25th Jul 2025 07:57
(Alliance News) - London stocks are called higher on Friday, as a UK retail data reading shows a rise in sales in June that fell short of expectations.
In early corporate news, NatWest posts a nearly 20% rise in half-year profit, plus a 58% increase to its dividend payout, and Close Brothers agrees the sale of its execution services and securities business, Winterflood Securities, for nearly GBP104 million.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called up 0.1% at 9,143.47
GBP: down at USD1.3491 (USD1.3571 at previous London equities close)
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ECONOMICS
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UK retail sales improved in June following record-setting warm weather but fell short of expectations, the Office for National Statistics reported on Friday. Total retail sales volumes rose 0.9% in June, compared to a fall of 2.8% in May, the latter downwardly revised from a decline of 2.7%. Sales fell short of an FXStreet-cited consensus for a 1.2% rise, however. Sales volumes were 1.7% higher over the year to the end of June, and were up 0.2% on-quarter for the three months to the end of June. Food stores sales increased 0.7% in June after a 5.4% fall in May. This was driven by improved supermarkets sales volumes as warm weather drove higher drinks sales. The ONS noted that England had its warmest June on record this year, according to the Met Office climate summaries, and the second warmest for the UK as a whole. Non-food stores sales rose 0.2% from the month before, as promotions and good weather drove up sales for department stores and clothing retailers, but this was offset by lower footfall at household goods stores and other non-food retailers such as auction houses.
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BROKER RATINGS
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UBS raises Howden Joinery price target to 940 (870) pence - 'neutral'
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Barclays raises Wizz Air to 'overweight' - price target 1,500 pence
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Berenberg cuts Treatt price target to 250 (440) pence - 'buy'
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COMPANIES - FTSE 100
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NatWest reports GBP3.59 billion in operating pretax profit for the six months that ended June 30, rising 18% from GBP3.03 billion the year before. Net interest income grows 13% to GBP6.12 billion from GBP5.41 billion, while non-interest income improves 8.1% to GBP1.87 billion from GBP1.73 billion. Net interest margin is 2.28%, improved on-year from 2.07%. The bank says its return on tangible equity for the six-month period is 18.1% against 16.4% the year before. Climate and sustainable funding and financing increases 3.7% to GBP16.9 billion from GBP16.3 billion. NatWest declares an interim dividend of 9.5 pence per share, up 58% on-year from 6p, and intends to launch a share buyback for GBP750 million in the second half of 2025. "With positive momentum in our business, we are ambitious for the future and see clear opportunities for further disciplined growth," says Chief Executive Officer Paul Thwaite. "This is complemented by our focus on bank-wide simplification, as we quietly revolutionise how we operate, enhancing our tech and AI capabilities in order to better meet and anticipate the evolving needs of our customers. Having returned to full private ownership in Q2 2025, NatWest Group is well placed to step up and play its part in supporting economic growth across the UK and, in doing so, to create sustainable value for all our stakeholders." For 2025, NatWest anticipates a return on tangible equity of more than 16.5%, and continues to target a CET1 ratio between 13% and 14%. Its first-half CET1 ratio was 13.6% in the first half of 2025, versus 13.8% in the first half of 2024.
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Rightmove says pretax profit rises 10% on-year to GBP146.5 million from GBP132.7 million in the six months that ended June 30, on 10% revenue growth to GBP211.7 million from GBP192.1 million. The online property portal provider declares an interim dividend of 4.05 pence per share, up 9.5% from 3.70p the year before. Average revenue per advertiser increases to GBP1,609 in the six-month period from GBP1,497 a year earlier. "These results highlight the strength of our platform and how we serve our long-term partners with products tailored to their circumstances and needs," says Chief Executive Officer Johan Svanstrom. "Against a backdrop of a positive market for agents, we have seen an increase in agent formation and estate agents using our top package, Optimiser Edge, which helps maximise their performance. Developers of new builds are turning to marketing products including our new Ascend package to help compete for buyers when the ratio of new builds to resale stock is at a post-COVID low." Looking ahead, Rightmove continues to expect revenue growth between 8% and 10% for 2025, as well as around 1% growth in membership and average revenue per advertiser growth of GBP95 to GBP105 across Estate Agency and New Homes developers. The firm expects to see ongoing revenue growth in its second half, but anticipates the on-year percentage growth figure to be lower than in the first half. Rightmove expects a full-year operating margin of 70%.
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COMPANIES - FTSE 250
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Close Brothers Group agrees to sell its execution services and securities business, Winterflood Securities, to Marex Group for a total of around GBP103.9 million in cash. The deal is expected to complete in early 2026 and is subject to regulatory approval. "This transaction marks another important step in simplifying the group to focus on our core specialist lending business, following the sale of [Close Brothers Asset Management] in February 2025," says Close Brothers Chief Executive Officer Mike Morgan. Upon completion, the firm expects the disposal to benefit its CET1 ration by around 30 basis points, increasing to around 14.3% from 14.0%. This is based on a tangible net asset value of GBP88.9 million and assumes an immediate reduction in market and credit risk weighted assets associated with Winterflood. Close Brothers anticipates further CET1 ratio benefits of up to around 25 basis points from a reduction in operational risk RWAs currently associated with Winterflood "in due course". A goodwill impairment loss of roughly GBP15 million is expected in the company's 2025 financial statements.
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OTHER COMPANIES
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John Wood says subsidiary JWG Investments agrees to dispose of its 50% interest in RWG Repair & Overhauls, which provides repair and overhaul services to operators of industrial aero-derivative gas turbines in the oil and gas, power generation and marine propulsion industries. Its stake will be sold to Siemens Energy Global, a subsidiary of Siemens Energy and John Wood's joint venture partner, for a total of USD135 million in cash. The deal is expected to close in late 2025 or early 2026, and proceeds will be used by John Wood to reduce net debt. John Wood Chief Executive Officer Ken Gilmartin calls the sale a "significant milestone", adding: "As previously announced, our disposal programme of non-core businesses is part of our strategy to simplify Wood and help mitigate the impact of negative free cash flow in the year. The sale will also ensure continuity for the employees and customers of RWG." John Wood announced in mid-February it would target USD150 million to USD200 million in disposal proceeds in 2025. The firm has to date agreed the sale of US civil construction services business Kelchner for around USD30 million, has disposed of its 51% stake in EthosEnergy and has sold CEC Controls Co.
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By Emily Parsons, Alliance News reporter
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Related Shares:
Howden JoineryWizz AirTreattNatwestClose BrosWood Group (J)Rightmove