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(Alliance News) - Gaming firm GVC Holdings on Wednesday upped its annual guidance after reporting a solid third quarter of trading but had more bad news for the UK high street, as it said it still expects to close 900 stores.
The betting firm - which owns the Ladbrokes, Coral and Gala brands - raised its earnings before interest, taxation, depreciation and amortisation guidance to a range of GBP670 million and GBP680 million. GVC previously guided for full-year Ebitda in the range of GBP650 million from GBP670 million.
Total net gaming revenue was down 1.0% year-on-year on a like-for-like basis during the quarter ended September 30, though in the year-to-date, it has improved 3.0%.
In Online alone, there was growth of 12% in the third quarter, despite a strong comparative period featuring the FIFA World Cup.
In UK Retail, like-for-like net gaming revenue was down 18%, though trends remain ahead of expectations following the UK government imposing a maximum stake of GBP2 on fixed-odds betting terminals, GVC said. Over-the-counter sports wagers improved by 7% on a like-for-like basis in the third quarter however, the company added.
The FTSE 250 constituent confirmed plans to close 900 more high street stores over the next two years. During the third quarter, 41 stores were closed meaning 198 have been closed since the beginning of a company review.
The stock was up 2.0% in early trade Wednesday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.2% at 7,153.52
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Hang Seng: down 0.7% at 25,706.04
Nikkei 225: closed down 0.6% at 21,456.38
DJIA: closed down 313.98 points, 1.2%, at 26,164.04
S&P 500: closed down 1.6% at 2,893.06
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GBP: unchanged at USD1.2204
EUR: unchanged at USD1.0959
Gold: up at USD1,507.08 per ounce (USD1,503.60)
Oil (Brent): flat at USD57.98 a barrel (USD57.86)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Wednesday's Key Economic Events still to come
0700 EDT US MBA weekly mortgage applications survey
1000 EDT US job openings and labour turnover survey
1030 EDT US EIA weekly petroleum status report
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Negotiating a new Brexit agreement by the crucial EU summit will be "very difficult", Leo Varadkar has warned Boris Johnson ahead of their crunch talks to avert a no-deal exit. The UK prime minister's chances of a breakthrough with Brussels were looking increasingly unlikely on Tuesday after accusations from Number 10 that the bloc was making it "essentially impossible" for Britain to leave with a deal. Johnson will hope to gain concessions from his Irish counterpart Varadkar during in-person talks anticipated later this week. But with the October 31 deadline rapidly closing in, the Irish taoiseach warned of the challenges of securing a new deal by next week – a key period in the Brexit saga with the summit in Brussels on October 17 and 18. Varadkar said Ireland and the EU would not accept an agreement at "any cost".
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The American economy should continue its expansion, with strong jobs markets but with price pressures in check and inflation approaching the central bank's target, Federal Reserve Chairman Jerome Powell said. However, US job creation has slowed while a weakening global economy, trade wars and Brexit uncertainty are risks to the outlook, he said. Policymakers "continue to see a sustained expansion," Powell said in a speech to the National Association for Business Economics in Denver. "At present, the jobs and inflation pictures are favorable."
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The US said it would curb visas for Chinese officials until Beijing ends its "repression" of Uighurs and other Muslims in the western region of Xinjiang, a day after imposing commercial restrictions. The one-two punch by President Donald Trump's administration marks the most forceful attempt by a foreign power to address what some rights groups call a historic crisis in Xinjiang, and comes amid a range of feuds between the US and China. "China has forcibly detained over one million Muslims in a brutal, systematic campaign to erase religion and culture in Xinjiang," Secretary of State Mike Pompeo wrote on Twitter.
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A defiant White House declared war against the impeachment investigation of Trump, blasting the process as partisan, illegitimate and unconstitutional and saying neither the president nor his administration will cooperate. In a fiery letter, the White House threw down the gauntlet to House Speaker Nancy Pelosi and the chairmen of three congressional panels leading the inquiry, challenging them to proceed with their effort to oust Trump despite zero future cooperation. "Put simply, you seek to overturn the results of the 2016 election and deprive the American people of the president they have freely chosen," White House counsel Pat Cipollone wrote in an eight-page letter.
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BROKER RATING CHANGES
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JPMORGAN REINITIATES LONDON STOCK EXCHANGE WITH 'OVERWEIGHT' - PRICE TARGET 7900 PENCE
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MORGAN STANLEY CUTS HSBC TO 'UNDERWEIGHT' (EQUAL-WEIGHT) - PRICE TARGET 540 PENCE
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JEFFERIES INITIATES DOMINO'S PIZZA WITH 'UNDERPERFORM'
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LIBERUM INITIATES QUILTER WITH 'BUY' - TARGET 159 PENCE
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COMPANIES - FTSE 100
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Retailer Kingfisher said it has appointed Bernard Bot as chief financial officer, effective from October 21. Bot joins most recently from Travelport Worldwide, a global technology platform for the travel industry that was NYSE-listed until this past June. Prior to that, Bernard was CFO of Aer Lingus. John Wartig, who joined Kingfisher as interim CFO on in April, has been moved to the newly-created role of chief transformation & development officer. He will report directly to Thierry Garnier, who started as chief executive at Kingfisher in September.
