12th Nov 2021 07:58
(Alliance News) - Large-cap stocks in London are seen opening lower on a quiet Friday morning amid fresh worries about increasing consumer prices.
IG futures indicate the FTSE 100 index is to open 13.38 points lower, or 0.2%, at 7,370.80. The blue-chip index closed up 44.03 points, or 0.6%, at 7,384.18 on Thursday.
Most businesses in the UK are increasing their prices amid "acute" staff shortages and the rising cost of fuel and energy, research suggests. A survey of 1,000 firms showed that four out of five increased the price of their goods or services in the past year.
The British Chambers of Commerce said its study indicated that nine out of 10 manufacturers and three quarters of UK businesses with more than 50 employees had a shortage of skilled workers in their own business or those in their supply chain. HGV drivers, engineers, warehouse staff, accountants, chefs and IT technicians were among the skilled staff said to be in short supply.
Many respondents cited the increased cost of vehicle fuel, shipping containers and utilities such as gas or electricity
In early UK company news, drug maker AstraZeneca reported total revenue in the year to date - including Alexion Pharmaceuticals Inc - was USD25.41 billion, up 32% year-on-year. On a constant currency basis, revenue grew by 28% in the nine months to September 30. Total revenue in the third quarter alone increased by 50% to USD9.87 billion.
Astra noted that the Alexion integration is progressing well, creating new opportunities in rare diseases. Astra bought Alexion, a Boston, Massachusetts-based biotech firm, in July for USD13.3 billion in cash and 236.3 million new AstraZeneca shares. Revenue includes Alexion from July 21 onward.
Excluding Astra's Covid-19 vaccine, total revenue increase 21% or 17% at constant exchange rates, in the year to date, to USD23.19 billion, and by 34% in the third quarter to USD8.82 billion.
"Our broad portfolio of medicines and diversified geographic exposure provides a robust platform for long-term sustainable growth. Following accelerated investment in upcoming launches after positive data flow, we expect a solid finish to the year and our earnings guidance is unchanged," said Chief Executive Pascal Soriot.
For all of 2021, Astra said it expects total revenue excluding the Covid-19 vaccine to grow by a low-twenties percentage. Including vaccine revenue in the final quarter of 2021, revenue is expected to grow by a mid-to-high-twenties percentage.
Annual guidance for core earnings per share was kept at USD5.05 to USD5.40. Core EPS was USD1.08 in the third quarter and USD3.59 in the first nine months.
Land Securities Group reported the sale of 6-9 Harbour Exchange in the Canary Wharf area of London to Blackstone European Property Income Fund for GBP196.5 million. The sale price reflects a net initial yield of 3.99%.
LandSec said this transaction underlines strong investor demand for high quality income in central London.
The disposal is in line with Landsec's strategy set out in October last year, it said. This identified a future growth strategy focused on three key areas: Central London offices; major retail destinations; and urban mixed-use neighbourhoods in London and other major regional cities.
John Wood Group said has initiated a strategic review of the part of its Consulting business facing the built-environment end-market. The scope of the review will consider a range of options to unlock value from this part of the business for shareholders, the company said.
Turning to trading, John Wood said it expects to deliver improved revenue and earnings in the second half of 2021 relative to the first half.
The engineering and consulting company said it is seeing robust activity in Consulting and Operations, but the rate of recovery in Projects has been slower than anticipated largely due to the deferral of activity and awards into 2022.
More positively, the Aberdeen, Scotland-based firm said it has maintained strength in the order book which is up 18% at the end of September compared to December 2020.
As a result, John Wood said it expects 2021 revenue to be USD6.4 billion. In 2020, the company recorded revenue of USD7.56 billion.
Housebuilder Redrow said trading has remained strong since its financial year end on June 27. The value of net private reservations in the 19 weeks to November 5 was 2.1% above the prior year at GBP672 million versus GBP658 million. The private revenue per outlet per week was GBP309,000 compared to GBP298,000 last year.
"Our Heritage range of houses in great locations fits people's requirements perfectly for quality, well designed homes with more space to live and work. This is increasingly reflected in the pricing of our homes and in combination with geographical and product mix, increasing desire of our customers to personalise their homes, and general house price inflation, has resulted in the average selling price of private reservations for the first 19 weeks being up 14% on the equivalent period last year at GBP453,000 from GBP398,000," highlighted Chair Richard Akers.
During the period Redrow said it has added 1,400 plots to its current land holdings and 95 plots to its forward land holdings compared to 457 plots and 119 plots, respectively, last year.
Homes turnover for the 19 weeks to November 5 was 3.5% below the prior year's GBP690 million, at GBP666 million, but the total forward order book is a record GBP1.51 billion, up 2.0% from GBP1.48 billion a year ago.
The company warned on material shortages and supply interruptions facing the industry, but said it is working with long-term supply partners to ensure build output remains at normal levels. Redrow said it estimates that overall build cost inflation will be 5% for the current financial year.
Looking ahead, Redrow said it now expects its revenue for 2022 to be GBP2.1 billion, and its operating margin to be 19%. A year ago, it posted revenue of GBP1.94 billion.
Galliford Try Holdings said it is performing well, as it continues to manage inflation and supply challenges, and maintain a strong cash position with margins in line with expectations.
The infrastructure construction company said it is "encouraged" by the continuing pipeline of new opportunities that align to its strategy and chosen sectors, and the government's planned investment in infrastructure and economic recovery.
Going forward, Galliford Try said it is confident of meeting its objectives for the current financial year.
The pound was trading at its lowest level this year, quoted at USD1.3380 early Friday, broadly flat from USD1.3381 at the London equities close Thursday.
The euro was priced at USD1.1446, soft from USD1.1462. Against the yen, the dollar was trading at JPY114.21 in London, firm from JPY114.02.
Brent oil was quoted at USD82.19 a barrel Friday morning, slipping from USD82.48 late Thursday. Gold stood at USD1,858.01 an ounce, down from USD1,861.20.
OPEC lowered its world oil demand forecast for 2021 on Thursday, citing weaker demand among major consumers China and India and an expected hit from high energy prices.
In a monthly report, the cartel of major oil producers cut its forecast by around 160,000 barrels per day. Global demand for 2021 is now forecast to reach 96.4 million barrels per day.
In Tokyo on Friday, the Nikkei 225 index closed up 1.1%. The Shanghai Composite closed up 0.2%, while the Hang Seng index was up 0.3% in late trade. The S&P/ASX 200 in Sydney closed up 0.8%.
The global economic calendar on Friday has eurozone industrial production data at 1000 GMT.
By Evelina Grecenko; [email protected]
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