Good morning. Today we're talking about Pret’s profitability, Ocado’s disappointing joint venture and relief for a British cyber firm.

Big Stories

Pret back in black

Sandwich chain Pret A Manger has returned to profitability for the first time since 2018 helped by its subscription service Club Pret and the reopening of the high street post Covid. The company reported a profit of £51m in the year to December 2022, having made a loss of £168m the year before. The profit jump came despite Pret raising wages twice last year as the hospitality industry battles to attract staff. Club Pret, which launched in 2020, allows customers to pay £30 per month for unlimited hot drinks and a 10% discount on food. The company said the service was "very popular" with customers, with redemptions up two-thirds on a year ago. The service now has over 500,000 subscribers. Looking ahead, Pret is targeting further growth in the UK and overseas. The company plans to open 100 new stores in the UK this year, and it is also expanding into new markets, such as India.

Ocado’s disappointing venture

Ocado has defended its partnership with Marks & Spencer after the high street retailer said it was "not happy" with the performance of the joint venture. Ocado CEO Tim Steiner said that the partnership was "still in its early days" and that there was "still a lot of work to be done". However, he said that he was "confident" that the partnership would be successful in the long term. The joint venture launched in 2019 and was created to allow Marks & Spencer to sell its products online through Ocado's platform. The partnership has been seen as a way for Marks & Spencer to compete with online grocery retailers such as Amazon and Tesco. The business has struggled despite the boom in demand for home deliveries during the pandemic. It posted an underlying loss of £2.5m in the six months to the end of May – coming on top of a £4m loss last year – while revenue was up just 5% on last year despite average prices increasing by 8%.

Cyber relief

Cybersecurity company Darktrace's share price jumped by more than 20% yesterday after the company said that an independent review by auditing firm EY had found no evidence of accounting irregularities. The review was commissioned by the British firm following allegations by a short-seller that the company had inflated its growth rates prior to its stock market debut in April 2021. EY's report found that there were "a number of areas" where Darktrace's systems, processes, or controls could be improved, but that these did not impact the company's previous financial statements.

Elsewhere...

Serious allegations: A toxic culture has been alleged by more than 100 current and recent UK staff at outlets of McDonald's.

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