Continued policy of the latest economic and monetary news, as the M-S point-of-sale chain announces a rationalization program and sharp task cuts.
It’s a morning in the City of London.
The FTSE Hundred High Stock Index fell first, but has now regained its losses to remain unchanged at 6126 points. However, the French, German, Spanish and Italian markets are all higher.
Housebuilder Persimmon is the first in London, with a 5% increase after reporting a strong recovery since the pandemic declined.
But the company continues to suffer after primary task cuts, 4% less than the rear of the FTSE 250 rating of indexed small businesses. The worst performance is the capita outsourcing organization, which fell almost 10% after reporting a loss of 28.5 euros due to the pandemic.
Capita warned:
The effect of COVID-19 came in a crucial year for Capita, as we expected a profit growth.
Profits have been particularly affected and the delay in returning to expansion means that we will not generate sustainable money for 1 or 2 years.
Marks and Spencer’s long-term customers are very lucky for their new collaboration with Ocado.
This partnership begins next month and will allow others to order food to deliver home to Ocado (replacing Waitrose).
Russ Mold, of the AJ Bell brokers, claims that M-S wants the Ocado deal to work quickly:
“The company will have to thank its fortunate stars for having a successful food industry, as this has helped help the industry in a very difficult period. His clothes and non-public interests fought in the face of the winds against serious as a call for the workplace and ceremonial clothes fell off a cliff.
“The next big check for Marks and Spencer will be the imminent launch of their origin agreement with Ocado for online food orders in the UK. The good luck of this joint venture in the giant component of the acceleration of the expansion in Marks and Spencer’s food sales.
“This is an opportunity for the store to catch up with the online channel and assembly expectations can simply be disastrous for both control and the company’s already fragile percentage price.
“Marks and Spencer has been in rotation mode for a long time and a lot of effort has been put into looking to fix things than to generate new ideas. The Ocado agreement is another because it is new territory for the group. Starting this Business with a smart start can fuel optimism that the store can still evolve over time rather than sink into quicksand.
Speaking of AustraliaArray … the country’s wine industry faces the risk of new price lists in sales in the developing Chinese market.
China has introduced an anti-dumping investigation into imports of Australian wine to a extent that is likely to increase tensions between the two countries. That has reduced the percentage of Australian winemakers today.
The investigation was initiated through court cases from the Chinese Alcoholic Beverage Association that Australian winemakers had unfairly reduced their costs, harming domestic manufacturers. More here:
In the mining sector, BHP Billiton is committed to promoting its thermal coal mines within two years.
This is a component of the global mining giant’s efforts for a low-carbon future, following investor stress to set its business blank.
From Australia, my colleague Ben Butler reports:
Announcing an annual $7.95 billion profit Tuesday, BHP executive leader Mike Henry also left the door to support a solution through activist shareholders that would force BHP to prevent mining that would destroy Australia’s Aboriginal cultural heritage sites until legislation is enacted. Changed. for your protection.
Henry said BHP agreed with the intent of the resolution, which is to save him “another Juukan Gorge,” a reference to rival miner Rio Tinto’s resolution of blowing up 46,000-year-old caves in Pilbara for access to higher-quality iron ore. Training
As stores struggle, property developers expect the situation in their sector to improve.
Persimmon, the UK’s largest homeowner, reinstated its dividend this morning after reporting that it had recovered strongly this summer.
Chief executive Dave Jenkinson told the city that weekly sales were nearly 50% higher since the structure industry ended its closure, and Persimmon’s accumulation also increased.
The group got off to a good start for the part of the moment with a c. A 49% year-over-year accrual on a weekly average consistent with consistent personal sales rates since early July and an existing accumulation of c. 2.5 billion pounds, an increase of 21% from last year.
The pandemic cost, with Persimmon’s pre-tax earnings during the first six months of 2020 falling by 43%, from 509 million pounds to 292 million pounds.
Marks and Spencer shares fell by almost 4% in the morning session, 4.4% to 109.2%.
This suggests that investors are disappointed with M-S’s new attempt at the company.
The percentage of M-S has been almost halved in price, so this year (the market as a total has fallen by almost 20%).
Julie Palmer, wife and restructuring of Begbies Traynor, says M-S task cuts highlight the “big structural change” in Spending patterns in the UK.
With more people buying groceries online, stores want fewer people at points of sale and more and more people are sending products to customers’ homes.
“This is a massive transformation for the brand.
And that is mandatory because consumers have become accustomed to the convenience of buying groceries in the confinement. The change from store to warehouse, a greater concentration in logistics and a greater ability that can help the online source will be where retail work will begin to appear. Increasing generation in the office to optimize organizations will also be less unusual as retail moves toward its long-term structure.
Clothing has been the weak aspect of the M-S business for many years, with strong food sales.
Covid-19 turned out to have accelerated this trend, leading to task cuts this morning.
As John Moore, senior investment manager at Brewin Dolphin, says:
“Today’s announcement, while complicated for MS members, has been slow to arrive. The fall of the FTSE company 1000 medium-cap was reflected beyond strategic errors; but, more recently, the company had experienced significant adjustments even before the Covid-19 pandemic.
Indeed, today’s measures underscore the extent to which the economy has an effect on the virus that has over-accelerated many of the trends that were already sweeping retail and other sectors. The hope will be that one of the UK’s leading iconic brands will emerge from this procedure as a more powerful and sustainable undertaking in the other area; however, the coming months will be difficult for the company and its staff. “
Retail analyst Nick Bubb said:
M-S Food sales go well, but M-S Clothing Home sales are very low and therefore it is not unexpected to see the company put into position large cost-cutting plans, disguised as “rationalization” Array.
