The falling prices of food and natural resources have hit some of Britain’s biggest businesses hard. A new analysis by stockbrokers The Share Centre found that annual pre-tax profits in FTSE 350 companies that reported in the second quarter of this year were down by 36.7% to £11.9bn.
The report showed that this was largely down to the plight of Britain’s three biggest listed supermarkets – Tesco, Sainsbury’s and Morrisons. Overall pre-tax profits for ‘food and drug retailers’ were down from £3bn at this time last year to a dramatic loss of £7bn – largely driven by property writedowns.
Mining company Vedanta also reported a £3.5bn loss, reflecting a wider malaise afflicting its sector caused by the falling price of metals and other commodities. Profits at food producers, presumably also squeezed by the grocery price war, were down 80% to £70m, while financial services profits also declined by 9.6% to £1.3bn.