Business News Round Up (02/03/2023)

North West experiences fall in equity investment in 2022, according to new British Business Bank report

Published today, the British Business Bank’s Small Business Finance Market 2022/23 report highlights a decline in equity investment in the North West, with activity also slowing considerably across the UK since Q3 2022. In the North West there were 108 announced equity investments into smaller businesses in the first three quarters of 2022, a 5% decrease compared to the equivalent period of 2021. The value of announced equity deals was also down by 35%, with the total investment value in the region being equal to £482m. Whilst lower than the record high of £863m for the full year of 2021, Q1-Q3 2022 still exceeds the £279m of investment in the region in the full year of 2020. With various economic headwinds impacting the activity of UK businesses, appetite for finance has subsequently taken a knock. Overall demand for external finance has dropped significantly, from 44% among North West based smaller businesses during Q3 2021 to 29% last year. This was also reflected across the UK, with only 33% of small businesses using external finance in the third quarter of 2022, compared to 44% the year prior. Across the UK, £35.5bn of bank lending came from challenger and specialist banks in 2022, exceeding lending by the major banks during the period, giving challenger and specialist banks a 55% share of the market. At the end of 2022 Starling Bank announced plans to open a new Northern office in Manchester, set to bring 1,000 new jobs to the region.

Hope for high street as closures hit seven year low

Shop closures in Scotland are at their lowest rate for seven years, suggesting the hollowing out of the retail sector may have passed its worst point. The 1.4% overall closure rate last year was almost a quarter of the 4.7% fall in 2021 and even less than the 3% decline in pre-pandemic 2019. It is also below the 1.7% average fall across Britain.. Throughout 2022, 888 stores north of the border closed their doors, while 669 shops were opened – resulting in a net loss of 219 stores managed by retailers with more than five outlets. Only the South East (-1.3%) has seen a slower rate of decline, while the East Midlands and North East were on a par with Scotland, with a net decrease in multiple retailers also at -1.4, according to new data from PwC and The Local Data Company (LDC). Like the rest of Great Britain, retail parks in Scotland remain the most resilient outlet type, with a small increase in outlets (+0.1%). North of the border the high street showed greater resilience, with a -1.5% closure rate – compared with -2.6% for the whole of GB. Shopping centres experienced a higher rate of decline, with a closure rate of -2%.

BT Group adds £24 billion to wider UK economy

The activities of BT Group added £24 billion to the wider UK economy last year and supported nearly 300,000 jobs, according to a new report published. The report from consultancy firm Hatch looked at the spend of employees and suppliers of BT Group – which includes EE, BT, Plusnet and Openreach – and the estimated knock-on impact that has on economies across the UK. The report found that BT Group, the UK’s largest telecommunications company which employs around 80,000 people in the UK, made a direct contribution to the economy estimated at £11billion in the last financial year (2021/22). Through the company’s employees and its supply chain, and their subsequent spending, Hatch estimates the resulting boost to the UK economy came to a total of £24 billion. The company’s spending with UK-based suppliers came to a total of £9.3 billion. According to the study, BT Group’s combined activities supported a knock-on total of 284,000 jobs across the UK. The report highlights BT Group’s presence in every nation and region in the UK and its current major investment in the rollout of full-fibre broadband and 5G across the country. It also profiles the range of activities by BT Group colleagues across the UK, from the volunteers helping care home residents avoid isolation and loneliness, to the teams protecting customers and the UK from cyber threats.

https://www.webwire.com/ViewPressRel.asp?aId=301483

Scotland top outside London for net zero deals – British Business Bank research

Scotland has seen the UK’s largest number of smaller business equity deals in net zero sectors outside of London, according to new research released today (March 1, 2023) by the British Business Bank. The Bank’s Small Business Finance Markets 2022/23 report found that Scotland accounted for 14% of net zero equity deals from 2018 to the third quarter of 2022, double its 7% share of total UK low-carbon and renewable energy sector turnover. Among the businesses securing net zero equity deals in recent years has been Celtic Renewables, which produces biofuels from whisky co-products. The firm is using the funding to develop Scotland’s first biorefinery facility in Grangemouth. The findings support previous research from the British Business Bank’s Nations and Regions Tracker, which found Edinburgh was the UK’s top ‘net zero cluster’ by deal count, with £186 million invested through 92 transactions between 2011 and the second quarter of 2022. Despite the challenging economic climate, Scotland saw a 26% increase in the announced equity investment value during the first three quarters of 2022 compared to the same period in the previous year. The £525 million invested between January and September also meant that values were on track to exceed the record £540 million set in 2021. However, in line with much of the wider UK, Scotland saw a fall in the total number of announced equity deals between the first and third quarters of last year compared to 2021 – down to 151 from 178.