Nationwide Building Society members are expected to benefit from a £2.3 billion following its acquisition of Virgin Money.
The society completed its £2.9bn takeover of Virgin Money in October, making it the UK’s second largest mortgage and savings provider. The gain emerged from buying its rival below its £4.4bn value.
Virgin Money’s pretax operating profit came in at £735m for the six months to 30 September, up 12% from the same period last year.
Debbie Crosbie, Nationwide chief executive, said the profits generated by Virgin Money will now be used for customers, rather than being paid to shareholders.
This will soften the blow of lower interest rates which drove down Nationwide’s statutory pretax profit to £568m between April and September, compared to £989m a year prior.
The society’s half-year results showed Nationwide delivered record growth in mortgages and retail deposits and the highest ever member value at the half-year stage.
This included returning £950m in rates and incentives, plus £385 million in Fairer Share payments, which sees rewards paid out to eligible members.
Mitchells & Butlers warning
Pubs owner Mitchells & Butlers, whose portfolio includes the Horseshoe in Glasgow the Sheep Heid in Duddingston, is the latest hospitality business to warn of higher costs due to the tax changes outlined in Labour’s Budget.
The group said that like-for-like sales for the year to 28 September increased by 5.3%, “out-performing against the market as a whole“.
Operating profit rose from £98m in 2023 to £300m in 2024, thanks to higher sales and lower costs.
However, the group warned that changes to the National Living Wage and the level of employer national insurance contributions would cause a “sharp” rise in wage costs.
The firm estimates cost headwinds at around £100m this financial year, an increase of just over 5% on its current cost base.
EasyJet
EasyJet said it expects its capacity to increase by 3% in fiscal 2025 after reporting a smaller-than-expected annual operating profit due to disruptions from the ongoing turmoil in the Middle East.
The airline reported an operating profit of £597m for the year ended 30 September, compared to the £625.6m expected by analysts. However, its reported operating profit is 25% higher than a year earlier.
For the current fiscal year, the airline expects holiday customers to grow by about 25% from last year.
“The airline will continue to grow, particularly on popular longer leisure routes like North Africa and the Canaries and we plan to take 25% more customers away on package holidays,” said CEO designate Kenton Jarvis, who is replacing Johan Lundgren next year.
Iomart
Scottish cloud computing company Iomart posted flat revenue in the first half in line with expectations as it targeted over £1m of annualised cost savings by the end of its financial year. Full story here