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FCA plans certification rollout to all financial services firms

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The Financial Conduct Authority, the City’s regulatory authority, has outlined a proposed expansion of its Senior Managers & Certification Regime (SM&CR).

The proposals will extend the FCA’s rules to all financial services firms, and a consultation period on the 312-page document is open until November. It aims to “reduce harm to consumers and strengthen market integrity by making individuals more accountable for their conduct and competence”, according to the authority.

“Culture and governance in financial services and its impact on consumer outcomes is a priority for the FCA,” explained Jonathan Davidson, Executive Director of Supervision – Retail and Authorisations. “The extension of the Senior Managers and Certification Regime is key to driving forward culture change in firms.

“This is about individuals, not just institutions. The new conduct rules will ensure that individuals in financial services are held to high standards, and that consumers know what is required of the individuals they deal with. The regime will also ensure that senior managers are accountable both for their own actions, and for the actions of staff in the business areas that they lead.”

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Amazon doubles London R&D headcount with new head office

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US multinational online giant Amazon has opened a new head office for its UK operations, in a move that grows its London R&D staff from 450 to 900.

The company has announced that it will take all 15 floors of its new London Development Centre in Shoreditch, taking its London corporate and R&D headcount to over 5,000 across its three facilities. It has invested over £6.4bn in the UK since 2010, and will add 5,000 UK jobs this year as its UK workforce will reach 24,000.

According to its UK country manager, Doug Gurr, “London is one of the world’s truly great cities and home to some of the most talented, creative people on the planet, and we are delighted to provide our teams of innovators with a new, purpose-built workplace.

“While we open a new development centre to house today’s innovators, we also want to help foster the next generation of inventors by funding a million healthy breakfasts to give schoolchildren the fuel to learn, and expand our bursary programme to help more women get university educations for high tech roles.”

The news was also welcomed by Minister for Digital Matt Hancock and Mayor of London Sadiq Khan.

 

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Sports Direct profits slashed as Ashley promises ‘Selfridges of sport’

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Sports Direct has reported a 58.7% drop in profits before tax, with founder and CEO Mike Ashley blaming a weak pound sterling.

The news came amid the retailer’s preliminary results for the year ended April 30th, and also saw group revenue rise by 11.7%. Net debt rose to £182.1m, up from £99.7m in the previous year.

“Sports Direct is on course to become the ‘Selfridges’ of sport by migrating to a new generation of stores to showcase the very best products from our third-party brand partners,” said Ashley. “We have invested over £300m in property over the last year, and I am pleased to report that early indications show that trading in our new flagship stores is exceeding expectations.

“We will continue to invest and make decisions for the long term, whilst trying to conservatively manage the currency volatility that is reflected in our full year results. As previously announced, the devaluation of sterling against the US dollar has led to a significant impact on EBITDA and profits in FY17. We have put in place hedging arrangements to minimise the short-term impact of currency volatility, but like many UK retailers we remain exposed to medium/long term currency fluctuations. Our results were also impacted by provisions and depreciation charges.

“I would like to thank all our people at Sports Direct for ensuring that we continue to move forward together whilst elevating our retail proposition.”

The group has spent much of the year in the headlines for its treatment of workers and Ashley’s colourful conduct as reported in recent High Court proceedings.

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Southern Rail owner handed £13.4m fine

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Southern Rail’s owner has been fined £13.4m by the Department of Transport over delays.

The Go-Ahead Group operates Southern Rail via its Govia Thameslink Railway (GTR) subsidiary.

“We are pleased that this issue has been concluded, and accept and are sorry that our service levels haven’t been good enough for passengers”, said GTR CEO Charles Horton. “We run the most congested network in the UK where passenger journeys have doubled in the last 12 years.”

“This has meant we have been running services for more and more passengers while also allowing stations to be rebuilt, platforms extended, track and signalling replaced and new trains and technology introduced too.”

Unions have rejected the fine as being too lenient.

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Premier makes “world-class” oil find off Mexico

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UK independent exploration firm Premier Oil has announced a “world-class oil discovery” off the coast of Mexico.

The find, made with partners Talos Energy and Sierra Oil & Gas, came at the Zama-1 well, the first private offshore exploration well in Mexico’s history. Premier holds a 25% share in Block 7, where the well is located.

