BOE Signals Willingness for Further Tightening, Despite Recession Fears

BOE Signals Willingness for Further Tightening, Despite Recession Fears

1222 GMT - The Bank of England will raise rates at least once more in August, with rates unlikely to come down until the second half of 2024, Ruth Gregory, deputy chief U.K. economist at Capital Economics, says in a note. The monetary-policy committee signaled its willingness to raise rates again should inflationary pressures remain strong, mindful of the U.K.'s higher and longer-lasting inflation problem, Gregory says. This will likely trigger a recession in the U.K. that is required to reduce inflation, but there remains a risk that the severity of this economic downturn will rise should the bank need to raise rates even further, she adds. ([e-mail])

COMPANIES NEWS:

DS Smith FY 2023 Pretax Profit Rose as Price Increases Offset Lower Volumes

DS Smith on Thursday said that fiscal 2023 earnings jumped as price increases and cost mitigation more than offset volume declines and inflationary pressures.

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Whitbread 1Q U.K. Accommodation, Comparative Sales Rose

Whitbread said Thursday that total U.K. accommodation and like-for-like sales for the first quarter of fiscal 2024 rose, and that it remained positive about the outlook for the year as the business momentum was strong.

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Spirax-Sarco to Buy Stake in Kyoto Group; Makes Plans with Kyoto, Iberdrola

Spirax-Sarco Engineering said Thursday that it will take an ownership stake in Kyoto Group, and will make investment, partnership and commercial agreements with Kyoto and Iberdrola to support development of the Heatcube technology.

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UK Regulator Blocks Cochlear-Oticon Medical Full Merger

The U.K.'s Competition and Markets Authority on Thursday said it is preventing part of the sale of Oticon Medical--the hearing-implant division of Demant AS--to Cochlear, blocking the sale of its bone-conduction solutions business but allowing the cochlear implant one to go ahead.

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Hornby Swung to FY 2023 Pretax Loss on Lower October to December Sales

Hornby said Thursday that it swung to a pretax loss for fiscal 2023 after disappointing sales in the important October to December period failed to achieve the levels forecasted earlier in the year.

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First Property Group Reports Steep Fall in FY 2023 Pretax Profit

First Property Group said Thursday that its pretax profit fell steeply in the fiscal year ended March 31.

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Ergomed Sees 2023 in Line With Views After Strong Start to Year

Ergomed said Thursday that it has had a strong start to 2023 with solid revenue growth reflecting its services-based business model, and that the board sees full-year results in line with current market expectations.

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Volex to Raise GBP60 Mln in Placing, Retail Offer to Buy Murat Ticaret

Volex on Thursday said it has agreed to buy Turkish complex wire harness manufacturer Murat Ticaret Kablo Sanayi for up to 178.1 million euros ($195.7 million), which it will partly fund through a 60 million pound ($76.6 million) share placing and retail offer.

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Volex FY 2023 Earnings Rose on Organic Growth, Acquisitions

Volex on Thursday reported a rise in pretax profit for fiscal 2023 after organic growth and acquisitions boosted revenue, and said it has seen good momentum and demand since the start of fiscal 2024.

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MS International FY 2023 Pretax Profit Fell on Weapon System Delivery Delays

MS International said Thursday that fiscal 2023 pretax profit fell, hurt by the delay in the delivery of a significant contract, and that its order book has almost doubled over the period.

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CVS Group Names COO Ben Jacklin as New Deputy CEO Role

CVS Group said Thursday that it has appointed Chief Operating Officer Ben Jacklin to the newly created role of deputy chief executive officer, effective from July 1.

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DG Innovate Shares Fall on Proposed Capital Reorganization, Fundraise

Shares in DG Innovate fell Thursday after the company said it would seek shareholder approval at its annual general meeting to undertake a capital reorganization and then a discounted placing to raise 517,000 pounds ($660,105) which will be mostly for enhancing its drive technology and battery technology commercialization strategy.

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Alpha Financial Shares Fall After Flagging Increased Competition Despite Higher FY 2023 Results

Alpha Financial Markets Consulting shares fell 13% on Thursday after the company said it is seeing increased levels of competition due to overcapacity and expects this to continue in the short term, as it posted a rise in pretax profit for fiscal 2023.

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Robinson's CEO Helene Roberts To Step Down

Robinson said Thursday Chief Executive Officer Helene Roberts has decided to step down to take up a new opportunity.

