Tate & Lyle, once synonymous with sugar, has undergone a significant transformation in the last decade. The company divested its sugar operations in 2011, although it continues to operate under the same brand name. The FTSE 250 firm also sold its starch division and a controlling stake in a commercial sweeteners business in the Americas to a private equity group for $1.3 billion in 2021, significantly reshaping its revenue sources.

Today, Tate has shifted its focus to specialized “ingredient solutions,” creating products aimed at manufacturers that enhance the health profile of beverages, snacks, and sauces without sacrificing taste or quality. In the previous financial year, Tate generated £1.4 billion out of a total £1.6 billion in annual revenue from these food and beverage solutions. The remainder of its revenue was derived from its sucralose division, which offers a high-potency, no-calorie sweetener, and a limited amount from its “primary products Europe” segment, which pertains to its corn wet milling operations.

This streamlined portfolio strategy aimed to bolster profit margins, but Tate’s recent $1.8 billion acquisition of CP Kelco, a pectin and gum supplier, has left investors feeling uncertain. The deal is anticipated to elevate total group revenue by approximately 30%, yet its cash component of $1.15 billion raises concerns about fiscal stability. The company’s net debt to adjusted cash profit ratio is projected to rise to 2.3, up from 0.5 at the end of March, although it remains within the target band of 1 to 2.5. The uneven financial performance of CP Kelco is a primary worry, with revenue growth slowing since 2021 and declining by 3% in 2023. Its adjusted cash profit margin has also decreased from 22.6% in 2021 to 17% this year, presenting a challenging scenario for beleaguered shareholders already navigating Tate’s significant restructuring efforts.

Nevertheless, an optimized CP Kelco might complement Tate’s updated strategy, as its spectrum of pectins, gums, and other natural ingredients aligns well with Tate’s new direction. Earlier this summer, there was a recommendation to buy Tate’s stock, highlighting the potential of CP Kelco to diversify Tate’s offerings. At that time, the stock had a modest price to earnings ratio of 10.8 and offered a favorable dividend yield of 3.2%. Since the rumors of a takeover surfaced, Tate’s shares have yielded a total return of 26%.

Tate’s improving profit margins and consistent growth make its stock appear attractive, currently valued above 760p, compared to 745p before acquisition talks surfaced. However, the company still trades at a lower price level compared to its larger ingredient sector competitors, showcasing a forward price to earnings multiple of 14, whereas larger players like the Dublin-listed Kerry Group and the Dutch firm DSM-Firmenich have multiples of 20.6 and 38.2, respectively. Given this context, Tate may struggle to command a premium compared to these industry giants. Current advice suggests holding onto shares, as they are unlikely to provide a premium equivalent to that of bigger competitors in the sector.

RWS Holdings Analysis

It is essential to recognize that excessive dividends can often signal a risky investment profile. For instance, RWS Holdings, an Aim-listed language services company, presents a forward yield of 9%, a possible red flag for investors.

Headquartered in Buckinghamshire, RWS specializes in translation services and operates four key divisions: language services, intellectual property services, regulated industries, and technology, which includes AI-powered solutions for content creation and automation.

RWS has faced challenges with sluggish sales growth, reporting a 4% drop in total sales to £350 million and a 16% decline in adjusted pre-tax profits to £45.6 million in their latest half-year results. Furthermore, cash flow has weakened considerably, with cash conversion plummeting to just 30% from 85% the previous year, attributed to low sales, targeted investments, and a temporary increase in debtor days, which indicates payment delays from clients.

The shares fell by as much as 16% recently, despite RWS indicating it had returned to growth in the second half of the fiscal year 2024 with a 2% revenue increase in constant currency. While adjusted pre-tax profits for the full year should range between £110.4 million and £114.4 million, this does not factor in foreign exchange impacts, which are expected to reduce profits by £3 million. Consequently, the broker Berenberg has lowered its earnings forecasts for next year by about 23%.

The company’s shares currently trade at an attractive forward price to earnings ratio of only 6, compared with an average of 18.9 over the last decade. Despite some signs of potential growth, investors should be cautious and may want to avoid RWS for the time being as it may still face a long path to recovery.

Advice: Avoid investment; the high yield comes with significant risk.

At 57, Jobanputra takes pride in navigating the music industry’s “extraordinary fluctuations” across the past 25 years, a period during which he noted the near collapse of the UK record business amid a surge in illegal downloads during the mid-2000s. In 1999, he co-founded Relentless with the Ministry of Sound to promote British hip-hop and R&B on vinyl. Today, a staggering 95% of the company’s revenue is generated from streaming. In 2023, Relentless Music Group, which also operates the Notting Hill Arts Club in London, reported sales of £21 million and a pre-tax profit of £4 million.