M-S task cuts are among the toughest announced through a British company since the pandemic brought the economy to its worst recession in decades.
But many other stores have also made mass layoffs and store closures.
Like what:
Others who are cutting jobs include:
If you only log in, these are the main points of the M-S’ main job cut plan, announced at 7 a.m.
Marks and Spencer is expected to eliminate about 7,000 jobs over the next 3 months as a component of the retailer’s most recent layoff, as it reduces price activity and adjustments as a result of the pandemic.
Task cuts will take place at its central assistance centre, regional control and UK stores, which will add to the wave of task cuts announced through British companies, the Covid-19 crisis.
It is that it expects a “significant proportion” of task losses to be caused by voluntary dismissals or early retirements, and has initiated consultations with staff.
The clothing, food and household goods store said what it called a “rationalization program” is a vital step in lowering prices and helping you out of the coronavirus crisis with a lower charge base and more resilient activity.
Marks and Spencer chief executive Steve Rowe said task cuts were part of his past-announced plans to “know the classes of the crisis, drive our transformation, and create a more powerful and agile company in a world where safe visitor behavior has been replaced forever.”
“The outlook is dubious and we remain cautious,” Rowe said, “these proposals are a vital step towards installing a lighter and faster company, designed to satisfy customers’ conversion desires, and we are committed to supporting our colleagues this time.”
Marks and Spencer is “desperately” to adapt to covid-19’s new global by reducing 7,000 jobs in his business, says Richard Lim, CEO of Retail Economics.
He fears that many more jobs will disappear when the government’s licensing program ends this fall:
“This is a big reduction and the store is desperately looking to reposition the company towards a new and emerging general in the sector. This painful era of readjustment will result in significant relief in labor costs, relief in the number of outlets, and a turnover of business style towards a more agile and digital orientation.
“Retailers were already grappling with the speed of structural replacement facing the sector, but the effect of the pandemic was a radical replacement for the industry. Retailers remain in survival mode, preserving their cash and clinging to more sustainable demand. But the way we shop has permanently replaced many parts of the industry almost overnight.
The truth is that many more stores will fail and the number of tasks lost will increase with the withdrawal of government aid. It’s the calm before the storm.
Here’s the reaction, by Graham Hiscott of the Daily Mirror:
The tweets of BBC Sally Bundock:
The scale of the crisis in the company’s homewear and clothing business is staggering: a drop of nearly 30% since outlets reopened in mid-June.
Over the more than 8 weeks, in-store stores fell 47.9% from the previous year.
Online sales are higher, 39.2%, but this still leaves total sales at 29.9%.
Therefore, even if food income is rising, overall incomes are declining by 10% in the last 8 weeks:
The demand for more elegant garments has declined especially this year (with so few people going or attending parties and weddings).
In-store sales functionality has several features across the field, with some of the new out-of-town retail outlets listed at a general point of sale close to last year’s in recent weeks, however, the old city’s retail outlets and some shopping malls are still heavily affected by social estrangement and reduced attendance.
In addition, with the closure of many workplaces and the lack of social gatherings, the clothing sales team has noticed a very extensive shift from ceremonial clothing to casual and recreational clothing.
Marks and Spencer CEO Steve Rowe blames the “uncertain prospect” of today’s massive cuts of task.
In this morning’s statement, he to shareholders:
“In May we presented our plans to be informed of the crisis, drive our transformation and create a more powerful and agile business in a global where the safe behavior of our consumers has replaced forever. Three months later, our Never the Same Again Program is progressing, even if the perspective is uncertain and we remain cautious.As a component of our Never The Same Again program to integrate positive replacement into how to succeed over the crisis, we are making proposals to further optimize workshop operations and control structures.
These proposals are a vital step towards the installation of a lighter and faster company, designed to satisfy consumer conversion desires and we are committed to supporting our colleagues this time. »
M-S says it also plans to create new jobs as a component of this rationalization plan, but there are no main points in the number.
Says:
At the same time, we plan to create a number of new jobs as we invest in online order control and the new food warehouse at room temperature and reshape our portfolio of stores throughout the year.
Hello and welcome to our ongoing policy of the global economy, money markets, the euro and businesses.
Some new mistakes to start the morning: Marks and Spencer is preparing to eliminate approximately 7,000 jobs.
The supermarket chain has just announced that it is launching a “multi-level consultation program” after being hit hard by the fall in retail spending on the Covid-19 pandemic.
Task cuts will affect staff at UK M-S stores, as well as its central aid centre and regional management. This will add to the tens of thousands of tasks already lost or threatened in the UK economy as a whole.
In a message to the city, M-S warns that sales of clothing and household items have declined particularly than a year ago, meaning you want to reorganize your business.
Says:
As reported in the past, the clothing and home industry at retail outlets remains well below last year, with online counterfeits and home delivery. It is transparent that there has been a significant replacement in the industry and if it is too early for what it should be, a new combination of post-Covid sales is expected to be established, we will need to act now to reflect that replacement.
We also learned that we can paint more flexibly and productively with more colleagues who perform multiple responsibilities and make the transition from food to clothing and home. The launch of our leading store generation package, developed in partnership with Microsoft, has also allowed us to reduce the control layers and overhead of the office.
It expects ‘a significant share to be made in voluntary and early retirements’, adding:
In keeping with our long tradition of treating our workers well, we will now begin an extensive communication program with our colleagues.
More main points and reactions to follow in Array …
It’s a busy day for American retailers, with Walmart, Kohl’s and Home Depot publishing results. This will show that sales have been recovered since the lock was eased.
We also get a fitness check in the genuine U.S. real estate market, with the latest figures for new home construction and construction rentals.
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