4th March 2022
Bite-sized business news from the UK and beyond
Good morning After a turbulent build up, the opening ceremony for the Winter Paralympics Games will take place today with competition starting tomorrow. Beijing 2022 will showcase 78 events across six Para sports: alpine skiing, biathlon, cross-country skiing, para ice hockey, snowboarding and wheelchair curling.
A record number of athletes - around 700 - were expected to compete at the 13th edition of the Games but that was before the expulsion of 83 Russian and Belarusian athletes yesterday following the Ukraine conflict.
- Russian exodus - London halts trading in 28 Russian companies
- Let’s get digital - ITV unveils ambitious streaming plans
London halts trading in 28 Russian companies
What’s going on?
Some of Russia’s largest miners, banks and oil producers have had their shares suspended on the London Stock Exchange yesterday in line with government sanctions.
It follows similar actions by stock markets in the US and Germany as Western organisations continue to distance themselves from Russia.
Why is this important?
Oil giants Lukoil, Gazprom and Rosneft, banking group Sberbank and the steel company Novolipetsk Steel are among the 28 Russian companies that have been suspended from the London stock market.
The move marks a turning point in the relationship between the LSE and Russian business. The capital has long been a popular destination for Russian firms seeking funds. Since 2005 39 Russian companies have listed on the LSE and raised $44bn.
Around £430bn has been wiped off the London-listed shares of Russian firms in the last two weeks alone as western sanctions bite, while the Moscow Exchange has been shut since Monday.
The UK and its Western allies are imposing heavy economic restrictions to cut off Russia from the global financial systems.
But crucially, Russia’s main export, oil and gas, remain exempt from sanctions for now. Western governments are wary of taking this step at a time when energy prices are already soaring. It means that the West is still buying oil and gas from Russia and thereby sending money to the Kremlin that can be used to fund the war.
The economic fallout from the ongoing conflict in Ukraine continues to build. The collapse of communism in the Soviet Union in the early 1990s led to a wave of Western companies entering the Russian market. 30 years on, top brands including Ikea, M&S, Expedia and Coca-Cola are taking a stand and pausing operations in the country.
ITV unveils ambitious streaming plans
Yesterday ITV announced plans to launch a revamped streaming platform called ITVX with the aim of doubling its digital revenue to £750m by 2026.
Britain’s biggest free-to-air broadcaster will invest £180m in the next two years on content that will premiere online up to nine months before it hits traditional ITV channels.
Ahead of the launch of ITVX later this year, ITV has bought out BBC’s share of the UK arm of BritBox, the streaming platform. ITVX will integrate BritBox UK and replace the ITV Hub brand. It will give subscribers the choice of watching ad-funded content free of charge, or to trade up and buy ad-free content on BritBox. BritBox International, which is available in the US, Canada, Australia and South Africa, will remain a 50/50 joint venture between ITV and BBC.
The news came as the company announced a 48% jump in profits to £480m last year, with total advertising revenues rising 24% to £2bn – the highest in its history – driven by the economic recovery from Covid.
But the strong performance wasn’t enough to please investors, ITV shares plunged 28% on the day over concerns on whether the huge digital investment will pay off.
ITV has struggled to compete against US streaming giants with multi-billion dollar content budgets. Since launching four years ago BritBox has gained 730,000 subscribers but lags much bigger platforms like Netflix which has over 10m users in the UK alone.
Stat of the day
Fitbit is recalling 1.7m of its Ionic smartwatches after reports of the battery overheating and burning some users
Other stories to keep you in the loop
- Russian oligarchs' super yachts seized
- English councils seek to end contracts with Russian-owned gas firm
- Supermarkets remove Russian vodka brand from sale
- Bet365 boss takes home almost £300m in a year
- FCA sees scam enquiries increase
- Bank of England updates logo with ‘more inclusive’ union flag
- Energy bills could reach £3,000 as oil and gas prices soar
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