BT and Shell shares are in the spotlight at the start of the FTSE 100 results season.
The oil giant boosted shareholder returns despite weaker earnings, while BT shares came under pressure amid disappointing revenue trends.
In other developments, Fevertree announced a US partnership with Molson Coors and struggling Mulberry unveiled a “back to British basics” reboot.
FTSE 100 Live Thursday
- BT revenues miss City target
- Fevertree unveils Molson Coors deal
- Shell earnings fall, lifts dividend
Market update: BT shares lower on revenue fears, US deal boosts Serco
10:31 , Graeme EvansA results-day setback for BT shareholders today offset progress elsewhere as another big distribution of cash by Shell kept the FTSE 100 index near a record.
The oil giant’s fourth quarter earnings fell sharply due to weaker energy prices and margins, meaning the overall haul for 2024 declined to $23.7 billion.
But with better-than-expected levels of cash generation, the company upped its dividend by 4% and announced the 13th consecutive quarter of buying back at least $3 billion of its shares.
Shell lifted 13.5p to 2608.5p as the heavyweight stock played its part in lifting the FTSE 100 index by 19.27 points to within sight of its record at 8577.08.
Other blue-chip risers in a busy session for year-end updates included St James’s Place, which jumped 8.5% or 79p to 1008p after reporting 13% growth in funds under management.
Net inflows of £4.3 billion were better than expected as the wealth manager’s stock market valuation continues to recover after last year’s slump.
Airtel Africa also fared well, surging 13.8p to its highest level in more than two years at 146.8p. This followed plans for a further $100 million buyback of shares, alongside strong third quarter results.
The reception for the telecoms and mobile money services firm was in contrast to the one for BT Group, which topped the FTSE 100 fallers board after its results.
A 3% fall in revenues to £5.2 billion was bigger than expected, offset by underlying earnings stronger than forecast due to one-offs and cost savings.
BT reiterated guidance for this year and the medium term but shares fell 3.2p to 142.8p.
UBS, which has a Sell stance on the stock, said: “We think revenue pressures will build over the coming quarters amid lower CPI-linked price rises and rising broadband infrastructure competition.”
Other fallers in the FTSE 100 include Sage as investors used a first quarter update as an opportunity to lock in profits with shares near a record high.
The cloud-based accounting software company dipped 18.5p to 1318p, having reiterated full-year guidance following a 9% rise in first quarter revenues.
GSK shares fell 12.5p to 1388p ahead of results next week, while Lloyds Banking Group weakened 0.5p to 62.1p and Centrica lost a penny to 138.4p.
The FTSE 250 index outperformed the top flight by rallying 0.7% or 139.13 points to 20,698.83.
Strong performers included Serco, which rose 7.9p to 158.5p after it struck a £264 million deal to buyNorthrop Grumman’s mission training and satellite ground network communications software business.
Digital publisher Future surged 41p to 936.5p after promoting Kevin Li Ying to the role of chief executive, while a 7.5% rise in first quarter revenues at convenience foods maker Greencore helped its shares add 5p to 188.2p.
The biggest FTSE 250 faller was low-cost carrier Wizz Air, which slumped 129p to 1243p as cost pressures continue to offset strong pricing and demand. It reported an operating loss of 75.9 million euros for the final three months of 2024.
On AIM, Fevertree Drinks jumped 23% or 153p to 811p after announcing a strategic partnership with Molson Coors that will see the US brewer acquire an 8.5% shareholding for £71 million.
The proceeds will go to Fevertree shareholders through a buyback programme.
St James's Place update boosts shares recovery
09:11 , Graeme EvansThe recovery of St James’s Place shares continued today after the wealth manager reported a record position for funds under management (FUM).
The figure of £190 billion at the end of 2024 compared with 2023’s £168.2 billion.
Budget uncertainty meant client engagement levels were high throughout the fourth quarter, with an increase in both gross inflows and outflows in the month of October.
Gross inflows across 2024 rose 20% to £18.4 billion, but the net figure was lower at £4.3 billion despite a fourth quarter improvement to £1.5 billion. The net investment return improved to £17.7 billion.
A new charging structure is due to be unveiled by the second half of this year.
Chief executive Mark FitzPatrick said: “Looking forward, we see a growing need for trusted financial advice, and I am confident in our ability to capture this and deliver great outcomes for clients and all our stakeholders."
The FTSE 100-listed shares rose 68.5p to 997.5p, which compares with 402p in April and 1,200p just under two years ago.
