BUSINESS LIVE: Pendragon to sell UK motor and leasing unit

S4 Capital shares plunged nearly 25 per cent on Monday after the advertising firm downgraded its outlook for the rest of the year.

Sir Martin Sorrell’s digital advertising firm told investors it now expects like-for-like net revenue to fall year-on-year after a ‘slower than expected’ summer.

S4 also expects its core earnings margin to be between 12 and 13.5 per cent, down from July’s guidance of between 14.5 and 15.5 per cent.

London-listed stocks have kicked off the week trading slightly lower, as investors await interest rate decisions from the US Federal Reserve and the Bank of England (BoE), while Britain’s main manufacturing trade body cut its forecast for the sector’s growth for this year.

Market participants keenly await the Fed’s and the BoE’s policy decisions as well as key domestic inflation data later this week as they hope for an end to the monetary tightening cycle.

Britain’s main manufacturing trade body cut its forecast for the sector’s growth for this year and next, citing a sharp fall in factory output and economic uncertainty.

Shares of Phoenix Group are up 1.6 per cent after the life insurer said it expects 2023 cash generation to come in at the top end of its forecast range.

Mondi has jumped 4.9 per cent after the paper and packaging firm agreed to sell its largest plant in Russia to a unit of Sezar Group, a Moscow-based real estate development firm, for 80 billion roubles.

Phoenix Group expects 2023 cash generation to come in at the top-end of its forecast range after the life insurer’s new business long-term cash more than doubled in the first half.

The company, which specialises in managing books of life insurance businesses that are closed to new customers, had forecast 2023 cash generation between £1.3billion to £1.4billion.

Phoenix Group CEO, Andy Briggs said:

‘As the UK’s largest long-term savings and retirement business, Phoenix is executing on its single strategic focus – helping customers journey to and through retirement.’

Figures from the Centre of Retail Research (CRR) bring into sharp focus the scale of the crisis that has engulfed the industry since the pandemic.

Debenhams and Philip Green’s Arcadia empire – which included Topshop – were among high-profile casualties.

Up to 12,500 jobs could be lost for good at Wilko. Although rivals B&M and Poundland have purchased a total of 122 stores, staff are unsure of what will happen. The Range has bought Wilko’s brand and website – but saved just 36 jobs on the digital team.

British paper and packaging firm Mondi has agreed to sell its largest plant in Russia to a unit of Sezar Group, a Moscow-based real estate development firm, for 80 billion roubles (£666million) in cash.

The announcement comes about three months after the company scrapped a 95 billion rouble deal to sell Mondi Syktyvkar to an investment vehicle owned by Russian billionaire Viktor Kharitonin due to a ‘lack of progress’ in getting approvals.

Heineken has snapped up a minority stake in Ellie Goulding’s cocktail-in-a-can brand.

Served, which was created by the British songstress in 2020 alongside entrepreneur brothers Dean and Ryan Ginsberg, produces premade mojitos and pina coladas, as well as alcoholic sparkling water Hard Seltzer – priced at around £3 per can.

The partnership with the Dutch brewing giant will help Served grow in Britain’s ‘ready to drink’ product market, which was worth an estimated £866m in 2022, the firm said.

British automotive retailer Pendragon is set to sell its entire UK motor and leasing businesses to Lithia UK Holding for a gross aggregate consideration of £250million.

Bill Berman, chief executive of Pendragon said:

‘Pendragon has built one of the UK’s leading automotive retailing businesses, underpinned by a market leading dealer management system, the quality of our people, long-standing relationships with OEMs and excellent execution for customers.

‘The Pendragon Board considers Lithia to be perfectly placed to build on this progress.

‘The launch of Pinewood as a standalone company is a unique and exciting opportunity to create a best-in-class product for customers, which we can market globally and drive substantial value for our shareholders and in Lithia we have the perfect partner to help accelerate Pinewood’s push into the hugely attractive North American DMS market.’