Today’s news in brief-13/3/24
Morrisons reported a loss of £1.1bn for the year ending October 2023. The increase in debt, mainly due to the takeover by Clayton Dubilier and Rice, has led to rising finance costs, reaching £735 million. Despite a slight drop in revenues to £1.84bn, underlying profits excluding debt interest costs have risen to £970m, indicating a strong operational performance. However, fuel sales plummeted to £3.4bn before the sale of its petrol forecourt business to Motor Fuel Group for £2.5bn, further impacting the financial landscape.
Matches face a tumultuous period as CEO Nick Beighton and CFO Dave Murray departed following the company’s administration. The collapse into administration, despite a recent acquisition by Frasers Group, signals a failed turnaround effort, with Matches consistently missing business plan targets and incurring substantial losses. This departure follows an exodus of executives, indicating broader internal challenges within the organisation.
UK GDP experienced a modest increase of 0.2% in January, attributed to heightened spending in retail, contributing to a 1.9% growth in wholesale and retail trade. The construction sector also saw a 1.1% increase in output, reversing previous declines. However, production output fell slightly, highlighting some areas of economic contraction despite overall growth.
Inditex, the parent company of Zara, celebrated a successful fiscal year 2023, with profits surging by 28.2% to €6.9bn and sales rising by 10.4% to €35.9bn. Strong performance in both store and online sales, along with gross profit and EBITDA increases, underscores Inditex’s robust financial health. The company plans to propose a dividend increase and invest in logistics expansion to sustain growth momentum.
Shoe Zone faced challenges as trading fell marginally below expectations due to increased costs, including higher National Living Wage and impacts from the Suez Canal situation. Despite revenue growth to £165.7m and a rise in pre-tax profit to £16.2m, the company’s slower-than-expected Autumn/Winter season adds pressure to its financial performance.
