Tullow Oil profits double, Bakkavor warns of tough year

London open

The FTSE 100 is expected to open 21 points lower on Wednesday, having closed down 0.13% on Tuesday at 7,919.48.

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Tullow Oil annual profits almost doubled as the company cashed in on higher oil and gas prices sparked by the war in Ukraine. Gross profit for 2022 almost doubled to $1.08bn, on a 40% rise in revenue to £1.78bn with group production in line with guidance. Free cash flow rose to $267m from $245m and net debt fell to $1.9bn from $2.1bn.

Fresh food company Bakkavor warned of a tough year ahead as 2022 profits slumped by 78% due to inflation, higher costs and changing consumer habits amid the cost of living crisis. The company on Wednesday said pre-tax profit fell to £18m, despite a 10% rise in like-for-like revenue to £2.06bn. It also announced the closure of two UK sites in an effort to cut soaring costs.

Newspaper round-up

The RMT union has called off a strike at Network Rail next week, fuelling hopes of a significant breakthrough in the long-running dispute. The union said it was suspending the strike planned for Thursday 16 March and all other industrial action, which was to include an overtime ban, after it received a fresh offer from Network Rail. – Guardian

Jeremy Hunt’s tax raid on airlines means passengers will have to pay higher air fares, bosses have warned. British Airways, Virgin Atlantic, Ryanair and easyJet are among a coalition of airlines urging the Chancellor not to increase air passenger duty (APD) in line with the retail prices index (RPI) next month. – Telegraph

Mortgaged homeowners in the UK are more at risk of falling into arrears than in any other major developed country, a leading credit ratings agency has warned. The share of homeowners missing more than three months of mortgage payments will double in 2023 to 1.5pc as high rates hit borrowers, according to Fitch Ratings. Based on the current number of residential mortgages in the UK, this means 135,000 households will be in arrears. – Telegraph

John Lewis is running into resistance over its first build-to-rent project, with the leader of the local council accusing the retailer of “bullying” and raising concerns about the height of its planned tower blocks and the lack of affordable housing. The trailblazing plan to build 430 flats in towers up to 19 storeys high in the west London suburb of Ealing above a Waitrose supermarket is already months behind schedule, according to local residents. – The Times

US close

Wall Street stocks headed south on Tuesday as market participants digested testimony from Federal Reserve chairman Jerome Powell.

At the close, the Dow Jones Industrial Average was down 1.72% at 32,856.46, while the S&P 500 slipped 1.53% to 3,986.37 and the Nasdaq Composite saw out the session 1.25% firmer at 11,530.33.

The Dow closed 574.98 points lower on Tuesday, easily erasing gains recorded in the previous session.

Investors zeroed in on congressional testimony from Powell on Tuesday, with the head of the Federal Reserve keeping the door open to larger rate hikes, if needed, while pointing out that recent economic data had been stronger than expected. In remarks prepared for his speech before the US Senate's Banking Committee, Jerome Powell, conceded that warmer weather had played a hand in recent stronger readings for employment, consumption and inflation.