BUSINESS LIVE: UK GDP grows 0.1%; Petrofac Debt Restructuring Talks; FCA Motor Finance Probe Warning

Controversial tax credit agent Brooksdale is preparing for liquidation, leaving questions for the clients whose tax refunds are currently in hand.

The company will hold a virtual meeting of creditors today, April 12, to discuss and vote on a possible creditor voluntary liquidation. This is Money has learned.

The Financial Conduct Authority has warned car finance providers to maintain sufficient cash for potential payouts as it continues to investigate previous failings.

In a letter to car finance companies published on Friday, the FCA said they must have ‘adequate financial resources’ at all times to meet operational costs and payouts associated with the historic car loan mis-selling.

One in five private tenants spends more than half of their gross salary on rent, according to data from the tenant information service Canopy.

With an estimated 11.6 million people in Britain renting privately, this could suggest that roughly 2.3 million tenants are spending more than half of their pre-tax wages on rent.

(PA) – One in three businesses face staff shortages at least once a week because they do not have enough employees available to work, new research shows.

A study by recruitment agency Indeed Flex has shown that among companies suffering from a staff shortage, employee illness is one of the biggest problems.

A third pointed to problems recruiting enough people to fill the gaps, while a similar number have staff unwilling to work certain days or hours.

One in four of the 400 companies surveyed indicate that they have had difficulty filling vacancies this year.

Nearly two in five companies use more temporary workers than a year ago, the study shows.

Novo Constare, CEO of Indeed Flex, said: “Employers are fighting hard to fill vacancies, but in such a tight labor market, many are forced to regularly leave gaps in their schedules.

“This is a major problem for the UK economy as it reduces productivity and can lead to workers working more overtime and ultimately feeling burnt out.”

Petrofac could swap a “significant portion” of its debt for equity as part of a rescue package, the oilfield services group said on Friday.

The London-listed company is in talks with lenders and investors about ways to restructure its debt and receive further investment, while negotiating the sale of non-core assets with potential buyers.

Peak pension withdrawal season is here, with older people likely to withdraw record amounts from their pension funds after two years of rising household bills.

Spring is popular because people receive a new set of benefits at the start of the tax year, and many over-55s choose this period to access their pension for the first time.

While an alarming number of British household names have fallen victim to declining consumer confidence, one Chinese retailer has quietly built a presence in Britain.

While other Chinese retailers like Shein have shaken up the fast fashion e-commerce model, Miniso has been the first to enter stores here.

The first Bitcoin halving in four years is expected to take place next week and will herald a new chapter for the world’s largest cryptocurrency and the scale at which it is mined.

London markets opened strongly this morning, led by a jump in precious metals mining and broader strength across the board, while data shows the UK economy grew in February.

Precious metals miners lead the sector gains with a 3.9 percent increase as gold prices soar to a new all-time peak.

Industrial metal miners followed with a 2.2 percent rise after aluminum prices in Shanghai hit a two-year high as funds pumped money into commodities, including metals, to hedge against rising inflation.

BP rose 2.2 percent after the United Arab Emirates’ state oil company recently considered taking over the energy giant, but deliberations did not go beyond preliminary talks.

The City Watchdog has told UK lenders to ensure they are adequately prepared for the potential costs of customer complaints arising from its investigation into the car finance sector.

The regulator began investigating possible overcharges in the sector in January, amid rising tensions between thousands of consumers and lenders over commission schemes.

In a letter to bank bosses on Friday, the Financial Conduct Authority said lenders should assess their ability to meet potential future obligations following a spike in customer complaints.

The watchdog said it planned to take the next steps in September, but said some companies were struggling to provide the necessary data and that it was prepared to expand its investigation if necessary.

A judicial review launched by Barclays against an ombudsman’s decision on a car finance complaint had also created uncertainty and could affect the timing of the review, the FCA added.

Marks & Spencer won a vote of confidence when JP Morgan said ‘the ship has turned’.

It has outperformed its peers in gaining market share since the pandemic, a bullish note said.

James Smith, developed markets economist at ING:

‘Assuming that activity picks up slightly again in March, we expect the UK economy to grow by 0.3% for the first quarter as a whole. That would mark the end of a very modest technical recession, albeit one in which the headline figures masked a steeper decline in per capita output.

‘We shouldn’t look too much into any given month’s data and it is worth remembering that the decline in overall GDP in the fourth quarter was partly due to the volatility of this data.

“For example, October manufacturing data was unusually weak and weighed on overall quarterly activity, but has since been followed by a strong recovery, including a 1.2% increase in February alone.”

Oilfield services company Petrofac continues to face challenges in securing new performance guarantees, and remains in discussions with lenders about restructuring its debt.

Petrofac told shareholders this morning: ‘The company is in discussions with its lenders and remains in discussions to restructure its debt, which would result in a significant portion of the debt being exchanged for equity in the company.

‘The company also remains in discussions with potential investors and certain major shareholders regarding potential further investments in the business and continues to negotiate with potential buyers regarding the sale of non-core assets, as set out in recent announcements. All options remain under consideration.

‘Management and the Board of Directors are focused on managing the Group’s payment obligations and delivering a solution that supports the provision of guarantees required for the recent contract awards, and ensures that Petrofac has the appropriate capital structure and has liquidity to support the strength of its $8 billion. disadvantage.

“While the company continues to face challenges in securing new performance guarantees, it is in discussions with lenders and customers to identify solutions regarding the guarantees required for the recent contract awards.”

Thomas Pugh, British economist at RSM UK:

‘The wettest February on record, at least in the south of the country, dampened construction activity (-1.9%), but this was offset by a strong performance by the manufacturing sector, which continues to recover after being down for much of the past period. have shrunk. two years.

‘It has been a difficult start to the year for the hospitality sector, which has shrunk by almost 2.5% since the start of the year. But this was offset by the recovery of the transport sector after strikes dampened production in that sector, and by renewed strong performance by the leisure sector, as consumers continue to value activities such as concerts.

‘There are good reasons to expect these weaker sectors to recover in the coming months. Higher consumer spending and confidence will directly benefit the hospitality sector, and better weather will allow construction activity to recover.

‘Overall, today’s figures reinforce our view that the fourth quarter of last year will mark the trough of a particularly painful period of stagnation for the UK economy. But we are now at a turning point. The rate cuts are likely to take place in the summer and growth should gradually improve in the first half of this year and pick up further after the summer and into 2025.”