(Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Monday.
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FTSE 100 - WINNERS
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Rolls-Royce Holdings, up 16%. The jet engine maker suspended its shareholder payout, withdrew financial guidance for 2020 and secured a new loan amid the grounding of aircraft around the world due to the Covid-19 pandemic. Rolls-Royce secured an additional GBP1.5 billion revolving credit facility commitment with a consortium of banks, increasing its overall liquidity to GBP6.7 billion. The company has decided to cancel a final shareholder payment of 7.1 pence per share with respect to 2019. "The collapse in air travel has seen half of its revenue disappear, as airlines ground their fleets," said CMC Markets analyst Michael Hewson, adding: "This morning's rebound in the share price suggests that markets knew this was coming and was already priced in." Meggitt and Melrose Industries, which like Rolls-Royce provide aftermarket services to the aerospace sector, were up 12% and 11% respectively in a positive read-across.
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FTSE 100 - LOSERS
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Smiths Group, down 2.9%. The engineer posted a 48% year-on-year drop in first-half pretax profit and said that Covid-19 disruption was "accelerating", with impact on both demand and supply in the near-term. Smiths also said it is withdrawing forward guidance for the year ending in July as it is "too early to assess the full impact of Covid-19". On Tuesday last week, Smiths had said it won't pay an interim dividend due to weak demand as a result of the Covid-19 health crisis. It also had halted the separation of Smiths Medical from the rest of the group. The company on Monday said it is now seeing generally weaker demand - with the exception of in its Medical business - due to contract delays, lower oil prices and airport closures. For the six months to January 31, Smiths recorded pretax profit of GBP46 million, down sharply from GBP89 million a year ago. The drop was attributed to a doubling in exceptional costs to GBP114 million from GBP57 million.
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Antofagasta, down 1.0%. The Chilean copper miner said it has suspended its operations at the Los Pelambres expansion project for an estimated maximum period of 120 days. The company explained that it is not possible to continue working "normally" as a result of the health emergency caused by the coronavirus. This decision makes it possible to strengthen general hygiene and social isolation measures, thus protecting the health of both workers and communities, Antofagasta explained. In addition, RBC Capital cut the stock to Underperform from Sector Perform.
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FTSE 250 - WINNERS
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GVC Holdings, up 14%. The gambling firm said it was in a robust position after it cut its estimated earnings hit from the Covid-19 outbreak. In the quarter ended March 31, GVC said total net gaming revenue rose 1% year-on-year, helped by 16% growth in Online alone. In the UK Retail unit, like-for-like revenue sunk 19% annually and there was a 3% fall in the European Retail arm. The disrupted sporting calendar led to GVC initially expecting a GBP100 million monthly hit to its earnings before interest, tax, depreciation and amortisation. On Monday, however, GVC cut its estimated monthly earnings fall to GBP50 million, after it reduced costs. GVC said: "In the UK, GVC is eligible to receive the government grant towards employment costs as we furlough retail colleagues and retain them on full pay, as well as the business rates relief, which together the group estimates will reduce costs by nearly GBP20 million per month."
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Bodycote, up 8.5%. The heat treatment services provider said it is keeping its final dividend proposal under review amid Covid-19 uncertainties as it also said it has completed the USD200 million acquisition of Ellison Surface Technologies. Back in March, the coatings services firm said it would pay a final dividend of 14.0 pence per share, up from 13.3p declared the prior year. However, it said that uncertainty caused by the outbreak has resulted in it keeping the proposal for that final dividend under review. Bodycote had already paid an interim dividend of 6.0p, up from 5.7p a year before. While trading in the first quarter has not been hurt, the company expects conditions to get worse and is therefore implementing cash conservation measures. It added that it currently has GBP147 million of available liquidity and is therefore in a strong financial position to withstand "a significant decline in trading conditions".
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FTSE 250 - LOSERS
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Playtech, down 8.5%. Deutsche Bank cut the betting and gaming firm to Hold from Buy.
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By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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