Daily Mail - 04.03.2020

OLYMPIC CONCERN Tempo-

rary power group Aggreko is

monitoring the potential impact

of coronavirus and the Tokyo

2020 Olympics. The group is

among firms providing power

for the upcoming games in

Tokyo, but there are fears Japan

may postpone the event due to

the outbreak. It unveiled a 13pc

rise in underlying pre-tax prof-

its to £199m for 2019.

T R A D I N G B O O ST O n l i n e

trading platform CMC Markets

raised its profits forecasts amid

increased trading volumes due

to Covid-19. Profits for the year

to the end of March should beat

current market estimates of

£199m to £202.3m.

RECRUITER WOE Recruit-

ment giant Robert Walters has

seen shares come under pres-

sure after it warned the out-

break is likely to affect 2020

profits. Shares fell 5.7pc as the

group reported 2019 pre -tax

profits of £47.4m – down 6pc.

VISA WARNING Revenues

will be lower than previously

expected at credit company

Visa in the first three months of

2020 due to the coronavirus.

Visa said. ‘We anticipate that

this deteriorating trend has not

bottomed out yet.’

SUPPLY FEARS The boss of

consumer goods firm Intertek

Andre Lacroix said: ‘Our 2020

performance will be affected by

the temporary disruption to the

supply chains of our clients in

China and any impact it might

have on global trade activities.’

However, he added that it was

too early to say exactly what

impact the virus will have on

the FTSE 100 company, which

works in 100 countries. Shares

rose 1.7pc, or 88p, to 5412p.

INSURANCE BILL Insurer

Direct Line said the UK’s recent

winter storms are set to cost it

at least around £35m, while it

revealed a £1m bill so far for

coronavirus travel claims.

The Churchill and Green Flag

owner said Covid-19 has the

potential to affect its travel

business results this year, while

the disruption in equity markets

could knock investments and

the speed of claims payouts.

Most coronavirus claims so far

cover cases where customers

were due to travel to countries

where the Foreign & Common-

we a l t h O f f i c e h a s a d v i s e d

against all but essential travel.

■ ■ ■ ■ ■ ■

(^) Daily Mail, Wednesday, March 4, 2020
City Editor: Alex Brummer http://www.thisismoney.co.uk Business Editor: Ruth Sunderland

City Finance

255 per cent

rise in sales of

hand sanitiser

last month

by Hugo Duncan

SHARES on Wall Street tumbled last
night after the first emergency inter-

est rate cut in the United States since

the financial crisis spooked investors
worried about the coronavirus.
The Dow Jones Industrial Average fell
nearly 1,000 points before finally closing
down 786 points, or 2.94pc, amid esca-
lating fears over the impact of the deadly
epidemic on the global economy.
The latest sell-off came after the Federal
Reserve cut rates from between 1.5pc and
1.75pc to a range of 1pc to 1.25pc.
Fed chairman Jay Powell (pictured), who
has been criticised by President Donald
Trump for setting rates too high, said the
virus ‘poses evolving risks to economic activ-
ity’. The Dow rose more than 300 points in
the immediate aftermath of the rate cut as
investors welcomed the bold move.
But shares then slammed into reverse
amid fears that there was little authorities
can do to shield economies.

Greggs double whammy Business rates demand

GREGGS said its sales were battered by the

February storms as retailers brace for a
slump in demand caused by coronavirus.
The on-the-go bakery said growth
slowed as people stayed home in the

recent wet weather.
It also suffered a flood at its bakery out-
side Cardiff, putting production out for

around four weeks. The chain, which has
2,050 shops, had a record-breaking 2019
with pre-tax profits up 31pc to £108.3m, on
revenue of almost £1.2bn, up 13.5pc.

It is the sixth consecutive year of growth.
Shares rose 3.6pc, or 76p, to 2166p, and
the dividend rose 25.8pc to 44.9p.

Greggs said 10pc growth in January, fell

to ‘low-single digit’ growth in February.

Its shops were battered by recent storms

and now face shoppers deserting high

streets due to the coronavirus.

Chief executive Roger Whiteside said

that Greggs would continue to open 100

stores per year, and had capacity to sup-

ply 2,500. ‘There are 20,000 food-on-the-

go locations in the UK. For Greggs, we just

don’t know the number,’ he said.

