Trending tickers: Ford, Rightmove, Mercedes, Drax

Ford (F)

Ford nosedived 18% on Thursday night as it missed earnings expectations due to car repair costs weighing on profits. Second-quarter earnings came in far below analysts’ expectations thanks to an unexpected spike in costs for fixing faulty cars under warranty, it said.

The company reported adjusted earnings of 46 cents a share in the second quarter, compared to the 68 cents a share anticipated by analysts polled by FactSet.

Chief financial officer John Lawler told investors that issues were “popping up on our older models", including some manufacturing issues for cars made in 2021 or later.

Despite the loss in adjusted earnings, the US carmaker reported overall revenue of $47.8bn, a 6% increase year-over-year.

It came amid news that it also loses nearly $50,000 on every electric car it sells as traditional manufacturers struggle with the switch away from petrol.

Ford posted a loss of $1.1bn for its electric vehicle division, Ford E – equivalent to about $47,600 per car. It sold 23,957 electric vehicles (EVs), an increase of 61pc from a year earlier.

Ford blamed a price war across the industry for the loss, which came despite efforts to slash costs by $400m.

Rightmove (RMV.L)

Rightmove reported a 7% rise in half-year revenues to £192.1m, leading to a 2% increase in operating profit to £131.6m.

For the full year, it expects revenue growth of between 7% and 9%, with membership growth of up to 2% across estate agency and new home and full-year average revenue per advertiser growth of £78 to £85.

Chief executive Johan Svanstrom said: “Our performance came against the backdrop of the sustained challenging mortgage rate environment.

“The period saw a pick-up in existing-homes listings and transactions, a continued yet softening imbalance of demand and supply for rentals, and a tentative outlook for new homes development volumes.

“With the election now concluded, the property market looks forward to potential interest rate reductions which will further stimulate activity.”

The property platform added that it was prepared for a surge in housing deals amid falling mortgage rates.

It is hoped that the Bank of England will unveil its first rate cut in four years as soon as next week, leading to further mortgage rates drops and rising house market activity.

The probability of an interest rate cut stands next week at 48% versus 52% for a rate hold, according to figures from LSEG based on analyst forecasts.

Charlie Huggins, manager at Wealth Club, said: “These are solid but uninspiring results from Rightmove. Even without much growth, Rightmove is still a cash cow. But with the competitive environment hotting up, Rightmove cannot afford to rest on its laurels."

Read more: FTSE 100 LIVE: European stock markets stage recovery after recent Wall Street tech rout

Mercedes (MBG.DE)

Profits plunged at carmaker Mercedes as it suffered a sharp drop in electric vehicle sales.

Underlying adjusted earnings fell 28% to €2.8bn (£2.3bn) in the second quarter as it reported that battery electric car sales fell by a quarter compared to the same period last year. It sold 45,843 battery electric cars during the three months to June.

Electric vehicle sales were down 17% over the first half of the year to 93,364.

The company said: “The pace of the ramp-up of electric vehicles slowed in key markets," adding that this had been partially a result of the end of the environmental bonus for electric vehicles in Germany, which was brought to an end in December.

The group also slightly lowered its carmaking margin outlook to 10% to 11%, down from between 11% to 12%.

Drax (DRX.L)

Drax shares surged as much as 13.5% in London on Friday as the biomass power station business lifted City guidance alongside a 23% rise in half-year earnings to £515m. It also announced a £300m buy back of shares starting in the next quarter.

The company, which is the UK’s largest source of renewable energy, reported profits of £463m in the six months to the end of June, up from £338m in the same period last year.

Drax chief executive Will Gardiner said: "Drax has delivered a strong operational performance, playing an important role supporting the UK energy system with dispatchable, renewable power, keeping the lights on for millions of homes and businesses."

The company, whose North Yorkshire site generates enough renewable electricity a year to power the equivalent of over eight million homes, said it looked forward to working with ministers on delivering the government’s 2030 net zero ambitions.

As well as the biomass Drax power station, the group operates the Cruachan hydro site and is developing opportunities around bioenergy with carbon capture and storage.

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