“We are delighted to be announcing this significant new oil discovery offshore Mexico,” said CEO Tony Durrant. “We have encountered a very substantial oil bearing interval which indicates over 1 billion barrels of oil in place, a commercial standalone development which adds materially to Premier’s portfolio of assets worldwide”

The find was made in 166 metres (546 feet) of water, around 60 kilometres (37 miles) offshore the industrial port of Dos Bocas.

“It is particularly pleasing that our strategy of focusing our exploration portfolio on high impact opportunities in proven but under-drilled basins has led to this world class discovery with our first well in Mexico,” said Durrant. “The oil discovered in the Zama-1 well is an extremely important event for Premier, the joint venture and for Mexico and we look forward to working with the government and our partners to realise the full potential of this exciting discovery.”

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Pearson sells share of Penguin Random House in $1bn deal

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Media group Pearson has announced the sale of a 22% share in Penguin Random House to Bertelsmann.

The deal is expected to close in September and values Penguin Random House at around $3.55bn.

“The transaction is in line with our strategy and allows us to generate net proceeds of approximately $1 billion, strengthen our balance sheet, return £300m of surplus capital to shareholders via a share buyback and maintain a significant income stream from an ongoing 25% stake in the world’s leading consumer publisher,” Pearson said in its announcement.

“Combining Penguin with Random House has proved to be a great publishing success, as well as enabling some big cost savings,” said Pearson CEO John Fallon. “This has benefited readers, authors, and shareholders.

“Today’s deal enables Pearson to realise a significant amount of the value we’ve helped to create whilst continuing to be part of the world’s biggest and best trade publisher. We will use the proceeds to maintain our strong balance sheet, invest in our business and return £300m to shareholders.”

When completed, the deal will see Pearson’s share fall to 25%.

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VIDEO: How having your own business is like never working a day in your life

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Nick Wheeler, Chief Executive and founder of Charles Tyrwhitt Shirts

Ruraidh Conlon O’Reilly speaks with entrepreneur Nick Wheeler about the “constantly changing” entrepreneurial landscape.

Successful businessman Wheeler was in Dublin to speak with guests at the KPMG Inspire Series, which features guest speakers from across the business spectrum, from leading entrepreneurs to venture capital and business leadership and management experts.

Charles Tyrwhitt Shirts is a leading UK shirts and menswear maker, which has taken the traditional retail model and added a highly successful online presence, quickly becoming one of Europe’s leading online retailers.

The full interview with Wheeler will be available over the coming weeks.

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Advance tickets to be sold on day of travel on UK trains

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Train operators have agreed a deal whereby advance tickets can be sold on the day of travel to British railway users, in some cases up to ten minutes before departure.

The announcement was made by the Rail Delivery Group, which brings together Network Rail and the railway operators.

“Not everyone can plan journeys in advance and now more people can buy cheaper tickets on the day, even on their way to the station,” explained Jacqueline Starr, Managing Director of Customer Experience at the RDG.

“We want customers to get the best possible deal whenever they travel. With 97 per cent of your fare going back into running and improving the railway, investment is driving quicker improvement, more choice and greater freedom.”

The initiative was first made by CrossCountry in 2015, with over a million advance ticket journeys undertaken since then. The popularity of advance tickets, typically only available until midnight before the day of travel, has quadrupled in the past decade according to the RDG.

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Carlsberg snaps up London Fields Brewery

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Craft beer brewery London Fields has been bought out by Carlsberg UK and will operate it in a joint venture with New York’s Brooklyn Brewery.

The Hackney-based brewer was founded in 2011 and today’s announcement involves returning brewing to the company’s original north London railway arches home.

“We’re thrilled to add London Fields Brewery to our growing portfolio of great quality craft and specialty beers,” said Julian Momen, CEO of Carlsberg UK. “Our customers, and specifically those in London and other major cities, are looking to us to offer them the best possible range of interesting craft beers – and we think that, with nurturing, London Fields Brewery has huge potential. It’s the right move for us as we build a credible craft portfolio.”

London Fields is responsible for beers such as Craft Lager, Easy IPA and Shoreditch Triangle IPA. These will now become part of Carlsberg’s House of Beers offering alongside Brooklyn’s beers.

As Brooklyn Brewery CEO Eric Ottaway explained, “we’re excited to be able to work closely with this great London-based craft brewery. The range of beers, their eye-catching artwork and the great location of the brewery in Hackney makes for a fantastic platform. London Fields Brewery is surrounded by a thriving creative community that reminds us of home, and we’re looking forward to becoming part of it.”