Latest news with #DanCoatsworth
Daily Mail
24-05-2025
- Business
- Daily Mail
Slash your household bills by investing in the very firms that keep on hiking prices
The cost of living has surged again, driven up by a sharp rise in household bills last month. So called 'Awful April' brought a barrage of bill hikes on everything from energy and water to broadband bills and car tax. Council tax bills increased £109 on average, energy bills by £111, water bills by £123, and £50 was added to the typical annual phone and broadband bill. That drove inflation up to 3.5 per cent, official figures confirmed last week. But for investors willing to do their homework, there is an innovative way to get help with the rising cost of all the essentials. Investing in the companies that are raising your bills could be an effective way to earn an income large enough to cover what they charge you. Dan Coatsworth, from the investment platform AJ Bell, says: 'Most of the companies on the stock market charging us these bills pay generous dividends – you could buy their shares and use the income payments to settle up. In doing so, you are effectively handing them back their own cash.' Of course, it may not make sense to buy shares in companies just because you are their customer. But there can be opportunities among firms that provide these basic household services, such as energy and insurance. Here, experts suggest their top picks in each category – and how much you would need to invest to cover your bills, although of course you could buy less to cover part of them. Energy bills The energy price cap, which dictates the maximum households can be charged for each unit of gas and electricity, increased by 6.4 per cent in April, bringing the typical annual bill to £1,849, although it will fall again by £129 a year in July. Centrica, which owns British Gas, yields 3 per cent, and SSE, which supplies about five million British households, 3.6 per cent. You would need to invest about £50,000 in the latter to generate a large enough dividend to pay your annual energy bill. Charles Luke, manager of the Murray Income investment trust, points to National Grid as one reliable dividend payer in the energy space. 'It is a very solid business and benefits from the fact that we need to invest in our infrastructure as part of the energy transition,' he says. Shares currently yield 4.5 per cent. Mr Coatsworth suggests looking beyond the major providers to Telecom Plus, which owns the Utility Warehouse brand and yields a healthy 4.8 per cent. An investment of about £38,500 would generate enough income to cover the bills. Insurance A typical car insurance policy now costs £589, and for home buildings and contents insurance you can expect to pay £393, according to the Association of British Insurers. That's a combined annual insurance bill of £982 on average. At 2.4 per cent, Direct Line's dividend yield is nothing to write home about. Admiral, which insures about 5.7 million cars in the UK, looks more interesting, with a yield of about 4.4 per cent. Aviva yields a chunky 6.5 per cent. An investment of £9,100 would produce a dividend large enough to cover the average car insurance premium. Meanwhile, a £6,250 investment in Mony Group, which owns the comparison site MoneySuperMarket and yields 6.3 per cent, could generate enough to cover the home insurance. Phone and broadband Mid-contract price hikes meant some customers saw their phone and broadband bills increase by as much as 7.5 per cent in April. Vodafone shares currently yield a hefty 8 per cent, but such a high yield raises questions about sustainability. The yield is a company's dividend expressed as a percentage of its share price, so when the share price falls, the yield rises. This might look attractive but isn't necessarily. Vodafone shares are down 9.6 per cent over the past year, and down 42 per cent over five years. Remember in general that high yields are not the only measure to look out for – you'll need to do your research to make sure you understand the business. A company may look like it's offering a great deal, but have a systemic problem that means future earnings could be lower than expected. Simon Gergel, manager of the Merchants investment trust, says: 'Focusing specifically on yield can be quite dangerous, and some of the highest yielding stocks can be value traps.' One helpful indicator to give you an idea of whether the annual payout could be cut in future is the dividend cover ratio. This indicates how many times over a company can afford to pay its dividend. Anything below one suggests a firm is borrowing to fund its payout, which can be a sign of trouble. Ben Kumar, from the wealth manager 7IM, adds: 'Remember also that dividends are not guaranteed. Companies can, and do, cut them. Shares in the telecoms giant BT yield 5 per cent. An £11,000 investment could bring in enough to cover the typical £550 annual cost of phone and broadband. Water Water bills leapt by 26 per cent in April, bringing the average annual cost to £603. Getting a water meter can help reduce that, particularly if there are fewer people in your property than it has bedrooms. Alternatively, you could make the water providers pay for you. Severn Trent, which serves about 4.6 million UK households, yields an attractive 4.5 per cent. Dan Coatsworth prefers United Utilities, which yields a fraction more at 4.6 per cent. A £13,100 investment could produce enough income to do the job. Mr Kumar says: 'While dividends tend to keep pace with broad inflation over time, that is different to the specific inflation on your bills. 'Overall inflation is 3.5 per cent right now, but water bills just went up 26 per cent – so you might have to invest considerably more in the future to ensure your dividend income keeps pace with increases.' Spread your risk Cherry-picking individual stocks can be risky, so you might feel more comfortable letting a professional do the work. Income funds can provide a reliable dividend while spreading their risk across dozens of different stocks. Murray Income Trust is a so-called Dividend Hero – a fund that has increased its dividend for at least 20 consecutive years. Its top holdings include National Grid, HSBC, and BP, which is good news for those worried about petrol prices. It yields 4.55 per cent. Merchants Trust, which has increased its dividend for 43 consecutive years, yields 5.4 per cent and its top holdings include Lloyds Banking Group and SSE. How it works When you buy shares in a company you get a vote at the firm's annual general meeting and you share in its profits. Your money could grow if the company share price rises – or your investment could fall if the share price goes down. But on top of this when a business is profitable it rewards shareholders with a payout called a dividend. The amount is expressed as a percentage. So if you invest £1,000 in a company and it pays a 5 per cent dividend, you'll get £50. When you get a dividend you can choose either to reinvest it or take the money as cash.