Reflecting on the evolution of the industry, he remarked, “On one level, the business model from 1999 to 2024 has remained unchanged; however, the methods of distribution have transformed dramatically.” He argues that record labels no longer have as much control over the industry landscape.

“In the past, we managed everything—promotion, marketing, and the music-making process,” Jobanputra continued. “Now, it’s a much more democratic environment where artists have numerous avenues available to achieve fame and success, far beyond just one label.”

This begs the question: why do emerging artists still seek record label partnerships? Why not cultivate their own audiences via social media and self-released tracks?

Jobanputra highlights Relentless’s continuing global influence. “We possess significant financial resources on a global scale,” he pointed out. The label, based in central London, operates alongside Sony, its partner since 2011, across over 70 international markets. “Producing records and mastering success in these varied markets is complex; achieving international recognition requires a dedicated team, not just a laptop.”

Having spent 40 years in various facets of the music industry, Jobanputra began his journey as a DJ for a pirate radio station in London in his teens. He launched his first label, Outcaste, in 1994, before establishing Relentless in 1999 and later serving as president of Virgin Records in the late 2000s. During that era, Virgin was part of EMI, which had formed a partnership with Relentless since 2002, succeeding Ministry of Sound, and was owned by Terra Firma, a private equity firm.

He describes the tumultuous period under Terra Firma’s ownership as “challenging.” In 2007, the firm acquired EMI for £2.4 billion when credit was easily accessible. However, as CD sales plummeted and illegal downloads proliferated amidst the financial crisis, Terra Firma saw its investment annihilated, leading to EMI’s takeover by Citigroup, its principal creditor, in 2011. By then, Jobanputra had accepted an offer from Sony to integrate Relentless into its umbrella.

“The best British music company being acquired by private equity coincided with the industry’s financial downturn, characterized by rampant piracy,” Jobanputra noted. “We were managing a period of decline.”

The landscape began to shift with the rise of streaming platforms and subscription models, although the changes were gradual at first. From around 2011, revenue from streaming services began to increase significantly. This year, however, growth has steadied to single digits as the market matures.

Despite this newfound stability in music consumption, artists and record labels face intensifying competition for listeners’ attention. “We are still creating three-minute content pieces, yet access to entertainment has become easier, with online platforms vying for eyes and ears — from videos and gaming to YouTube and more,” explained Jobanputra.

Interestingly, he perceives this as an opportunity rather than a setback. “We are launching new music into a frantic atmosphere—young audiences are simultaneously engaged with their phones, television, and tablets—but music retains its profound impact. Take Taylor Swift this year; her global phenomenon illustrates that fans still crave communal experiences.”

Scouting new talent not only involves attending live performances but also keeping an eye out for acts garnering online traction. Jobanputra estimates the timeline from signing an artist to achieving a successful return on investment has extended to approximately three to five years, compared to just 18 months in the pre-digital age.

“While technology has accelerated many processes, launching a new star has become a more protracted endeavor,” he added. “Current success stories, such as Sabrina Carpenter and Chappell Roan, reflect this trend; they have been crafting their craft for years. Selecting the wrong artist now carries significant financial implications.”

Relentless has adapted by maintaining a diverse portfolio of artists, which includes an unexpected partnership—license arrangements with Pinkfong, the South Korean toy company behind the viral sensation, Baby Shark. Every streaming instance of the iconic children’s song contributes to Relentless’s revenue, which counts in the billions.

Jobanputra describes the contrasting nature of these partnerships: “While we were forming a licensing deal with Pinkfong, we were also working with a prominent Tottenham rapper, Headie One, known for his tumultuous past. I thought, ‘This perfectly highlights the dichotomy of Relentless.'”

Jobanputra’s journey in the music industry is guided by his passion for creativity and innovation. Relentless emerged at a time when no one else was producing British hip-hop and R&B on vinyl, driven by a desire to celebrate the authenticity of the medium. “A life-changing conversation at 3 a.m. during a music conference in Cannes with a Ministry of Sound associate set everything in motion, and ten months later, we launched the label,” he recounted.

His willingness to embrace risk—and to forge a path in an industry where few second-generation British Asians have thrived—stems from his background as a refugee. Arriving in the UK at the age of five after fleeing the oppressive regime of Idi Amin in 1972, Jobanputra’s journey instilled a sense of resilience. “Having nothing to lose has undeniably shaped my entrepreneurial path. Arriving in Stansted on a distinctly cold day, we were taken to a refugee camp in Kent, where my mother fell ill almost immediately. It was a stark reminder that I had no past to look back on.”

High five

My hero: Richard Branson. I admire his charisma.

My best decision: Sharing one more drink at 3 a.m. in January 1999, which inspired the idea for Relentless.

My worst decision: Failing to sign Amy Winehouse. There were discussions early on, but I was already preoccupied with Joss Stone and KT Tunstall and felt unable to take on additional artists. Signing an artist represents a mutually exchanged commitment; it’s a privilege I strive to honor.

