Losses widen at cybersecurity agency Snyk
Losses widened to $267 million (£218 million) at Snyk, its 2022 accounts present at the moment, because the cybersecurity business counted the cost of its aggressive enlargement plans.
The London-based tech agency noticed its prices go up by half after it ramped out its advertising and marketing spend and recruited lots of of recent workers in 2022, resulting in a near-doubling in its wage invoice.
Those prices finally proved too tough for Snyk to swallow, and in April it laid off over 120 workers, round 12% of its workforce, in a bid to “increase operational efficiencies and streamline expenses.”
Its turnover rose from $58 million in 2021 to $147 million in 2022.
The cybersecurity market has boomed over the previous yr as quite a lot of high-profile cyberattacks on blue-chip businesses prompted companies to strengthen the protections round their IT programs.
But the business has additionally seen fierce competitors between main gamers, with huge sums spent on promoting and advertising and marketing to safe new prospects. Synk’s British rival Darktrace spent as a lot as $228 million on gross sales and advertising and marketing within the yr to finish June, greater than 4 occasions its spend on analysis and growth.
Is a recession nonetheless on the playing cards?
Investec analyst Sandra Horsfield says the UK continues to be prone to enter a recession on the finish of this yr regardless of the revised GDP figures.
She stated: “We see little in today’s numbers to derail our expectation of a more challenging growth picture ahead: we continue to forecast that the UK economy will enter a recession over the winter months, a view that fits with the clear weakening in the most recent survey data. But the revisions to the GDP numbers since early September do mean this comes from a stronger starting point.”
FTSE 100 larger on retail optimism, Aston Martin up 9%
Retail shares powered the FTSE 100 larger at the moment, led by JD Sports Fashion within the wake of final night time’s sturdy first quarter outcomes by sportswear big Nike.
Transatlantic operator JD Sports rose 5% or 7.85p to 150.7p in a session when meals retail companions Marks & Spencer and Ocado lifted 6.9p to 242.2p and 21.4p to 602.4p respectively.
The FTSE 100 index surged 56.58 factors to 7658.43, with Severn Trent 4% or 88p larger at 2353p on the again of its £1 billion fundraising plan.
The FTSE 250 index placed on 1% or 189.68 factors at 18,288.36. Consumer publishing group Future surged 9% or 67p to 781.5p after the GoCompare proprietor reassured on recent buying and selling.
Aston Martin Lagonda additionally rallied 9%, up 23.4p to 284.4p because it emerged that the Yew Tree consortium led by the automobile maker’s govt chair Lawrence Stroll had elevated its stake to over 26%.
FTSE 100 up 0.7% on GDP information
Half an hour into the day’s buying and selling session in London, the FTSE 100 is up 0.7% as traders cheered upward GDP revisions.
Here’s a have a look at your key markets information:
Future says journal efficiency ‘resilient’
Country Life and TechRadar writer Future stated its journal titles had been “resilient” during the last three months, leaving it nonetheless on monitor to hit its revenue targets for the yr.
The business stated viewers numbers had stabilised after a slowdown within the first half of the yr, with journal income having “remained resilient”. Advertising and affiliate marketing online income for its on-line publishing manufacturers struggled, regardless of a very good efficiency on Amazon Prime Day. However, value comparability big GoCompare carried out nicely with income rising.
The group expects working revenue to land near the consensus determine of £254.1 million.
Jon Steinberg just lately took over as Future CEO after the exit of Zillah Byng-Thorne.
Energy value cap to fall – however households should should pay greater than final winter
A fall in Ofgem’s vitality value cap takes impact this weekend amid considerations households might nonetheless find yourself paying round 13% greater than final winter.
The regulator introduced in August that the cap on a unit of gasoline and electrical energy would cut back the common invoice from £2,074 to £1,923 for the three months from October 1 in England, Wales and Scotland.
However, that is nonetheless greater than 50% larger than pre-crisis ranges, and the Government is but to announce any monetary assist alongside the traces of final yr, when the Energy Price Guarantee restricted common payments to £2,500 per yr and every family obtained an extra £400 over six months to offset the hovering prices.
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New GDP figures ‘don’t change huge image’
Capital Economics deputy chief UK eonomist Ruth Gregory was not optimistic in regards to the UK’s financial outlook regardless of the revised GDP figures.
She stated: “Overall, today’s release changes very little. The data leaves the economy still only 0.6% above its level a year ago. It does not change the big picture that the economy has lagged behind all other G7 countries aside from Germany and France since the pandemic. And that’s before the full drag from higher interest rates has been felt.”
Water big Severn Trent in £1 billion sale of recent shares to fund business plan overhaul
Severn Trent, the FTSE 100 water utility, is elevating £1 billion through a putting of recent shares to fund an overhauled business plan, which incorporates an elevated stage of funding in infrastructure.
Half the brand new inventory – price £500 million in whole – goes to Qatar Investment Authority, an present investor.
The firm, which provides almost 5 million properties from the Bristol Channel to the Humber, additionally launched its five-year business plan working from April 2025 to the top of April 2030. It consists of £12.9 billion of whole expenditure.
The water business has been hit by a wave of public anger over overflows of uncooked sewage into rivers throughout storms and excessive ranges of leaks of provide from mains pipes. Severn Trent stated its plan aimed to chop storm overspills by 30% and leakage by 16%.
Brent Crude above $90 after huge quarterly rise
Brent Crude futures at the moment remained near their highest stage in a yr, having rallied by some 22% within the quarter about to shut.
The enhance follows Saudi Arabia’s choice to increase a voluntary provide minimize by way of to the top of the yr, in addition to recent indicators of falling US stockpiles.
The oil benchmark at the moment traded at simply above $93 a barrel, fuelling worries that inflation will take longer to fall again to focus on ranges and power central banks to maintain rates of interest excessive for longer.
Wall Street’s worst month of yr, FTSE 100 seen larger
A uneven quarter for world markets is poised to finish on a subdued observe, with the FTSE 100 index forecast by CMC Markets to open 13 factors larger at 7614.
US markets completed in constructive territory final night time, though the positive aspects are unlikely to stop Wall Street recording its worst month-to-month efficiency to this point this yr.
The S&P 500 index, which hit a three-month low earlier this week, is down 4.5% in September and the tech-focused Nasdaq about 6% decrease.
Michael Hewson, chief market analyst, stated: “There’s been a significant shift in sentiment over the summer as economic data has deteriorated and expectations around how long interest rates are likely to stay high have shifted well into 2024.”
There’s potential for extra price rise jitters this afternoon by way of the discharge of the worth index for private consumption expenditure, which is the Federal Reserve’s most well-liked measure for monitoring inflation.
Hewson added: “The Federal Reserve has continued to suggest that they may look to hike rates again in November if inflation doesn’t show further signs of coming down.
“Today’s numbers need to show that further downside is possible when it comes to core inflation for the prospect of a further rate hike by year end to recede.”