BT shares down 4% in flat FTSE 100, Shell holds firm
08:37 , Graeme EvansShell shares have risen 13p to 2608p as the promise of another $3.5 billion buyback offset a bigger-than-expected fall in fourth quarter profits.
The results by BT Group left its shares 4% or 6.1p lower at 140p, reflecting disappointment over a 3% drop in third quarter revenues to £5.2 billion.
Among other blue-chips reporting today, software group Sage fell 28p to 1308.5p, Glencore lost 3.1p to 342.4p and 3i Group eased 38p to 3773p.
St James’s Place got a better reception as its sharets rallied 7% or 64.5p to 993.5p, while Airtel Africa improved 7.1p to 140.1p.
The FTSE 100 index rose 1.65 points to 8559.46 and the FTSE 250 lifted 51.80 points to 20,611.50.
Royal Mail deliveries set for overhaul
08:26 , Graeme EvansPlans allowing Royal Mail to scrap second class post deliveries on Tuesdays, Thursdays and Saturdays have been unveiled by Ofcom.
The first class post service is set to continue on Monday to Saturday although the cost of a stamp could go up as the current price cap would be removed.
Twenty years ago, Royal Mail was delivering 20 billion letters but it has fallen to just 6.6 billion a year, of which about two thirds is “bulk mail.” The total is expected to drop further to be 4 billion a year in the coming years.
Fevertree unveils Molson Coors partnership
08:09 , Graeme EvansFevertree Drinks has unveiled a strategic partnership with Molson Coors as the London-listed mixers firm attempts to accelerate US growth.
The brewing giant will acquire an 8.5% shareholding for £71 million, with the proceeds returned to Fevertree shareholders through a buyback programme.
Fevertree first entered the US market in 2008 and has since become the country’s leading tonic and ginger beer brand.
The partnership utilises Molson Coors' national network of US distributors and customers.
Other benefits for Fevertree include expertise to drive operational efficiencies and to manage the onshoring of US production.
Fevertree co-founder and chief executive Tim Warrillow said the tie-up marked a transformational step for the brand in the US.
He added: “This partnership will be fuelled by a step change in marketing investment to take advantage of the highly compelling opportunity ahead."
Fevertree shares jumped 14% or 94p to 752p.
BT full-fibre rollout continues progress, handset sales fall
07:48 , Graeme EvansBT Group today said the roll out of full fibre broadband passed more than one million premises for the fourth consecutive quarter.
The Openreach division has now reached 17 million premises - more than half the UK - and is on track to reach 25 million by December 2026.
Openreach made a record 472,000 customer connections in the third quarter but total broadband lines fell by 208,000 due to competition and weakness in the new homes market.
Today’s updates also revealed that consumer division revenues returned to growth, up 0.4% after a 1.3% decline in the first half. This was despite a 12% decline in equipment revenue, mainly handset trading.
Overall revenues of £5.2 billion were 3% lower year but adjusted earnings of £2.1 billion lifted 4%, aided by cost savings.
The company reiterated guidance for this year and the medium term.
Chief executive Allison Kirkby said: “Our ongoing modernisation continues at pace, delivering a further step-up in fibre build and take-up, customer satisfaction and EBITDA.
“Benefits from our cost transformation more than offset lower revenue outside the UK and weak handset sales.”
Shell earnings fall but extends run of buybacks
07:21 , Graeme EvansShell fourth quarter earnings today dropped sharply to $3.7 billion (£3 billion) after its performance was impacted by weaker oil prices and margins.
The figure, which compared with $6 billion in the previous quarter, led to an overall earnings haul of $23.7 billion (£19 billion) for 2024.
Despite the lower earnings in the quarter, Shell’a free cash flow of $39.5 billion (£31.8 billion) for 2024 came in higher than 2023.
This has fuelled a 4% increase in the fourth quarter dividend and another $3.5 billion buyback, making it the 13th consecutive quarter of at least $3 billion.
Chief executive Wael Sawan said: “2024 was another year of strong financial performance across Shell.”
FTSE 100 seen lower, US interest rates on hold
07:03 , Graeme EvansUS markets closed lower last night after Federal Reserve chair Jerome Powell said the central bank is in no hurry to lower borrowing costs.
Interest rates remain in the range of 4.25-4.5% after cuts at the previous three meetings.
The Dow Jones Industrial Average finished 0.3% lower, with the S&P 500 index and Nasdaq Composite down by 0.5%.
Results after the closing bell left the shares of Microsoft 5% lower but Meta Platforms rose 2% and Tesla by 4% in extended hours trading.
The FTSE 100 index is forecast to open about 25 points lower, having risen 0.3% to 8558 at last night’s closing bell.
