Debenhams issues profit warning, Whitbread appoints new chairman
London open
The FTSE 100 is expected to add 16 points on Thursday, having finished at 7,671.11 the prior session.
Stocks to watch
Debenhams has issued the first profit warning of 2018 after sales fell and "tactical promotional action" misfired in the department store group's crucial festive period. UK like-for-like sales fell 2.6% in the 17 weeks to 30 December and after cutting prices for many weeks in order to try and compete, gross margins for the six-month period are expected to be down around 1.5 percentage points on the prior year.
Whitbread has appointed former ITV and Royal Mail boss Adam Crozier as its new chairman, just as City chatter swirls about a potential break-up of the Premier Inn and Costa Coffee owner. Current chairman Richard Baker will retire from the board at the end of February, with Crozier promoted from his role as senior independent director.
Medical inhaler group Vectura said 2017 full year revenue should be in line with expectations, adding that a strong second half delivered closing cash and cash equivalents of around £104m net of £1.4m outflows in respect of the £15m share buyback which started in November. It added that it was now going to focus on “relatively lower risk, high value development opportunities with known molecules” across its whole non-partnered pipeline after delays in the approval of the group's US generic Advair programme with Hikma alongside positive pipeline developments prompted an investment review.
Newspaper round-up
Bosses of top British companies will have made more money by lunchtime on Thursday than the average UK worker will earn in the entire year, according to an independent analysis of the vast gap in pay between chief executives and everyone else. The chief executives of FTSE 100 companies are paid a median average of £3.45m a year, which works out at 120 times the £28,758 collected by full-time UK workers on average. – Guardian
Poundland has secured up to £180m of independent financing that will reduce its reliance on its troubled South African owner Steinhoff International after bumper Christmas trading. Pepkor Europe, the European owner of Poundland, the Pep&Co clothing business and two other chains, has arranged a two-year loan facility from US investment firm Davidson Kempner Capital Management. Pepkor is owned by Steinhoff. – Guardian
Tesla pushed back its production targets for Model 3 electric cars once again, after delivering just 1,550 of the vehicles in the last three months of the year. The delivery figures came in well below the 4,100 Model 3 sedans analysts had been expecting Tesla to deliver in the three months to Dec 31, according to data compiled by FactSet. – Telegraph
US close
US stocks hit records highs on Wednesday following solid data on manufacturing and construction spending, as the minutes from the Federal Reserve’s latest meeting showed officials were divided over the prospect of three rate hikes this year.
The S&P 500 rose above 2,700 for the first time, closing up 0.6% at 2,713.06, while the Dow Jones Industrial Average ended just below the 25,000 mark, up 0.4% at 24,922.68 and the Nasdaq increased 0.8% to 7,065.53. Technology, energy and healthcare shares provided much of the upside.
Meanwhile, the dollar was up 0.6% versus the pound at 0.7400, 0.4% higher against the euro at 0.8325 and 0.2% firmer against the yen at 112.52, buoyed by strong data releases.