21st Oct 2025 07:54
(Alliance News) - UK government borrowing climbed in September as higher debt costs and spending weighed on the public finances, while Coca-Cola HBC unveiled a USD2.6 billion deal to buy Coca-Cola Beverages Africa to expand its presence in high-growth markets.
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 0.2% at 9,420.57
GBP: lower at USD1.3415 (USD1.3424 at previous London equities close)
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ECONOMICS
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UK government borrowing rose in September to its highest level for that month in five years, as higher debt interest payments and increased departmental spending weighed on the public finances, the Office for National Statistics says. Public sector net borrowing, excluding banks, totalled GBP20.2 billion, up GBP1.6 billion, or 8.6%, from a year earlier. The figure was below the FXStreet-cited consensus of GBP20.5 billion but slightly above the Office for Budget Responsibility's March forecast of GBP20.1 billion. For the financial year to September, borrowing reached GBP99.8 billion, up GBP11.5 billion, or 13%, from a year earlier and the second-highest April-to-September total since records began in 1993. The current budget deficit rose 21% to GBP13.4 billion, while debt interest costs jumped GBP3.8 billion to GBP9.7 billion due to higher inflation-linked gilt payments. Central government spending increased 9.8% to GBP90.6 billion, reflecting higher pay and inflation-related costs, as well as increased benefit and pension payments.
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BROKER RATINGS
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JPMorgan raises Smiths Group price target to 2820 (2700) pence - 'overweight'
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Deutsche Bank Research Cuts B&M price target to 250 (340) pence - 'buy'
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COMPANIES - FTSE 100
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Coca-Cola HBC agrees to acquire a 75% stake in Coca-Cola Beverages Africa from Coca-Cola Co and Gutsche Family Investments for USD2.6 billion, creating the world's second-largest Coca-Cola bottling partner by volume. Completion is targeted by the end of 2026, and the company plans a secondary listing on the Johannesburg Stock Exchange to strengthen its presence in Africa. Coca-Cola HBC says the acquisition will enhance shareholder value, with expected low-single-digit earnings per share accretion from the first full year after completion. In a separate trading update, the company reports third-quarter organic revenue growth of 5.0%, bringing year-to-date growth to 8.1%. Growth was driven by a 1.1% rise in volumes and a 3.8% increase in revenue per case, led by strong performances in Nigeria and Egypt. Coca-Cola HBC reiterates its 2025 guidance for organic revenue and Ebit growth at the top end of its 6% to 8% and 7% to 11% ranges, respectively.
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Unilever revises the timetable for the planned demerger of Magnum Ice Cream Co due to the ongoing US federal government shutdown. The company says preparatory work remains on track and it still expects to complete the separation in 2025. The delay stems from the US Securities & Exchange Commission being unable to declare effective the registration statement required for Magnum shares to be listed on the New York Stock Exchange. Unilever says its shareholder meeting to vote on a related share consolidation will proceed as planned, though the implementation timeline will also be adjusted.
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Segro reports a strong third quarter, with improving occupier sentiment driving GBP22 million of new headline rent signed, taking the total for the year to date to GBP53 million. The property developer says it achieved its most productive quarter of pre-lettings since early 2024, signing GBP7 million of new deals. Chief Executive David Sleath says the group is seeing "momentum building" across its development programme and a "significant value creation opportunity" in its growing data centre pipeline. Occupancy stood at 94% and customer retention at 86%, while rent reviews delivered a 37% uplift year-to-date. Segro expects development capital expenditure of around GBP400 million for 2025.
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COMPANIES - FTSE 250
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NCC Group says its strategic review of operations could lead to a sale of the entire company. The cybersecurity and software escrow firm says it continues to assess a potential sale of its Escode division and has also begun reviewing options for its Cyber Security business. The review includes the possibility of offers for the whole group, though no decisions have been made. Regardless of the Escode outcome, NCC plans to launch a share buyback programme after December 11. For the year ended September 30, NCC expects adjusted Ebitda of around GBP43.5 million, in line with board expectations, and revenue down 2.5% at constant currency to about GBP294 million. Escode revenue rose 2%, while Cyber Security fell 4%. Net cash at year-end is expected to be around GBP13 million, ahead of expectations.
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OTHER COMPANIES
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AB Dynamics promotes current Chief Financial Officer Sarah Matthews-DeMers to chief executive officer, effective December 1. Matthews-DeMers, who has been part of the leadership team for six years, succeeds James Routh, who will step down from the board on November 30 and remain with the group until year-end to ensure a smooth transition. Chair Dick Elsy says Matthews-DeMers was the "standout candidate" to lead the company's next growth phase under its value creation plan. AB Dynamics has begun the search for a new CFO, with the finance team continuing to report to Matthews-DeMers in the interim.
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Savannah Resources says a Portuguese court has dismissed another legal claim related to its Barroso lithium project, confirming the validity of the 2016 mine concession agreement. The case, filed by the Parish Council of Covas do Barroso against the Ministry of Environment, aimed to annul the concession but was rejected by the Administrative & Tax Court of Mirandela. Savannah notes this marks the eighth consecutive favourable ruling for the project, which is designated a strategic project under the European Critical Raw Materials Act. Four legal cases remain ongoing, though none are expected to affect project progress. Chief Executive Officer Emanuel Proenca says the ruling reinforces the "strong legal framework" supporting the project.
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London & Associated Properties plans to delist from the London Stock Exchange, citing low liquidity and high regulatory costs relative to its size. The property investor and manager says maintaining its listing is no longer justified, with expected annual savings of around GBP350,000. The delisting will take effect on November 19, with the final trading day on November 18. Afterward, its shares will trade via a matched bargain facility on JP Jenkins.
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By Eva Castanedo, Alliance News reporter
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Related Shares:
Coca-Cola HBCUnileverSegroNccAB DynamicsSavannah ResourcesSmiths GroupB&MLondon & Associated Properties