Interactive Investor

Must read: UK jobs, Vodafone, Boohoo, Marston's, Greggs

Our head of investment rounds up the morning's big news.


European markets are trading flat, after disappointing data in China and a raft of corporate updates. China’s retail sales, industrial production and fixed asset investment data all grew by less than economists expected with the Hang Seng and the Shanghai Composite closing in the red.

Rolls-Royce Holdings (LSE:RR.) is at the top of the FTSE 100 after Jefferies raised its target price on the stock from 170p to 210p, while Vodafone Group (LSE:VOD) is languishing at the bottom after announcing plans to slash 11,000 jobs.


UK unemployment rose to 3.9% in the first quarter, the highest level since the three months to January 2022 and worse than expected. The number of employees on the payroll fell by 136,000 in April, the first drop since February 2021. The number of people not working due to long-term sickness hit a new record high. Job vacancies fell by 55,000 in the three months to April, with 1.083 million job vacancies on average from February to April.

The number of days lost to strikes rose again in March, with education and health making up four-fifths of this total, according to the ONS. Average weekly earnings rose by 5.8% year-on-year in the three months to March, in line with expectations. However, once inflation is accounted for, wages are still falling in real terms.

The economic backdrop is starting to weigh on the labour market, with an unexpected uptick in the unemployment rate and another fall in job vacancies as businesses become increasingly cautious about their hiring plans. While wage growth remains robust, prices are rising even more rapidly, stripping away any benefit to workers from this earnings increase.

An initial jump in the pound after the data was short-lived, with sterling in the red against the US dollar, trading back below $1.25.


Greggs (LSE:GRG) reported total sales in the first 19 weeks of the year of £609 million, up from £495 million in the same period in 2022, partly because of Omicron, which weighed on sales at the start of last year. In the 10 weeks to 13 May, Greggs reported underlying sales growth of 15.7% and kept its full-year outlook unchanged. The bakery warned about material cost inflation but said it has good cover on key commodities and sees no change to its cost inflation expectations.

Greggs' value proposition is holding up amid the backdrop of a softening consumer, with strong demand for hot food and its growing plant-based offering after the success of its vegan sausage roll. However, weaker disposable income and higher costs continue to be challenges for the baker.

Shares in Greggs are trading flat today but are up more than 18% year-to-date, sharply outperforming the wider market thanks to its resilient low price point offering.”


Vodafone reported lacklustre full-year group revenue up 0.3% to 45.7 billion euros. It also announced plans to slash 11,000 jobs over three years to slim down the telecoms giant, as it struggles with costly energy bills and weakness in its key market Germany where it continues with its turnaround plan. For the full-year, Vodafone is forecasting adjusted earnings to come in ‘broadly flat’ at 13.3 billion euros and free cash flow to slump by 1.5 billion euros.

Amid a lacklustre share price performance with the stock down around 27% year-on-year and forecasts for little earnings growth ahead, Vodafone is attempting to reconnect with investors by slimming down its cost base through a major reduction to headcount, representing approximately 10% of its total employees. In March Vodafone’s German arm CEO Philippe Rogge told the Handelsblatt newspaper he’s aiming to cut 1,300 jobs while Vodafone is also planning job cuts in Italy.

Vodafone has had a tough time lately, having cut its annual profit forecast last November, announced a major cost cutting strategy, and saw its now former CEO Nick Read depart after four years at the helm during which time Vodafone’s share price suffered a sharp slide. 

However, its slump has caught the attention of some opportunistic major investors such as John Malone from Liberty Global, an investor in ITV and Virgin Media O2, who snapped up a stake in Vodafone, and French billionaire Xavier Niel who also bought a 2.5% holding last September.

On M&A, Vodafone’s tie-up with Three UK is starting to look less likely after the telecoms giant said today there can be no certainty that any transaction will ultimately be agreed. Shares in CK Hutchison finished the session lower in Hong Kong. Sky News meanwhile reported earlier that Vodafone is considering selling a stake in its Internet of Things arm, although no update was provided on this by the company.

Shares in Vodafone have slumped to the bottom of the FTSE 100 today, moderating its year-to-date gain to less than 1.5%, underperforming the FTSE 100 which is up over 3% in 2023.


Boohoo Group (LSE:BOO) reported adjusted full-year earnings (EBITDA) of £63.3 million, beating expectations for £62.1 million but falling 49% from £125.1 million last year. Revenue slumped 11% to £1.77 billion.

Shares in Boohoo have been on the decline in recent weeks with ASOS (LSE:ASC)’s recent first half loss adding to the downward pressure. With low expectations going into this set of numbers, Boohoo is enjoying a reprieve today from the doom-and-gloom thanks to earnings which came in slightly ahead of consensus estimates. Even though the stock is rallying by over 14% today, shares are still down around 20% over the past month, and are down roughly 45% over a one-year period, suggesting there is still a long way to go to reinvigorate the bulls.

Boohoo operates in a highly competitive market with a slew of low price point, fast fashion competitors. Squeezed household budgets amid the inflationary backdrop means less disposable income among its customers to spend on non-essential fashion items. And the e-commerce pandemic era online shopping boom has faded with many consumers enjoying going back to physical stores again last year.


Marston's (LSE:MARS) reported a first-half underlying loss before tax of £3.6 million versus a loss of £7.5 million last year. Like-for-like sales grew up by 10.7% year-on-year and up 17.9% versus the Covid-hit 2020. CEO Andrew Andrea said ‘the cost outlook, and consumer confidence, are steadily improving.’ However, the board said no dividends will be paid in respect of the 2023 financial year because of the macroeconomic uncertainty.

The pub and bars chain benefitted from strong sales over Easter and on the first May bank holiday, helping to drive better demand. Shares in Marston’s are modestly lower today and are down by 6% year-to-date, underperforming the wider market amid ongoing investor nervousness towards hospitality because of the cost-of-living crisis and headwinds from cost inflation.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.