By Powerscourt on 14/08/2020
Powerscourt Coronavirus Briefing – 14 August 2020
ANALYSIS
The UK has imposed a new coronavirus quarantine on UK travellers returning from France, affecting an estimated half a million travellers who had booked summer holidays in the country.
The abrupt quarantine decision, which reflects a significant spike in new coronavirus cases in France yesterday, is likely to engender chaos for many British families on holiday. The UK government has provided a grace period of up to 4am Saturday, prompting a likely stampede for the exit as holidaymakers already in France to book flights and ferries home – ironically almost certain to lead to the kind of overcrowding that fuels the spread of the virus.
The rules also affect Monaco, Malta, the Netherlands and the Turks and Caicos islands. Spain, another of the UK’s favoured holiday destinations, is also subject to a quarantine due to spiralling virus numbers there, meaning that a swath of the UK’s most popular holiday destinations are now effectively out of bounds and likely to engender further pain for Europe’s battered tourism-based industries.
On Thursday TUI, Europe’s largest travel operator, reported an eye-watering drop in revenue, to £67.8m for the three months to June compared with £4.2bn for the corresponding period last year, although the company did flag strong bookings data for 2021 holidays.
The new UK quarantine rules are part of the government’s ongoing calibration of its approach to the virus: allowing flexibility and responsiveness to the fast-moving situation which is designed to respond quickly to public health threats while allowing reopenings that support economic stability.
On the one hand it has beefed up rules on risky behaviour: increasing fines for people who don’t wear face-coverings, with the top penalty of up to £3,200. However, more freedom will be allowed in other areas from Saturday, including a relaxation for operators who offer some beauty treatments, theatres and weddings.
One clear beneficiary of the coronavirus crisis has been biotechnology companies pursuing research and development for cures and vaccines, sparking a gold rush on stock markets around the world.
In the past 48 hours a pair of developers have listed shares: German firm CureVac in New York and Chinese developer CanSino in Shanghai. CanSino’s shares almost doubled at the open upon listing on the Shanghai-based STAR growth market.
According to EY, there’s no sign of this cooling off any time soon. Martin Steinbach, head of EY’s IPO business in Europe, the Middle East, India and Africa, told the FT that he expected six biopharma companies to have raised a collective $1.78bn by the end of August.
US markets closed lower on Thursday and Asia-Pacific shares struggled into Friday, with disappointing Chinese retail data suggesting Chinese consumers remain cautious in the face of a risk of further coronavirus outbreaks.
WHAT ARE COMPANIES SAYING?
Industrial & Travel
Easyjet
The European airline announced today that it had successfully raised just over £600 million through a sale and leaseback programme for a total of 23 aircraft. The plan was highlighted in their trading update in May, predicting proceeds of £500-650 million. The company confirmed that this puts the total amount raised since the start of the pandemic at over £2.4 billion, made up of the proceeds of the sale and leaseback, a £400 million RCF, £600 million from the UK Governments Corporate Financing Facility, £400 million from two term loans and £419 million from an equity raise.
Thai Airways
The Stock Exchange of Thailand has suspended trading in Thai Airways International’s shares after auditor Deloitte declined to sign off on the accounts of the now bankrupt state carrier as it reported a record first half loss. The company reported a loss in the year to June 2020 of $901 million. The airline was already struggling prior to the pandemic and filed for bankruptcy in May. The airline is due to present its rehabilitation plan at its first hearing in Thailand’s Bankruptcy Court on Monday.
Cathay
The airline group comprising of Cathay Pacific and Cathay Dragon has said that it carried a total of 42,984 passengers last month, which is a 98.7% decline on July 2019. In a release of statistics, the company said that in the first seven months of 2020 passenger numbers were down by 79.4% compared with the same period in 2019. Cargo was also down across the two airlines, by 39.8% in July. They did suggest however that incremental improvements were being made, with passenger flights up from 4% of normal capacity in June to just over 7%. Chief Customer and Commercial Officer Ronald Lam said that he expected August passenger flights to represent about 8% of normal.
TMT
Rovio
The maker of the Angry Birds game has reported today a 160% jump in second-quarter adjusted operating profit. The company said that it had been helped by “increased player engagement” as a results of the Covid-19 lockdowns. CEO Kati Levoranta said that the company had “reached a record high games revenue driven by the strong performance of our key games”. Adjusted operating profit rose to €13.8 million from €5.3 million while revenue fell 3.6% to €69.2 million. The latter was due to lower movie revenue, which they said was down in Q2 as the popularity of the sequel to the Angry Birds movie has fallen since its release nearly a year ago.
IN THE NEWS
Travellers from France added to UK quarantine list – The Financial Times
Get creative to save jobs, urge experts – The Times
Covid-19 Shaping Up to Be Battle for Years Even With Vaccine – Bloomberg
