12th Feb 2026 08:02
(Alliance News) - The UK economy posts modest fourth-quarter growth, while FTSE 100 asset manager Schroders agrees to a GBP9.9 billion takeover by Nuveen and British American Tobacco reports higher annual profit alongside guidance for continued growth in 2026.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: opened 0.5% higher at 10,519.02
GBP: lower at USD1.3628 (USD1.3640 at previous London equities close)
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ECONOMICS
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The UK economy grows 0.1% in the fourth quarter of 2025, matching the third quarter's expansion, according to the Office for National Statistics. On an annual basis, gross domestic product is 1.0% higher than a year earlier. For 2025 as a whole, the economy expands 1.3%, accelerating from 1.1% growth in 2024 and ahead of consensus expectations of 1.2%. Monthly data show GDP rises 0.1% in December, following 0.2% growth in November and a 0.1% fall in October. Over the quarter, production output increases 1.2%, while services show no growth and construction declines 2.1%. Real GDP per head falls 0.1% in the quarter but is up 0.6% year-on-year, and rises 1.0% for 2025 overall.
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UK industrial production falls 0.9% month-on-month in December, missing expectations for flat output and reversing a 1.1% rise in November, the Office for National Statistics says. On an annual basis, industrial production increases 0.5%. Manufacturing output declines 0.5% on the month but rises 0.5% year-on-year. Separate ONS data show the UK goods trade deficit widens to GBP22.72 billion in December, broadly in line with expectations for a GBP22.7 billion shortfall. The overall trade balance records a deficit of GBP4.34 billion, while the non-EU trade deficit totals GBP10.99 billion.
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BROKER RATINGS
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HSBC cuts BP to 'reduce' - price target 430 pence
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Jefferies cuts HgCapital Trust to 'underperform' (hold)
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COMPANIES - FTSE 100
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Schroders agrees to a recommended all-cash takeover by Pantheon LLC, a newly incorporated subsidiary of Chicago-based asset manager Nuveen, valuing the London-based fund manager, which currently has a market capitalisation of GBP7.36 billion, at up to GBP9.9 billion on a fully diluted basis. Shareholders will receive 590 pence per share in cash plus permitted dividends of up to 22p, implying a total value of up to 612p per share, a 34% premium to Wednesday's 456p closing price. The transaction is expected to become effective in the fourth quarter of 2026, subject to regulatory approvals. Schroders says its shares will cease trading in London upon completion. However, in the event of a future initial public offering of Schroders or the combined group, London would be one of the intended dual listing venues. Schroders Chair Elizabeth Corley says: "The combined goup will bring together two successful firms with shared values and highly complementary strengths to create a new global leader in public-to-private investment management. The transaction will deliver an attractive premium in cash to our shareholders, reflecting the value of our business and its future prospects. The board of Schroders is confident that this is the right step for our shareholders, clients and people."Separately, Schroders reports its 2025 earnings, with assets under management, including joint ventures and associates, rise 6% to GBP823.7 billion at December 31 from GBP778.7 billion a year earlier, as adjusted operating profit increases 25% to GBP756.6 million and statutory pretax profit climbs 21% to GBP673.8 million from GBP558.1 million.
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British American Tobacco reports higher profit in 2025 and guides revenue and earnings growth for 2026 at the lower end of its medium-term targets. Revenue declines 1.0% to GBP25.61 billion from GBP25.87 billion, though rises 2.1% at constant exchange rates. Reported pretax profit increases to GBP9.86 billion from GBP3.54 billion, while reported diluted earnings per share jump to 349.1 pence from 136.0p. Adjusted profit from operations excluding Canada rises 2.3% to GBP11.28 billion, with the adjusted operating margin flat at 44%. Smokeless products account for 18% of total revenue, up 70 basis points, as the group adds 4.7 million consumers to reach 34.1 million. The company increases its dividend 2.0% to 245.04p and plans a GBP1.3 billion share buyback in 2026, reaffirming its commitment to dividend growth in sterling terms. For 2026, British American Tobacco expects 3% to 5% revenue growth, with low double-digit growth in new categories, and 4% to 6% adjusted profit from operations growth, weighted to the second half. It sees global cigarette industry volume declining around 2% in 2026.
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Unilever and its recent spin-off Magnum Ice Cream both report 2025 results. Unilever says pretax profit rises to EUR8.69 billion from EUR8.37 billion in 2024, despite turnover slipping by 3.8% to EUR50.50 billion from EUR52.48 billion. Unilever says the revenue decline is due to net disposals and adverse currency movements. It declares a EUR0.4664 interim dividend for the fourth quarter, up 3.0% from the third quarter, and announces a EUR1.5 billion share buyback to start in the second quarter of this year. Magnum Ice Cream reports pretax profit of EUR447 million for 2025, down from EUR747 million in 2024 on flat revenue of EUR7.9 billion.