My funniest moment: During So Solid Crew’s peak, a tabloid journalist rummaged through my bins daily for two weeks. I greeted him cheerfully each day, unconcerned about what they might find, as I thought, ‘I’m definitely not the person you imagine.’

My best business advice: During your lowest moments, you must be willing to endure the challenges to reach your goals. There will be personal costs, yet the desire for achievement must prevail. This mindset isn’t for everyone.

On Wednesday, Mark Zuckerberg, the CEO of Meta, introduced a range of updates to the company’s AI offerings. These include new smart glasses equipped with features that can remind users of their parked vehicles, as well as a digital assistant capable of responding in the voice of acclaimed actress Dame Judi Dench.

Despite these advancements, the AI technology will not be immediately accessible in Europe. Instead, it is set to launch first in the United States, Canada, Australia, and New Zealand.

The delay in deploying Meta AI in Europe has been attributed to concerns about the types of data permissible for training their AI models.

This month, Meta, along with 58 other technology firms, issued an open letter to European leaders, warning that inconsistent AI regulations threaten to hinder Europe’s competitiveness in the global AI landscape. The letter emphasized that Europe is becoming less innovative compared to other regions.

Among the signatories were notable companies such as Ericsson, a Swedish telecommunications leader, and Spotify, a popular music streaming service.

Meta AI is anticipated to launch in the UK before it becomes available in other parts of Europe. The company is moving forward with plans to train its AI models using public content provided by adults on Facebook and Instagram in the UK, aiming for the technology to better reflect the nation’s cultural and historical context.

The Information Commissioner’s Office in the UK has raised questions regarding these plans. In response, Meta adjusted the user interface to allow individuals to more easily opt out of data processing within their account settings. In contrast, EU regulators have expressed that Meta’s plans do not comply with the region’s strict privacy and transparency regulations.

During the annual Connect conference in Menlo Park, California, Zuckerberg claimed that Meta AI, intended to compete with OpenAI’s ChatGPT chatbot, is likely the most utilized digital assistant globally, boasting over 400 million monthly users, despite its absence in Europe.

Meta is heavily investing in AI, banking on it to drive increased revenues from its suite of applications. At the conference, Zuckerberg also presented the first functioning prototype of augmented-reality glasses branded as Orion.

Following these announcements, Meta’s stock rose by $9.08, marking a 1.6 percent increase, with shares trading at $572.41 during mid-afternoon on Wall Street.

The Financial Conduct Authority (FCA) revealed that suspicious trading actions were noted prior to 30.3 percent of bids in 2023, a decrease from 35.3 percent in the previous year.

New methods of analysis suggest that illegal trading might have been more prevalent than previously recognized due to prior inefficiencies in flagging suspicious activities.

By factoring in unusual share-buying behaviors on the day a bid is publicly announced, the rate of questionable cases escalated from around 20 percent to over 30 percent.

Previously, the FCA did not consider suspicious activities occurring on the day of the announcement, despite that being a time when many additional stakeholders and staff first learn of impending bids.

The FCA acknowledged that its previous assessments could have “potentially underestimated” incidents of suspected insider trading.

In addition to monitoring unusual share price fluctuations, the FCA evaluates irregular trading volumes before bids. This metric decreased from 8.4 percent of bids to 5.6 percent. Another indicator, focused on unique trading activities such as much larger-than-usual transactions, also saw a decline.

The FCA plays a crucial role in prosecuting cases of insider trading. In February, Mohammed Zina, a former analyst at Goldman Sachs, received a 22-month prison sentence after being convicted of multiple counts of insider dealing and fraud. This case marked the FCA’s first successful prosecution for insider trading since 2019.

Insider trading is illegal and carries significant penalties, including fines and up to seven years in prison for offenses committed before 2021, with a maximum sentence of ten years for actions taken thereafter. Given that takeover announcements typically lead to a substantial increase in the target company’s stock price, individuals with prior knowledge can secure substantial profits by purchasing shares beforehand.

The FCA asserted that its new analytical methodology remains effective even during periods of heightened market volatility, aiming to ensure that data aids the FCA in promoting transparency, deterring market manipulation, and fostering fair competition.

Last year, using its previous methodology, the FCA reported the highest levels of suspicious activity seen in 13 years.

In 2022, the FCA reached out to the executives of spread-betting firms, urging them to enhance their reporting of suspicious trades.

Numerous property transactions were delayed pending the budget announcement on October 30, with hopes of introducing favorable measures for the housing market.

However, immediate changes included rising stamp duty rates from 3% to 5% for additional properties and the discontinuation of the stamp duty holiday designed to bolster the market. Consequently, starting April 1, buyers will incur duty on property values exceeding £125,000 rather than the previous £250,000 threshold. Additionally, the upper limit for first-time buyers decreases from £425,000 to £300,000.

