BUSINESS LIVE: Royal Mail’s IDS fined over delivery failures; BAE Systems sales jump; British Land rents soar

Gas station giant EG Group will acquire the network of ultra-fast chargers from electric car manufacturer Tesla.

The Blackburn-based group, which also owns Asda, said the chargers will be branded ‘evpoint’ and available to all electric vehicle drivers.

BAE Systems has reiterated its recently upgraded annual guidance after securing around £10bn of orders in recent months.

Ofcom has fined Royal Mail for failing to meet its first and second class delivery targets in the last financial year.

The postal service, now owned by FTSE 250-listed International Distribution Services, has been fined £5.6 million for failing to meet the watchdog’s targets.

Exports of British TV shows such as Frozen Planet II and Top Gear have reached record levels.

The call from abroad for our programming saw sales reach almost £1.9 billion last year, up 22 percent year on year.

Reports from whistleblowers to HMRC have increased by 47 per cent in the past year, with experts attributing the increase to fraud linked to government support against Covid-19.

The number of whistleblowing reports to HMRC has risen from 106,920 in 2021/22 to 157,270 in 2022/23, according to new research from international law firm RPC.

Adam Craggs, partner and head of RPC’s tax litigation, financial crime and regulatory team, said the sheer scale of fraud against the government’s Covid-19 assistance programs could be a key driver of the jump.

Victoria Scholar, head of investments at Interactive Investor, comments on Heathrow’s latest monthly passenger figures:

It was a successful summer for aviation, highlighted by the impressive results of airlines such as IAG, EasyJet and Ryanair. Heathrow continued to see further positive passenger traffic figures in October, with expectations for a rise during the busy Christmas holidays. Heathrow is launching a range of retail offers to support the holiday peaks.

While leisure travel has proven remarkably resilient amid the cost of living crisis, the risk of a recession in Britain next year could weigh on passenger traffic. And business travel remains lower than pre-coronavirus levels as videoconferencing remains the new normal.

The FTSE 100 has started the week higher, led by a rise in industrial metal mining shares as copper prices rose, while insurer Phoenix Group has lifted its life insurance index after an expected upgrade.

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FTSE 100 rises 0.4%, FTSE 250 adds 0.2%

Nov 13 (Reuters) – Britain’s FTSE 100 started the week higher, led by a rise in industrial metal mining shares as copper prices rose, while insurer Phoenix Group lifted its life insurance index after an expected upgrade.

Industrial metals miners rose 0.9 percent, helped by a rise in copper prices on a softer dollar.

Phoenix Group raised its full-year cash generation forecast after completing the merger of two of its insurance brands, with shares rising 8.6 percent.

British Land has estimated annual rental value growth at the high end of previous forecasts, sending the stock up 5.5 percent.

Inheritance duties and stamp duty could be reduced in the Autumn Statement as a result of positive projections about the state of public finances.

The cuts are being considered by Jeremy Hunt after he was told he has more budgetary ‘headroom’ than expected.

Aarin Chiekrie, equity analyst at Hargreaves Lansdown:

‘BAE occupies a key position in the defense market, and another promising update proves why the group is so highly regarded in the defense sector. With some of its biggest buyers, Britain, the US and Europe, all expected to continue increasing defense budgets in the coming years, the sky really is the limit for this aircraft maker.

‘Given the heightened threat environment, demand for BAE’s products and services has remained strong, with order inflows of around £10 billion since the half year. That brings the current figure to around £30 billion, and because these are typically long-cycle orders, with payments spread over several years, this gives BAE insight into revenues over several years.

‘That has given management the confidence to reiterate all recently upgraded full-year guidance, which is something new for most companies in the current uncertain environment.

‘The regulatory process surrounding BAE’s massive $5.55 billion acquisition of Ball Aerospace is progressing well and is expected to be completed in the first half of 2024, and it appears to be a good fit for BAE. Ball Aerospace delivers mission-critical space systems and defense technologies for air, land and sea – a great addition to BAE’s range of products.

‘The acquisition should add approximately $2.2 billion in revenue to BAE’s top line, before growing at a compound rate of approximately 10% per year over the next five years. And given the similarities between the two companies, there is clearly room to streamline operations, reduce costs and increase profit margins.”

British Land now expects annual rental growth to be at the high end of previous forecasts, but asset returns remain under pressure in a high interest rate environment.

Aggressive rate hikes have hit UK landlords’ investment activity, even as strong operating performance has led to a tentative sector recovery from the lows of the pandemic.

British Land expects strong labor market fundamentals in its submarkets despite the uncertain macroeconomic environment, with portfolio returns now above 6 percent and UK base rates more likely to approach their peak.

BAE Systems maintains its forecast for annual profits to rise by as much as 12 percent as orders for military equipment continue to flow in at a time of heightened geopolitical risk, benefiting Britain’s largest defense company.

BAE raised its forecast in August, expecting earnings per share to grow 10 to 12 percent in 2023, after orders soared following Russia’s invasion of Ukraine last year.

Since then, Israel’s invasion of Gaza in the aftermath of the October 7 Hamas attack has disrupted stability in the Middle East.

BAE has booked £10 billion in orders since the end of June, including £3.9 billion in funding for the next phase of the AUKUS submarine program between Australia, Britain and the United States.

“Order flow for new and existing programs, renewals of existing positions and progress on our opportunity pipeline remain strong,” CEO Charles Woodburn said in a statement.

Britain’s communications watchdog has fined Royal Mail owner International Distribution Services £5.6 million for failing to meet delivery targets over the past year.

Ofcom said in May it was investigating the company for failing to meet delivery targets for the year to the end of March 2023.

Ian Strawhorne, director of enforcement at Ofcom, said: ‘Royal Mail’s role in our lives comes with enormous responsibility and we know from our research that customers value reliability and consistency.

‘It is clear that the pandemic has had a significant impact on Royal Mail’s operations in recent years. But we warned the company that it could no longer use that as an excuse, and it just hasn’t happened since.

“The company has failed consumers, and today’s fine should be a wake-up call: the company must take its responsibilities more seriously. We will continue to hold Royal Mail to account to ensure service levels improve.”