There’s a lot to digest this lunchtime in the world of business. Lloyds has announced thousands of job cuts and it customers have deserted British Gas in huge numbers. There’s also an update on Facebook’s growth and how over 50s fashion retailer Bonmarche is performing. Here’s all you need to know at a glance.
The major story this morning is Lloyds Banking Group’s announcement that it is to cut 3,000 jobs and shut 200 branches as the lender braces for a cut in interest rates following Britain’s decision to quit the European Union, our city editor Ros Snowdon reports.
The Bank of England has signalled that it will cut the base rate at its next Monetary Policy Committee meeting. In fact the central bank surprised many when it decided to hold interest rates at 0.5 per cent at the last MPC meeting.
Almost 400,000 customers deserted British Gas in the first half of the year as its parent firm, Centrica, saw profits take a dive. Centrica said 399,000 UK homes no longer get their energy from British Gas as a “competitive environment” saw more households switch to rival suppliers.
Over 50’s fashion retailer Bonmarche reported a disappointing 8 per cent slide in like-for-like sales in the three months to June 25, blaming bad weather. The Wakefield-based group said it is not unusual for external conditions to create significant variations in quarterly performance, and therefore its expectation for the full year remains unchanged on the assumption that trading conditions normalise through the autumn season.
Today’s Focus on SMEs section features an interview with Leeds Beckett Graduate Zainah Khan. The psychotherapist talks about launching her new business Chakra and why some business leaders fear having conversations about mental well-being in the workplace. “It’s easy to overlook mental health in business because there’s so much pressure all the time on people to get on with what they need to do,” Ms Khan tells me.
Game Of Thrones broadcaster Sky has brushed aside economic uncertainty surrounding Britain’s referendum on the European Union to drive up revenues and profits.
The firm saw operating profits lift 12 per cent to £1.6bn in the full year to June 30, while revenues climbed 7 per cent to £11.9bn over the period.
The rout in the oil and gas sector continues. Royal Dutch Shell today reported a 72 per cent plunge in profits for the second quarter as the energy giant continues to be hit by low oil and gas prices. The firm said adjusted earnings tumbled from £2.85bn to £800m as chief executive Ben van Beurden flagged the “significant challenge” lower energy costs are posing.
House prices lifted to a new record in July, passing £205,000 on average for the first time, but Nationwide Building Society cautioned that the increased economic uncertainty following the EU referendum could lead to weaker demand for homes in the near term. It said that with the housing market in an “unusually uncertain” condition, it may take several months to see clearly what the underlying trends are. The typical UK property value was £205,715 in July, marking a 0.5 per cent increase compared with June.
Digital company SkyBet pumped £126m into the Leeds economy last year, which shows the sector’s growing importance to the regional economy.
Finally in social media news, Facebook is now used by more than 1.7 billion people every month, the company’s latest financial results revealed. The social media site, which was created by Mark Zuckerberg in his dormitory room at Harvard in 2004, also reported revenue for the last three months of £4.87bn - a figure that exceeded analyst predictions by more than £303m.