Proactive Investors -
- FTSE 100 up 40 points at 7,972
- UK recession confirmed
- Thames Water rescue collapses
Baltimore bridge collapse could be largest insurance payout ever - Lloyds (LON:LLOY)
Lloyd’s of London chair Bruce Carnegie-Brown has said the Baltimore’s Francis Scott Key Bridge incident could turn out to be the largest marine insurance payout of all time.
The bridge collapsed after being struck by the Dali cargo ship, operated by Maersk on Tuesday morning.
Several people have been left missing presumed dead following the incident, including workers on the bridge at the time, while drivers have been pulled from the river since.
One of the US east coast’s major shipping arteries has been shut, and will likely remain so for some time, following the collapse, meanwhile.
Carnegie-Brown commented he would be “very surprised” if the total cost to insurers was not in the multi-billion dollar mark.
“The tragedy has the capacity to become the largest single marine insurance loss ever,” he said.
JD Sports leads risers, FTSE 100 climbs
London’s blue-chip index added 32 points to reach 7,964 on Thursday morning, with JD Sports Fashion PLC (LON:JD) leading the way after a positive trading update.
Having reassured that it was outperforming the market and that conditions should improve later this year, the retailer climbed 5.4% to 122.61p.
Also rising were HSBC Holdings PLC (LON:HSBA) and Flutter Entertainment PLC (LON:FLTRF), as each looked to recoup falls seen on Wednesday.
Severn Trent PLC (LON:SVT) and United Utilities PLC (LON:UU) featured among the day's fallers meanwhile, following news that peer Thames Water would not get a rescue package from shareholders.
Medical technology company Smith & Nephew PLC fell 3.4% in the meantime, after announcing John Rogers would join the company as chief executive in April, replacing Anne-Francoise Nesmes.
Thames Water shareholders blame Ofwat as funding pulled
Shareholders in Thames Water have blamed regulator Ofwat after pulling a £500 million rescue package from the supplier to London earlier today.
In a statement, the nine shareholders said Ofwat had failed to provide regulatory support for Thames Water's turnaround plan, which included over £18 billion worth of investment in the likes of infrastructure.
"To support such unprecedented investment, shareholders committed to supporting a further £3.25 billion of investment on top of the £500 million provided last year, and pledged to take no cash out of the business until a turnaround was delivered," the statement read.
"This was a solution which addresses the root cause of Thames Water’s challenges without the need for any taxpayer funding.
"However, after more than a year of negotiations with the regulator, Ofwat has not been prepared to provide the necessary regulatory support for a business plan which ultimately addresses the issues that Thames Water faces. As a result, shareholders are not in a position to provide further funding to Thames Water."
888 Holdings sells US assets to Hard Rock
William Hill owner 888 Holdings PLC (LON:888) has agreed to sell selected assets to Hard Rock Digital as it disposes of it US business-to-consumer business.
This will likely be completed in phases up to the fourth quarter of this year, as 888 looks to fully exit from the US by the end of 2024.
“The exit of US B2C operations is expected to realise a recurring annualised benefit to adjusted EBITDA of approximately £25 million from 2025 onwards,” a statement read.
“The group intends to reinvest approximately £10 million of these savings into growth and value creation initiatives.”
A £40 million net impact is set to be incurred from the disposal of its US assets, which 888 added had already been included in financial targets.
Shares dipped 1.7% to 87p.
UK recession confirmed, construction rebounds in January
Revised figures from the Office for National Statistics (ONS) on Thursday confirm that the UK did indeed enter a technical recession over the latter half of last year.
However, the contraction was not as bad as originally feared, with gross domestic product (GDP) growth coming in at a negative 0.4%, against previous estimates of minus 0.5%.
This is after revised figures showed a 0.1% contraction between July and September, followed by a 0.3% reduction between October and December.
GDP was said to have ticked up by 0.2% over the month of January meanwhile, supported by a 1.1% growth in the UK’s construction output.
However, the figure remained in negative territory over the three months to January, down 0.2%, as service output stagnated, production dipped 0.2% and construction fell 0.9%.