Trending tickers: Universal Music Group, ITV, Unilever, Centrica

Universal Music Group (UMG.AS)

Universal Music Group (UMG) lost as much as 29% on Thursday after reporting a slowdown in its subscription and streaming segment in the second quarter.

Despite revealing better than expected revenue, thanks to merchandising, analysts downgraded the company amid concerns over its streaming income.

Revenue rose to €2.9bn (£2.5bn) in the three months to June, with its top sellers including releases by Taylor Swift and Billie Eilish.

However, analysts at Citi, Barclays, Guggenheim and Kepler Cheuvreux all lowered their ratings, with Citi saying streaming and subscription growth was meaningfully below what had been expected. It raised concerns about volatility between the music giant’s different lines of revenue.

Commenting on the results, UMG´s Chairman and CEO, Sir Lucian Grainge, said: "Our continued strong revenue growth this quarter demonstrates that we are, by design, a multifaceted music entertainment company that places our artists at the centre of everything we do.

“Our unique structure, which is both innovative and constantly evolving, enables us to support our recording artists and songwriters with an ever-expanding array of revenue sources, reinforced by new products and the exciting next phase of development of streaming services.”

ITV (ITV.L)

ITV reported a 17% rise in ad revenue in the second quarter of the year, boosted by the Euro 2024 football tournament.

The broadcaster, which is behind the hit show Love Island, said that overall first-half ad revenues increased by 10%, beating its forecasts of a 12% rise in the second quarter and 8% over the first six months.

Overall adjusted profit before tax was up 51% year-on-year to £178m in the first half, with a 3% dip in total revenues to £1.9bn.

However, the company's production arm, ITV Studios, reported a 13% fall in revenues for the first half, impacted by the writers’ and actors’ strike in the US, which brought productions to a halt.

ITV added that its production arm has taken a majority stake in Hartswood Films, the production company behind the Emmy-award-winning series Sherlock, for an undisclosed sum.

Shares in the group fell 5% on Thursday morning after the trading update.

Dame Carolyn McCall, ITV chief executive, said the group remained “confident” of delivering a group underlying earning this year after heavy investment in its ITVX streaming platform over 2023.

She cheered a 17% jump in digital ad revenues over the first half as these investments began to pay off.

“This was driven by strong viewing across our broadcast channels and ITVX, with a very successful Euros, a year-on year-increase in viewing of Love Island and a slate of great dramas,” she said.

“We have strong momentum in improving efficiency and simplifying ways of working right across ITV and are on course to deliver the £40 million of incremental in-year savings in 2024 that were previously guided.”

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Unilever (ULVR.L)

Dove soap maker, Unilever, climbed as much as 7.1% after beating profit estimates for the first half of the year.

It comes even though sales growth by the London market’s fourth biggest company came in a little short of expectations.

Underlying sales growth at the firm grew 3.9% compared with an expected 4.2% uplift. The maker of Magnum ice cream raised prices by only 1% in the second quarter, well below a consensus estimate of 1.6%.

The group maintained its sales growth outlook of 3% to 5% for the year, driven by growing sales volumes. The company expects its underlying operating margin to be at least 18% for the year, well ahead of expectations.

Unilever is undergoing a major turnaround in a bid to boost growth. This has included splitting off its ice cream business by the end of next year, as well as job cuts.

It is looking to axe around a third of all office roles in Europe by the end of next year.

Chief executive, Hein Schumacher, said: "We continue to embed the growth action plan, doing fewer things, better and with greater impact,” adding that the productivity programme and separation of its ice cream unit announced earlier this year was “progressing at pace.”

"There is much to do, but we remain focused on transforming Unilever into a consistently higher-performing business."

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Centrica (CNA.L)

British Gas reported an operating profit of £159m in the first half of the year, down from the record £1bn reported in the same months last year.

Profit levels are now “normalising” it said, after the energy crisis that saw watchdog, Ofgem, allow British Gas to claw back more money from household bills to recoup the costs of supplying its 10 million customers.

British Gas owner, Centrica, revealed a sharp drop in overall profit on Thursday, pointing to “a more normalised environment.”

After energy prices fell back from the elevated levels hit after Russia’s invasion of Ukraine, the FTSE 100 company said its operating profit was down 74% to £1.7bn.

It added that the future of its gas storage business looked “challenging” with energy markets back to normal. Its facility at Rough was upgraded during the price spikes and was now faced with, what Centrica called, “low seasonal spreads.”

It also said there were “marked improvements in customer satisfaction."

Centrica slipped to the bottom of the FTSE 100 with a 9% decline on the back of the news.

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