FT Opening Quote
Does Unilever have a Facebook feed? Does the consumer goods group upload images to Apple Photos? If so, Paul Polman, chief executive of the Anglo-Dutch giant, is probably not finding the “Memories From One Year Ago” function terribly enjoyable, writes Matthew Vincent. It can only be showing him selfies of Kraft Heinz and Warren Buffett – and reminding him that we’re just a year on from their aggressive £115bn bid for the entire Unilever business.
What’s the most frustrating job in corporate Britain today? Apart from middle manager at Carillion asking why on earth did the directors keep bidding for contracts? And keep overlooking the pension deficit? And keep reassuring the so-called auditors? Arguably, it’s middle manager at at any other UK outsourcer, trying to address similar questions, writes Matthew Vincent.
If the wider public likes to joke about estate agents in order to feel a bit superior, do property portals do the same? ZPG, owner of the Zoopla portal, does not – but some analysts almost think it should, writes Matthew Vincent. In a trading update this morning, ahead of its annual general meeting, ZPG simply said that in the three months to December 31 it “signed multiple new long-term portal listing and data services agreements with some of the UK’s largest estate agents”.
If Carillion’s former directors, pension trustees, auditors or even pension regulators were hoping the news agenda might have moved on by now, Opening Quote has news for them. And it’s not good news, writes Matthew Vincent. This week, the Work and Pensions Select Committee is turning its attention to the collapsed construction group’s pension scheme funding – and the committee chairman has already accused the management of spending ten years trying to “wriggle out” of its pension obligations.
When does the alternative become mainstream? To dedicated followers of music, it never can and it never should – as those mourning the death of Mark E Smith of The Fall have been noting this morning (even his acclaimed 1985 album This Nation’s Saving Grace was described as “just on the edge of the mainstream” by The Guardian). To dedicated followers of fashion, though, it’s not a life-long distinction, writes Matthew Vincent. Especially not with online fashion pioneer Asos still trading on the Alternative Investment Market – but commanding the market value of a blue-chip FTSE 100 company.
Crest Nicholson shareholders: big-time winners, or small time-losers? It depends on whether you look at the housebuilder’s absolute or relative return, writes Matthew Vincent. Crest’s share price rose by 20 per cent in calendar year 2017, which is an extraordinary 12-month performance… until you realise that its rivals shares rose by an average of 43 per cent.
Good morning. Here is the news. Which could very likely soon not be news. But there is a chance that it might not be non-news. So, for now, it is very big news, writes Matthew Vincent. This morning the Competition and Markets Authority has sensationally ruled that the takeover of Sky by the Murdoch family’s 21st Century Fox is not in the public interest because of its likely effect on media plurality in the UK.
How was your Sunday? Church in the morning… roast lunch… walk to the pub… sudden desire to recalculate the value of your order book, phone your PRs and have them issue a press release…? No? That last activity was probably not top of the list for many of you, writes Matthew Vincent. But you’re not all head of GKN’s automotive division and facing a hostile takeover bid from Melrose, are you? Spare a thought, then for Phil Swash, who seems to have foregone the sermonising, the horseradish and a few swift halves in favour of a spreadsheet.
Breaking news alert: a private-sector company providing previously state-run services is not about to collapse, require refinancing, or pay massive bonuses to its former bosses… er, in fact, it has just reported a stronger than expected financial performance. Don’t tell Jeremy Corbyn or John McDonnell. Yes, Royal Mail, the privatised logistics utility that the Labour party leadership and two-thirds of the population think should be renationalised, has issued a nine-month trading update slightly ahead of market expectations, writes Matthew Vincent.
Another 24 hours into the liquidation of Carillion, and the crisis seems to spread wider by the minute, writes Matthew Vincent. Last night came news that another contractor, Interserve, has been put on financial health watch by government, as concerns about outsourced contracts grow. And, this morning, thousands of Carillion’s former employees are still waiting for clarity over their jobs – as a government guarantee to keep paying workers on private-sector contracts expires.
Carillion’s collapse and liquidation are set to have more repercussions today – and provoke more recriminations. Among the more astonishing facts to emerge yesterday was that not a single direct employee had been dismissed from the construction group. “Everyone is still on the payroll,” said the Official Receiver on Monday – including, it would seem, former boss Richard Howson, who stepped down last July but will keep receiving his £660,000 salary and £28,000 of benefits until October.
Carillion’s journey from reporting “an encouraging start to the year”, “new orders” and “increased revenue visibility”, to a writing down of its construction contracts by £845m, to struggling with debt and unpaid suppliers, to entering compulsory liquidation has taken… just 258 days.
Bovis Homes this morning became the latest housebuilder to update on its 2017 performance, emphasising its quality over quantity as it reported 3,645 completions, down from 3,977 in 2016. “There has been a step change in the quality of our homes delivered on completion and I’m pleased to see this reflected in our level of customer satisfaction which continues to improve,” said Greg Fitzgerald, chief executive. Overall average selling prices increased 7 per cent to £272,000 (2016: £254,900k). There are total forward sales of 2,656 units with a value of £518m. Profits before tax, exceptional and one-off items are said to be in-line with management expectation. Bovis reports “excellent progress with balance sheet restructuring resulting in a £145m year end net cash balance”.
