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  • FTSE 100 Opens Slightly Lower Near Record Levels; Earnings From LSEG and Rolls-Royce in Spotlight

    FTSE 100 Opens Slightly Lower Near Record Levels; Earnings From LSEG and Rolls-Royce in Spotlight

    UK equities slipped modestly at Thursday’s open but remained close to record territory as investors digested a fresh wave of corporate earnings, including updates from Rolls-Royce and London Stock Exchange Group. Sterling weakened against the US dollar while continuing to trade above the $1.35 level.

    At 0813 GMT, the benchmark FTSE 100 index was down 0.08%. The pound fell 0.2% to $1.3533 versus the dollar. Across Europe, Germany’s DAX declined 0.2%, while France’s CAC 40 advanced 0.3%.

    Globally, markets also reacted to results from NVIDIA Corporation (NASDAQ:NVDA), which beat revenue forecasts and issued an upbeat outlook but failed to spark investor enthusiasm. Attention additionally turned to geopolitical developments as the United States and Iran entered talks, while artificial intelligence remained a key theme, with investors weighing returns on heavy AI-related capital spending and potential disruption risks, according to Jefferies.

    UK Market Round-Up

    Rolls-Royce (LSE:RR.) reported a 40% rise in annual profit following strong aero-engine performance, alongside upgraded medium-term targets and enhanced shareholder return plans.

    Underlying operating profit reached £3.46 billion in 2025, producing a margin of 17.3% and exceeding the £3.27 billion consensus estimate. Free cash flow totalled £3.3 billion, supported by strong operating execution and expanding long-term service agreement balances, leaving the group with net cash of £1.9 billion at year-end. For 2026, Rolls-Royce expects underlying operating profit of £4.0 billion to £4.2 billion and free cash flow of £3.6 billion to £3.8 billion.

    London Stock Exchange Group (LSE:LSEG) posted a 56.5% increase in pretax profit for 2025 and announced an additional £3 billion share buyback programme. Pretax profit rose to £1.97 billion from £1.26 billion a year earlier, while total income excluding recoveries grew 5.8% to £8.99 billion, or 7.1% on an organic constant-currency basis. Reported earnings per share climbed 85.1% to 238.4 pence, with adjusted EPS up 15.7% to 420.6 pence.

    WPP (LSE:WPP) unveiled a multi-year restructuring strategy named Elevate28, aimed at simplifying operations and restoring organic growth. The advertising group plans to transition from a holding company structure into a unified operating model organised around four divisions: WPP Media, WPP Creative, WPP Production and WPP Enterprise Solutions, operating across North America, Latin America, EMEA and APAC.

    Hikma Pharmaceuticals plc (LSE:HIK) issued 2026 guidance below market expectations, forecasting sales growth of 2% to 4% compared with consensus estimates of 5.5%. Core EBIT is projected between $720 million and $770 million, below the $778 million consensus estimate, while injectables margins are expected to remain below market forecasts.

    Ocado Group (LSE:OCDO) reported stronger-than-expected second-half 2025 performance and said it anticipates achieving positive free cash flow in the second half of 2026, with full-year 2027 also expected to turn cash-flow positive. Group revenue beat expectations by 4.5%, while EBITDA exceeded consensus by 4.2%.

    CVS Group (LSE:CVSG) delivered first-half 2026 revenue growth of 5.8%, broadly matching forecasts as sales reached £356.9 million. Like-for-like growth improved to around 2.7%, reflecting a recovery from negative growth recorded a year earlier. UK operations generated £320.6 million in revenue, with Australia contributing £36.3 million.

    Derwent London (LSE:DLN) reported a net asset value of 3,225 pence per share for FY25, up 2.4%, alongside earnings per share of 98.4 pence and a dividend of 81.5 pence per share. Leasing activity totalled £11.3 million during the year at rents nearly 10% above estimated rental value.

    Howden Joinery Group (LSE:HWDN) exceeded profit expectations for FY25 and announced a £100 million share buyback. Pre-tax profit reached £344.9 million, beating consensus estimates of roughly £331 million.

