwhile, many UK social-care workers are unlawfully paid less than the minimum wage once their travel costs are included and would earn more at supermarkets Aldi and Lidl, a new report found.
In Case You Missed It
Business confidence in Britain has sunk to its lowest level since the global financial crisis, according to a survey of accountants, amid persistently high inflation and fears that the country is already in a recession.
That’s as automakers had their worst year in the UK in more than six decades after the global semiconductor shortage and the closing of key factories hammered output.
US investment firm MSP Sports Capital is considering a potential investment in Everton Football Club, people with knowledge of the matter told Bloomberg.
Finally, Lloyds Banking Group Plc is getting behind a startup making car ownership less of a hassle, particularly in city centres, where failing to keep up with all manner of taxes and tolls can lead to big fines.
Looking Ahead
Buy-to-let mortgage lender Paragon Banking Group Plc’s trading update tomorrow will be in focus for any signs of stress that falling house prices may cause for landlords and their ability to keep rental yields above funding costs. Keefe Bruyette & Woods analyst Edward Firth downgraded Paragon’s stock earlier this month, saying shares would trade at a “counterintuitive” premium to other British banks.
For a more considered take on the UK’s economic and financial news, sign up to Money Distilled with John Stepek.
(Corrects spelling of “Johnnie Walker” in headline.)
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