Cineworld swings to massive loss, United Utilities flags fall in profit

London open

The FTSE 100 is expected to open 16 points lower on Thursday, having closed up 0.2% on Wednesday at 6,712.89.

Stocks to watch

Cineworld swung to a huge loss as the movie house chain felt the full impact of closures during the Covid-19 pandemic and warned any tightening of restrictions would force it to raise extra cash. The company on Thursday reported a pre-tax loss of £3bn, compared with a profit of $212m a year earlier as revenue collapsed to $852m from $4.3bn in 2019. Cineworld earlier this week said it planned to reopen US cinemas on April 2. “There can be no certainty as to the future impact of Covid-19 on the group. Governments strengthening of restrictions on social gathering may lead to closure of cinemas or studios delaying movie releases. This would have a negative impact on the Group's financial performance and likely require the need to raise additional liquidity,” Cineworld said.

United Utilities is expecting a 3% fall in group revenue for the year ending 31 March, it said on Wednesday, mainly as a result in the reduction in its allowed regulatory revenue. The FTSE 100 water company said that lower consumption from businesses as a result of the Covid-19 pandemic had been largely offset by higher consumption from households. Underlying operating profit was expected to be lower than the prior year, it added, largely reflecting both lower revenue and higher infrastructure renewal expenditure.

Compass said profitability improved in the second quarter while volumes stayed subdued because of the Covid-19 crisis. The catering company's organic revenue fell 28% in the three months to the end of March from a year earlier compared with a 33.7% drop the previous quarter. In both the first and the second quarter organic revenue was 71% of 2019 levels. Compass said revenue fell less sharply in the second quarter as it began to lap the Covid-19 impact on the previous year's income. Operating margin is expected to strengthen to about 4% in the second quarter from 2.7% in the first quarter.

Newspaper round-up

A formal investigation has been launched into whether David Cameron breached lobbying laws through his work on behalf of Greensill Capital, according to reports. However, the Guardian understands the former prime minister will say he was acting as an employee for the firm. According to guidance by the Register of Consultant Lobbyists, people who lobby on behalf of their own organisation do not need to declare themselves on the register. - Guardian

The ticket resale website Viagogo has been accused of advertising non-existent gig tickets on behalf of an employee of its sister company StubHub, prompting calls for regulatory and criminal investigations. Musicians condemned Viagogo amid renewed concern about resale websites, which allow fans – but also professional ticket touts – to sell on music, theatre and sports tickets for profit. - Guardian

The UK's biggest building society has told its staff they can work from anywhere in the country after finding that only 6pc wanted to return to their old routine. Nationwide surveyed its 13,000 office-based employees and discovered that barely one in 20 wished to work from their old desks full-time. More than half (57pc) never wanted to go back to the office again. - Telegraph

Fast-fashion website Boohoo has dramatically cut the number of clothes makers it works with after a sweeping review of its supply chain in the UK. The company revealed it now has 78 approved factories in 100 locations, down from an estimated 200 main manufacturers. This is the first time Boohoo has published a full list of suppliers after the controversy around its supply chain in Leicester. - Telegraph

The prime minister has said jobs in the steel industry will be protected amid the crisis at Liberty Steel. Boris Johnson said the government “will do everything we can to ensure that we continue with British jobs producing British steel” after pressure from Labour to intervene to prevent the collapse of Liberty, which is under threat following the demise of Greensill, the commercial lender. - The Times

US close

Wall Street stocks closed below the waterline on Wednesday, having opened the day in positive territory, following a sharp sell-off in the previous session.

At the close, the Dow Jones Industrial Average was down 0.01% at 32.420.06, while the S&P 500 lost 0.55% to 3,889.14 and the Nasdaq Composite slid 2.01% to 12,961.89.

The Dow closed 3.09 points lower on Wednesday, adding to the losses recorded in the previous session.

In focus, the yield on the benchmark 10-year Treasury note continued to slide, sitting well of recent highs at around 1.62%.

Rising Covid-19 cases across the globe were also in focus as multiple variants of the coronavirus continue to spread worldwide, with both Germany and France extending or enforcing new lockdown measures.

However, giving some hope to traders was news that the pace of vaccinations in the US was continuing to accelerate, with nearly one in five adults now fully vaccinated.