    Greencoat UK Wind (LSE:UKW) reported net asset value per share of 133.5 pence at the end of 2025, equating to a total return of -4.9% for the year. Shares trade at a nearly 30% discount to NAV, prompting a continuation vote at the upcoming AGM.

    Man Group (LSE:EMG) recorded record organic growth, with assets under management rising 35% year-on-year to $227.6 billion, supported by $28.7 billion in net inflows and strong investment performance. The firm achieved its sixth consecutive year of market share gains.

    Drax Group (LSE:DRX) reported record renewable electricity generation for 2025, producing 6% of UK power and 11% of UK renewable output. Adjusted EBITDA declined to £947 million due to lower power prices, while operating profit dropped following £378 million in non-cash impairments. The company extended its share buyback programme with a new £450 million plan.

    Tate & Lyle (LSE:TATE) said third-quarter trading was in line with expectations, with revenue for the three months to December 31 rising 15% on a reported basis following the integration of CP Kelco.

  • Rolls-Royce Profit Surges 40% as Company Raises Targets and Expands Shareholder Returns

    Rolls-Royce Profit Surges 40% as Company Raises Targets and Expands Shareholder Returns

    Rolls-Royce (LSE:RR.) reported a sharp rise in annual earnings for 2025, driven by strong performance in its civil aerospace business, while upgrading its medium-term financial targets and outlining increased capital returns to shareholders.

    Underlying operating profit climbed 40% to £3.46 billion for the year, delivering an operating margin of 17.3% and exceeding the market consensus forecast of £3.27 billion. Free cash flow reached £3.3 billion, supported by solid operational execution and continued expansion of long-term service agreement balances. The group ended the year with a net cash position of £1.9 billion as of 31 December 2025.

    For 2026, Rolls-Royce expects underlying operating profit to rise further to between £4.0 billion and £4.2 billion, alongside projected free cash flow of £3.6 billion to £3.8 billion.

    The company also lifted its medium-term ambitions, now targeting underlying operating profit in the range of £4.9 billion to £5.2 billion, compared with its previous goal of £3.6 billion to £3.9 billion. Operating margin targets were raised to 18%–20%, up from the earlier 15%–17% range.

    Free cash flow expectations over the medium term were also increased to £5.0 billion to £5.3 billion, compared with prior guidance of £4.2 billion to £4.5 billion. The company now anticipates return on capital of 23% to 26%, up from its earlier target of 18% to 21%.

    As part of its enhanced shareholder distribution strategy, Rolls-Royce announced plans for a share buyback programme valued between £7 billion and £9 billion covering the period from 2026 to 2028, including £2.5 billion scheduled for completion this year.

    The group also declared a final dividend of 5 pence per share.

  • Ocado Releases 2025 Preliminary Results and Sets Investor Presentation Date

    Ocado Releases 2025 Preliminary Results and Sets Investor Presentation Date

    Ocado Group (LSE:OCDO) has published its preliminary results for the financial year ended 30 November 2025, with the full annual report now accessible through the London Stock Exchange and the company’s corporate website.

    The online grocery and technology group confirmed that the unedited results have also been filed with the Financial Conduct Authority’s National Storage Mechanism, providing formal regulatory access for investors and market participants.

    In conjunction with the results release, Ocado announced it will host an investor and analyst presentation on 26 February 2026, including a live webcast and question-and-answer session. The event is intended to offer additional insight into the company’s annual performance, operational progress and forward outlook, reflecting its ongoing focus on maintaining transparency and engagement with shareholders.

    The company’s outlook continues to be shaped by challenging financial performance, including declining revenues and ongoing losses. Technical indicators suggest a weaker share price trend, further weighing on sentiment, while limited valuation visibility adds uncertainty around pricing levels. Although management highlighted positive elements such as revenue improvements in certain areas and strong liquidity during earnings discussions, these factors have yet to fully offset broader financial and technical pressures.

    More about Ocado Group

    Ocado Group is a UK-based online grocery technology and logistics company specialising in automated fulfilment systems and e-commerce solutions for food retailers. Its operations combine its own online grocery retail activities with the international licensing of the proprietary Ocado Smart Platform, which enables partners to operate automated warehouses and digital grocery services in global markets.

