UK's Higher Interest Rates Pressure Consumer Credit Less Than Housing

UK's Higher Interest Rates Pressure Consumer Credit Less Than Housing

1025 GMT - U.K. money and credit data suggests that, while interest rates have weighed on the housing market, they are less effective elsewhere in the economy so far, says Ashley Webb, U.K. economist at Capital Economics, in a note. The rise in monthly consumer credit eased only slightly in February, to GBP1.4 billion from GBP1.7 billion, according to the Bank of England. This means the 1.2% surge in retail sales volumes registered in the month looks like it was financed partly by increased borrowing, Webb says. However, the recent tightening in financial conditions might cause banks to restrict their credit supply, amplifying the drag on activity in the real economy, he says. (edward.frankl@wsj.com)

 
Companies News: 

Mirriad Advertising Says Numerous Companies Have Made Offers Since Start of Review

Mirriad Advertising PLC said Wednesday that a number of parties have entered early-stage discussions over a potential investment or acquisition of the company since the launch of the strategic review and formal sale process.

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Michelmersh Brick 2022 Pretax Profit Rose on Price Increases

Michelmersh Brick Holdings PLC on Wednesday posted a rise in its revenue and profit for 2022 on the back of two price increases to offset higher input costs.

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tinyBuild COO Luke Burtis Resigns; 2022 Pretax Profit, Revenue Rose

TinyBuild Inc. said Wednesday that Chief Operating Officer Luke Burtis resigned with immediate effect, and that 2022 pretax profit rose as revenue benefited from the performance of new titles and back catalogue sales.

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Next PLC Backs FY 2024 Guidance After FY 2023 Pretax Profit Beat Views

Next PLC said on Wednesday that pretax profit for fiscal 2023 rose ahead of the board's expectations and backed its guidance for fiscal 2024 as it anticipates inflation will ease.

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Up Global 1H Pretax Fall on Higher Interest Rates and Impairment Charge

Up Global Sourcing Holdings PLC said Wednesday that pretax profit fell in the first half of fiscal 2023 due to the increase in interest rates and an impairment charge, despite revenue rising driven by online sales.

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LoopUp Group Says 2022 Revenue Beat Views After PGi Connect Transaction

LoopUp Group PLC said Wednesday that it expects to report 2022 revenue ahead of market expectations, boosted in the fourth quarter by its transaction with PGi Connect.

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Artisanal Spirits 2022 Pretax Loss Narrowed on Better-Than-Expected Revenue

Artisanal Spirits Co. said Wednesday that pretax loss for 2022 narrowed on the back of better-than-expected revenue increase across its markets.

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BSF Enterprise Raises GBP2.9 Mln to Fund Organic Growth

BSF Enterprise PLC said Wednesday that it has raised 2.9 million pounds ($3.6 million) via an oversubscribed share placing and will use the money toward organic growth and for working capital.

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One Media IP Fiscal 2022 Profit Fell on Investment in Subsidiary

One Media iP Group PLC said Wednesday that revenue rose for fiscal 2022 but that profit fell as it continued to invest into its anti-piracy software subsidiary TCAT.

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Essentra 2022 Pretax Loss Widened; Launches GBP60M Buyback

Essentra PLC on Wednesday said its pretax loss widened in 2022 and launched a share buyback from the proceeds of the disposal of its filter and packaging divisions.

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Big Technologies 2022 Profit Rose Amid Growing Demand

Big Technologies PLC said Wednesday that pretax profit rose for 2022 as it saw growing demand, new contract wins and deployment of a record number of new electronic monitoring devices to customers in the criminal justice sector.

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RM PLC Swung to FY 2022 Pretax Loss on Higher Costs

RM PLC said Wednesday said that it swung to a pretax loss in fiscal 2022 due to higher costs, despite revenue rising on strong growth in its RM assessment unit.