Concerns have mounted regarding elevated government borrowing and increased national insurance contributions, driving fears of inflation and rising interest rates, with mortgage costs already starting to climb.

This raises the question: Is now a favorable time to purchase? Here’s an overview of the current situation.

Current House Price Trends

Across the UK, the average house price experienced a slight dip of 0.3% from August to September, settling at £291,828, although year-on-year, this represents an increase of 2.9%. Since January 2019, when the average price was £228,314, prices have surged by 28%.

According to estate agency Knight Frank, projected price growth for the upcoming year is revised down from 3% to 2.5%, attributing this change to rising borrowing costs. Similarly, Hamptons has adjusted its five-year growth forecast from 20.5% to 19.3%, anticipating a 3% rise next year.

Despite the Bank of England reducing the base rate from 5% to 4.75% recently, further cuts appear unlikely, especially as inflation for the year ending in October exceeded the government’s target, climbing to 2.3% from 1.7% in September, largely due to escalating energy prices.

The Market’s Current Activity

Alastair Cochrane of Stirling Ackroyd reports a 25% increase in agreed property sales this month compared to last year. He remarks, “There was a notable rebound as the budget was generally perceived as less detrimental than anticipated. With recent events like the US election and Bank of England’s rate announcements settled, market activity has been unexpectedly robust.”

Real estate brokers indicate a surge in properties listed for sale as sellers aim to finalize transactions before the impending stamp duty rise.

Mortgage broker Andrew Montlake suggests it could be an opportune moment to buy. Although it’s possible mortgage rates may drop next year, he warns that delays might lead to increased competition along with potentially higher house prices, necessitating larger loans.

According to the property data firm Landmark Information Group, the average duration for a sale to complete is 123 days, indicating a time crunch as the March 31 deadline approaches.

Are Mortgage Rates Increasing?

Offers for mortgages under 4% have nearly vanished due to expectations that interest rates will remain steady for an extended period. The average rate for a two-year fixed mortgage has risen from 5.39% on November 1 to 5.54%, resulting in an additional £216 in annual repayments on a £200,000 loan over 25 years.

The rising inflation rates suggest that the Bank of England’s monetary policy committee may refrain from lowering its base rate of 4.75% in its next meeting. After a series of cuts beginning in August and November post a significant rise starting from December 2021, further reductions appear improbable.

Nonetheless, lenders typically roll out mortgage deals in early January and February to help meet sales goals, which could lead to heightened competition in 2025, according to Peter Stimson from MPowered Mortgages.

While mortgage deals are usually valid for six months, buyers can lock in a rate now and switch to a better offer later if available.

Implications for First-Time Buyers

Moneybox Mortgages reports an 8% uptick in loan applications for first-time buyers in the last three weeks compared to the previous three weeks prior to the budget announcement.

Felicity Holloway from Moneybox notes, “Many prospective buyers who were ready to purchase but waiting for lower mortgage rates have now accelerated their search to beat the changes in stamp duty regulations.”

This deadline has spurred individuals like Rhys Crookes to expedite their home-buying process. Crookes and his partner, Maddie Green, both 23, are looking for a three-bedroom property in their Hampshire village, which is priced around £400,000. Purchasing before April would help them save £5,000 in stamp duty costs.

Crookes commented, “We weren’t rushing before, but the impending deadline has pushed us to act faster; it’s a considerable expense that could otherwise diminish our deposit or the budget for furnishing our new home.”

Interestingly, first-time buyers might find themselves facing less competition from landlords due to the additional homes surcharge. Amy Reynolds from the estate agency Antony Roberts recounted a recent case where an investor withdrew interest in a one-bedroom flat in East Sheen after the surcharge took effect, allowing a first-time buyer couple to secure it for £390,000.

Market Activity for Upsizers and Downsizers

In contrast, the market for larger homes is experiencing a slowdown, as individuals needing more significant mortgages to upsize are discouraged by the higher borrowing costs.

Data from UK Finance revealed that 202,520 new mortgages were approved for home movers from January to October, reflecting a notable decrease from the 368,160 approved during the same period in 2021 when interest rates were lower.

Cochrane remarked that lowering rates could instigate movement in the market; however, the current range of 4.5% to 5% poses challenges for buyers. He anticipates an increase in sales of larger homes early next year, possibly after current owners seeking to downsize “enjoy one last holiday season in their homes.”

Estate agency Savills predicts a gradual increase in movers from 280,000 in the upcoming year to 350,000 by 2027 as mortgage rates are expected to eventually decline.

Are Landlords Exiting the Market?

Although there isn’t a significant mass exit among buy-to-let owners currently, trends suggest a gradual retreat from the market as higher mortgage rates and reduced tax reliefs take effect. UK Finance reports a decline in buy-to-let loans from a peak of 2.06 million in November 2022 to 1.95 million in September.

