The FTSE 100 opened in negative territory following poor trading on Wall Street as Federal Reserve watchers try to gain insight on what the new chair of the Reserve, Jerome Powell, will do regarding interest rates.
In corporate news, mining giant Glencore (GLEN) ticks up 1% to 388.05p on news that its 2017 profits rose 44% to $14.8bn driven by higher commodity prices and cost reductions. The company’s earnings per share also rocketed up from $0.10 to $0.40 on a year-on-year basis and it reduced its net debt by 31% to $10.6bn in 2017.
UK bank Lloyds (LLOY) gains 2% to 69.22p after releasing a strong set of 2017 results. Highlights include a 24% increase in statutory pre-tax profits of £5.3bn and hiking its ordinary dividend per share by 20% to 3.05p. In addition, the board intends to implement a share buyback of up to £1bn, equivalent to a capital return of 1.4p per share. The bank also increased its buffer against economic shocks - its common equity tier one ratio - by over a percentage point, from 14.1% n 2016 to 15.5% in 2017.
Housebuilder Barratt Developments (BDEV) improves 2.4% to 575.4p on releasing half year to 31 December results. These numbers include a 9.5% increase in revenue to £1.99bn and 6.8% improvement in pre-tax profits to £342.7m both on a year-on-year basis. The company has completed 7324 plots in its first half, a 2% increase on the same period in 2016.
Transport operator FirstGroup (FGP) reverses 3.4% to 92.75p after saying that its North American divisions encountered ‘extremely challenging travel conditions’ in January. The company’s trading update goes on to say that this has led to a reduction in its outlook for earnings per share.
However, FirstGroup says there is no change to its management’s expectations for substantial cash generation during the year.
Breakdown and roadside assistance company AA (AA.) collapses 30.3% to 81.1p on releasing a new business strategy. The AA is looking to invest in its insurance business although its chief executive Simon Breakwell says that this will reduce short term profitability. The full year dividend per share is set to be cut from its 9.3p pay out for the January 2017 financial year to just 2p for January 2019.
On the AIM market, housing support services company Bilby (BILB) shoots up 15.2% to 110p after revealing a string of new clients in 2018. These include Wandsworth Council and the University of Essex. The company also says that its revenue and profits will be ahead of market expectations for its year ending 31 March.