Daily Mail
22-05-2025
- Business
- Daily Mail
Should you invest in the UK government bond that will pay you 5.375% interest for 30 years?
The Treasury has launched a new gilt that is set to pay a rate beating the current best buy savings accounts. The government bond, launched last week, will pay 5.375 per cent interest until January 2056. Investors will receive their interest payments as well as the face value of the bond at the end of the period. The rate offered by the gilt is far ahead of the top savings rates currently offered by banks, with the best non-bonus cash Isa rate from Tembo currently paying 4.80 per cent. CMC Invest offers an Isa with a rate of 5.7 per cent, but this drops to 4.85 per cent after three months. Dan Coatsworth, investment analyst at AJ Bell said: 'In the current market, 5.375 per cent equivalent interest could have investors jumping for joy. A bank offering that rate on a cash savings account might have a long line of people queuing up to hand over their money. 'While that might sound enticing, deciding if the investment is attractive is not as straightforward as you think.' The Government's latest gilt issue will pay interest ahead of the current best buy savings deals Government gilts are essentially IOUs issued by the UK Government on which they will pay a set interest rate over a stated period. Generally, these bonds are considered low risk investments, with the Government having never yet defaulted on a coupon payment during the term or a gilt repayment at the end. UK government bonds are becoming increasingly popular investments as retail investors look to make the most of the tax benefits they offer. Interest on gilts is taxed as income, but the bonds are free from capital gains tax. Coatsworth said: 'Gilts have also appealed to investors who have used their annual Isa allowance – they've been buying gilts with the hope that prices go up and they can make a quick profit. Gilts are advantageous because you don't pay any tax on capital gains.' Meanwhile, the shift towards gilts also comes amid concerns that the Government will make changes to the current cash Isa allowance. What's the catch? The 5.375 per cent gilts began trading on Wednesday, meaning that they can no longer be bought from the Debt Management Office at auction. This means that the gilts can only be bought on the secondary market, but this is subject to liquidity, and the price may change. Gilt yields are subject to market movements, meaning that if the price rises, the yield will fall and if the price falls the yield will rise. Coatsworth said: 'If interest rates go up, gilt yields could also move higher. That means future gilt issues could have a more attractive headline yield and investors might sell their existing gilts to buy the newer ones. That process could push down the price of existing gilts.' He added: 'Inflation also matters when weighing up gilts. Gilt prices tend to fall when inflation rises by more than expected because investors tend to demand a higher yield to compensate for the erosion of the investment's value and purchasing power.' If you sell a gilt when the price has fallen, you will likely make a capital loss However, if you intend to hold the gilt until it matures that wouldn't matter, but then it is best to 'forget' about it until the time rolls around and redeem it for par value. The first interest payment on the 5.375 per cent gilt will be made on 31 July this year.
France 24
21-05-2025
- Business
- France 24
Cyberattack costs UK retailer Marks & Spencer £300 mn
Marks last week revealed that some personal data of its customers had been stolen in a cyberattack that has crippled its online services for weeks. "In Fashion, Home & Beauty, online sales and trading profit have been heavily impacted by the necessary decision to pause online shopping, however stores have remained resilient," Marks said in a statement. "We expect online disruption to continue throughout June and into July as we restart, then ramp up operations." The impact on annual group operating profit is estimated at around £300 million, "which will be reduced through management of costs, insurance and other trading actions", the retailer added. The news came as Marks on Wednesday reported operating profit before adjusting items of £985 million for its financial year to the end of March. Following the update, its share price dropped 2.5 percent at the start of trading in London. Group operations have since Easter been hampered by a ransomware sting which forced the retailer to suspend online sales, contactless payments at stores and even recruiting operations. Marks said information stolen could include names, dates of birth, home addresses and telephone numbers. However, it did not include "useable payment or card details", nor account passwords. The company reported the incident to relevant government authorities and law enforcement. "There's still a big unknown regarding any potential fines on Marks and Spencer from the Information Commissioner's Office, which enforces data protection regulation" in Britain, noted Dan Coatsworth, investment analyst at trading group AJ Bell. Taking into account the way the fine is calculated and previous penalties handed down to UK companies for data breaches, Marks could take a further hit totalling around £550 million, he added. 'Crime investigation' Britain's National Crime Agency told the BBC it is investigating a series of cyberattacks including on luxury department store Harrods and the Co-op food chain. "We are looking at the group that is publicly known as Scattered Spider, but we've got a range of different hypotheses," Paul Foster, head of the NCA's national cybercrime unit, told a BBC documentary. The BBC said on its website "the hacks have been carried out using DragonForce, a platform that gives criminals the tools to carry out ransomware attacks." Despite the Marks attack having a bigger impact, chief executive Stuart Machin described it as only "a bump in the road". © 2025 AFP
Straits Times
21-05-2025
- Business