Notably, around 32% of homes currently listed are chain-free, according to property website Zoopla, often consisting of properties previously utilized as rentals.

Reynolds highlighted a landlord in possession of a one-bedroom flat valued at about £350,000 planning to notify her tenant in January with the aim of selling before the March 31 deadline.

Other landlords may also consider selling in anticipation of the Renters (Reform) Bill, which is progressing through parliament and has the potential to eliminate landlords’ rights to issue no-fault evictions.

Cochrane remarked, “This could serve as a significant motivator for landlords contemplating a larger market exit.”

Landlords Finding Market Viability Challenging

Rebecca Booker and Simon Read share plans to sell their two rental properties within the coming year, citing the financial impracticality of continuing as landlords.

Residing in Leighton Buzzard, Bedfordshire, they own two properties in Ramsgate, Kent. Booker purchased their first property, a two-bedroom terraced house, for £128,000 in 2013 with inherited funds, and the couple subsequently acquired another for £160,000 in 2015.

They aim to sell the initial property before their current five-year fixed mortgage deal expires in March. Presently, they pay £250 monthly, but recent interest rate inquiries suggest that even the lowest offers would triple their payments. Although they receive £900 monthly in rent, expenses such as letting fees, insurance, and maintenance threaten to eliminate their earnings entirely.

Booker expressed, “A significant maintenance issue could cost us more than the income we generate from renting. You can’t keep raising rents like traditional businesses because tenants simply can’t manage it.” She expressed an intention to offer the property to first-time buyers as she wishes to assist someone in entering the housing market.

Future plans involve listing their other rental property after the first sale goes through.

Booker concluded, “We would love to continue letting property if it were financially feasible, but it’s just not sustainable anymore.”

Chris Weston emphasized that the proposed cuts would undermine investor confidence in Thames Water’s business plan for the 2025-2030 period, rendering it “not deliverable.”

With significant debt and the threat of nationalisation looming, Thames Water announced its intention to increase customer bills by 52%—an increase of £18.99 monthly—targeting an average charge of £666.50 by 2030 to fund critical improvements, notably in wastewater treatment.

Earlier in July, Ofwat permitted water companies to hike average bills by an average of 21% over the next five years. This figure falls short of what the companies have deemed necessary to modernize infrastructure, accommodate a growing population, and address issues related to climate change such as droughts and extreme weather events.

Thames Water was informed it could raise bills by up to 23% in the same five-year timeframe, significantly lower than its original request of 40%.

In a market statement, Thames Water expressed “significant concerns” over Ofwat’s proposals, which it claims would result in a 25% reduction in its intended spending. The utility has criticized Ofwat for establishing what it calls “unattainable” wastewater targets and for halving its budget earmarked for wastewater treatment, increasing the risk of incurring further fines.

There has been mounting criticism aimed at utility companies for sewage discharges contaminating the nation’s waterways, underscoring the industry’s outdated infrastructure.

Thames Water’s challenges are viewed as indicative of broader issues within the water sector, where shareholder dividends and escalating debts have prompted public discontent regarding the management of water services since privatization.

Ofwat, which oversees water services in England and Wales, has issued provisional decisions affecting companies’ spending proposals and restricting bill increases. This comes as part of the regulatory price review, which will influence firms’ business strategies and expected investor returns from 2025 to 2030.

Water companies had sought Ofwat’s approval for a combined expenditure of £104.5 billion, intending to cover an average water bill increase of £144 over five years. However, the regulator proposed a reduced budget of £88 billion and set the average bill increase at £94 in its recent draft review.

The forthcoming plans, expected to be finalized in December, will include stricter performance metrics for utilities and a heightened risk of financial penalties for non-compliance.

Thames Water cautioned that Ofwat’s spending plan for wastewater management could lead to disproportionate penalties and increased financial risks, which would adversely affect its ability to attract investment and improve infrastructure. The company stressed the urgent need to address these concerns before final decisions are made.

Water UK, the trade association for the sector, warned that the regulatory approach could deter equity investors from supporting the water industry.

Weston stated, “The funds we’re requesting from customers will directly support the development of new infrastructure and enhancements in service for both households and the environment. This is not about them paying twice but addressing years of emphasis on keeping costs low.”

Sir Adrian Montague, chairman of Thames Water, remarked that after years of prioritizing low bills, it is time for challenging decisions. The onus is on the company, regulators, and the government to find solutions that benefit both customers and the environment.

An Ofwat spokesperson noted that the organization has received feedback from various stakeholders, including water companies, environmental groups, and investors, reflecting a wide range of opinions on the proposals. All feedback will be thoroughly reviewed over the next three months, with final decisions expected on December 19.