  • Drax Raises Shareholder Returns as Renewable Output Hits Record Levels and New CfD Supports Growth Strategy

    Drax Raises Shareholder Returns as Renewable Output Hits Record Levels and New CfD Supports Growth Strategy

    Drax (LSE:DRX) reported record renewable electricity generation in 2025, strengthening shareholder returns and outlining long-term growth plans backed by a new low-carbon dispatchable Contract for Difference (CfD) agreement aimed at supporting UK energy security.

    The company generated enough renewable power during the year to supply around 6% of the UK’s total electricity demand and 11% of its renewable output. Biomass pellet production also increased by 5%, reflecting continued operational expansion. Despite strong generation performance, adjusted EBITDA declined to £947m, while operating profit fell significantly following a £378m impairment charge.

    Drax continued to reinforce its financial position during the year, increasing its dividend by 11.5% and completing a £300m share buyback programme. The group has also launched a further £450m repurchase initiative, supported by improved earnings visibility stemming from the newly agreed CfD framework.

    Management said the agreement enhances long-term revenue certainty while reinforcing the company’s role in delivering reliable low-carbon power to the UK grid.

    Looking ahead, Drax is targeting annual adjusted EBITDA of between £600m and £700m beyond 2027 and expects to generate roughly £3bn in free cash flow between 2025 and 2031. Of this, more than £1bn is planned for shareholder distributions, while up to £2bn will be invested in growth initiatives including flexible renewable generation capacity and battery storage assets.

    The company is also advancing plans to develop data centre and battery projects at its 4GW power station site, positioning the location to benefit from rising electricity demand linked to digital infrastructure and artificial intelligence workloads. In parallel, Drax is pursuing cost efficiencies expected to exceed £150m annually from 2027.

    These initiatives are intended to strengthen the group’s role in the energy transition while increasing exposure to growing system flexibility requirements across the UK power market.

    Drax Group plc’s overall outlook is supported by robust cash generation, solid profitability metrics and favourable valuation indicators, alongside strategic initiatives such as buybacks and government-backed agreements. However, management acknowledged that slower revenue growth and evolving dynamics within the biomass pellet market present risks that will require careful oversight.

    More about Drax Group plc

    Drax Group plc is a UK-based renewable energy company focused on biomass generation, pumped storage, hydroelectric assets and other flexible power solutions. The group also operates a large North American biomass pellet production business and is expanding into battery energy storage systems and energy optimisation services designed to enhance grid stability and support the broader transition to low-carbon energy.

  • European Markets Higher as AI Concerns Fade; HSBC and Nordex Lead Gains: DAX, CAC, FTSE100

    European Markets Higher as AI Concerns Fade; HSBC and Nordex Lead Gains: DAX, CAC, FTSE100

    European equities traded mostly higher on Wednesday after artificial intelligence concerns eased following new partnership announcements from AI startup Anthropic.

    The company introduced updated features for Claude Cowork, enabling businesses to integrate the productivity platform across a wide range of enterprise software applications.

    The U.K.’s FTSE 100 Index advanced 1.0%, while Germany’s DAX Index gained 0.5% and France’s CAC 40 Index rose 0.4%.

    Shares of U.K.-based pharmaceutical group GSK (LSE:GSK) were largely unchanged after the company agreed to acquire biotech firm 35Pharma Inc., which is developing an early-stage treatment for high blood pressure.

    Banking giant HSBC Holdings (LSE:HSBA) moved sharply higher after reporting 2025 earnings that exceeded market expectations.

    Wind turbine maker Nordex (TG:NDX1) also rallied strongly following better-than-anticipated fourth-quarter results.

    Adecco Group (USOTC:AHEXY) shares climbed after the Swiss staffing company said it was experiencing “positive momentum” in hiring activity at the start of the year.

    In contrast, Diageo (LSE:DGE) dropped sharply after the spirits producer cut its annual sales outlook for the second time during the current fiscal year.

    German healthcare company Fresenius (TG:FME) also declined after issuing a 2026 outlook that disappointed investors.

