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What to watch: All Bar One owner swings to loss, Meggitt warning, and stocks rise

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
A view of a sign for a All Bar One in London. Photo: Mike Egerton/PA via Getty

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

All Bar One owner swings to loss

Pub and restaurant group Mitchells & Butlers (MAB.L) has fallen to £121m ($151m) half-year loss as a result of the COVID-19 pandemic, down from a £75m profit in the same period last year.

The company, which owns brands like All Bar One, Toby Carvery, and Nicholson’s pubs, said revenue fell to £1bn in the 28 weeks to the 11 April. That compared with revenue of £1.2bn in the same period last year.

Mitchells & Butlers said a review of its property portfolio has also led it to writedown the value of its assets by £524m.

“The business was performing very well before the enforced closure in response to Covid-19,” chief executive Phil Urban said.

Urban said the business had a “clear plan for re-opening.”

“We are well placed to continue to bring people and communities together and to keep Mitchells & Butlers at the forefront of the eating and drinking-out market,” he said in a statement.

Mitchells & Butlers has secured £100m of additional unsecured financing to support reopening. The business has net debts of £2.2bn.

Meggitt warning

Engineering giant Meggitt (MGGT.L) has warned investors to expect a sharp fall in revenue as a result of the grounding of airplanes around the world.

Meggitt said second quarter revenue was set to be 30% below expectations and half-year income would be 15% lower than forecasts.

The company reassured investors on its liquidity position and was pursuing an aggressive cost cutting programme that will see it reduce outflows by up to £450m this year.

Shares rose 6.6%.

Primark counts cost of shutdown

Primark-owner Associated British Foods (ABF.L) has said its retail brand lost £650m in sales per month during the shutdown.

In a trading update on Thursday, ABF said Primark also spent £800m on rent and payments to supplies between March and May when “trading across the estate was either non-existent or minimal.”

Sales for the last three months were down 75% as a result of the lockdown, falling to £582m.

Primark has now been able to reopen all but eight of its 375 stores and trading has been “reassuring and encouraging”. ABF said Primark is expected to make a full-year operating profit of £300m to £350m, which would be around a third of the prior period’s figure.

Shares in ABF rose 7.5%.

Stocks rise ahead of unemployment data

European stock markets opened higher on Thursday, ahead of closely-watched EU and US unemployment data later today.

The FTSE 100 (^FTSE) opened up 0.7% in London, the DAX (^GDAXI) rose 1% in Frankfurt, and the CAC 40 (^FCHI) climbed 06%.

Analysts said investor attention was focused on unemployment data due later this morning from both the EU and US.

“Today’s economic docket is all about the unemployment numbers,” said Michael Hewson, chief market analyst at CMC Markets.

The EU unemployment rate is due to be published at 10am UK time. Economists expect the jobless rate to rise from 7.3% to 7.7%.

US labour market statistics, including non-farm payroll numbers and the unemployment rate, follow at 1.30pm BST.

The US unemployment rate is expected to fall to 12.3% and non-farm numbers are forecast to show 3m new jobs created in June, although “estimates vary widely” Hewson said.