Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Gym Group swings to £26m loss
Budget fitness chain Gym Group (GYM.L) said on Wednesday that it lost more than £26m ($34.7m) in the first half of its financial year, as the coronavirus pandemic and associated gym closures razed its revenue.
For the six months to the end of June, the company reported an adjusted pre-tax loss of £26.3m, compared with a profit of £5.6m in the same period last year.
Revenue in the period plunged by almost 50%, from £74m last year to just £37.3m in 2020.
Sweeping coronavirus restrictions introduced by the UK government forced the closure of the chain’s gyms on 20 March, and they did not reopen until 25 July.
Gym memberships have also declined markedly — from 796,000 in June last year to just 658,000 on 25 July.
The losses come after Gym Group raised £40m in April to bolster its balance sheet in the wake of the pandemic.
“Following our decisive actions during lockdown to minimise costs and secure additional liquidity, we have reopened as the strongest capitalised company in the sector,” said chief executive Richard Darwin.
Profits at Barratt almost halve as home completions collapse
Barratt Developments (BDEV.L), the UK’s largest house-builder, said on Wednesday that pre-tax profits had almost halved in its most recent financial year.
The number of homes completed fell by 29% to 12,604 in the 12 months to June 30, pushing revenue in the period down by 28%, to to £3.42bn.
Pre-tax profits in the period fell 46% to £491.8m, in part because of more than £74m in costs associated with the coronavirus pandemic.
The house-builder spent more than £45m on safety measures, site costs and other employee measures, and expects its bottom line to be dented by almost £30m due to an expected increase in project durations.
The company, which suspended its dividend in March, said it would not restart shareholder payouts until the “time is right.”
“Although uncertainties remain, all of our sites are operational, we are seeing very strong consumer demand and our robust financial position means we enter the new financial year with cautious optimism,” said Barratt chief executive David Thomas.
UK house prices hit a new all-time high in August after the biggest monthly rise since 2004, according to new figures from Nationwide.
The average home sold for £224,123 ($299,82) in August, up 2% from £220,935 in July.
It provides the latest sign of the mini-boom in Britain’s property market in recent months, with pent-up demand after lockdown and a temporary stamp duty holiday fuelling growth in sales and prices.
The data from the building society, one of Britain’s biggest mortgage lenders, showed a 3.7% increase year-on-year. Analysts had expected just a 0.5% rise on July, and a 2% annual increase.
The market has now erased all the losses seen in May and June. Robert Gardner, Nationwide’s chief economist, said it reflected the “unexpectedly rapid” recovery in activity since lockdown curbs eased.
Gardner highlighted not only pent-up demand, but also people reassessing their “housing needs and preferences” as a result of life under lockdown.
Ryanair flew just seven million passengers in August, down 53% from 14.9 million the previous year.
Figures published by the company on Wednesday indicate it flew just 60% of its usual August schedule, with a load factor — a measure of how many seats are used — of just 73%.
But the data marked an improvement for the company versus the previous month, with passenger numbers down 70% year-on-year in July. It had run 40% of its usual schedule.
At Wizz Air, passenger numbers dropped to 2.38 million, with a load factor of 70.9%.
Airlines have hit out at the UK government over travel quarantine policy announcements over the summer, including popular destinations like France and Spain, for exacerbating their woes.
Stocks in Europe rose on Wednesday after US Treasury secretary Steve Mnuchin urged lawmakers to approve new stimulus measures to tackle the economic fallout from the coronavirus pandemic.
Signalling that the Trump administration may be willing to support a package worth as much as $1.5tn (£1.1tn), Mnuchin also suggested that he was willing to consider Democratic proposals to provide more funding for state and local governments.
While both sides remained locked in dispute on Tuesday, the funding has been one of the key stumbling blocks in the protracted standoff between Democrats and Republicans.
What to expect in the US
Futures were pointing to a positive open for stocks in the US on Wednesday. Traders on Wall Street also took encouragement from favourable US economic data and moderating coronavirus infections.
While construction spending was nearly flat in July, data from June was revised sharply higher on Tuesday. Purchasing managers’ index data suggested, meanwhile, that the country’s manufacturing sector continues to rebound.