Pearson holds dividend steady, Standard Life revenue rises
London open
The FTSE 100 is expected to open three points lower on Friday, after closing down 0.42% at 7,271.37 on Thursday.
Stocks to watch
Micro Focus reconfirmed that it did not expect to grow revenue in its current financial year, while also noting overnight results showed HPE Software saw revenues fall but profits margins improve ahead of their agreed merger. The company said for the full year ending 30 April revenue for the group was likely to decline by 0-2%, while noting the strengthening of the dollar had resulted in a reduction in pro forma numbers from the previous year.
Publishing company Pearson, which delivered a profit warning in January, held its dividend steady as full year pre-tax losses widened to £2.5bn from £433m in 2015. Sales fell 8% to £4.5bn in underlying terms. Adjusted operating profit of £635m was down 21% in underlying terms due to weaker revenues, the partial reinstatement of incentives and “other operational factors”, Pearson said.
Standard Life’s revenue for 2016 grew “against a backdrop of volatile investment markets” as the insurer aims to increase its exposure to the Indian market through the acquisition of Max Life. Fee based revenue rose 5% in 2016 to £1.65bn, which accounts for 95% of Standard Life’s total income, compared to the previous year, with growth channels revenue up 10% to £1.2bn and the average revenue yield maintained at 59 basis points.
Bookmaker William Hill posted its final results for the year to 27 December on Friday, with group net revenue up 1% to £1.6bn. The FTSE 250 company said its adjusted operating profit was £261.5m, in line with revised guidance, with adjusted earnings per share falling 10% to 22.3p. Its full-year dividend was maintained at 12.5p per share, which the board said reflected the group's continued strong cash flow and its confidence in delivery of strategic priorities and future growth.
Newspaper round-up
Boeing plans to open its first manufacturing plant in Britain, picking Sheffield to make critical parts for its best-selling 737 and 777 airliners. The company has earmarked the Northern city for a £20m investment where it will produce complex parts for “actuators” which move flaps on the jets’ wings. The decision is notable as the US aerospace giant is bringing work in-house, rather than subcontracting it out to the supply chain as is common. – Telegraph
Budget airline Ryanair has urged the Government to secure agreements which mimic those allowing barrier-free travel between the UK and EU. The Irish carrier said it transports roughly 40pc of the approximately 25.3 million European tourists who come to the UK from the continent and it would be crucial for the Government to ensure agreements in place now, which allow carriers to freely fly between the UK and mainland Europe, were replicated entirely by the time the country exits the bloc. – Telegraph
The government is under growing pressure to overhaul the business rates system rather than just offer help for small firms affected by the revaluation of properties. Theresa May, the prime minister, and Sajid Javid, the communities secretary, told parliament on Wednesday that small businesses facing a sharp increase in their business rates bill from April could receive support in the budget next month. However, business leaders and MPs are now pushing the chancellor for a wider review of the controversial tax. – Guardian
John Lewis is to axe nearly 800 jobs in its customer restaurants and store administration in its biggest ever round of redundancies. The department store chain said it was consulting 773 people about redundancy as it attempts to cut costs and become more efficient. The cuts are the first sign of change since the department store’s managing director, Paula Nickolds, took the helm in late January. – Guardian
A Eurosceptic coalition of City grandees is calling on Theresa May and Mark Carney to put the planned £24 billion merger of the London Stock Exchange and Deutsche Börse on hold for two years. They claim it would be destabilising for the deal to take place while Britain negotiates its departure from the EU. – The Times
President Trump’s promise to quickly introduce a “phenomenal” package of tax cuts is likely to face delays, the new US Treasury secretary suggested yesterday. Steven Mnuchin said that the White House was working with Republican leaders in the House and Senate to push through “very significant” tax legislation before August. – The Times
US close
US shares ended the session on Thursday in mixed fashion with the Dow Jones Industrial Average delivering its 10th straight record close while the Nasdaq declined again.
The S&P 500 finished up 0.99 points at 2,363.81. The Dow Jones rose 34.7 points, to 20,810.3, and the Nasdaq composite fell 25.1 to 5,835.5.
Nvidia Corp and Tesla both weighed heavily on the Nasdaq, falling 9% and 6.4% respectively.