Last checked at LONDON (Alliance News) - The following stocks are amongst the biggest risers and fallers within the main London indices midday Thursday.
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FTSE 100 WINNERS
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WM Morrison Supermarkets, up 7.6%; J Sainsbury's, up 5.8%; Tesco, up 3.4%. The supermarkets are leading the blue chip gainers after Morrisons said it was making progress in its three-year turnaround plan, cutting long-term prices and focusing less on promotions. It narrowed its full-year profit guidance range as third quarter sales continued to slide, albeit at a slower pace. The company said it expects to meet its full-year profit target and narrowed its target range for underlying pretax profit to between GBP335 million and GBP365 million, from between GBP325 million and GBP375 million previously but still around half the profit of GBP785 million in the year to February 2, 2014. The UK grocer said it was continuing to invest in price cuts, as total store sales excluding fuel and sales tax fell 3.6% from a year earlier.
Marks & Spencer Group, up 4.2%. The retailer received a number of positive broker notes Thursday after impressing analysts on Wednesday with its first half results. Deutsche Bank upgraded the M&S to Buy, CitiGroup raised its price target by 13%, and Goldman Sachs removed the stock from its Conviction Sell list.
Experian, up 3.9%. The information services company reported a rise in first-half pretax profit, citing strength in North America Credit Services, a return to growth in Brazil and a good all-round performance in the UK. Experian, which provides services such as helping to manage credit risk and prevent fraud, said it made a USD534 million pretax profit in the six months ended September 30, compared with USD480 million in the corresponding period last year. The group increased its first interim dividend by 7% to 12.25 US cents per share, citing strong cash performance.
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FTSE 100 LOSERS
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RSA Insurance Group, down 2.9%. The insurer reported a fall in premiums as a result of weak insurance market conditions and the group's restructuring plan being led by Chief Executive Stephen Hester. RSA said net written premiums fell to GBP5.68 billion in the first nine months of the year, compared with GBP6.74 billion in the corresponding period last year.
Coca-Cola HBC, down 2.7%. The bottler of Coca-Cola products reported a drop in third-quarter revenue as poor weather in its markets hit volumes, and it warned that it expects tough market conditions for the rest of the year. Revenue in the three months to September 26 fell 5.3% to EUR1.82 billion, from EUR1.92 billion, on a drop in volume to 547 million cases. Comparable earnings before interest and taxes fell 3.1% to EUR200.9 million though its margin improved slightly to 11.1% from 10.8%.
Astrazeneca, down 2.7%. The pharmaceutical company raised its guidance for 2014, as it saw revenue rise in the nine months to end-September at constant currency. However a recent strengthening of the US dollar works against and it expects a 5% hit from foreign exchange revaluations this year. Berenberg says that means core earnings per share is likely to come in around USD4.30, lower than the consensus expectation of USD4.55. AstraZeneca posted a pretax profit of USD1.83 billion in the first nine months of 2014, down from USD3.98 billion in the same period a year before, despite seeing revenue rise to USD19.41 billion from USD18.87 billion, due to exceptional costs. The read across sees GlaxoSmithKline down 2.3%.
British Land Company, down 1.3%. The property investor said two steel bolts have recently broken on the Leadenhall Building, informally known as the Cheesegrater, although it said that no one has been injured and there is no risk to the structural integrity of the building. The company said contractor Laing O'Rourke and structural engineers Arup Group Ltd will conduct a full investigation, and an examination of the remaining bolts will be undertaken.
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FTSE 250 WINNERS
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Spire Healthcare, up 3.4%. The independent hospital group said it expects to see revenue for the full year between GBP825 million to GBP840 million as it has traded in line with expectations, and announced that it had agreed a contract renewal with healthcare provide Bupa UK. Spire said that its Private Medical Insurer business has seen stable volumes with a marginal increase in revenue per case for the period from the start of July to end-October. The company also agreed a contract renewal with Bupa for a minimum term of four years, with prices agreed for the six years to end-March 2021. The agreement covers all of Spire's existing hospitals. Financial details of the deal were not disclosed.
3i Infrastructure, up 2.2%. The investment business reported a 10 pence rise in its net asset value per share after deducting dividend payments, to 133 pence at the end of September from 123 pence at the end of march. Chairman Peter Sedgwick said the company has a "healthy" pipeline of core infrastructure and primary project investment going into the second half of the year.
Inmarsat, up 2.0%. The satellite operator posted a pretax profit of USD104.1 million for the three months to end-September, up from USD23.5 million a year before, although revenue dropped slightly to USD300.6 million from USD306.9 million. The company also said operating costs are now anticipated to be slightly lower than previously expected for the full year.
IP Group, up 1.4%. The finance group said its US subsidiary has formed a pilot initiative with FedIMPACT, to identify and develop early-stage technologies from a select group of US Department of Energy Laboratories. According to IP Group, FedIMPACT will look for early-stage technologies from an initial pilot group of DOE Laboratories that will include Pacific Northwest National Laboratory and the National Renewable Energy Laboratory.
Riverstone Energy, up 1.4%. The investment company said Canadian Non-Operated Resources Corp (CNOR) has signed a deal with Canadian oil company Tourmaline Oil Corp for the acquisition of the Peace River High operated area in Alberta, Canada. Under the deal, Tourmaline will sell a 25% stake in the existing complex for CAD500 million to CNOR. The pair will form a joint venture, which will see them share any future acquisitions made by the venture shared 75% to Tourmaline and 25% to CNOR. Riverstone has invested USD674 million in CNOR, representing around 55% of the total capital raised by the company.