Healthcare professionals may feel that they’ve heard this narrative before. A decade ago, then-health secretary Jeremy Hunt committed to a fully paperless NHS by 2018, a goal that has yet to be realized. According to the British Medical Journal, approximately three-quarters of England’s healthcare trusts continue to depend on paper patient records and drug charts.

However, a growing group of current and former NHS employees are harnessing their expertise to infuse innovation into the health sector through technology.

“There’s a long road ahead,” asserts Benyamin Deldar, a junior doctor who completed his final NHS shift this year. He now concentrates on Deep Medical, the AI-driven appointment scheduling startup he co-founded with data scientist David Hanbury in 2021. “Paper prescribing remains prevalent in the NHS; discharge letters are often handwritten,” he notes. “I haven’t encountered any fax machines lately, but pagers are still very much in use.”

Deep Medical’s platform utilizes AI to address the annual 12 million missed appointments in the NHS. By leveraging algorithms and anonymized data, the system generates personalized patient profiles that help clinics operate closer to their full potential, factoring in traffic, weather, and alternative transportation arrangements.

“For instance, an elderly person who relies on public transport wouldn’t be able to make an 8:30 AM appointment,” Deldar explains. “Every patient has a unique risk profile and method of communication, be it via WhatsApp, a phone call, or a letter. We might issue four reminders or book an Uber for those facing transport issues. Every missed appointment costs the NHS approximately £165, so the potential savings could be enormous.”

In a trial with the Mid and South Essex NHS Foundation Trust, Deep Medical observed a nearly one-third reduction in appointment no-shows over a six-month period. The trust estimates that it could save £27.5 million annually with the service, which charges between 30p and 40p per booking. With $3.2 million in funding and a projected £6.5 million turnover for 2025, Deep Medical has secured partnerships with ten more trusts, although Deldar acknowledges that working with the NHS can be complex.

“The top priority for the NHS’s digitization is something rather mundane—supply chain and procurement,” he points out. “Whenever we engage with a new hospital, we must demonstrate compliance with NHS digital governance, which can take six months, even if we’ve just completed the process at a nearby facility. Why should procurement and governance be treated differently across 250 NHS trusts? We need to dismantle bureaucratic hurdles so that effective digital innovations can be implemented swiftly when they work.”

Rachael Grimaldi, an anaesthetist, experienced significantly less resistance when launching her medical technology startup, largely due to the unique circumstances brought about by the pandemic. While on maternity leave in the U.S., she and her husband Tim found themselves isolated as Covid struck. Grimaldi felt helpless as her peers faced the frontline battle.

“Then I encountered an article about a frightened patient who couldn’t communicate with healthcare staff due to PPE,” Grimaldi recalls. “Emergency workers were jotting down notes on scraps of paper, shouting instructions at patients, or providing care without ensuring understanding or consent.”

In response, the couple developed CardMedic, an application that offers a library of simple scripts for common clinical tasks, such as taking medical histories and explaining procedures without technical jargon. Within three weeks of launching, CardMedic attracted 8,000 users across 50 countries. It is currently utilized in 30 NHS hospitals and in the U.S., with the capability to translate into 50 languages, including sign language.

The advantages extend beyond the pandemic period. Grimaldi highlights, “Patients with communication challenges endure significant health disparities—higher mortality rates, prolonged hospital stays, and increased readmission rates.”

Anaesthetics are a fertile ground for entrepreneurship; Tara Rampal, a professor in the same field as Grimaldi, launched Quest Prehab last year, an online platform aimed at enhancing patients’ mental and physical health before treatments. Inspired by a family member’s cancer diagnosis, which revealed a decline in quality of life due to treatment, Rampal created a digital initiative that “helps individuals build resilience prior to surgery or cancer treatment, thereby speeding up recovery.”

To date, Quest Prehab has assisted 1,500 NHS cancer patients by providing access to virtual classes in yoga and tai chi, as well as support for mental coping skills. A study involving bowel cancer patients showed that participants in Rampal’s program were 60% less likely to experience surgical complications requiring hospital readmission within 90 days. Given that hospital readmissions cost the NHS £1.6 billion annually, the potential financial and clinical benefits are significant.

Rampal, who works part-time at Princess Royal University Hospital in Bromley, London, believes that the digital nature of Quest Prehab could vitalize healthcare delivery. “This approach could alleviate pressure on valuable healthcare resources—not just finances but also staff availability and physical space in hospitals—which is crucial for those who genuinely require in-person care.”

According to Rampal, the Darzi report has invigorated NHS tech entrepreneurs. “It sends a strong message about our capabilities. With the government embracing the potential for digital transformation in healthcare, we are on the brink of a revolution.”

Ali Haddad, a neurosurgeon at Imperial College Healthcare NHS Trust, shares similar optimism. Like Deldar and Grimaldi, he participated in the NHS clinical entrepreneur program, which empowers healthcare professionals to pursue entrepreneurial ambitions during their clinical training.

