BUSINESS LIVE: Rio Tinto agrees SEC settlement; Kingfisher slashes profit outlook; Autumn Statement at 12.30pm

Severn Trent has hiked shareholder payouts after claiming it remains on track to meet its annual financial targets, despite a fall in profits over the first half.

The group’s pre-tax profit on ordinary activities fell by nearly a third to £70.7million in the six months to the end of September, down from £104.7million at the same point a year ago.

Sage Group has unveiled a £350million share buyback programme after sales surged over the last year.

The accounting software provider, which is one of Britain’s biggest technology companies, revealed underlying revenue rose 10 per cent to £2.18billion in the year ending September, thanks to bumper results across all regions.

At lunchtime, Chancellor Jeremy Hunt will publish his Autumn Statement – will he attempt to rebuild the Conservative’s reputation as a low-tax party?

Has that got you in the mood?

B&Q owner Kingfisher has cut its annual outlook for the second time in three months, amid a weak performance in France.

Group sales in the third quarter ending 31 October came in at £3.2billion, down 2.1 per cent on last year, with like-for-like sales slipping 3.9 per cent.

Adam Vettese, analyst at eToro:

‘This is a tough time for Kingfisher. Expectations are higher following the pandemic DIY boom, but the reality is this is a very different market to the one back then.

‘Now, consumers are spending less money on DIY, largely because of the cost-of-living crisis but also because many workers have returned to the office and so are in less of a rush to spruce up their homes.

‘The group is also facing intense competition in many of its key markets, particularly in Poland and France, which has led the DIY giant to lower its full-year profit expectations.

‘Having said that, we don’t think this troubled patch is down to a problem with Kingfisher itself. Market conditions are mostly to blame. Therefore, we expect things to improve as economic conditions become more benign and consumers are feeling better off.’

The future of OpenAI hangs in the balance as the board opens negotiations to bring back its ousted co-founder Sam Altman.

Talks kicked off late last night after 747 of its 770 employees – 97 per cent – threatened to quit unless he is reinstated as chief executive.

Sir Jim Ratcliffe’s petrochemicals empire Ineos is being sued in a row over the sale of a business – as the billionaire closes in on a £1.3billion stake in Manchester United.

One of the richest men in the country, Ratcliffe founded chemical engineering giant Ineos in 1998.

The humble asthma inhaler is set to be the latest casualty in the battle to cut greenhouse gases.

Pharma giant GSK is planning to create a low-emission version of its Ventolin medicine. That is because its Ventolin inhalers account for nearly half its total greenhouse gas output.

The Bank of England yesterday stepped up its battle against City expectations of an interest rate cut – warning that markets were ‘underestimating’ the persistence of inflation.

Bank governor Andrew Bailey told MPs that traders were placing ‘too much weight’ on recent figures showing that inflation has plunged to less than 5 per cent.

Markets expect that interest rates will start to be cut from their current level of 5.25 per cent from June next year and some experts even see them falling to 4 per cent by the end of 2024.

British software company Sage expects its profit margin to continue to increase this year after a bumper 2022/2023.

The group posted a 18 per cent rise in full-year underlying operating profit to £456million after its margin rose to 20.9 per cent.

Boss Steve Hare said: ‘We continue to help small and mid-sized businesses succeed, providing them with the tools and expertise they need to simplify their accounting and HR processes, streamline their operations, and make more informed business decisions.

‘Through the Sage Network, we are delivering innovative, AI-powered services to customers, faster and more efficiently than ever before.

‘Small and mid-sized businesses are continuing to digitalise, despite the macroeconomic uncertainty. We are building a resilient platform to deliver sustained, efficient growth, and I am confident that Sage is well positioned to take advantage of the market opportunity in 2024 and beyond.’

Kingfisher has downgraded its full-year profit outlook for the second time in three months after the B&Q owner’s third quarter underlying sales fell 3.9 per cent, with market trends in France weaker than expected.

The FTSE 100 group, which also owns Screwfix in Britain and Castorama and Brico Depot in France and other markets, said it now expected adjusted pretax profit of around £560million for the 12 months to the end of January 2024.

This is down from the £590million it was forecasting in September and the £758million made in 2022/23.

CEO Thierry Garnier said: ‘As we move into 2024, we are focused on what is in our control.

‘First, a continued focus on growing market share in the UK, France and Poland with delivery of our strategic growth initiatives. Second, driving productivity gains to offset wage inflation. And finally, delivering on our free cash flow and shareholder returns targets.

‘We expect to see some product cost price inflation, albeit at a significantly lower level, and expect rational retail pricing and competitive price indices at all our banners.

‘On the medium-to-longer term outlook, we remain very positive for home improvement growth in our markets, and our ability to grow ahead of our markets.’

Rio Tinto has reached a $28million settlement with the US securities regulator, drawing a line under a suit brought in 2017 concerning disclosure of the impairment of Rio Tinto Coal Mozambique (RTCM) reflected in Rio Tinto’s 2012 year-end accounts.

Without admitting to or denying the SEC’s allegations related to its books, records and reporting requirements, Rio Tinto will pay the penalty and retain an independent consultant to advise on its current policies, procedures, and controls related to impairment, disclosures and project risk.

Former chief executive Tom Albanese has also reached a settlement with the SEC and will pay a $50,000 penalty.

Rio Tinto said: ‘Rio Tinto welcomes closure of the SEC case on appropriate and reasonable terms.

‘With this settlement, all investigations of Rio Tinto regarding this matter have been finalised’