Cathay Pacific posts record loss; Lego sales soar in pandemic – business live | Business

Lego CEO Niels Christiansen has also told the FT that the toy company is hiring hundreds of new employees to work on digital projects, to continue to digitalisation push.

Here’s their take:

Lego recorded its strongest growth rates in five years as sets that blend physical bricks with digital Super Mario games propelled the Danish toy company to record sales and profits in 2020.

The world’s largest toymaker increased revenues by 13 per cent to DKr43.7bn ($7bn) in full-year results while operating profit jumped 19 per cent to DKr12.9bn.

The growth was well ahead of the privately held company’s two main listed rivals, Hasbro and Mattel of the US, and better than the broader toy market as Lego’s investments in boosting its online sales and broadening its product range paid off.

“I’m very keen that five or 10 years out we stay relevant,” said chief executive Niels Christiansen. “We need to do whatever it takes to stay relevant. Digitally, we start to find a formula that works, and I think we can do a lot more of this.”

Toy company Lego has reported a jump in sales last year, as the lockdown encouraged families to play together more.

The Danish firm reports that revenues rose by 13% last year to DKr43.7bn (£5bn), with sales to consumers surging by 21%.

The pandemic boosted sales around the globe, with especially strong growth in China, the Americas, Western Europe and Asia Pacific.

Niels B. Christiansen, CEO, said:

“We are very pleased with these results. They show the timeless relevance of the LEGO brick and learning through play. This performance is also a testament to the passion, creativity and resilience of our people. Despite the challenges of the pandemic, they worked tirelessly to keep the world playing.”

Christiansen adds that Lego’s ‘large-scale’ investments over the last couple of years, including online and in digital, are now paying off.

In 2020, we began to see the benefits of these, especially in e-commerce and product innovation. We will further increase investments during the coming year with a continued focus on innovating play, our brand, digitalisation and developing an omnichannel retail network.”

With umpteen millions of children being home-schooled, demand for toys jumped last year. The lockdown, and the rise in household savings, has also spurred adults into buying more expensive items – such as Lego’s Technic sets.

Lego has staged a remarkable recovery since the early 2000s, when it came close to bankruptcy.

Tie-ups with Star Wars and Harry Potter, the Lego Friends range, the ninja-focused Ninjago line, programmable robots, Lego Architecture products, and the hugely successful Lego Movie all helped to build one of the greatest turnarounds in corporate history.

It’s also moved towards the digital world, with products such as its LEGO Digital Designer (which lets you build models with virtual Lego bricks), and a new partnership with Universal Music Group to create a “playful and innovative” music video maker.

London estate agent Foxtons has reported a strong start to the year, as the rental market recovers from the pandemic.

Foxtons says there’s been a flurry of activity, swelling its pipeline of work by almost a third:

The sales commission pipeline started 2021 more than 30% higher than prior year and has led to much improved revenue growth in the first two months of the year. Despite the significant increase in units sold to date, the value of the pipeline has remained stable over this period at levels last seen in early 2017.

Foxtons also reckons that a relative glut of rental options means tenancy costs are down year-on-year…

Stock levels in lettings are also well ahead of 2020 and, although a relative excess supply of rental properties in London has driven down average rents by 12% versus prior year, we have so far been able to fully mitigate the impact on average commissions through greater volumes as tenants look to take advantage of more attractive prices.

With so many restaurants closed, takeaway service Just Eat is seeing strong demand this year.

Just Eat told shareholders it expects a “further acceleration” in order growth this year, having swelled its revenues by 54% in 2020.

The current lockdown is certainly boosting demand at the online food order and delivery service.

So far in 2021, UK orders are up 88% compared with the first two months of 2020, with Delivery orders up more than 600%.

It says:

Given recent trading and the investment programme, management expects to increase market share in the UK in 2021.

But despite this strong growth, Just Eat made a loss last year of €151m, up from €115m million in 2019.

This was partly due to “advisory and integration costs” from the merger of Just Eat and Takeaway.com and the proposed takeover of Grubhub.

Adam Vettese, analyst at multi-asset investment platform eToro, says this rapid growth comes at a high price:

“With people having been cooped up in their homes for the best part of the year, conditions have been perfect for delivery food services such as Just Eat Takeaway.

“In 2020, the firm increased revenue 54%, active customers by 23% and the number of restaurants listed on its app by 42% in what was a hugely impressive year of growth.

“But that growth has come at a price and Just Eat has had to spend big on marketing and delivery drivers to stay ahead of the deep-pocketed Uber Eats and Deliveroo.

The crisis in the airline industry is also pushing the UK government towards cutting air passenger duty on domestic flights.

Such a move would be a boost to the sector, but doesn’t exactly square with the ministers’ commitment to a target of net-zero carbon by 2050.

My colleague Gwyn Topham explains:

Air passenger duty is set to be cut on domestic flights after the prime minister signalled his support for reform to bolster air links around the UK.

Lower rates for UK internal flights or an exemption for return legs will be considered.

The news will come as some relief to the beleaguered aviation industry, whose complaints about the level of duty predate the Covid-19 crisis, but environmental groups said the move was “nonsensical” and “beggared belief” in the face of climate change.

The tax currently stands at a minimum £13 per passenger departing from a UK airport, and similar – but lower – levies only exist in a few other European countries.

The rate of APD was increased in last week’s budget by £2 for economy long-haul flights to £84 per person, but frozen for all short-haul flights (including domestic).

The UK stock market has opened lower, with the blue-chip FTSE 100 down 31 points or 0.45% at 6700 points.

Mining stocks are pulling the index down from yesterday’s three-week high, with Rio Tinto down 3.3% and BHP Group off 2.7%.

The BBC says 2020 was a ‘bruising year’ for the airline:

In October, Cathay Pacific announced it would close its subsidiary Cathay Dragon, a regional carrier flying mainly to mainland China and other Asian destinations.

Cathay Pacific and its budget carrier Hong Kong Express took over Cathay Dragon’s routes.

The beleaguered carrier also announced it would cut an additional 8,500 jobs, amounting to about a quarter of its staff.

AFP points out that Cathay Pacific entered the pandemic in a ‘vulnerable position’:

When the coronavirus first emerged Hong Kong had fallen into recession and Cathay Pacific in the red as months of huge and disruptive democracy protests in 2019 led to a plunge in customers, especially from the lucrative mainland Chinese market.

The airline also found itself punished by authorities in Beijing because some of its employees joined or voiced support…