  • European Stocks Reach Record High as HSBC Outlook Boosts Banks and AI Concerns Ease: DAX, CAC, FTSE100

    European Stocks Reach Record High as HSBC Outlook Boosts Banks and AI Concerns Ease: DAX, CAC, FTSE100

    European equities climbed to a fresh record on Wednesday, supported by a rebound in banking shares after HSBC (LSE:HSBA) lifted a key lending target, while investor worries about rapid disruption from emerging artificial intelligence models showed signs of easing.

    The pan-European STOXX 600 index rose 0.4% to 631.6 points by 08:24 GMT, after briefly touching an intraday record of 632.40 earlier in the session. Banking stocks advanced by more than 1% as global sentiment improved following announcements from U.S.-based AI startup Anthropic, which partnered with several companies and introduced new AI plug-ins — developments seen as evidence that established businesses are adapting to AI rather than facing immediate displacement.

    Financial institutions are often viewed as particularly exposed to technological disruption. However, indications that companies are integrating AI gradually helped calm concerns about potential margin pressure, improving risk appetite and supporting gains in the banking sector.

    Similar fears around AI-driven disruption have triggered episodes of volatility in global markets several times this year, including sharp declines in European banking stocks during Tuesday’s session.

    Market sentiment was further lifted by HSBC, Europe’s largest lender, which raised an important earnings target after reporting annual profit above expectations despite booking a $4.9 billion one-off charge.

    Among individual movers, onshore wind turbine manufacturer Nordex (TG:NDX1) surged 11.6% after delivering better-than-expected core profit for 2025.

    In contrast, Diageo (LSE:DGE) fell 6.5%, weighing on the broader index after the drinks group lowered its annual sales and profit outlook for the second time in four months and announced a dividend reduction.

  • FTSE 100 rises to record high as earnings drive gains; pound strengthens

    FTSE 100 rises to record high as earnings drive gains; pound strengthens

    UK equities opened higher on Wednesday, supported by a busy corporate earnings schedule led by HSBC, helping markets recover from recent declines linked to geopolitical tensions and concerns surrounding artificial intelligence.

    At 08:36 GMT, the FTSE 100 reached a fresh record, climbing 0.7% to 10,760.70, while sterling strengthened, with GBP/USD rising 0.2% to 1.3520 against the dollar. Elsewhere in Europe, Germany’s DAX added 0.07% and France’s CAC 40 advanced 0.3%.

    UK market roundup

    HSBC Holdings (LSE:HSBA) reported full-year pretax profit of $29.91 billion, surpassing analyst expectations of $28.86 billion, although down from $32.38 billion recorded in 2024. Shares rose 5.8% in early London trading.

    The Asia-focused lender’s year-on-year decline reflected $4.9 billion in notable items, including impairments linked to its Bank of Communications stake and restructuring costs. Excluding these factors, pretax profit increased to $36.62 billion from $34.18 billion. HSBC also issued a 2026 net interest income target above analyst forecasts, lifting its Hong Kong-listed shares by more than 2%.

    Aston Martin (LSE:AML) reported a 21% drop in revenue to £1.26 billion in 2025, while wholesale volumes declined 10% to 5,448 vehicles. Gross profit fell 37% to £369.8 million, with gross margin narrowing to 29.4% from 36.9% in 2024. The luxury carmaker posted an adjusted EBIT loss of £189.2 million, widening from a £82.8 million loss the previous year, as lower volumes, fewer high-margin Special models and tariff pressures weighed on performance. Management outlined plans for a recovery in 2026.

    Haleon (LSE:HLN) shares dropped more than 4% in early trading after the consumer health company reported fourth-quarter organic sales growth of 2.1%, missing consensus forecasts of 3.5%. Volumes declined 0.3% versus expectations for growth of about 1%, while pricing increased 2.4%, broadly in line with estimates.

    St. James’s Place (LSE:STJ) posted an underlying cash result of £462.3 million for 2025, up 3% year on year and 4% above consensus expectations. Underlying cash earnings per share rose 6% to 87.0 pence, while revenue climbed 19% to £3.77 billion. Funds under management reached a record £220.0 billion, up 16%, and the wealth manager announced an accelerated increase in shareholder distributions, sending shares up around 4%.

