Shares in Dixons Carphone slumped after the Government’s much-criticised decision to end duty-free shopping led it to close its travel arm.
The electricals retailer said the lost tax break, combined with the collapse in tourists using airports, meant the business and its 35 shops were no longer profitable.
It does not expect passenger numbers to ‘sufficiently compensate for the removal of air-side tax-free shopping’, which was introduced by the Government this year.
Dixons Carphone said the Government’s decision to end duty-free shopping, combined with the collapse in tourists using airports, meant its 35 airport shops were no longer profitable
The move hit around 400 staff in the division, which made a £20million profit before the pandemic.
All these employees have been offered jobs in other areas of the business. Dozens of big businesses have warned that the end to duty-free would be disastrous for retailers and will send tourists who would usually come to the UK to other countries instead.
Dixons said it had paid back £73million in Covid support to the Government thanks to ‘strong’ sales.
Stock Watch – Mulberry
Handbag maker Mulberry surprised the City by announcing it will turn a small profit for the year ended March 28.
It has been boosted by strong sales in Asia, which is a key market for luxury goods and where economies such as China’s are rebounding from the pandemic.
Online sales also held up in the second half despite lockdowns in many Western countries. Shares in the AIM-listed retailer, which had told investors it would post a loss, rose 13.4 per cent, or 34p, to 288p.
Like-for-like sales grew 12 per cent in the six months to April 24, despite the third lockdown, with online sales more than doubling to £4.5billion for the full year.
Shares slid 6.7 per cent, or 10.5p, to 146.8p.
But it was a different story for WH Smith, which said it would raise £325million via a bond sale to fund 100 new travel stores, including 60 in the US.
Its airport and train station business has been one of the best performing divisions in recent years.
Alongside the bond news, WH Smith (up 0.4 per cent, or 8p, to 1883p) revealed it slumped to a £19million loss in the six months to February, compared to a profit of £80million the year before, as sales fell 44 per cent.
There was a results ‘onslaught’ on the London markets, as AJ Bell financial analyst Danni Hewson described it.
Hewson said: ‘No sooner do investors begin to digest one set of figures, another pops up to blur the overall picture.’
The FTSE 100 rose 0.3 per cent, or 18.7 points, to 6963.67, while the FTSE 250 climbed 0.03 per cent, or 6.74 points, to 22,439.82.
Sales of condoms and cleaning products are booming, says consumer goods giant Reckitt Benckiser.
It reported a ‘double-digit’ increase in Durex sales in the first quarter of 2021, with strong demand in countries where lockdown restrictions are loosening.
But that did not offset a fall in its health division, where sales fell 16.4 per cent compared to a year ago, due to so many households stockpiling cold and flu medicines.
Disinfectants Dettol and Lysol were also popular as hygiene sales rose 21.1 per cent. First-quarter sales were 1.1 per cent lower than the previous year, at £3.5billion.
Shares fell 3.9 per cent, or 258p, to 6328p.
Advertising behemoth WPP topped the FTSE 100 leaderboard, rising 4.3 per cent, or 40.6p, to 991.6p, after sales rose 3.1 per cent to £2.3billion in the first quarter – proof companies are starting to loosen the purse strings after a frugal year.
It has been boosted by new deals with brands including vodka-maker Absolut, Salesforce, JP Morgan and the US Navy.
Earnings rose at the London Stock Exchange group and it reckons it will be able to make £350million in savings by the end of this year following the takeover of data group Refinitiv.
Its shares closed 1 per cent higher, up 76p, to 7554p, but it suffered a bloody nose at its annual meeting.
It will consult investors on chief executive pay after 23 per cent of votes were cast against a motion to raise boss David Schwimmer’s pay by 25 per cent, to £1million.
Elsewhere, builders merchant Travis Perkins tumbled 4.1 per cent, or 55.5p, to 1415p after it demerged its Wickes retail business, which listed under the ticker ‘Wix’ yesterday. Wickes ended up 5.6 per cent, or 13.9p, higher at 263.9p.
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