This motivated Haddad to develop XARlabs, a video-assisted augmented reality solution that converts traditional 2D medical images into interactive 3D representations. Already operational at Imperial, XARlabs also facilitates remote collaboration, allowing surgeons worldwide to consult on procedures. Recently, it was employed by British neurosurgeons in Turkey to perform surgery on conjoined twins.

“Incorporating mixed reality technology into surgical planning holds the promise of enhancing efficiency and containing costs,” Haddad explains. “Surgeons frequently rely on flat CT or MRI scans for complex surgeries, which lack the necessary depth for precise planning. By improving spatial awareness and accuracy through mixed reality, we may reduce operation durations and minimize complications—small reductions, like a 5 to 15 percent decrease in surgical time, can dramatically enhance operational efficiency.”

While traditional surgical laboratories and plastinated models can exceed £1 million annually in costs, augmented reality tools are significantly more affordable. However, successful integration, Haddad acknowledges, “depends on providing healthcare providers with the necessary resources and training for seamless adoption.”

Cera, one of the UK’s leading health technology companies, excels at navigating NHS and social care financing. Established by Ben Maruthappu in 2016, it leverages AI technology to enhance efficiency in at-home care. Cera’s caregivers log patients’ updates via an app, utilizing machine learning to identify concerning trends for preventative care. The company asserts that this approach reduces hospitalization rates by enabling proactive care at home.

Currently serving two million patients in their homes each month, Cera boasts revenues of £225 million last year, claiming its scale rivals that of all the UK’s accident and emergency services departments. Maruthappu attributes their effectiveness to a consumer-oriented approach in product design. “We ensure our offerings are intuitive—similar to how one utilizes WhatsApp or Deliveroo. The NHS must adopt this philosophy; cumbersome technologies hinder healthcare professionals’ daily operations.”

Maruthappu advocates for the NHS to embrace AI—not just for the complex ideas like AI-led diagnostics, but for streamlining fundamental tasks. “At Cera, AI automates administrative duties—billing, scheduling, and care plan development—allowing staff to devote more time to patient care. The NHS should pursue a similar strategy, empowering healthcare workers and improving efficiency.”

Maruthappu believes that the NHS’s shift towards digital solutions could drive its recovery. “The timing is crucial,” he asserts. “The NHS faces unprecedented challenges—skyrocketing waiting lists, declining staff and public satisfaction, and plummeting productivity levels. We urgently require solutions. Simultaneously, we have a new government keen to transition the NHS from an analogue to a digital framework. There exists a strong desire to implement change.”

How are they proving this assertion? One notable way is by allowing two significant acquisition offers to slip away: first, last year’s bid from buyout firm Apollo at £1.66 billion, valuing shares at 240p, and then this year’s approach from private engineering firm Sidara at a reduced price of 230p. Adding to this, the announcement of an accounting review has resulted in shares plummeting by 60 percent to just 49.84p.

This situation becomes even more perplexing when considering that it took Apollo five attempts to engage with Wood due to Franklin’s belief in the company’s value and his trust in Gilmartin’s operational turnaround. Sidara had to make four attempts, and both firms ultimately withdrew their offers, citing concerns over “geopolitical risks and financial market uncertainty” after evaluating Wood’s financials.

Despite the doom and gloom, the board expressed optimism during the half-year results in August, noting a $6.2 billion order book and suggesting that Gilmartin was poised to deliver the “significant” free cash flow investors seek by the following year. However, following engagements with auditor KPMG, they have now enlisted Deloitte for an “independent review” of their accounting practices. Meanwhile, their recent third-quarter update has rendered their cash flow projections murky, with only vague forecasts for 2025 being offered in the upcoming fiscal reports.

Deloitte’s review follows the revelation of half-year losses totaling £983 million, largely attributed to new finance chief Arvind Balan’s write-down of $815 million in goodwill, followed by an additional $140 million loss linked to exiting large-scale projects.

Deloitte’s investigation will concentrate on the reported positions of ongoing projects and address issues concerning “accounting, governance, and controls,” raising questions about potential previous-year restatements. This adds pressure as KPMG withheld approval on the half-year results, suggesting problems within the company’s accounting methods, particularly in their underperforming projects division, which has seen a decrease in sales and EBITDA year-to-date.

No board member was prepared to elaborate on the concerning updates, while investors were also faced with two unwelcome pieces of information. Firstly, a disappointing order book value of $5.4 billion. Secondly, a forecast indicating that net debt, excluding leases, would remain at levels comparable to last year’s $694 million, despite anticipated proceeds from asset disposals, hinting that cash flow issues persist.

