Mon. Dec 6th, 2021


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FTSE 100 Group Johnson Matthey spelled out the cost of his U-turn on his battery business this morning and took a £ 314m impairment charge into his half-year results after announcing he would leave the business two weeks ago.

The chemicals group has been betting on battery-powered electric cars as a route to replace earnings from its catalytic converter business, which will decline as fossil fuel-powered vehicles are phased out. But earlier this month it said it could not compete with larger, lower-cost producers. The division had assets of £ 340 million.

The impairment charge reduced Johnson Matthey’s operating profit for the six months to September to £ 20 million, with a £ 9 million pre-tax loss. The group also announced the sale of its specialist glass technology business for £ 178 million and said it was also in talks about the possible sale of its healthcare business.

Robert MacLeod, who is leaving next year, called trade “robust” nonetheless, despite the group plagued by declining global car production, and declining precious metal prices and “acute temporary labor shortages in the US”.

It also launched a £ 200 million share buyback as underlying profits returned to £ 293 million, double the level before the pandemic, helped by a period of higher precious metal prices.

Lex written a very good note about what Johnson Matthey should do next, which is worth reading if you have not already done so. And I always enjoy hearing your thoughts on the business issues of the day (email me at citybulletin@ft.com) – but here is the view of Sir John Rose, former CEO of Rolls-Royce, on the company’s predicament.

Briefly

Handbag maker sales Mulberry rose more than a third in the first half of his financial year, helping him make a profit (although more than half of his £ 10.2m pre-tax profit came from the sale of his Paris lease) ).

Even wealth manager Brewin Dolphin is not immune to the pressure of wage inflation, it seems. It cited employee wages as one of the reasons why operating costs will grow by “medium to high single-digit percentage” in its 2022 financial year (in addition to technology projects), while commission income is expected to remain stable at the rate set in the final. quarter of the 2021 financial year. It reported net inflows of £ 1.9bn for the year to September, with total revenue rising 12 per cent to £ 406m and profit before tax rising by 16 per cent to £ 73m thanks to “strong investment performance” as well as the influx.

United Utilities published its half-year results this morning, though you have to go through 17 bullet points of corporate struggling before you get to any hard numbers. Underlying operating profit rose 4 percent higher at the water group.

Former Prime Minister David cameron lobbied Lloyds Bank to reverse a decision to sever ties with the sick Greensill Capital, appealing to a councilor he coined while serving as prime minister, our correspondents report. Lloyds wanted to stop doing business with Greensill months before his collapse in March. But after Cameron’s plea to former Conservative party treasurer Lord James Lupton, the bank reconsidered.

London has its first Space since the government revised rules on blank check companies in August. Hambro Perks, the venture capital firm, said yesterday it would seek to raise up to £ 150m for a listing vehicle through listing in London, and then use the Spac to merge with a fast-growing European technology company within 15 months. Daniel Thomas has the full story.

And Blue Prism shareholders will have the opportunity to vote on a takeover offer next month from private equity group Vista, despite a potentially competitive offering from SS&C Technologies on the table. The Takeover Panel will now set a deadline for SS&C to explain its intentions.

Also from today, half-year results of Britvic and money maker From the street.

Beyond the square mile

appeal release NSO Group Technologies, the spyware group that created surveillance software used to target the cell phones of journalists, political dissidents and human rights activists, to prevent them from using its products, we technology team report. The lawsuit, filed Tuesday, alleges that NSO spied on and targeted Apple users, claiming damages as well as an order preventing NSO from using any Apple software, device or services.

Samsung Electronics is to build a $ 17 billion chip plant in Texas after pressure from the Biden administration to expand US semiconductor production. The plant will create more than 2,000 jobs and start work in about three years, with construction starting next year.

Daniel Loeb’s third point has a profit of about $ 300 million on its stake in Rivian in the wake of the electric truck manufacturer’s IPO this month. Loeb has made profits through a series of investments over the past year, including in his convertible notes, our correspondent Laurence Fletcher reports. The hedge fund’s performance so far this year is the best in a decade.

Brooke Masters serves as ringside commentator in the battle between Visa and Amazon, after the retailer sent an email to UK customers saying they planned to stop taking Visa credit cards. It’s a collision of two titans accustomed to getting their own sense, she says – and it’s a battle over who can keep the profits from non-cash payments.

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