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Medica 2022 Pretax Profit Rise On Increasing Revenue, Gross Profits

Medica Group PLC said Wednesday that its pretax profit increased thanks to rising revenue and gross profits, and that it has declared a final dividend.

 
Market Talk: 

Tesco's Margins Likely to Recover on Lower Cost Inflation -- Market Talk

1037 GMT - Tesco's margin trajectory is expected to stabilize from the second half given food-inflation dynamics in the U.K., Morgan Stanley analyst Izabel Dobreva says in a note. This means that the U.K. grocer will be able to start recovering from the margin squeeze over fiscal 2022 given that cost-of-goods-sold inflation runs below shelf-price inflation, the analyst says. On the other hand, industry data shows resilient volumes despite higher prices, Dobreva adds. In this context, Tesco's gross margins for fiscal 2023 is forecast to be 50 basis points below prepandemic levels, Dobreva adds. MS upgrades Tesco's rating to overweight from equal-weight, at a price target of 296 pence. Shares are up 3%. (michael.susin@wsj.com)

Next Looking Confident With Long-Term Prospects

0824 GMT - London-listed fashion retailer Next's big-picture outlook shows that its transition from retail stores to online is nearly over and that it is more optimistic of future growth than it has been any time in the recent past, Liberum analysts say in a note. The optimism is supported by its Total Platform opportunities, recent M&A and investments, new brands on its Label platform and further overseas opportunities, they add. Its FY 2023 results came in ahead of guidance on the back of better retail store performance and clearance rates in January, its FY 2024 has started in line with expectations, and Liberum sees Next delivering FY 2025 double-digit shareholder returns. (michael.susin@wsj.com)

Medica Should See Demand and Investments Ease Investor Concerns

0817 GMT - Medica should see strong demand and investments ease investor concerns, Liberum analysts Edward Thomason and Seb Jantet write. "Medica trades at a 20% discount to its U.K. healthcare services peers despite delivering some of the fastest growth within the group," they say. The discount is due to investor concerns in regards to a combination of Medica's ability to deliver on growth and on margins, Liberum says. On the former, the strength seen in across Medica's divisions and long-term structural tailwinds should support demand. On the latter, investments made last year should help gain scale in the U.S. and U.K. through expanded activity, Liberum says. "As management delivers against forecasts, we expect the shares to re-rate." Shares are up 4% at 155 pence. (christian.moess@wsj.com)

Up Global Could Reward Patient Investors in Long Term

0749 GMT - Up Global is a materially undervalued equity that should handsomely reward medium to long-term investors, Shore Capital analysts Clive Black and Darren Shirley write in a research note. "Up Global has the basis to deliver strong shareholder returns in our view through a combination of growth, dividends, and rating expansion," the analyst say. Sales growth of 2% in fiscal 2023 showed resilience, while flat year-on-year Ebitda with pretax profit and EPS down 5% were solid outcomes for the U.K. homeware company, given tough current market conditions, they note. Up Global is a house stock of Shore Capital and as such the U.K investment group doesn't provide recommendations on the stock. (christian.moess@wsj.com)

Sterling Could Fall Vs Euro on BOE-ECB Divergence

0737 GMT - Sterling could fall against the euro after recent gains as the European Central Bank shows more resolve to raise interest rates further than the Bank of England, ING says. ECB member Madis Muller joined the "hawkish" rhetoric of other policymakers Tuesday by signalling that there's still room to lift rates, ING analyst Francesco Pesole says in a note. "We saw EUR/GBP fall below 0.8800, but we don't expect the pair's weakness to be very sustainable as we see the market pricing for Bank of England tightening as too aggressive and policy divergence should be a primary driver for a higher EUR/GBP." EUR/GBP trades flat at 0.8787 after reaching a one-week low of 0.8770 on Tuesday, according to FactSet. (renae.dyer@wsj.com)

Contact: London NewsPlus; paul.larkins@wsj.com

(END) Dow Jones Newswires

March 29, 2023 07:10 ET (11:10 GMT)

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