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Equilibrium's Finance and Investment News Roundup

In our roundup this week we report a small profits increase for ASOS, as well as fears that the UK's steel industry could be in crisis, concern that pension reforms might result in an upturn in scams and predictions of how our paying habits are likely to change by 2024. 


ASOS posts small annual profits rise

ASOS has recorded a 1% rise in annual pre-tax profits and has claimed a strong start to the new financial year. The online clothing retailer posted a £47.5 million profit for the year to the end of August, which represented a small climb on the £46.9 million recorded 12 months earlier.

According to the company - whose founder and Chief Executive Nick Robertson stood down last month - UK retail sales were 27% higher at £474 million, while its total global retail sales were 17% higher at £1.12 billion.

Shares in ASOS are now 51% up on last year, and closed at 2,928 pence on Monday. It means the company is currently valued at £2.44 billion. Nick Beighton, who has taken on the role of Chief Executive from Mr Robertson, said the figures show an "encouraging process", adding: "We remain focused on achieving our next staging post of £2.5 billion [worth of] sales." 

Is the UK steel industry in crisis?

Questions have been raised about the state of the UK steel industry as more than 1,000 job cuts have been announced at Tata Steel. Gareth Stace, the Director of UK Steel, has claimed the industry is in crisis and requires "life-saving surgery" in order to turn things around.

Mr Stace has called on Business Secretary Sajid Javid to address the problem, requesting he comes good on promises he has previously made regarding the sector's current plight. However, Mr Javid has claimed "there is no straightforward solution to the complex global challenges" that the industry faces.

Mr Stace stated: "Sajid Javid needs to deliver now, in days and weeks not months and years, on energy costs, business rates costs and fair trade."

His comments come as 1,200 jobs will be lost at Tata Steel's Scunthorpe and Lanarkshire plants, representing the latest round of job losses seen across the UK steel sector of late. 

New pension rules 'could lead to scams rise'

There are fears that new pension rules, first introduced in April, could lead to a rise in scams and the exploitation of retirees. The Commons Work and Pensions Committee has warned that the reforms, which mean people aged 55 and over can now choose to cash in their pension pots instead of opting for a retirement income, may increase the risk of people being conned out of their life savings.

According to the MP committee, the new setup is not yet working as it should, while it also asked questions about whether any gaps in advice and charges were being plugged. The committee said: "Financial scammers are notoriously adept at reinventing themselves to take advantage of such opportunities. But this does not mean scams should be accepted as a fact of life." 

Paying habits 'to change markedly by 2024'

The way we pay for goods is likely to change considerably by 2024, a trade association has suggested. According to Payments UK, the average consumer will write only two cheques all year and only purchase something with cash twice every three days. In nine years' time, it is expected that debit cards will be the number one payment method of choice, ahead of cash and direct debits.

It has been predicted that items such as lottery tickets and groceries - traditionally paid for with cash - will increasingly be bought online, while small transactions such as buying a newspaper will be paid for by card.