- Straits Times
Cyberattack costs UK retailer Marks & Spencer $519 million
Marks and Spencer said information stolen could include names, dates of birth, home addresses and telephone numbers. PHOTO: REUTERS LONDON - British clothes-to-food retailer Marks and Spencer on May 21 said a cyberattack disrupting its online service is set to last through to July and hit group profit by around £300 million (S$519 million). Marks last week revealed that some personal data of its customers had been stolen in a cyberattack that has crippled its online services for weeks. 'In Fashion, Home & Beauty, online sales and trading profit have been heavily impacted by the necessary decision to pause online shopping, however stores have remained resilient,' Marks said in a statement. 'We expect online disruption to continue throughout June and into July as we restart, then ramp up operations.' The impact on annual group operating profit is estimated at around £300 million, 'which will be reduced through management of costs, insurance and other trading actions', the retailer added. The news came as Marks on May 21 reported operating profit before adjusting items of £985 million for its financial year to the end of March. Following the update, its share price dropped 2.5 per cent at the start of trading in London. Group operations have since Easter been hampered by a ransomware sting which forced the retailer to suspend online sales, contactless payments at stores and even recruiting operations. Marks said information stolen could include names, dates of birth, home addresses and telephone numbers. However, it did not include 'useable payment or card details', nor account passwords. The company reported the incident to relevant government authorities and law enforcement. 'There's still a big unknown regarding any potential fines on Marks and Spencer from the Information Commissioner's Office, which enforces data protection regulation' in Britain, noted Dan Coatsworth, investment analyst at trading group AJ Bell. Taking into account the way the fine is calculated and previous penalties handed down to UK companies for data breaches, Marks could take a further hit totalling around £550 million, he added. 'Crime investigation' Britain's National Crime Agency told the BBC it is investigating a series of cyberattacks including on luxury department store Harrods and the Co-op food chain. 'We are looking at the group that is publicly known as Scattered Spider, but we've got a range of different hypotheses,' Mr Paul Foster, head of the NCA's national cybercrime unit, told a BBC documentary. The BBC said on its website 'the hacks have been carried out using DragonForce, a platform that gives criminals the tools to carry out ransomware attacks'. Despite the Marks attack having a bigger impact, chief executive Stuart Machin described it as only 'a bump in the road'. He added: 'It has been challenging, but it is a moment in time, and we are now focused on recovery, with the aim of exiting this period a much stronger business.' AFP Join ST's Telegram channel and get the latest breaking news delivered to you.
Int'l Business Times
21-05-2025
- Business
- Int'l Business Times
Cyberattack Costs UK Retailer Marks & Spencer GBP300 Mn
British clothes-to-food retailer Marks and Spencer on Wednesday said a cyberattack disrupting its online service is set to last through to July and hit group profit by around GBP300 million ($404 million). Marks last week revealed that some personal data of its customers had been stolen in a cyberattack that has crippled its online services for weeks. "In Fashion, Home & Beauty, online sales and trading profit have been heavily impacted by the necessary decision to pause online shopping, however stores have remained resilient," Marks said in a statement. "We expect online disruption to continue throughout June and into July as we restart, then ramp up operations." The impact on annual group operating profit is estimated at around GBP300 million, "which will be reduced through management of costs, insurance and other trading actions", the retailer added. The news came as Marks on Wednesday reported operating profit before adjusting items of GBP985 million for its financial year to the end of March. Following the update, its share price dropped 2.5 percent at the start of trading in London. Group operations have since Easter been hampered by a ransomware sting which forced the retailer to suspend online sales, contactless payments at stores and even recruiting operations. Marks said information stolen could include names, dates of birth, home addresses and telephone numbers. However, it did not include "useable payment or card details", nor account passwords. The company reported the incident to relevant government authorities and law enforcement. "There's still a big unknown regarding any potential fines on Marks and Spencer from the Information Commissioner's Office, which enforces data protection regulation" in Britain, noted Dan Coatsworth, investment analyst at trading group AJ Bell. Taking into account the way the fine is calculated and previous penalties handed down to UK companies for data breaches, Marks could take a further hit totalling around GBP550 million, he added. Britain's National Crime Agency told the BBC it is investigating a series of cyberattacks including on luxury department store Harrods and the Co-op food chain. "We are looking at the group that is publicly known as Scattered Spider, but we've got a range of different hypotheses," Paul Foster, head of the NCA's national cybercrime unit, told a BBC documentary. The BBC said on its website "the hacks have been carried out using DragonForce, a platform that gives criminals the tools to carry out ransomware attacks." Despite the Marks attack having a bigger impact, chief executive Stuart Machin described it as only "a bump in the road". He added: "It has been challenging, but it is a moment in time, and we are now focused on recovery, with the aim of exiting this period a much stronger business."
