Berkeley anticipates further decline in profits, AstraZeneca announces three new drug approvals
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The FTSE 100 is expected to open seven points higher on Wednesday at 7,450.
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Berkeley Group posted a 20.7% decline in full-year pre-tax profits to reach £775.2m, which was nevertheless at the top end of market expectations, leaving it 18% ahead of its December 2016 plans for £3.0bn of profits for the five years ending on 30 April, despite the "extended macro and political uncertainty". For the year ahead, the luxury homebuilder guided towards a one third drop in pre-tax profits versus 2018/19, with return on equity anticipated to settle at about 15% thereafter. The company's net cash position at period end stood at £975.0m, which was 42% higher than a year before, although cash due on forward sales fell by roughly 18% to £1.8bn. The full-year dividend payout declined by £93.7m to £53.0m with the company opting instead to increase its share buybacks by £58.5m to £198.9m.
First quarter like-for-like revenue per available room at Whitbread's Premier Inn division fell 6% as Brexit concerns and cost inflation continued to weigh. The food and hotel company, which last year sold the Costa coffee chain to Coca-Cola for £3.9bn, said total UK like-for-like sales were 3.7% lower. "The weaker business and leisure confidence has continued, as referenced at the start of the year, coinciding with ongoing political and economic uncertainty in the UK. This has impacted domestic hotel demand, particularly in the regional business market, where most Premier Inn hotels are located," the company said in a trading update.
AstraZeneca announced three new drug approvals in Japan on Wednesday, first confirming that ‘Breztri Aerosphere’ (budesonide/glycopyrronium/ formoterol fumarate) has been approved there as a triple-combination therapy to relieve symptoms of chronic obstructive pulmonary disease (COPD). The FTSE 100 pharmaceuticals giant also said that ‘Lynparza’ (olaparib) had been approved as a maintenance treatment after first-line chemotherapy in patients with BRCA-mutated (BRCAm) advanced ovarian cancer, and that ‘Bevespi Aerosphere’ (glycopyrronium/formoterol fumarate) was approved as a fixed-dose, long-acting dual bronchodilator to relieve symptoms in patients with COPD.
In the press
Jeremy Corbyn will back a move today for Labour to change its Brexit policy and support a second referendum in all circumstances. The shadow cabinet is due to discuss the plan to make Labour’s stance decisively pro-Remain. A paper drawn up by Andrew Fisher, Mr Corbyn’s head of policy, recommends that Labour support a second referendum on any deal negotiated with Brussels. A senior Labour source confirmed that Mr Corbyn was endorsing the shift in policy, adding: “It is a moment.” - The Times
Boris Johnson softened his Brexit stance and backed away from tax cuts for high earners as he faced his first sustained scrutiny of the Tory leadership race. The frontrunner failed to guarantee that he would leave the European Union on October 31 and downgraded his tax plans to an “ambition”. Mr Johnson also refused to say that he would stop the Heathrow expansion as he and the four other remaining candidates took part in a BBC debate last night. - The Times
The re-election of Donald Trump as president for a further four years threatens to subvert America's institutional structure and reduce the country to a third world state, a revered veteran of the US Federal Reserve has warned. Stanley Fischer, the Fed’s former vice-chairman, said Mr Trump’s constant attacks on the central bank break a century-long taboo in American political culture and may become unstoppable if he wins a second term. “It will destroy the independence of the Fed,” he said. - The Daily Telegraph
US close
Stocks on Wall Street finished sharply higher on Tuesday after Donald Trump and his Chinese counterpart Xi Jinping said that they would meet at this month's G-20 leaders' summit, catching traders - whose attention had been locked on the Federal Reserve as policymakers began a two-day meeting - on the hop.
By the end of trading, the Dow Jones Industrial Average was up 1.35% at 26,465.54, while the S&P 500 was 0.97% firmer at 2,917.75 and the Nasdaq Composite ended the session 1.39% stronger at 7,953.88.
Shares surged from the get go, with the Dow opening 295 points higher after Donald Trump revealed that he had just gotten off a "very good telephone conversation" with President Xi Jinping of China.