BP (BP.), property stocks, estate agents, Serco (SRP), SThree (STEM), Currys (CURY), Bunzl (BNZL) and Mears Group (MER)
Bernard Looney left BP (BP.) under a cloud in September after the board decided he had not been honest enough about his workplace affairs. Now, the energy giant has decided Looney’s actions amounted to “serious misconduct” and so he will miss out on £32mn in bonuses and salary, including 50 per cent of last year’s bonus. Most of this came from his resignation with immediate effect in September (£28mn) but the directors also decided to pull back more given the ex-CEO “misled the board”.
Reports since the resignation have painted a picture of Looney as a serial womaniser and the Financial Times said he had promoted women with whom he’d had relationships. The hunt for a new boss continues, with CFO Murray Auchincloss serving as interim chief executive. AH
Read more: BP disappoints as interim boss rules out M&A
Property stocks rally after Fed meeting…
FTSE 350 real estate investment trusts (Reits) and housebuilders were among the biggest risers in London this morning after the US Federal Reserve said it had finished hiking interest rates and indicated three cuts in 2024. Yesterday, the Fed held rates at a targeted range between 5.25 and 5.5 per cent as the Federal Open Market Committee's aggregate expectation for the federal funds rate at the end of next year dropped to 4.6 per cent, implying three rate cuts.
In London this morning, there were share price gains for Reits and housebuilders, who are sensitive to interest rates because of their impact on property buyers' budgets. The biggest Reit winners in the FTSE 350 this morning were Safestore (SAFE), Great Portland Estates (GPE), and LXi (LXI), who were all up between 7 and 8 per cent in early trading. Meanwhile, housebuilders Persimmon (PSN), Vistry (VTY), and Crest Nicholson (CRST) all rose between 6 and 7 per cent.
Read more: The next big problem for Reit investors
Serco generating more cash than expected
Shares in Serco (SRP) rose 5 per cent in early trading after the outsourcing giant upgraded its 2023 free cash flow forecasts by £20mn and posted predictions for 2024. Free cash flow is now due to reach £170mn this year, while the group expects to achieve underlying operating profit of £245mn, in line with guidance.
Next year, Serco’s underlying operating profit is expected to increase to around £260mn, as growth in the underlying business and contribution from acquisitions more than offsets currency headwinds and mobilisation costs from new contracts. JS
Currys boosted by improved profitability in the Nordics
Currys (CURY) shares climbed by more than 10 per cent in early trading after the electrical retailer reported a 190-basis point gross margin increase in its troubled Nordics market and maintained full-year guidance.
For the half year to 28 October, revenue fell 7 per cent to £4.16bn “as consumer spending remained under pressure”, while statutory pre-tax losses significantly narrowed from a negative £548mn to a negative £46mn. The company made a deal to sell its Greek business after the period end for net proceeds of £156mn, with the disposal expected to complete in the first quarter of 2024. CA
Mears steers in new chief
Social housing contractor Mears Group (MER) said that chief operating officer Lucas Critchley will take over as CEO in the New Year following David Miles’ retirement. Miles, who has been with Mears since 1996 and on the board since 2007, announced his plan to retire in May last year. MF