Marks and Spencer’s latest innovations in clothing and food show it is still trying to be all things to all people, writes Matthew Vincent. This week, it launched an eclectic plus-size women’s fashion range called ‘Curve’, while at the same time proposing customers lunched on an ascetic vegetarian dish, called ‘Cauliflower Steaks’ (yes, basically two slices of the low-calorie vegetable in a lemon drizzle, costing £2.50). This morning’s third quarter trading update suggests M&S needs the curvature to sell more than the cauliflower.
Finding it hard to get back to work, after the festive break? Then just imagine how Jeff Fairburn, Persimmon’s chief executive, feels. On New Year’s Eve, he received the first £50m chunk of his controversial £110m bonus. Another 150 executives were due to share some £400m. It’s not likely to make any of them feel a need to leap out of bed this freezing January morning, is it? Or, as Numis prefers to express it, it could lead to problems with senior management retention.
Still got the back-to-work blues? What’s wrong with you? It might only be January 4, but the City’s finest have already successfully implemented – or partly waived – 1.7m paragraphs of new Mifid II regulations, and earned as much as the average employee does all year, writes Matthew Vincent. And it’s almost the weekend again!
Next always seems to go first in reporting what’s happening to retail sales, writes Matthew Vincent. This is perhaps nominally appropriate – and moderately helpful to rivals. In early January 2017, the clothing chain was first to forewarn that rising inflation would hit consumer spending – knocking £948m off its own market capitalisation, but making it easier for Marks & Spencer and others to break their own bad news later on. In 2018, however, it may be easier to be Next than next.
Compass Group will not be the only company to feel the loss of Richard Cousins, its chief executive who died on Sunday, writes Matthew Vincent. When, last September, Cousins announced his intention to step down as chief executive of the FTSE 100 caterer after 11 years, the FT Lombard column was not alone in suggesting others could have benefited from his food for thought. Not least Tesco, from which he had earlier resigned over an objection to its proposed Booker acquisition.
Thursday December 14 will go down in history as the day that the Walt Disney Company wrote a new chapter in the history of a once feared empire, and settled the destiny of one who was taught to wield mysterious power by a wise and wizened old master. But enough of Star Wars, Luke Skywalker and his mentor Yoda, writes Matthew Vincent. In other news, Disney is buying the entertainment assets of the 21st Century Fox empire, and deciding the destiny of James Murdoch, who had run the business for his father: the legendary media mogul Rupert.
Customers are used to be being put on hold by retailers. Retailers are less used to being put on hold by customers, writes Matthew Vincent. But that is exactly what has happened to Dixons Carphonethis year: customers decided to put their mobile phone upgrades on hold, refusing to choose expensive new models, and forced the electricals retailer to ring up a profit warning.
Did you think Local Shopping REIT selling 142 retail properties for £19.3m was dealmaking? No, that’s not property dealmaking. Did you think UK shopping centre owner Hammerson offering £3.2bn for rival Intu was proper dealmaking? No, it’s really not. Unibail-Rodamco, the largest commercial property company in Europe, buying Westfield Corporation for $24.7bn. Now that is property dealmaking, writes Matthew Vincent.
Theresa May is not the only one to secure a political deal in the nick of time, and breathe a sigh of relief, writes Matthew Vincent. Charles Woodburn, chief executive of BAE Systems has managed no less a negotiating feat, but in the Middle East rather than Europe: finalising a £5bn order from Qatar for 24 Typhoon fighter jets – a deal that will safeguard British jobs and ensure UK production of the aircraft into the mid-2020s.
For Ladbrokes Coral shareholders this morning, it is not so much a case of Christmas coming early, as a bid coming early, writes Matthew Vincent. GVC Holdings’ wish to buy the High Street bookmaker has been known for months – it has been the worst kept secret in the the FTSE 250. But most people expected the two companies would wait until the outcome of the government review of fixed odds betting terminals – the high-stakes machines that deliver a majority of Ladbrokes’ retail revenues.
Carillion’s full-year trading statement was always going to be the news this morning, whether it happened or not, writes Matthew Vincent. And those betting on further falls in the stricken construction group’s shares probably had money on “not”. In fact, as of last night, Carillion’s own financial calendar still said: “There is no event/s available for current selection” and the company had not confirmed to news websites that any announcement would be forthcoming today.
Long-term incentive plans are about to get longer – but long-term board appointments will have to get shorter, writes Matthew Vincent. That’s the (extremely) short and sharp version of the new UK Corporate Governance Code, as published by the Financial Reporting Council this morning. And it seems to be aimed at removing two long-standing reasons for public mistrust of business: money for old rope and jobs for the boys.
Water company Severn Trent hit the headlines (or should that be the ley lines?) earlier this week when it emerged that its engineers still used ancient divining, or “dowsing”, rods to find underground pipes – despite widely held scientific opinion that they don’t actually work. And, this morning, Severn Trent investors will be trying to divine the likely outcome of an upcoming regulatory price review – despite widely held opinion that these don’t work, either, writes Matthew Vincent.