888 (888) has reported an 8 per cent slide in revenues for 2023 after gamblers cut their spending. The company said new government rules also hit sales, although “a shift away from dotcom markets” was also apparent. UK online takings were down 8 per cent for the year but 4 per cent for the fourth quarter, showing some improvement.

The weakness will continue this year, with the company saying its 2024 Ebitda margin would be at the “low end” of expectations. This will be driven more by capital spending than by gamblers holding on to their cash, however. 

The shares fell 12 per cent in reaction, before rebounding slightly mid-morning. AH

Read more: Re-ratings and M&A: Gambling stocks roll the dice on 2024

House prices slump at fastest rate since financial crisis

House prices are falling at their fastest in 13 years as high interest rates drive down buyers’ budgets. According to the ONS, the value of the average British home fell 2.1 per cent in the year to November, the steepest annual decline since June 2011, in the aftermath of the great financial crisis. The average British home cost £284,950 in November, down 0.82 per cent from £287,314 in October and 2.31 per cent from £291,716 at the market’s peak in September 2022.

Views on how the housing market will fare in 2024 differ. Online housing portal Rightmove (RMV) anticipates a 1 per cent fall over the year, but Knight Frank predicts a 3 per cent rise. Mortgage rates are falling in anticipation of rate cuts from the Bank of England, but the surprise inflation increase announced this morning means the bank may be less dovish than hoped. ML

Read more: What UK house prices will do in 2024

Pearson still on track 

Education giant Pearson (PSON) has met its upgraded guidance for 2023, following strong performances from its assessment division and its English language learning business. Underlying sales rose by 5 per cent last year, while adjusted operating profit shot up by more than 30 per cent to between £570mn and £575mn. 

Revenue continued to decline within higher education, however, driven by “loss of adoptions to non-mainstream publishers”. Virtual learning sales also tumbled by 20 per cent due to the previously announced loss of a major contract. JS

Read more: Pearson’s latest revamp masks future problems

Wizz to pay £1.24mn in refunds

The UK’s Civil Aviation Authority said that action taken against Wizz Air (WIZZ) has led to £1.24mn of refunds for customers.

The regulator first took action against Wizz last year after receiving “high volumes of complaints” about the airline not paying passengers what they were owed following disruptions to flights in 2022. The regulator said it reviewed more than 25,000 claims, leading to additional payments being made in 6,000 cases.

Wizz Air said it had spent more than £90mn on improving its operations last year and that 90 per cent of refunds are now processed within five days. It has also “identified and paid all known” County Court Judgments imposed on it. Wizz Air’s shares fell by 3 per cent in early trading. MF

Read why we’re bearish on Wizz Air

Brick business makes cuts

Brick maker Ibstock (IBST) said it has undertaken a “comprehensive” review of operations in response to lower demand, leading it to cut capacity across the business and to permanently close its South Holmwood brick factory in Surrey. 

The moves will cost the company £15mn (£5mn of which will fall into last year’s accounts and £10mn into this year’s) but will deliver an annualised benefit of £20mn. The company said the focus of the review was on “preserving key skills and knowledge” as this will allow it to rebuild output quickly as demand recovers. 

Revenue for 2023 is expected to have dropped by more than a fifth to £405mn and net debt more than doubled to £101mn, the company said in a trading update. Ibstock’s shares fell by 3 per cent. MF

Read why builders’ merchant stocks are struggling

Paper maker comes a cropper

Shares in James Cropper (CRPR) fell by more than a third after the paper maker said a deterioration in demand over the last two months of 2023 meant adjusted pre-tax profit would be “materially below” prior expectations.

The company blamed continued high inflation and supply chain destocking for a slump in demand in its paper products arm, while its advanced materials arm producing electrochemicals materials used in green hydrogen production had suffered due to a number of expected projects being delayed. The company only expects to make a “small” adjusted profit this year. 

House broker Shore Capital cut its adjusted profit forecast for the company to £0.5mn, from £5.9mn previously. MF

Profits tumble at Gateley

Shares in professional services firm Gateley (GTLY) have fallen by 9 per cent following the publication of its interim results. Adjusted operating profit fell by 15 per cent in the six months to 31 October. Activity levels were subdued in the period while costs – particularly staff costs – rose. 

Visibility for the second half of the year is poor. The combination of “ongoing macro uncertainty, varying activity levels across the group and the natural weighting towards the final months of the financial year make the group’s full-year outturn more difficult than usual to forecast,” according to management. However, the board expects full-year results to be “broadly in line with market consensus”. JS