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COMPANIES - OTHER MAIN MARKET AND AIM
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Scapa Group said it expects interim profit to be hurt by the loss of a contract, while revenue will grow on strong performance of the Healthcare unit. The industrial tape and adhesives maker said its trading performance in the six months to the end of September was in line with expectations, with revenue growth of 14% from GBP140.7 million reported a year ago. On a constant currency basis, revenue improved by 10%, predominantly driven by Healthcare and the Systagenix technology. The Healthcare unit, revenue was up 23% on last year, or 17% in constant currency, despite the loss of ConvaTec Group volumes. Scapa's profit however, is expected to be hurt by the loss of the contract with FTSE 250 medical products firm ConvaTec and is estimated to be 17% below last year's GBP17.1 million, meaning about GBP14.2 million. Scapa said it anticipates that the second half of the year will benefit from a strong pipeline of new products and technology transfers from new and existing customers.
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Vehicle retailer Vertu Motors reported a lower half-year profit, though lifted its dividend 9%. Revenue grew 5.6% to GBP1.65 billion for the six months to August 31, with like-for-like revenue growth of 2.3%. Despite this, pretax profit fell to GBP16.1 million from GBP17.3 million. Even though profit fell, the firm raised its dividend by 9.1% to 0.6 pence per share. Turning to current trading, Vertu said September like-for-like new retail volumes were down 1.6%, though used car sales and high-margin service revenue continued to grow on like-for-like basis. September profitability was ahead of prior year levels, the firm said.
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Capital & Regional said discussions between it and real estate investment trust Growthpoint Properties for the sale of a majority stake In Capital & Regional to Growthpoint have reached an advanced stage. As a result, both property companies have secured an extended deadline from the Panel on Takeovers & Mergers for Growthpoint to make a firm decision on an offer to Friday next week. The original deadline was for Wednesday. In September, Growthpoint and Capital & Regional both confirmed talks about Growthpoint acquiring a majority stake, through a combination of buying existing Capital & Regional shares and injecting capital through a subscription for new shares.
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Reach is the preferred bidder for JPI Media's regional newspapers, the Financial Times reported. The FT said that "according to two people briefed on the negotiations", Reach had emerged as frontrunner in the bid for JPI's regional newspaper assets such as the Yorkshire Post, The Scotsman, and Sussex Express. One of the two sources briefed "said Reach entered exclusive talks last week".
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COMPANIES - INTERNATIONAL
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A Pennsylvania jury ruled that US pharmaceutical giant Johnson & Johnson must pay USD8 billion in damages and interest for failing to warn that a psychiatric drug could cause breast growth in men. Johnson & Johnson and its subsidiary Janssen Pharmaceuticals were blamed as plaintiff Nicholas Murray told the Philadelphia court that the drug Risperdal, prescribed to treat schizophrenia and bipolar disorder, had made him grow breasts. The company challenged the ruling in a statement, calling the damages awarded "grossly disproportionate" with the initial award in the case of USD680,000.
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Renault's new chair will ask the French carmaker's board to find a successor to Chief Executive Officer Thierry Bollore as the company still reels from the fallout of the Carlos Ghosn scandal, Le Figaro has reported. The subject could be brought up, with the approval of the French state – a major shareholder in the company – at the next board meeting of the French automaker on October 18, the French newspaper said in its Wednesday edition, citing informed sources. Contacted by AFP, Renault and the economy ministry declined to comment. Bollore took over as boss in a provisional capacity in January, leading the company alongside new Chair Jean-Dominique Senard, with whom he had a difficult relationship. Bollore was formerly deputy to Ghosn who was arrested in Tokyo last November accused of financial misconduct.
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China's state media accused Apple of supporting pro-democracy protesters, warning the US tech giant would suffer consequences for its "unwise and reckless" decision, in an echo of campaigns against other Western firms. An opinion piece in the People's Daily, the mouthpiece of the ruling Communist Party, highlighted a transport app available on Apple's store that it alleged helped protesters identify police in Hong Kong. "Apple's approval for the app obviously helps rioters," the article said. "Does this mean Apple intended to be an accomplice to the rioters?"
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Wednesday's Shareholder Meetings
Fast Forward Innovations
Fulcrum Utility Services
Diverse Income Trust
Greene King (re acquisition by CK Noble)
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By Tom Waite; thomaslwaite@alliancenews.com
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