Powerscourt

By Powerscourt on 08/08/2020

Powerscourt Coronavirus Briefing – 08 August 2020

ANALYSIS

Fear of a second wave is now firmly driving UK Government policy, bringing yet more pressure on businesses and confusion over the Government’s “back to work” message.

Preston, Lancashire, went into lockdown at midnight after the local council imposed extra restrictions. This came as officials warned Britons holidaying in France that they may face a two-week quarantine when they return. Other EU countries are tightening measures as cases spike.

The UK government has announced that the list of settings where face masks are compulsory has expanded to include hairdressers, cinemas, and more. Police can issue £100 fines for those caught breaking the rules. New statistics revealed another 871 cases in the UK bringing the total number of infections to 309,005. The number of cases has slightly dropped after 880 were recorded last Friday.

According to a report from SAGE, the UK government’s scientific advisory group, for every three people who have died from Covid-19 another two have died because they missed vital medical treatment.

In the US, President Trump has announced the details of another coronavirus relief package, including extending unemployment benefits to the end of the year and deferring student loan repayments.

Trump told reporters he would suspend payroll tax until the end of 2020, backdated to 1 July, Reuters reports. He said his administration “continues to work in good faith with democrats to extend unemployment benefits and prevent evictions,” then added that if the Democrats hold the relief package hostage, he will “act under his own authority”.

Finally, even Japan is now reeling from threats of a second wave, with over 1,500 new cases confirmed on Friday. Cases continue to mount, particularly in urban areas like Tokyo and Osaka, Japan’s national daily, The Mainichi, reports.

 

WHAT ARE COMPANIES SAYING?

 

Industrials & Transport 

British Airways
It was confirmed yesterday that more than 10,000 employees are being made  redundant, as the airline pushes ahead with plans to cut the number of employees by 29 per cent. It is understood that 6,000 of the redundancies have been voluntary, while another 4,000 have been compulsory. The IAG-owned airline had announced in April that it would need to lose up to 12,000 of its 42,000 staff to survive the pandemic and remain competitive. A spokesperson said: “Our half-year results, published last week, clearly show the enormous financial impact of COVID-19 on our business. We are having to make difficult decisions and take every possible action now to protect as many jobs as possible”.

Gatwick Airport 
The country’s second largest airport has told staff that its South Terminal could remain shut until next summer, after British Airways announced sweeping job cuts and hopes of recovery were dashed by new travel restrictions. Chief executive Stewart Wingate spoke to staff in a live-streamed meeting, and explained that the terminal could not return to full operations until carriers’ scheduled were restored, according to employees. A spokesperson for the airport said: “While we have seen small green shoots of recovery over the past couple of months, we are continuing to see significantly reduced passenger numbers at what would usually be our busiest time of the year”.

Rolls-Royce
Shares in the aero-engine maker fell yesterday after it emerged that the California-based activist investor, ValueAct, has sold out of the company, having been one of its biggest shareholders for much of the past five years. The engineering business is contemplating raising £1.5bn – £2bn from shareholders after being severely impacted by the collapse in air travel caused by the corornavirus pandemic. 

 

TMT

Evening Standard
The London free sheet it to lose around a third of its 341-strong workforce as it works to reduce costs in response to the coronavirus pandemic and broader changes in the industry. Staff were reportedly told yesterday morning of management proposals to cut 115 jobs to help save the paper, including 69 newsroom staff, 31 commercial jobs and 15 roles in distribution. Chief Executive Officer Charles Yardley explained that “the proposed restructuring comes at a challenging time for the industry, which has been accentuated by the pandemic”. 

 

Healthcare

Pfizer 
The pharmaceutical giant announced yesterday that it has agreed to manufacture and supply Gilead Sciences’ antiviral drug, remdesivir. The multiyear agreement will support efforts to scale up supply of the intravenous drug, which has been shown to help shorten recovery time of some hospitalised coronavirus patients, according to the company. Joining a remdesivir network of more than 40 drugmakers in the U.S., Europe and Asia, Pfizer will produce the drug at its plant in McPherson, Kansas.

Hikma
The pharmaceuticals multinational upgraded forecasts for two of its three main businesses in its half year results yesterday, as a result of increased demand for medicines during the pandemic. Shares in the FTSE100 drugs company rose by 11 per cent as it reported a 25 per cent rise in operating profit for the first half and an 8 per cent rise in sales. An interim dividend of 16.0 cents was announced, representing a 14% increase from the H1 2019 dividend of 14.0 cents.  

 

IN THE NEWS

UK restaurants boosted by discount scheme but still in pain – Financial Times

UK tourists “left in dark” by holiday quarantine, say MPs as anger over “red-listing” of countries grows – The Daily Telegraph

Slower US jobs growth raises fears that virus has hit recovery – The Times




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