Today's UK stock market: Slightly down near historic highs; London Stock Exchange and Rolls-Royce earnings reports in focus

Investing.com - The UK stock market opened slightly lower on Thursday but remains near historic highs. The pound sterling weakened against the US dollar but stayed above $1.35. Markets are assessing earnings reports from Rolls-Royce and the London Stock Exchange.

As of 08:13 GMT, the FTSE 100 blue-chip index fell 0.08%. GBP/USD declined 0.2% to $1.3533. In European markets, Germany’s DAX dropped 0.2%, while France’s CAC 40 rose 0.3%.

In broader market news, NVIDIA (NASDAQ: NVDA) exceeded earnings expectations and issued an optimistic forecast, but this failed to impress investors. Market focus shifted to geopolitics, as the US and Iran began negotiations on Thursday. Artificial intelligence remains a key focus, with Jefferies noting investors are weighing concerns over capital expenditure returns and potential AI disruption.

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Rolls-Royce reported a 40% annual profit increase, driven by strong performance in its aircraft engine business. The company raised its mid-term targets and increased planned shareholder distributions.

In 2025, Rolls-Royce announced a basic operating profit of £3.46 billion, with a margin of 17.3%, beating the consensus estimate of £3.27 billion. Free cash flow reached £3.3 billion, supported by robust operational performance and ongoing growth in long-term service agreements. As of December 31, 2025, the company’s net cash was £1.9 billion. Looking ahead, the company expects 2026 basic operating profit to be between £4.0 billion and £4.2 billion, with free cash flow of £3.6 billion to £3.8 billion.

London Stock Exchange Group reported a 56.5% surge in pre-tax profit for 2025 and announced an additional £3 billion share buyback plan. Pre-tax profit rose from £1.26 billion to £1.97 billion. Total revenue, after recoveries, increased 5.8% on a reported basis to £8.99 billion, and 7.1% at organic constant currency. Earnings per share jumped 85.1% to 238.4 pence, while adjusted earnings per share increased 15.7% to 420.6 pence.

CVS Group (LON: CVSG) reported a 5.8% increase in revenue for the first half of 2026, reaching £356.9 million, in line with the market expectation of £357 million. The veterinary service provider saw same-store sales grow about 2.7%, an improvement from 2.5% four months ago, recovering from a decline of 1.1% in the first half of 2025. UK revenue totaled £320.6 million, with Australian operations contributing £36.3 million.

Derwent London (LON: DLN) announced a net asset value per share of 3,225 pence for fiscal 2025, up 2.4%. Earnings per share were 98.4 pence, and dividends per share were 81.5 pence. The company signed new leases totaling £11.3 million in FY2025, 9.9% above estimated rental value. Since the start of the year, Derwent London secured an additional £1.5 million in leases, with £14.4 million in negotiations, including all offices for Network, and another £4.4 million in ongoing discussions.

Howden Joinery Group (LON: HWDN) reported better-than-expected profit for FY2025 and announced a £100 million share buyback plan. Pre-tax profit for FY2025 was £344.9 million, with EBITDA of £355.3 million, exceeding market consensus and previous guidance by 4%. According to the company’s November 2025 update, market consensus expected pre-tax profit of about £331 million and EBITDA of around £340 million.

Greencoat UK Wind (LON: UKW) reported a net asset value per share of 133.5 pence as of December 31, 2025, reflecting an annual total return of -4.9%. This NAV includes the impact of subsidy RPI/CPI adjustments, lower than the previously reported 136.1 pence excluding this adjustment. The current trading price is 93.45 pence, representing a 29.8% discount to NAV. Due to the discount exceeding 10% during the reporting year, a continuation vote will be held at the upcoming annual shareholder meeting.

Man Group reported record organic growth, with assets under management reaching $227.6 billion as of December 31, 2025, up 35% from $168.6 billion last year, driven by $28.7 billion in net inflows and $21.4 billion in positive investment performance. The London-based alternative investment manager’s net inflows, weighted by assets, outperformed the industry by 19.3%, marking the sixth consecutive year of market share gains. Systematic long-only strategies attracted $22.5 billion in net inflows, including $13.2 billion from a single client, while autonomous long-only strategies attracted $12 billion.

Drax Group announced a record 12-month renewable energy generation for FY2025, producing 6% of the UK’s electricity and 11% of renewable energy. Adjusted EBITDA reached £947 million, down from £1.064 billion in 2024, mainly due to lower realized electricity prices. Operating profit fell from £850 million to £241 million, primarily due to £378 million in non-cash impairments. Drax completed a £300 million share buyback in October 2025 and launched a £450 million three-year deferred plan, supported by expected operational cash inflows of about £500 million when the renewable obligation scheme ends in 2027.

Tate & Lyle (LON: TATE) issued a nine-month trading update for FY2025, with Q3 operating performance in line with expectations and consistent with the first half. For the three months ending December 31, 2025, group revenue increased 15% on a reported and fixed FX basis, reflecting the acquisition of CP Kelco on November 15, 2024.