19th Dec 2025 07:55
(Alliance News) - Next has outlined plans for a shareholder return, WH Smith says it has a lot to do to "rebuild confidence", while Applied Nutrition has struck an out-licensing with grocer Morrisons.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called down 0.3% at 9,804.67
GBP: lower at USD1.3368 (USD1.3387 at previous London equities close)
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ECONOMICS
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UK public sector borrowing was higher than expected last month, but shrunk on year, numbers showed. According to the Office for National Statistics, net borrowing amounted to GBP11.65 billion in November, falling from GBP13.55 billion a year prior and GBP21.19 billion in October. It was the lowest November borrowing figure since 2021, the ONS said. However, it topped an FXStreet cited forecast of GBP10.2 billion. Borrowing in the financial year to-date totalled GBP132.3 billion, up 8.2% over the same eight-month period a year prior. It is the second-chunkiest borrowing figure for that stretch, topped only by 2020.
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UK retail sales were weaker than expected in November, numbers showed, declining on-month and registering tamer on-year growth than forecast. The Office for National Statistics said retail sales volumes shrunk 0.1% in November from October on a seasonally-adjusted basis, shy of an FXStreet cited forecast for a 0.4% rise. "Non-store retailers' volumes dipped as demand for gold slowed, while supermarkets fell for the fourth consecutive month," the ONS said. In October, sales fell 0.9%, an outcome upwardly revised from an initially reported 1.1% decline. On-year, retail sales increased 0.6% in November, matching October's growth. However, a rise of 0.9% had been forecast.
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The UK needs to be prepared for people to be "displaced from jobs" due to the rise of artificial intelligence, AI, the governor of the Bank of England has said. In an interview with BBC Radio 4's Today programme, Andrew Bailey said the widespread adoption of AI could have a similar impact on the job market to the industrial revolution, when there were concerns over the impact of technology on populations. "As you saw in the industrial revolution, now over time, I think we can now sort of look back and say it didn't cause mass unemployment, but it did displace people from jobs and this is important," Bailey said. "My guess would be that it's most likely that AI may well have a similar effect. So we need to be prepared for that, in a sense."
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BROKER RATINGS
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Barclays raises Jet2 price target to 2,125 (2,080) pence - 'overweight'
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COMPANIES - FTSE 100
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Retailer Next has proposed a shareholder return of GBP421.3 million. The clothing and homeware seller says this will be conducted through a B share scheme of 360 pence per share. "We have spent time considering a number of potential methods for returning capital to shareholders and have concluded that a B share scheme would be the most effective method for doing so, rather than a special dividend. In reaching this conclusion, the board considered in particular the position of both retail and institutional shareholders and the benefits of completing a capital return within a reasonable timescale," it adds. The return needs shareholder approval at a general meeting to occur on January 15.
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COMPANIES - FTSE 250
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WH Smith says annual profit weakened markedly, as the retailer suffered a "difficult end to the year". Interim Chief Executive Andrew Harrison says the firm is "acutely aware that we have much to do to rebuild confidence" in the wake of a damning review which found "shortcomings" in accounting treatments in its North American division. In the year to August 31, pretax profit from continuing operations slumped 97% to GP2 million from GBP65 million a year prior, WH Smith says. Trading profit weakened 4.9% to GBP173 million from GBP182 million. Before non-underlying items, pretax profit fell 3.8% to GBP102 million from GBP106 million. Revenue, however, improved 5.4% to GBP1.55 billion from GBP1.47 billion. In the final 13 weeks of the year, like-for-like revenue grew 3%. This sales trend has continued into the first 15 weeks of the new year, the firm says. For the new year, it expects total revenue growth between 4% and 6% and pretax profit before non-underlying items between GBP100 million and GBP115 million. Last month, WH Smith said Carl Cowling resigned as CEO after the probe. WH Smith instructed Deloitte to undertake the review back in August after an internal investigation found profit had been overstated. WH Smith said Deloitte's review found the accounting treatment for supplier income adopted by the North America division was not consistent with the group's accounting policy and not consistent with the requirements of the relevant accounting standards. Deloitte blamed a "target-driven performance culture" and "decentralised divisional structure combined with a limited level of group oversight of the finance processes in North America" for the issues. "We are acting at pace progressing our remediation plan and are committed to ensuring that we strengthen our financial controls and governance as we move forward," Harrison says. "Following the sale of our UK High Street business and Funky Pigeon during the year, we are now a pure-play global travel retailer. Travel retail is a high growth market, and we have attractive market positions in the UK, North America and our international markets from which we are well-positioned to grow." WH Smith says it has proposed a 6.0p per share final dividend, cut from 22.6p a year earlier. Its final dividend has been reduced to 17.3p from 33.6p.
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OTHER COMPANIES
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Applied Nutrition says it has penned its first out-licensing deal. The deal has been struck with grocer Morrisons, which will "formulate, produce and sell Applied Nutrition branded meals and food products". The sports nutrition brand says this will initially involve launch of 53 products in around 400 Morrisons stores from January. The plans it to launch more products later in the year. "The high-protein, product range will include balanced ready-meals, food-to-go sandwiches and salads, breads and cheeses. The range will include the UK's first supermarket exclusive range of GLP-1 friendly ready meals," Applied Nutrition says. "This licensing agreement requires no capital expenditure, supports the company's strategy to increase brand awareness, product range and distribution, which aligns with the vision of becoming the world's most trusted and innovative sports nutrition, health and wellness brand." Applied Nutrition is to join the FTSE 250 index from Monday, replacing outgoing PRS REIT.
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Bar operator Revel Collective says "a number of credible parties" are in talks with the firm, but it warns any deal is unlikely to return any value to shareholders. The operator of the Revolution bar brand says it has "engaged with a significant number of potential acquirers of the businesses it operates". "Presently, a number of credible parties are actively engaged in diligence and discussions with the group in relation to the group's business and assets or the shares in certain group companies. At the current time, the transactions being contemplated would not be expected to deliver any return to shareholders. Negotiations are ongoing, with the continuing support of the group's bank, however, there can be no certainty on the timing of any transactions. Furthermore, there can be no guarantee that these negotiations will result in any transactions," Revel adds. Revel says the option of an equity fundraise was considered, though it does not have "the necessary support" for one. Annual results for the year that ended June 28 will not be published by December 28, it adds, so trading of its shares will be suspended before the end of the year.
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Strix Group says it has struck a deal to sell its Billi business for GBP110.0 million. The supplier of kettle safety controls and other devices for water heating and temperature control, steam management, and water filtration says Billi includes Strix Australia and each regional subsidiary. The buyer is Birmingham Bidco, an Australian firm incorporated by Crescent Capital Partners, the manager of the private equity fund known as Crescent Capital Partners VII. Crescent Capital Partners is a Sydney-based private equity and alternative asset management firm. Strix adds: "As previously announced, the group has encountered certain macroeconomic and geopolitical headwinds, particularly within its Controls division, owing in part to indirect tariff impacts and a weakening US dollar. This has led to lower than anticipated trading, a weakened financial performance and an increase in the group's net debt leverage position. In order to mitigate the impact of this, the group has already initiated a number of key actions to enhance working capital efficiency and maintain careful control of operational and capital expenditure. In connection with this, the Board has also been considering a number of more permanent strategic options to help enhance the financial position of the group."
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By Eric Cunha, Alliance News news editor
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Jet2Applied NutriThe Revel CollectiveWh SmithNextStrix