Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
We’re very much in that pre-Christmas lull now, so slim pickings on the wire this morning However Kingfisher [LON:KGF], owner of B&Q, have announced that they are the latest retailer to return business rates relief to the government. The move reflects a resilient performance by the group through lockdowns with the Chairman adding that this underlines the strong financial position of the company. So that’s another £130m for the Treasury and comes on top of the £23m the company has already repaid from the job retention scheme. Management note that profits for the full year will now be supported by non-recurring cost savings of £85m.
Interim results from Ted Baker [LON:TED] for the 28 weeks to August 8th show that the fashion retailer has suffered badly as a result of the lockdown. Revenues are down by half, pre-tax losses have jumped from £23m to £86m and the dividend has been suspended. There was an uptick in online sales but this has been insufficient to mitigate the impact of store closures, whilst annualised cost savings of £31m have also been realised. The company also notes that its balance sheet is in better shape than had been expected. As if 2020 hadn’t been challenging enough, the statement adds that the worst case scenario for a no-deal Brexit will see a further £16m shaved off profitability.
Keeping with retail, Mike Ashley’s Frasers Group [LON:FRAS] has confirmed to the market this morning that it is in negotiations with the administrators of Debenhams, although adds that there is no certainty that any transaction will take place. Perhaps twisting the screw a little more on trying to ensure the best discount can be obtained, the note adds that a deal is left looking less likely if discussions cannot be concluded swiftly.
Sign up for three quick facts and more with our Free Daily Digest newsletter, every weekday morning.