    Hiscox (LSE:HSX) reported full-year earnings per share 7.5% above company-compiled consensus and unveiled a $300 million share buyback programme, exceeding market expectations by 43% compared with the $210 million consensus estimate. The insurer’s retail division delivered insurance contract written premium growth of 6.3% for the full year, accelerating from 6.1% growth recorded during the first nine months. Fourth-quarter retail premiums rose 10.0%.

    Diageo (LSE:DGE) reported a 2.8% decline in organic revenue and earnings before interest and taxes for the first half of fiscal 2026. Organic revenue and EBIT both fell 2.8%, compared with consensus forecasts for a 2.0% revenue decline and a 3.9% EBIT drop. Earnings per share reached 95.3 cents, ahead of the 93.1-cent consensus estimate, while the company also announced a dividend reduction.

    Jet2 (LSE:JET2) said earnings for the financial year ending March 2026 are expected to match analyst consensus forecasts of £439 million. The airline indicated that summer 2026 EBIT will remain broadly flat year on year before accounting for £40 million to £50 million of investment linked to its new Gatwick base, implying EBIT of roughly £400 million for fiscal 2027.

    Bookings for summer 2027 increased 7.9%, broadly in line with capacity growth of 8.0%. The expansion includes 2.0% underlying growth, with 1.1 million additional seats from new bases and a further 0.4 million seats added across established operations.

  • HSBC Tops FY25 Profit Expectations and Sets Stronger 2026 NII Outlook; Shares Gain 2%

    HSBC Tops FY25 Profit Expectations and Sets Stronger 2026 NII Outlook; Shares Gain 2%

    HSBC Holdings (LSE:HSBA) exceeded full-year profit forecasts on Wednesday and issued a 2026 net interest income (NII) outlook above market expectations, lifting its Hong Kong-listed shares by more than 2%.

    The Asia-focused banking group reported pretax profit of $29.91 billion for 2025, surpassing the $28.86 billion analyst consensus compiled by Bloomberg, although lower than the $32.38 billion recorded in the previous year.

    The year-on-year decline was largely attributable to $4.9 billion in notable items, including impairments related to its stake in Bank of Communications and restructuring expenses. On an adjusted basis excluding these items, pretax profit increased to $36.62 billion from $34.18 billion.

    Group revenue rose 4% to $68.3 billion, supported by stronger wealth management fees and foreign exchange income. Return on tangible equity reached 13.3% for the full year, or 17.2% when excluding notable items.

    HSBC projected banking net interest income of at least $45 billion for 2026, driven by deposit growth and contributions from its structural hedge. The guidance compares with an analyst consensus currently standing at $43.5 billion.

    Management also indicated operating costs would rise by around 1% in 2026, implying a cost base of approximately $33.8 billion — about $500 million below consensus expectations.

    “This gives management – along with visibility from the structural hedge – the conviction to produce banking NII guidance for ’26E of > $45bn, some $1.5bn higher than the street,” Jefferies analysts said.

    The bank expects credit losses in 2026 to be roughly 40 basis points of loans and reaffirmed its goal of achieving a return on tangible equity of at least 17% through 2028, alongside revenue growth accelerating to around 5% by that time.

    Adjusted pretax profit for the fourth quarter reached $8.59 billion, exceeding consensus forecasts by 9%. Banking net interest income totalled $11.7 billion, about 6% ahead of expectations, supported by higher HIBOR rates and a one-off contribution not expected to recur. Wealth management fees increased 20% year on year, while insurance income surged 49%.

    Reported pretax profit for the fourth quarter rose sharply to $6.8 billion from $2.3 billion a year earlier, when results had been affected by losses linked to the disposal of the Argentina business.

    HSBC’s CET1 capital ratio stood at 14.9%, 20 basis points above consensus estimates. Tangible net asset value per share increased 12% year on year to 964 cents. The board declared a fourth interim dividend of $0.45 per share, bringing total shareholder distributions for 2025 to $0.75 per share.

    The bank also disclosed $500 million in base synergies linked to the Hang Seng transaction, with an additional $400 million in potential synergies targeted by 2028, associated with restructuring costs of $600 million.

