AutoTrader annual profits almost double, Serco upgrades FY guidance

London pre-open

The FTSE 100 was being called to open 20.5 points lower ahead of the bell on Thursday after closing out the previous session 0.51% stronger at 7,522.75.

Stocks to watch

Digital car sales platform Auto Trader almost doubled annual profits as more customers spent online making purchases.

AutoTrader reported a 91% rise in pre-tax earnings to £301.0m on Thursday, while revenues rose 65% year-on-year to £432.7m and 17% on 2020. Revenue in the prior year was impacted by the company’s decision to give free advertising to retailer customers several times during the Covid pandemic.

Government contractor Serco said on Thursday that better than expected trading and a "positive outlook" had led it to increase full-year guidance for both revenue and underlying trading profits.

Serco stated it now expects reported revenues of £4.3bn-£4.4bn for the full year, as well as reported underlying trading profits of roughly £225.0m, significantly ahead of previous expectations for UTP of £195.0m set out at the time of its full-year results in February and approaching levels reported in 2021.

Newspaper round-up

Elon Musk has secured additional funding to purchase Twitter, according to financial filings made public on Wednesday, moving the billionaire closer to completing the high-profile deal. The Tesla CEO said in the regulatory filings he has increased his personal funding of the purchase from $27.3bn to $33.5bn and secured an additional $6.25bn in equity financing, reducing the amount of debt the entrepreneur would take on in the $44.0bn purchase. – Guardian

The business secretary, Kwasi Kwarteng, has launched an inquiry into the proposed takeover of the UK's largest microchip manufacturer Newport Wafer Fab by Chinese-backed Nexperia. Kwarteng said on Wednesday that the deal will be scrutinised under the new National Security and Investment Act, which was introduced at the start of the year. – Guardian

Boris Johnson has opened the door for Heathrow to build its third runway as ministers commit to support necessary airport expansion. In a move that risks angering opponents of Heathrow's £14.0bn expansion, ministers are vowing to "support growth in airport capacity where justified" in a ten-point plan for aviation. The programme will be unveiled by aviation minister Robert Courts at Heathrow today. Other commitments include the setting up of an aviation council designed to allow industry executives to influence Government policy. – Telegraph

For exhausted parents, nothing quite rounds off the day like staggering about the house retrieving toys from the living room floor or groping around the back of the sofa for lost puzzle pieces. Well, not for much longer. Dyson, the technology company founded by the billionaire inventor Sir James Dyson, unveiled plans to create cleaning robots that will perform a range of mundane domestic tasks. - The Times

Frasers Group, which recently promoted founder Mike Ashley's son-in-law as chief executive, is selling Bob's Stores and Eastern Mountain Sports for $70.0m to GoDigital Media Group. The company bought the two discount sporting goods chains out of bankruptcy for $101.0m in 2017, in a move that pushed Frasers, then known as Sports Direct, into the US for the first time. However, it announced last August that it would be launching a strategic review of Bob's Stores after Nike said that it would close a string of wholesale accounts including Bob's. - The Times

US close

Wall Street stocks closed in positive territory on Wednesday as market participants digested minutes from the Federal Reserve's most recent policy meeting, which suggested the central bank was prepared to be flexible with interest rate hikes.

At the close, the Dow Jones Industrial Average was up 0.6% at 32,120.28, as the S&P 500 added 0.95% to 3,978.73 and the Nasdaq Composite advanced 1.51% to 11,434.74.

Reporting by Iain Gilbert at Sharecast.com