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Oracle Power Shares Fall on GBP363,000 Discounted Fundraise

Shares in Oracle Power fell Thursday after the company said it will raise 363,000 pounds ($463,478) via a discounted placing and a subscription to support the development of its green hydrogen project and for general working capital purposes.

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Essensys Shares Temporarily Suspended Pending Statement

Essensys shares were temporarily suspended from trading on London's alternative investment market on Thursday, pending a statement from the software company.

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Argentex Resolution to Reappoint Director Passes With Low Support

Argentex said Thursday that a resolution to reappoint nonexecutive director Henry Beckwith at its annual meeting passed with low shareholder support.

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Noventiq to Delist From London, Moscow Exchanges, Join Nasdaq After Merger

Noventiq Holdings said Thursday that it will delist from the London and Moscow exchanges and join the Nasdaq following a merger with Corner Growth Acquisition.

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Boohoo Proposes Appointment of Former THG CEO to Revolution Beauty's Board

Boohoo Group said Thursday that it plans to propose the appointment of former THG Chief Executive Officer Rachel Horsefield to the board of Revolution Beauty, alongside prior proposals Alistair McGeorge and Neil Catto.

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Westminster Group Chairman to Become Nonexecutive Chairman

Westminster Group said Thursday that Chairman Tony Baldry will move to the position of nonexecutive chairman at the conclusion of the company's annual general meeting on June 28.

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Speedy Hire FY 2023 Pretax Profit Slumps on Impairments; Raises Dividend

Speedy Hire said Thursday that its pretax profit for fiscal 2023 fell sharply on exceptional costs, but raised its dividend payout, and named Paul Rayner as its permanent chief financial officer.

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Angling Direct Flags in Line Performance for First Months of FY 2024

Angling Direct on Thursday said performance since the start of fiscal 2024 has been in line with the board expectations.

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Manolete Partners Sees Growth in FY 2024 After FY 2023 Pretax Loss

Manolete Partners on Thursday swung an expected pretax loss for fiscal 2023 as a stronger second half didn't offset its subdued first half and said it is well placed for continued growth given increasing number of corporate insolvencies in the U.K.

MARKET TALK:

Short-Dated Gilt Yields Rise After BOE's 50Bps Rate Increase

1217 GMT - U.K. 2-year and 5-year gilt yields rise after the Bank of England surprised markets with a 50 basis-point interest-rate increase to 5.0% as it battles to bring down high inflation. "The BOE continues to chase inflation surprises," says State Street Global Markets head of macro strategy Michael Metcalfe in a note. "While more modest in absolute terms, the last three inflation prints have been more surprising than at any point last year." The U.K. 2-year gilt yield last trades at 5.066%, up from 5.023% before the rate decision, while the U.K. 5-year gilt yield last trades at 4.576%, up from 4.570%, Tradeweb data show. 10-year gilt yields fall, however, amid concerns about the potential longer-term damage of higher interest rates to the economy. ([e-mail])

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Manolete Partners' Momentum Improves With Incoming New Cases

1215 GMT - Manolete Partners' momentum is improving fast, Peel Hunt says in a note raising its rating on the stock to add from hold after the insolvency-litigation financing companys posted a swing to pretax loss for fiscal 2023. The year had challenges but these are now in the past, analyst Andrew Shepherd-Barron says. "Manolete is a clear market leader, having proven itself over multiple years," he says, noting profitability and cash generation are expected to accelerate given the increase in incoming new cases. The broker raises its target price to 250 pence from 210 pence. Shares trade up 2.1% at 245 pence and are down 3% year to date. ([e-mail])

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Inflation, Employment Data Justify BOE's 50Bps Rate Rise

1205 GMT - The Bank of England's larger 50 basis point interest-rate rise was somewhat unexpected but it makes sense given recent inflation and employment data and further rate increases are likely, says Ed Hutchings, head of rates at Aviva Investors. As the market is still priced for a further 100 basis point of interest-rate rises, "it could still be some time before we do actually see a pause [in rate increases]," he says. However, the split vote on the decision, with two out of nine Monetary Policy Committee members voting for unchanged rates, suggest some believe taking the rate from 0.10% to 5.0% without a pause along the way is taking things too far, he says. ([e-mail])

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BOE's 50 Basis-Point Rate Rise Will Be a Shock For Many, Could Suggest Panic

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06-22-23 0842ET