BUSINESS LIVE: Markets Gear Up for Budget; The next profit will exceed £1 billion; Sales of GSK vaccines are falling

Aston Martin posted a narrower-than-expected third-quarter loss on Wednesday as the luxury car maker reaffirmed its full-year forecast and said supply disruptions that had caused factory delays were being “proactively managed.”

Shares are up as much as 6 percent in early trading on the results, which come as European carmakers struggle with weak demand in China and the US.

Aston Martin last month warned of lower annual profits and cut its production forecast by about 1,000 vehicles due to disruptions at several suppliers, causing production delays. It also reported continued weak demand from China.

New CEO Adrian Hallmark said in a statement that the improved financial and operational performance in the third quarter demonstrated the effectiveness of the group’s strategy to ramp up production of new models.

Next is on course to make more than £1 billion in annual profits for the first time in its history after the retailer revised down expectations for the third time in three months.

Next welcomed a boost from colder weather to sales of its autumn and winter ranges, with full-price sales rising 7.6 per cent in the third quarter to October 26.

Mamta Valechha, consumer goods analyst at Quilter Cheviot:

‘Next today delivered a positive trading statement, with full-price sales up more than 7% in the third quarter, above expectations of 5%. This reflects recent UK data points of a strong start to sales in autumn/winter 2024, driven by the early arrival of colder weather this year, compared to an unusually warm September and early October last year.

‘Within the figures, growth was largely driven by online, particularly overseas, which rose by more than 20%, while UK sales improved both online and in-store after the weather impacted the first half of the year, with a growth of 5.8%.

‘Looking ahead, Next has increased full-year earnings guidance by 1% based on full-price sales growth of +4.9%. Next’s latest quarter guidance implies a slowdown in the fourth quarter, with the release noting that the company is “more confident in the two-year comparison as we believe outperformance in the third quarter of this year is likely increased fourth quarter sales.”

A massive fire has broken out at the BAE Systems shipyard that builds Britain’s nuclear submarines, but there is no major risk from the incident, police said on Wednesday.

Online photos showed what appeared to be flames and black smoke billowing from the top of the massive Devonshire Dock Hall building, which is visible from miles away. With an area of ​​approximately six hectares, it is the second largest shipbuilding complex of its kind in Europe, according to the company.

Cumbria police in north-west England said in a statement that two people had been taken to hospital after suspected smoke inhalation and that there had been no other casualties.

Police said emergency services were called to the location at 00:44 GMT.

Online trading platforms suffered a pre-Budget sell-off yesterday amid fears over the contents of the Chancellor’s red box.

While businesses and households have a lot to worry about – from higher national insurance contributions to a rise in bus fares – companies such as CMC Markets and IG Group have been hit by speculation about what might happen to capital gains tax.

Keir Starmer sparked outrage last week when he insisted that anyone who owns shares is not a ‘working person’ – implying they are fair game for a revenue-hungry Treasury.

GSK has cut its 2024 vaccine sales forecast for the second time this year, hit by weak demand for vaccines against respiratory syncytial virus (RSV) and shingles.

The British drugmaker now expects vaccine sales to fall by a low single-digit percentage of revenue in 2024. Previously, the company had expected business to grow at a low to mid-single-digit rate.

The company reported core earnings per share of 49.7p on revenues of £8 billion for the three months to September 30, compared with earnings per share of 43.6p on analysts’ forecast revenues of around £8 billion.

The company kept full-year full-year revenue and profit expectations unchanged.

“Strong growth in specialty medicines helped offset lower vaccine sales and reflected successful new product launches in oncology and HIV,” GSK CEO Emma Walmsley said in a statement.

Next expects annual profits to exceed £1 billion as the fashion retailer upgraded its guidance for the third time in four months on Wednesday.

The group said the upgrade reflected a better-than-expected 7.6 percent increase in full-price sales in the third quarter, driven by the early arrival of colder weather this year, compared to an unusually warm September and early October last year .

Susannah Streeter, head of money and markets, Hargreaves Lansdown:

‘The FTSE 100 looks set to open lower as uncertainty surrounds the contents of the UK budget, the first from a Labor chancellor in 14 years.

‘British investors are prepared for a slew of tax rises to fill a gaping black hole in the UK’s public finances. There is speculation that Rachel Reeves will try to find ways to increase revenues and cut spending to cover a deficit of up to £40 billion.

‘The details of how debt rules will be changed to allow the government to borrow more without exceeding self-imposed borrowing limits will be announced soon.

‘This strategy is being widely pursued to avoid creating a temperamental attitude among bond investors, and so far it appears to have paid off, although government bond financing institutions will be keeping a close eye on what the growing investment budget will be spent on. spent. on.

‘Her expected budget plans have already been assessed by bond traders to push UK government bond issuance towards £300 billion this year, an increase of around 6% on the existing target.

‘Any sign of profligacy could be punished by investors demanding higher returns to hold UK debt. Nervousness has already increased, with UK government bond yields rising to around 4.3%, but still lower than July levels.

‘Some of this rise is due to changing interest rate expectations and overall, markets still appear quietly confident that the Chancellor will continue to focus on building a reputation for prudence and responsibility. It appears unlikely that the investment commitments announced today will maximize the government’s new borrowing facility under the rule change.”

Rachel Reeves was last night accused of turning her back on economic growth as the business community prepares for a budget attack that will drive up costs and threaten livelihoods.

The Chancellor will today hit British businesses with an increase in employers’ national insurance contributions to 2p, after previously labeling the levy a ‘tax on jobs’.

The raid on National Insurance – which could raise as much as £20 billion – is accompanied by an inflation-busting 6.7 per cent minimum wage increase and a workers’ rights package costing companies £5 billion a year.