• UK case numbers unchanged.
• Russia’s “Sputnik – V” vaccine produces an antibody response in early trails.
• US non-farm payrolls increased by 1.371m jobs in August.
• Greece and Portugal stay on England’s quarantine-free travel list.
• The government’s Eat Out to Help Out scheme subsidised 100m meals and cost £500m.
Buildings & Construction
• Berkeley Group – “Berkeley’s trading has been resilient over this period and supports our existing guidance of £500 million of pre-tax profit for the full year and our commitment to our shareholder returns programme of £280 million per annum. We now anticipate a more even split of profit between the first and second halves of the year, reflecting levels of production that have been better than initially anticipated and our decision not to furlough staff. Production continues to be impacted by the need for modified working practices and increased supervision, with the health, safety and well-being of our people remaining uppermost in our minds at all times. However, the experience and expertise of our construction teams and subcontractors, supported by our Health and Safety professionals, means that disruption has been minimised and efficiency levels are now at around 90% of normal. In overall terms, this has been offset by the continued investment in bringing forward our portfolio of over 25 large regeneration developments accumulated over recent years. In the period, construction activity has started at a number of these, including Twelve Trees Park in East London and the site of the old Horlicks factory in Slough where we have consent for 3,800 and 1,300 homes, respectively. We are also progressing a number of new land opportunities on which we anticipate being in a position to update at the half year.
Sales pricing has been robust in the period and above our business plan levels. This has been supported by the demand for Berkeley properties in under-supplied markets, good mortgage availability and the welcome support from Government for the sector, including the temporary removal of SDLT for the first £500,000 of sales value and the announcement of a brief extension to the current Help to Buy scheme.
The value of underlying sales reservations for the first four months of the year is around 20% below the annualised run rate for last year, which is supportive of forward sales remaining around the year-end position of above £1.8 billion. This is a strong position, providing good visibility over the next two years of earnings.”
• Eurocell# – “In line with official guidance from the UK Government on 23 March, we closed our manufacturing plants, branch network, distribution and recycling operations. The shut-down was carefully controlled, in order to leave the business well placed to recommence operations and trading when appropriate to do so.
Following updated guidance from the Government in May, which permits tradesmen to work in domestic dwellings so long as appropriate precautions are taken, we began to implement a phased re-opening of the business as follows:
• 11 May – we started to supply our fabricator customers from existing stocks and opened six branches around the country. This allowed us to test safe working practices and begin to assess the level of customer demand.
• 20 May – following encouraging early results, we re-opened the full branch network.
• 26 May – we recommenced manufacturing operations on a progressive basis, with all sites open in June except Eurocell Recycle North, which followed in July.
The re-opening process was successful and operating efficiencies since the re-start have been good.
Since re-opening, sales have exceeded our initial expectations, particularly in the branch network, and we have been encouraged by recent market trends. We are pleased that operating efficiencies have been better and that gross margins are improving as volumes increase. The actions we took to strengthen the business have left us well placed to capitalise on opportunities and continue to take market share.”
• Capital & Regional – “All seven of the Company’s community shopping centres remained open throughout lockdown. 605 stores, representing over 96% of units are now back open, up from 68 stores in early May.
Occupancy has remained high at 95% (December 2019: 97.2%).
Footfall significantly impacted by Covid-19, but 20.7 million visits across the portfolio outperformed the national index by 2.6%. Visitor numbers currently improving week on week.
76% of rent in respect of the first half of the year has now been collected. Rent collection for the third quarter of the year is running at 54%. Over half of the balance of rent outstanding is due from well-capitalised national retailers.
24 new lettings and renewals during the period with an encouraging leasing pipeline.
Net Rental Income (NRI) down £9 million to £16.2 million (June 2019: £25.2 million), largely as a result of Covid-19, driving reduction in Adjusted Profit to £4.6 million (June 2019: £14.8 million).
IFRS Loss for the period of £115.5 million, due primarily to a 16% fall in property valuations (June 2019: Loss of £55.4 million) mitigated by relative resilience of London assets which fell by 11.8%.”
• Redde Northgate – “Since our pre-close trading update of 19 May 2020, and as restrictions relating to Covid-19 have eased, the Group has seen sequential monthly improvements in trading, such that the level of support packages provided to customers has now reduced to a minimal level, vehicles on hire have increased in all countries, accident and incident volumes have started to increase as traffic volumes pick up, and vehicle disposal channels have re-opened, with recent significant improvement in residual values compared to the prior year. Further, excellent progress has continued to be made in integrating Redde and Northgate since the merger.
Given the improving trading environment and the continued close management of liquidity, cash inflows have been strong and the headroom on our bank facilities has increased from £234m at the end of April 2020 to £291m at the end of August 2020.”
• Renew Holdings – “Trading since the announcement of our interim results has been strong and consequently the Board expects the Group’s full year results to be materially ahead of current market expectations with adjusted operating profit forecast to be between £39m-£40m. This improved forecast result is reflective of our defensive qualities, resilience and the implementation of numerous mitigation measures that have proven to be extremely effective in responding to the challenges of Covid-19.
Our engineering activities in our Rail, Infrastructure and Environmental markets have remained robust and reliable throughout the Covid-19 pandemic. The UK Government designated the majority of our activities as critical to the Covid-19 response and we have safely and proactively responded to the ongoing network demands. In Energy, as previously announced, all site activities at Sellafield and Springfields were suspended in March. Site activities are steadily being re-mobilised however we do not expect to be fully operational at these sites until the 2nd half of our next financial year.”
• Filming for The Batman movie has been suspended because its lead actor Robert Pattinson has tested positive, according to US media.
• People arriving in Wales from Portugal, French Polynesia and six Greek islands must self-isolate for 14 days. Arrivals to Scotland from Portugal and French Polynesia will have to self-isolate from Saturday. However, Portugal, Greece and French Polynesia remain on England and Northern Ireland’s lists of travel corridors, meaning there is no quarantine requirements for travellers.
• Restaurants have claimed more than 100m meals under the UK’s Eat Out to Help Out scheme. In July, restaurant bookings were down 54% on Mondays-to-Wednesdays, compared with July 2019 but the final day of the scheme, Monday 31 August, saw a 216% jump in bookings against the equivalent day in 2019, according to OpenTable.
• Turkey has extended a ban it introduced in April on companies laying off employees for another two months.
• New Zealand to retain current restrictions until mid-September. The largest city, Auckland, will remain on alert level 2.5, while the rest of the country will be on alert level 2.0.
• The numbers of people testing positive for coronavirus in England remains unchanged in the week to 25 August, according to the Office for National Statistics.
• Virgin Atlantic is to cut a further 1,150 jobs after UK and US courts approved a £1.2bn rescue plan, which will secure its future for at least 18 months. Virgin had already cut more than 3,500 jobs, from the 10,000 employees it had at the beginning of the year.
• The Co-op is opening 50 new stores and creating 1,000 new jobs this year.
• Pret a Manger is to offer customers up to five coffees a day if they sign up to a £20 monthly subscription service.
• US job growth slowed further in August as financial assistance from the government ran out. Non-farm payrolls increased by 1.371m jobs last month, after advancing 1.734m in July, the Labor Department’s closely watched employment report showed on Friday. The unemployment rate fell to 8.4% from 10.2% in July.
• Russia’s “Sputnik-V” Covid-19 vaccine produced an antibody response in all participants in early-stage trials, according to results published by the Lancet medical journal.
• The World Health Organization has said it does not expect widespread vaccinations against coronavirus until the middle of next year, stressing the importance of rigorous checks on their effectiveness and safety.
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