    Jefferies reiterated a “hold” rating on the London-listed shares with a price target of 1,120 pence. The stock last closed at 1,291 pence, equivalent to around 1.8 times spot tangible book value.

  • Diageo Lowers Dividend and Outlook Amid Weaker U.S. and China Demand

    Diageo Lowers Dividend and Outlook Amid Weaker U.S. and China Demand

    Diageo (LSE:DGE) reported first-half fiscal 2026 net sales of $10.5 billion, representing a 4% decline year on year, as organic net sales dropped 2.8% due to softer consumer demand in North America and continued weakness in Chinese white spirits. Growth across Europe, Latin America and Africa provided some offset, but operating profit still fell 1.2%, reflecting an unfavourable product mix and tariff pressures. Free cash flow decreased to $1.5 billion, prompting management to revise full-year expectations to a 2–3% fall in organic net sales and flat to low single-digit growth in organic operating profit.

    The company is placing greater emphasis on balance sheet resilience and financial flexibility, introducing a rebased dividend policy targeting a 30–50% payout ratio alongside a minimum annual dividend floor of 50 cents per share. An interim dividend of 20 cents was declared. Diageo also anticipates roughly $2.3 billion in proceeds from the agreed disposal of its holdings in East African Breweries and its Kenyan spirits operations. Meanwhile, the Accelerate cost-efficiency programme continues under new CEO Sir Dave Lewis, who is steering strategy toward improved competitiveness, broader portfolio strength and more customer-focused execution.

    Diageo’s outlook reflects supportive corporate developments and an attractive dividend yield, though pressures on profit margins, reduced cash flow stability and bearish technical indicators continue to weigh on overall sentiment.

    More about Diageo

    Diageo is a global beverage alcohol company known for its portfolio of premium spirits, beer and ready-to-drink brands. The group operates across key categories including whisky, vodka, rum and regional white spirits, supported by a diversified geographic presence spanning North America, Europe, Latin America, Africa and Asia-Pacific markets.

  • AFC Energy Advances Hydrogen Commercialisation Following £27.5m Capital Raise

    AFC Energy Advances Hydrogen Commercialisation Following £27.5m Capital Raise

    AFC Energy (LSE:AFC) released its FY25 results outlining a strategic shift toward commercial rollout of its fuel cell generators and ammonia cracking technology, supported by an oversubscribed £27.5 million fundraising. The company increased investment in research and development during the year, while reporting a wider post-tax loss of £22.2 million. AFC Energy closed the period with £25.3 million in cash and investments and has since obtained regulatory approval to begin early hydrogen sales from its Dunsfold pilot facility.

    Operational progress included several deployments of 30kW generators through the Speedy Hydrogen Solutions joint venture and the introduction of the Hy-5 ammonia cracker. These initiatives are designed to deliver low-carbon hydrogen at a targeted cost of £10 per kilogram, positioning the company to compete among the UK’s lowest-cost suppliers. After the reporting period, AFC Energy launched its LC30 generator, signed new joint development agreements with both an S&P 500 partner and Komatsu, and entered a manufacturing partnership with Volex. Management indicated that 2026 is expected to mark the transition from pipeline development to firm commercial orders and more consistent revenue expansion.

    The company is now focused on securing pre-orders for the LC30 and Hy-5 platforms, building out a Fuel-as-a-Service offering, and expanding distribution channels across North America, Europe and through its Saudi Arabian partner Tamgo. A simplified organisational structure, continued patent development and an emphasis on commercial execution are intended to reinforce AFC Energy’s position within the developing low-carbon hydrogen and off-grid energy markets.

    AFC Energy’s investment outlook remains influenced by ongoing profitability and cash flow pressures. Technical indicators suggest improving market momentum, although valuation metrics — including a negative P/E ratio and absence of dividend yield — continue to weigh on overall sentiment.

    More about AFC Energy

    AFC Energy is a UK-listed developer of ammonia-based low-carbon hydrogen production and hydrogen-to-power technologies designed to replace diesel generation in off-grid environments. Its modular ammonia crackers and fuel cell systems aim to enable decentralised, scalable hydrogen supply for industrial and hard-to-abate sectors without dependence on government subsidies.