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FTSE 250 LOSERS
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Cable & Wireless Communications, down 7.9%. The telecommunication group announced a placing of new shares representing up to 9.99% of its existing share capital to help fund the acquisition of Columbus International Inc for USD1.85 billion, while posting a rise in pre-tax profit for the half year to end-September. Columbus is a privately-owned telecommunications and technology services company based in Barbados. The company will fund the acquisition via the payment of USD707.5 million in cash and issue of 1.56 billion new shares in the company to some Columbus shareholders. The placing of 252.8 million new shares will part fund the cash element, with new debt financing being used for the remainder.
Halfords Group, down 4.7%. The bike and car parts retailer reported higher profits for the first half of its financial year, driven by sales of cycles and growth in online sales, but its gross margin declined and it raised its cost estimate for the retail business for the full year. Halfords reported a pretax profit of GBP49.4 million for the 26 weeks to September 26, up from GBP44.6 million a year earlier. However, profit margins declined in both businesses, with its autocentres hit as it sold a bigger proportion of low-margin tyres, and its retail business hit by strong sales of lower-margin premium bikes. Retail gross margin fell to 50.6%, from 51.2%, while autocentre gross margin declined to 63.8%, from 65.0%.
Hikma Pharmaceuticals, down 4.5%. The drug maker has seen its shares fall despite raising its full year revue guidance to about 7% growth from the 5% it forecast previously. The group also said it is working with the US Food and Drug Administration to resolve "all outstanding" issues with its Portugal manufacturing facility "as quickly as possible". Hikma received a warning letter from the FDA in October relating to an inspection of the Portugal facility in March.
Bank of Georgia, down 3.6%. The bank reported a 10% rise in third-quarter pretax profit, as growth in net interest income, net fee and commission income and net healthcare revenue more than offset a decline in net insurance revenue and a jump in operating expenses. Numis Securities has downgraded the stock to Add from Buy following a strong recent share price performance. The brokerage in pleased with the progress however, and has also raised its price target to 2,708p from 2,745p. Bank of Georgia shares closed Wednesday at 2,481p.
Rightmove, down 2.4%. The property website business said trading has been in line with expectations in the second half of the year so far, with membership numbers rising and average revenue per advertiser also advancing. Rightmove said membership has increased 2% in the period from the end of June to the end of October, with membership up a total of 5% in the year to date. The group now has 19,320 agents and new homes developments. "Business as usual at Rightmove towers," says Jefferies analyst Anthony Codling. The shares performed strongly ahead of the update and are seeing a little profit taking.
Fidessa Group, down 2.3%. The financial trading software provider said it has returned to underlying growth but warned that it expects the "exceptional" strength of sterling during the year to more than offset that and affect reported numbers.
Esure Group, down 1.9%. The insurer has received a number of price target cuts from analysts Thursday after reporting an update on Wednesday. Deutsche Bank has cut its target to 275p from 303p, Berenberg has cut its target to 261p from 281p, and Numis has cut its target to 255p from 285p. Esure closed Wednesday at 222p. "Trading conditions in the motor and home insurance segments remain a difficult environment in which to build value," says Numis analyst Nick Johnson.
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AIM ALL-SHARE WINNERS
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SeaEnergy, up 11%. The alternative energy company said it was seeing continued growth across its business, with all segments meeting expectations and the company on track to generate a profit for the full year. The company said its R2S Visual Asset Management business posted a record revenue in the third quarter, with a strong order book in place for the rest of 2014 and for the first half of 2015.
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AIM ALL-SHARE LOSERS
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Corero Network Security, down 35%. Th software company saw its shares plunge after saying its 2014 loss is likely will be wider and revenue lower than market expectations due to its shift to focus on the SmartWall Threat Defence System. Due to the shift, it said it expects its revenue for the year to be around USD9 million and its loss before interest, taxation, depreciation and amortisation to be around USD7 million, both poorer than market expectations.
Sweett Group down 24%. The construction and property consultancy said it has "identified challenges" in some of its overseas operations. Sweett said its UK operations continued to recover in the first half of its financial year, but it said trading in Hong Kong had been disappointing and it is set to writedown the value of its Australian business in its full-year results unless there's a significant improvement in trading in the second half. It also said the Middle East remains a challenge, and it is committed to reducing and restricting its exposure to the region. Sweett also said it will book charges to cover the costs of its investigation into allegations of deception reported by the Wall Street Journal last year, as it continues to cooperate with a UK Serious Fraud Office probe into the allegations.
Aurum Mining, down 12%. The gold miner posted a narrower first half loss as it works to progress its gold joint venture with Ormonde Mining PLC and the Morille tungsten project with Plymouth Minerals Ltd. Aurum said its pretax loss for the six months to the end of September narrowed to GBP172,000 from GBP259,000 a year earlier. The company does not generate any revenue.
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By Jon Darby; jondarby@alliancenews.com; @jondarby100
Copyright 2014 Alliance News Limited. All Rights Reserved.
Today 09:23
LONDON BROKER RATINGS: Berenberg raises Ricardo; Goldman cuts LandSec
(Alliance News) - The following London-listed shares received analyst recommendations Monday morning and on Friday:
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