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WINNERS & LOSERS SUMMARY: Spire Healthcare Sinks On Litigation Charges

Thu, 14th Sep 2017 11:51

LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Thursday.
Next, up 12%. The clothing and homewares retailer said the first half of 2017 had been "difficult" but its performance had been "encouraging" on a number of fronts, as it reported a fall in profit, but upgraded its sales and profit guidance for its full year. The retailer said "sales and profits are in line with our cautious expectations" and while the retail environment remains tough, the company's prospects going forward appear somewhat less challenging. Next registered a 9.5% fall in pretax profit to GBP309.4 million from GBP342.1 million in the first half of 2016. "The last three months have given us some encouragement that our ranges are improving, but the weather has been in our favour and the comparative numbers last year were very poor," Next said. In light of this the retailer marginally upgraded its full year full price sales expectations to be between a 2% fall and 1.5% growth, and for full year profit to be between GBP687 million to GBP747 million.

GKN, up 3.5%. The engineer said Chief Executive Nigel Stein plans to retire from his position, and will step down at the end of 2017, and Finance Director Adam Walker will also leave before the year end.Stein will be succeeded by Kevin Cummings, currently the chief executive of GKN's Aerospace unit, from the beginning of 2018. Stein will step down as a director of the company March 14, 2018. Cummings joined GKN in 2008, and has headed the Aerospace division since the beginning of 2014. Meanwhile Finance Director Adam Walker will also leave GKN before the year end to take up an opportunity outside of the engineering sector. He had held the position since February 2014, and will be succeeded by Jos Sclater.

Sage Group, up 1.2%. Barclays upgraded the accounting software company to Equal Weight from Underweight.
Provident Financial, down 4.9%. RBC Capital downgraded the subprime lender to Underperform from Sector Perform. Provident will be demoted from the FTSE 100 when the FTSE Russell index review changes come into effect on Monday.

WM Morrison Supermarkets, down 4.2%. The supermarket chain reported growth in profit in the first half of its financial year as revenue rose, and it said it is making progress with its strategy to 'fix, rebuild and grow' the business. The company said pretax profit in the 26 weeks ended July 30 grew to GBP200 million from GBP143 million the year before, as revenue rose to GBP8.42 billion from GBP8.0 billion. Like-for-like sales excluding fuel increased by 3.0% year-on-year for the first half, after second-quarter like-for-likes grew by 2.6% year-on-year. Retail rose by 2.5% in the half, while wholesale was up 0.5%. Within retail, supermarkets achieved 2.1% growth and online rose by 0.4%.
GVC Holdings, up 4.0%. The sports betting and gaming company reported higher revenue in the first half of 2017 with company performance exceeding expectations and the pretax loss also narrowing substantially. Revenue for the six months to June 30 rose 24% to EUR472.8 million from EUR382.1 million. Pretax loss narrowed to EUR6.6 million from EUR86.1 million. Adjusted pretax profit doubled to EUR101.9 million from EUR51.3 million. The adjusted figures exceptional items such as amortisation of acquisitions, impairments, changes in fair value of derivative financial instruments. GVC paid a special dividend in February of EUR14.9 cents per share, with a further interim dividend of EUR16.5 cents per share being payable on October 19. It said the company aims to return no less than 50% of free cash flow.

Auto Trader, up 2.5%. UBS upgraded the online car marketplace to Neutral from Sell.

UDG Healthcare, up 1.9%. The healthcare services provider said it has acquired US-based healthcare communications agency MicroMass Communications for up to USD75.8 million. It will pay an initial consideration of USD63.8 million, with an additional USD12 million payable over the next three years, based on the achievement of agreed profit targets. MicroMass's existing management team will remain with the business after its acquisition.
Spire Healthcare, down 15%. The private hospital operator warned it has seen revenue "significantly lower" over the past few months, with the trend continuing into September, leading it to lower its guidance for 2017. The reduced outlook came as the company's interim profit was dented by significant one-off costs related to the Ian Paterson litigation. Paterson, a former breast surgeon, was jailed in May for 15 years for carrying out unnecessary cancer operations. Spire said, whilst its first half performance was in line with its expectations, revenue has been "significantly lower than anticipated" in July and August, and this appears to be continuing into early September. Spire reported a pretax profit of GBP12.1 million for the half year to the end of June, down from GBP46.0 million the prior year, hit by one-off costs of GBP32.1 million in the half, offsetting a rise in revenue to GBP481.0 million from GBP469.5 million. GBP192.0 million has been wiped off its total market value in wake of the warning.

McCarthy & Stone, down 3.5%. Goldman Sachs downgraded the retirement housebuilder to Neutral from Buy.

Hochschild Mining, down 3.0%. UBS cut the gold miner to Neutral from Buy.
Metminco, up 12%. The miner said it has received approval from the Colombian environmental agency to construct up to 2,000 metres of underground development covering the Miraflores licence. The Corporacion Autonoma Del Risaralda has approved the exploration development under Metminco's existing plan, which will allow Metminco to expose the previously defined ore zones on multiple levels and complete infill diamond drilling for stope definition ahead of a final decision to construct processing facilities and supporting infrastructure. Metminco said it will assess the possibility of trucking ore from the mine to a nearby processing facility in order to get large scale bulk processing information ahead of its decision to construct the processing facilities at Miraflores. It said it is on track to finalise its feasibility study for Miraflores during the third quarter of 2017.
Interserve, down 47%. The support services and construction group warned on its full-year results, after "disappointing" UK trading in July and August. The company said trading in the UK over the summer months was particularly disappointing in support services, but also in construction. It therefore expects the outturn for the full year to be "significantly" below its previous expectations. Interserve added that it has made further progress on contracts within its exited Energy-from-Waste business, but that the anticipated timing and complexities of completion mean it now considers it likely that the final costs will significantly exceed the GBP160 million currently provided.

Forbidden Technologies, down 22%. The cloud-based video technology company reported a widened loss for the first half of 2017 as invoiced sales fell, but deferred revenue increased, with the company seeing a pipeline of larger deals but at slower conversion rates. Forbidden reported a widened pretax loss of GBP1.7 million for the half year to the end of June, compared GBP1.3 million the prior year, as revenue fell slightly to GBP316,000 from GBP327,000. Invoiced sales - the company's key metric - fell 20% to GBP355,000 from GBP445,000, whilst deferred revenue rose 74% to GBP262,000 from GBP150,000. The increase in longer term, higher value licensing contracts is reflected, Forbidden said, in the fall in invoiced sales but the much higher deferred revenue figure. Forbidden said the resignation of director and Chief Executive Officer Aziz Musa in February hit commercial capacity due to his focus on global sales.
By Arvind Bhunjun;; @ArvindBhunjun

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