Bosses are looking at openings in train

stations and airports, click-and-collect, a

delivery service from Just Eat, and will

start serving in five Asda stores. Interna-

tional expansion is also seen as an option,

but not before 2025.

BUSInESS leaders are pleading for the

Chancellor to shake up Britain’s broken

business rates regime.

In a letter to Rishi Sunak as he prepares

for his first Budget next week, organisa-

tions have demanded urgent reform.

With the struggling High Street facing a

fresh onslaught from the coronavirus,

groups including the British Chambers of

Commerce (BCC), the Federation of Small

Business, the British Retail Consortium

and the British Beer and Pub Association,

want business tax reduced.

Adam Marshall, director-general of the

BCC, said: ‘The system is one of many

upfront costs holding back the growth

potential of companies across the UK.

‘It’s time for the Government to deliver on

its manifesto pledge to review and reduce

business rates so firms can invest in their

people and prospects instead.’

James Lowman, chief executive of the

Association of Convenience Stores, said:

‘The system is no longer fit for purpose.’

Businesses say the system unfairly taxes

those with lots of property – such as shops,

pubs and cafes – while giving online sellers

a competitive advantage.

High rates have been cited in dozens of

cases of businesses going under, and critics

say the tax risks turning thousands of UK

main shopping streets into ghost towns.

The call comes as high streets brace for a

slump if shoppers stay home to avoid catch-

ing the coronavirus. The rates raise £30bn

for the Treasury each year, and businesses

say the smallest firms should not pay the

tax at all, to support start-ups.

Shares tank after

shock US rate cut

Trump urges

Fed to do more

Carney vows

help for UK firms

Dow falls

786 points

George Lagarias, chief econo-
mist at Mazars, said: ‘This is one
of the very few times in recent
financial history that the Fed fires
its bazooka, and nothing happens.
Markets did not follow the move
with an exuberant rally.
‘Rate cuts don’t stop viruses or
mitigate demand and supply dam-
age from people not being able to
leave their homes.’
With stock markets tanking,
Trump demanded more rate cuts.
He said on Twitter: ‘The Federal
Reserve is cutting but must fur-
ther ease and, most importantly,
come into line with other coun-
tries/competitors. We are not play-
ing on a level field. n ot fair to USA.
It is finally time for the Federal
Reserve to LEAD. More easing and
cutting!’ The Australian central

bank also cut rates, to a record low

of 0.5pc, and pledged to take fur-

ther action if necessary. Other cen-

tral banks are ready to act, includ-

ing the Bank of England, European

Central Bank and Bank of Japan.

It is feared the outbreak, which

started in China but has spread

round the world, disrupting air

travel and hampering business,

could tip countries into recession.

C h a n c e l l o r R i s h i S u n a k i s

expected to use next week’s

Budget to support the economy.

And Bank of England Governor

Mark Carney yesterday said the

authorities stood ready to protect

small firms. ‘We don’t want viable

businesses to go out of business

because of the very necessary

steps that need to be taken to

protect and serve the British pub-

lic over the course of the near

future,’ he said.

The International Monetary

Fund and World Bank last night

said they will adopt a ‘virtual for-

mat’ for next month’s spring

meetings instead of convening

some 10,000 government officials,

business leaders and other dele-

gates in Washington.

The World Bank also revealed

that it would make an emergency

funding package worth £9.2bn

available to developing countries

which are struggling to cope with

the Covid-19 outbreak.

Finance ministers and central

bankers from the G7 nations of

the US, Canada, UK, Japan, Ger-

many, France and Italy also held a

conference call yesterday to dis-

cuss the epidemic. Following the

call, they said: ‘Given the poten-

tial impacts of Covid-19, we reaf-

firm our commitment to use all

appropriate policy tools to achieve

strong, sustainable growth and

safeguard against downside risks.

‘Alongside strengthening efforts

to expand health services, G7

finance ministers are ready to

take actions, including fiscal

measures where appropriate, to

aid in the response to the virus

and support the economy.

‘G7 central banks will continue

to fulfil their mandates, thus

su p p o r t i n g p r i c e s t a b i l i t y

and economic growth while main-

taining the resilience of the finan-

cial system.’

coronavirUS chaoS

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