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(Alliance News) - Stock prices in London are seen opening slightly lower on Monday tracking a fall in Asian equity markets, as investors continue to monitor the conflict in Ukraine.
In early UK company news, contract-for-difference operator Plus500 made an acquisition in Japan. Personal care products maker PZ Cussons bought a baby and child personal care brand. Photobooth operator Photo-me International reinstated its dividend after swinging to annual profit.
IG futures indicate the FTSE 100 index is to open 8.23 points lower at 7,396.50. The index closed up 19.39 points, or 0.3%, at 7,404.73 on Friday.
Ukraine has rejected an ultimatum to surrender the besieged port city of Mariupol to Russian forces, its deputy prime minister told Ukrainian media Monday.
"There can be no talk of surrendering weapons. We have already informed the Russian side of this," Iryna Vereshchuk told Ukrainska Pravda newspaper.
"It's a deliberate manipulation and it's a real hostage situation," she added of the demand. Russia gave the city an ultimatum late Sunday, urging its defenders to surrender before 05:00 am on Monday.
Ukraine's rejection came as Russian bombs hit targets across the country overnight, killing at least six in Kyiv and allegedly damaging a chemical plant in the north of the country causing an "ammonia leakage".
Trading platform Plus500 said it is venturing into the Japanese retail trading market through the acquisition of EZ Invest Securities for an undisclosed sum.
EZ Invest is licenced as a type 1 Financial Instruments Business Operator, regulated by Japan's Financial Services Agency and a member of the Japan Securities Dealers Association and the Financial Futures Association of Japan.
EZ Invest's offering includes contract-for-differences and OTC foreign exchange.
Plus500 said the acquisition represents a major growth opportunity for the company and further strengthens its strategic position as a multi-asset fintech group. Further, the purchase diversifies its geographic footprint through an immediate presence in the retail trading market in Japan, the company noted.
PZ Cussons said that it has acquired UK-based baby and child personal care products maker Childs Farm.
The company said Joanna Jensen, founder of Childs Farm, subsequently made an investment into the PZ Cussons subsidiary that made the acquisition. This means that PZ Cussons now holds a 92% interest in Childs Farm for a total of GBP36.8 million, with an agreed path to full ownership by the end of May 2025.
The FTSE 250-listed firm said the deal will be fully funded by cash from existing facilities, reflecting its "strong financial position".
Chief Executive Officer Jonathan Myers said: "Childs Farm is a clear leader in sustainability, demonstrating that we share a strong ethos, as PZ Cussons journeys towards our own 'B Corp' ambition. We look forward to welcoming Childs Farm to the PZ Cussons family as a 'Must Win Brand', and to driving the next stage of its growth both in the UK, and beyond."
Photo-Me International said it delivered a strong performance in 2021 with a progressive recovery in demand for vending services seen across most of its key markets.
For the year that ended October 31, Photo-Me posted a pretax profit of GBP28.6 million, swung from a GBP27.8 million loss in financial 2020, on revenue of GBP214.4 million, up from GBP186.3 million.
The company explained that it benefited from completion of its restructuring programme to remove unprofitable machines from its estate - mainly photobooths and children's rides - which was completed in April 2021. As such, total revenue and pretax profit were at the upper end of the company's own expectations.
Photo-Me declared a 2.89 pence annual dividend, having paid out nothing in financial 2020.
"There has been a recovery in activity in most territories, except for Asia which is still severely impacted by Covid-19 government restrictions. The Board believes that the group's recovery to date demonstrates its resilience and the benefits of its strategic activities, which gives us further confidence that our financial performance will return closer to pre-pandemic levels as the pandemic subsides," said Chair John Lewis.
Photo-Me made no comment on the failed offer for all of the company by CEO & Deputy Chair Serge Crasnianski, which lapsed earlier this month. Crasnianski owns about 37% of Photo-Me via investment vehicle Tibergest.
In Asia on Monday, the Shanghai Composite ended up 0.1%, but the Hang Seng index in Hong Kong was down 1.4%. Financial markets in Japan were closed to mark Vernal Equinox Day. The S&P/ASX 200 in Sydney closed down 0.2%.
"European markets look set to open lower, taking their cues from a quiet Asia market session which has seen Chinese markets slip back," said CMC Markets analyst Michael Hewson.
China's central bank left its key interest rate unchanged on Monday, as expected. The one-year loan prime rate was held at 3.7%. The five-year rate also was unmoved at 4.6%, the People's Bank of China said. The loan prime rate is a lending reference rate set monthly by 18 banks.
The pound was quoted at USD1.3154 early Monday, down from USD1.3178 at the London equities close Friday.
The euro was priced at USD1.1047, lower against USD1.1061. Against the Japanese yen, the dollar was quoted at JPY119.22 in London, up from JPY119.15.
Brent oil was trading at USD111.72 a barrel Monday morning, rising from USD107.51 a barrel late Friday. Gold stood at USD1,924.33 an ounce, lower against USD1,938.46.
The latest FTSE Russell index review changes take effect on Monday, with Endeavour Mining and Howden Joinery promoted to the FTSE 100 replacing Polymetal International and Evraz.
Russia-focused Polymetal and Evraz, together with commercial real-estate investor Raven Property Group, will be removed from all FTSE Russell indices from Monday, due to insufficient trading liquidity following the imposition of sanctions against Russia.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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