Future of the FTSE 350
With such an unpredictable and challenging economic environment, knowing where growth is going to come from in the corporate world is tricky.
It’s a real stockpicker’s challenge.
The Investors Chronicle (IC) has had a go - its 2018 review of the UK’s largest listed businesses highlights which companies to watch in every stock market sector.
The FTSE 350 exited 2017 at a record high, in spite of what’s been described as “the biggest monetary experiment in history”. But the FTSE showed more movement in January 2018 than it did all last year.
According to equity experts, a 10% market correction happens every 18 months. So market volatility could just be part of a new volatile bull market. However, the risk of a swift transition to a bear market should not be underestimated.
We’ve had a mixed set of manufacturing and trade results. Add to this uncertainty over the shape of Brexit, UK political leadership, wage stagnation, price inflation and interest rate rises – and we could see subdued share price performance.
In this environment, it’s worth focusing on particular sectors that may provide opportunities. We’ve looked within these to highlight driving forces and outlook. We’ve also picked some key Emperor clients in the FTSE 350 to see how they are addressing these market challenges via well-planned communications strategies.
With oil at its highest level in three years, it’s not surprising that analysts expect strong earnings growth from giants Shell, BP and Cairn as they demonstrate their size and muscle/ and there are signs that the retrenchment in oil exploration budgets may have bottomed out.
For Cairn Energy’s website, we wanted to bring alive its operational scale and reach. We focused on the visual, content and messaging – using imagery, video and infographics; refining lengthy content; effectively showing the employer brand proposition.
Housebuilders have slowly used up their expensive land and steadily improved margins as demand continues to outweigh supply, and increasing Government housing initiatives aim to plug this gap. Brexit, consumer confidence and the economy will influence the sector in 2018.
Our Annual Report for McCarthy & Stone was based it on its core value to enrich customers’ lives, backed by building a culture of excellence among employees. The report communicates the key messages of a leading housebuilder that has demonstrated exceptional growth, has a proven business model and strong financial position.
The U.K. Government continues to invest and increase competition in broadband - good news for internet providers that rely on Openreach. In mobile, the auction of the spectrum of wavebands to carry 5th generation mobile network is expected shortly.
We produced a corporate reporting suite for BT Group during a challenging year. We focused on advising BT on the brand usage and adopting the brand effectively, while telling the story of this challenging year. This included the Annual Report, an online Summary Report, shareholder communications, ancillary documents and a full Sustainability Report.
UK domestic banks have shown progress despite setbacks (mis-selling PPI payment protection, commodity-related bad debt and restructuring costs). A low interest rate environment does not aid matters, however this could be set to change. For the major banks, a drive to reduce risk assets and focus on improvements in core business are making returns, while a bunch of new challenger banks are keeping the established banks busy.
As the first new high street bank in over 100 years and founded in the belief that British banking needed shaking up, Metro Bank has proved things can be better. As a newly-listed company, we developed an easy-to-navigate online Annual Report that captured its focus of making the customer’s life easier.
Fickle consumer spending is making it difficult for food producers and household goods companies to find a focus for corporate spend and growth. Promotions will help increased sales volumes, but at what expense to margins? Companies will need to address other key non-financial areas to attract investors.
RB commissioned us to produce an integrated Annual Report that accurately reflects its positive social impact. We created an Annual Report in print and online around the theme of “purpose with a passion”, encapsulating how the business maintains its position in a challenging sector.
The engineering sector is forecast to benefit from U.K. tax cuts and commitment to infrastructure spending, driving demand. However, the U.K.’s departure from the EU could halve material implications for exporters and manufacturers. Companies will need to demonstrate their long-term strategy for growth and global dominance.
Rotork has made significant developments in innovation. In the latest Annual Report, we created a snapshot spread of innovation offered by Rotork over the past 60 years, showing how it has become one of the largest fluid power actuator manufacturers in the world, with the most extensive product range available from a single company.
The UAE is rich in opportunity as it seeks to emulate Western standards of healthcare, while the well-documented woes of the U.K. healthcare market provide a stark contrast. However, given the growing and ageing population in the UK, something has to give.
NMC is the leading integrated private healthcare operator in the UAE, and we worked with it to communicate to external stakeholders the Group structure, the business model and strategy through the Annual Report, and demonstrate the fit of NMC’s latest acquisition in Dubai within its strategy.