Consequently, shareholder reactions were understandably negative. Gilmartin maintains, however, that “we continue to make progress on our turnaround,” projecting a “high single-digit growth” in underlying adjusted EBITDA for the year. Yet, analysts from Panmure Liberum have pointed out that the potential for additional write-downs may continue to severely impact share values.

This situation illustrates that either Franklin or Gilmartin must take responsibility for the ongoing crisis, as the Wood board’s current performance suggests that their brilliance has limits.

BT Struggles with Competition

The pace of change at BT remains challenging to interpret. The company’s new CEO, Allison Kirkby, claims that she has “accelerated the modernization” of the telecoms giant during the first half of the year. However, this initiative has coincided with a 4 percent tumble in share value to 137p, driven by investor concerns over unmet revenue projections, the absence of announcements regarding asset sales, and competition from alternative network providers.

These competitors are successfully acquiring BT’s customer base while the company continues to transition from its outdated copper infrastructure to high-speed fiber. Kirkby highlighted that the broadband rollout from their Openreach division had achieved record numbers, reaching 16 million premises in total, with 446,000 new customers added in the latest quarter.

Nevertheless, this data doesn’t paint a complete picture. Most new subscribers are merely migrating from copper services, resulting in BT losing 377,000 broadband customers during the last half—a decline of 2 percent in its broadband base. While Kirkby emphasizes Ofcom’s goal to bolster competition, BT’s ambition of establishing the UK’s largest fiber network, which aims to connect 25 million homes by the end of 2026, may come off as a struggle to maintain momentum in a backward-sliding environment.

Adding to the challenges, revenues are projected to decline by 1 to 2 percent this year, with Kirkby acknowledging that the market is not fond of surprises. This downturn is largely attributed to low-margin activities, such as supplying equipment to international clients. While free cash flow improved by 57 percent over the last half to £715 million and BT aims for an adjusted EBITDA of £8.2 billion this year, Kirkby’s target of achieving annual free cash flows of £3 billion by 2030 still faces significant challenges ahead.

Budget Pressures Heightened

The financial landscape is becoming increasingly burdened, with Sainsbury’s facing a £140 million expense, BT incurring £100 million, and both Wetherspoon and Marks & Spencer forecasting £60 million in costs each, among numerous other obligations across corporate Britain. Companies are warning that Rachel Reeves’s budget introduction, which holds higher national insurance and minimum wage obligations for UK businesses, may compel them to implement cost reductions, elevate prices, and limit employment opportunities.

Additionally, the inflationary effects of the budget, compounded by possible trade conflicts, are leading the Bank of England to suggest that maintaining the interest rate cut to 4.75 percent is a sufficient strategy for the time being. The Chancellor’s claims that these adjustments would not adversely impact “working people” are increasingly being called into question.

alistair.osborne@thetimes.co.uk

The survey, conducted between September 2 and 16, highlighted a decline of 3 percentage points, bringing overall confidence down to 47 percent.

This recent downturn follows a period of optimism, where confidence had peaked at 50 percent—marking the highest level since November 2015—in both July and August.

In parallel, economic optimism also fell, reaching 38 percent, the lowest since March.

Hann-Ju Ho, a senior economist at Lloyds Bank Commercial Banking, remarked, “The mixed signals regarding economic optimism suggest that some businesses are proceeding with caution. While we anticipate economic growth, it might occur at a slower pace than in the first half of 2024.”

Factors contributing to the decline in confidence include negative messaging from the Labour party regarding public finances and uncertainty surrounding anticipated reforms in workers’ rights.

Nonetheless, many companies maintain a positive outlook towards their individual businesses. The survey indicated that business owners’ confidence in their trading prospects increased by 2 percentage points to 56 percent, matching the high for the year. Additionally, 63 percent of respondents expected stronger output, up one percentage point from the previous month.

Positive hiring intentions persist, with 53 percent of respondents planning to increase staffing levels over the next year, a figure consistent with last month.

“Despite the decline in overall confidence, it is important to note that this drop occurred from an eight-year peak, and businesses remain optimistic about their trading outlook,” Ho emphasized.

He added, “The joint-highest result this year suggests that respondents still foresee a hopeful trajectory for their companies, which is evident in the stable employment figures.”

A notable portion of businesses also expressed intentions to raise prices next year, with this figure increasing by 11 percentage points to 65 percent, largely reflecting small businesses’ efforts to protect profit margins.

Output forecasts varied across different sectors; while the manufacturing and construction sectors experienced declines, there was a slight increase in retail and a more significant rise in the dominant services sector.

Paul Gordon, managing director for relationship management at Lloyds Bank Business and Commercial, stated, “These findings indicate that businesses are navigating through a challenging phase, yet it is crucial to acknowledge that the underlying metrics remain robust.”

“We continue to observe strong confidence levels in key sectors and regions, while firms exhibit greater self-assurance, as indicated by this year’s joint-highest trading prospects results.”