BUSINESS LIVE: Vertu eyes UK zero emissions boost; Landsec ups Bluewater stake; Saga insurance challenges

Saga has flagged persistent ‘challenges’ within its insurance division, taking the shine off an ‘exceptional’ start to the financial year for its cruise business.

The over-50s speicalist told investors ahead of its upcoming annual general meeting it was ‘taking action to stabilise’ its broking business, and was ‘seeing early signs of the expected benefits’ in the motor category.

However, it cautioned that ’emerging net rate inflation’ – or higher costs – in the home insurance segment means the actions it is taking ‘are expected to have less of an impact overall’.

Britain’s biggest sparkling wine producer Chapel Down could put itself up for sale just over six months since listing its shares on London’s AIM market.

Chapel Down, which has cashed-in on booming demand for domestically sourced wine, told shareholders on Tuesday it had launched a strategic review to consider options to fund profitable growth.

Chemring has appointed a chairman as it cashes in on increased military spending in the West.

The FTSE 250 explosives maker said Tony Wood will join the board in October and take over as chairman in December.

Wood succeeds Carl-Peter Forster who is retiring after more than eight years in the job.

Land Securities Group has increased its stake in Bluewater Shopping Centre in a £120million deal.

The commercial property developer, which also owns the Piccadilly Lights, said that it has acquired an additional 17.5 per cent in the Kent-based shopping centre for from GIC.

This now leaves the FTSE 100-listed developer with an overall stake of 66.25 per cent in one of the UK’s leading retail destinations.

Gatemore Capital Management has once again called for the removal of Elementis boss Paul Waterman, warning the group’s chair could be targeted for removal if action is not taken.

Waterman survived a shareholder vote in early May with the backing of 88 per cent of voting investors after Gatemore called for ‘urgent change’ in the wake of so-called ‘self-inflicted management failures’ and frustration over the chemicals firm’s share price performance.

But in an open letter published on Tuesday Liad Meidar, managing partner at Gatemore, warned that if Waterman is not removed it could seek to unite shareholders in efforts to oust chairman John O’Higgins.

The FTSE 100 has inched higher at the open as gains in energy shares offset declines in defence stocks, while investors stay cautious ahead of economic data that could sway expectations on the path of US and UK interest rates.

Energy majors Shell and BP are up more than 1 per cent each as crude prices steady near recent highs.

Shares of aerospace and defence firms like Melrose Industries, Rolls-Royce and Senior PLC fell in the range of 2.6 and 5.9 per cent after European aerospace group Airbus cut its industrial and financial guidance for the year.

Traders largely refrained from placing big bets ahead of the US personal consumption expenditure data (PCE), due Friday even as they banked on the numbers to show a renewed moderation in inflation.

UK gross domestic product data is also due this week and could potentially add to Bank of England policymakers’ confidence for an interest rate cut in August.

Comments from BoE officials last week had revived some hopes for an August cut, which were partially tempered by a strong retail sales reading on Friday.

Derren Nathan equity research, Hargreaves Lansdown:

‘With few UK corporate or economic releases scheduled for today, the FTSE 100 is expected has opened flat.

‘One British company that has updated on trading, however, is car dealership network Vertu Motors. New vehicle volumes were up 6.8%, but margins were down, reflecting increased discounting.

‘Softness in auto pricing is another sign that inflation is receding and will provide some comfort for those hoping for interest rate cuts in the near future.

‘Used vehicle volumes also grew strongly, with prices remaining stable. The Group also noted that regulatory support for electric vehicles may lead to the strengthening of petrol and diesel used car values as supply dwindles. Overall, Vertu expects that results for the year ending February 2025 will be in line with market expectations.’

Over 50s specialist Saga has said its cruise business has seen an ‘exceptional’ level of bookings this year, but cautioned over a challenging market squeezing its insurance division.

The London-listed firm, which specialises in products and services for people over 50, highlighted a buoyant start to the year for its ocean and river cruises.

Bookings are ahead of the same time last year, with revenues 14 per cent higher as more passengers secured their holidays, Saga said.

However, the company flagged that conditions have remained challenging in the insurance sector, with inflation continuing to put pressure on its business costs.

Atom Bank will become the latest lender to abandon its offices because so many employees are working from home.

Chief executive Mark Mullen said attendance at the app-based bank’s headquarters in Durham is only at a third of previous levels and it will look for a new location in the North East of England.

Vertu Motors expects Britain’s zero emissions vehicle mandate to create ‘volatility’ in the new car market, reducing the supply of new petrol and diesel vehicles and driving second-hand prices higher.

The zero emission vehiclemandate sets out the percentage of new zero emission cars and vans manufacturers will be required to produce each year up to 2030.

Government targets want 80 per cent of new cars and 70 per cent of new vans sold in Britain to be zero emission by 2030, increasing to 100 per cent by 2035.

It came as Vertu reported solid new and used car sales volumes growth ahead of its annual general meeting, with the dearlership group on track to meet full-year expectations.

Boss Robert Forrester said:

‘I am pleased to report that trading remains positive. 

‘Used car pricing has remained stable and we have gained market share in the new retail and Motability car market and delivered strong like-for-like volume growth in used vehicles. 

‘The performance of our high margin aftersales business has remained strong.’