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Relx reports higher revenue and profit in 2025 and expects continued "positive momentum" in 2026. Revenue rises 2% to GBP9.59 billion from GBP9.43 billion, with underlying growth of 7%. Pretax profit increases to GBP2.75 billion from GBP2.56 billion, while reported earnings per share climb to 112.6 pence from 103.6p. Adjusted operating profit grows 4% to GBP3.34 billion from GBP3.20 billion, with underlying growth of 9%, and adjusted earnings per share rise to 128.5p from 120.1p. Relx proposes a final dividend of 48.0p per share, up from 44.8p, taking the total dividend to 67.5p from 63.0p. The London-based provider of business, scientific and legal information says it sees continued positive momentum across the business and expects another year of strong underlying revenue and adjusted operating profit growth in financial 2026. CEO Erik Engstrom says: "Relx delivered strong underlying revenue and profit growth and strong new sales in 2025: continued strong growth in Risk; good growth with improving momentum in Scientific, Technical & Medical; a further step up in growth in Legal; and strong ongoing growth in Exhibitions."
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COMPANIES - FTSE 250
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Morgan Sindall says 2025 performance is in line with current expectations and guides 2026 results ahead of expectations following a record year. The construction and regeneration group enters 2026 with a record secured orderbook and work at preferred bidder stage of GBP19.1 billion, up 17% from a year earlier. The company says profits in its Fit Out division for 2026 are now expected to be significantly ahead of expectations and above the top end of its GBP80 million to GBP100 million medium-term target range, supporting a group outlook for 2026 ahead of expectations.
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THG says its Myprotein brand agrees a licensing partnership with convenience food producer Greencore to launch a range of protein-enriched salads and wraps in Sainsbury's supermarkets and convenience stores. The collaboration expands Myprotein's offline retail presence as part of its strategy to grow its licensing footprint to 100,000 doors. THG says licensing agreements, including with Muler, Iceland and Jimmy's Coffee, drove sales of over 43 million Myprotein units into retail in 2025, and it expects to sell in more than 60 million licensed products in 2026.
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OTHER COMPANIES
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South32 reports a 29% rise in half-year profit and increases shareholder returns despite lower revenue. Profit attributable to equity holders climbs to USD464 million in the six months to December 31 from USD360 million a year earlier, while diluted earnings per share rise 29% to 10.3 US cents from 8.0 cents. Revenue from continuing operations declines 2.6% to USD2.81 billion from USD2.88 billion, though expenses excluding finance costs fall 3.4% to USD2.45 billion. The miner raises its interim dividend 15% to 3.9 cents per share from 3.4 cents and adds USD100 million to its on-market share buyback programme, with USD209 million remaining to be returned to shareholders by February 2027.
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Sanofi appoints former Merck KGaA chief executive Belen Garijo as its new CEO, effective at the conclusion of its annual general meeting on April 29, as the board decides not to renew the mandate of current CEO Paul Hudson. Hudson will step down next week after six years in the role, with Olivier Charmeil, executive vice president of General Medicines, serving as interim CEO. Sanofi says Garijo, who previously worked at the French drugmaker for 15 years, has the experience to lead the company's next growth cycle. Garijo "knows the Sanofi group very well, where she has held important positions and achieved many successes for 15 years," says Sanofi Chair Frederic Oudea. "She has the experience and profile to accelerate the pace, strengthen the quality of execution of strategy and lead the next growth cycle of the company."
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Anheuser-Busch InBev reports higher annual profit and raises its dividend despite weaker volumes in 2025. The Leuven-based brewer posts profit of USD8.50 billion, up 14% from USD7.42 billion, while basic earnings per share rise 18% to USD3.45 from USD2.92. Revenue slips 0.7% to USD59.32 billion from USD59.77 billion as total volumes decline 2.5% to 561.1 million hectolitres from 575.7 million, with beer volumes down 2.5% and non-beer volumes 3.1% lower. Normalised Ebitda increases 1.3% to USD21.22 billion from USD20.96 billion. AB InBev declares a final dividend of EUR1.00, taking the total 2025 payout to EUR1.15 per share, and says it has completed around USD635 million of its USD6 billion share buyback programme announced in October. The company expects 2026 Ebitda growth in line with its medium-term outlook of 4% to 8%.
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By Eva Castanedo, Alliance News reporter
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Related Shares:
SchrodersBritish American TobaccoRelxSouth32 LimitedThgMorgan Sindall GroupSainsbury'sGreencoreHgCapital Trust plcBP