(Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Tuesday.
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FTSE 100 - WINNERS
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Hiscox, up 2.8%. HSBC raised the insurer to Buy from Hold.
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CRH, up 2.7%. The Irish building materials firm reported a "strong" performance so far in 2019, with the outlook remaining positive. CRH has guided for earnings before interest, tax, depreciation, and amortisation for 2019 to be above EUR4.15 billion, which would mean at least 23% growth year-on-year. The company, based in Dublin, credited "positive momentum" in all divisions, contributions from acquisitions, the impact of a new accounting treatment of leases, and currency tailwinds. As a result, CRH expects to report annual pretax profit ahead of 2018's EUR1.9 billion.
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FTSE 100 - LOSERS
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Compass Group, down 5.5%. The contract caterer said annual organic revenue growth beat its own targets in a strong annual performance, though it warned on the economic environment in Europe. Revenue growth in the year to September was 8.8% to GBP24.88 billion, with organic revenue growth "strong" at 6.4% and above Compass's target of 4% to 6% growth. The market had expected organic revenue growth of 6%, according to company-compiled consensus figures. Compass's pretax profit fell 3.5% on the year before to GBP1.47 billion. Compass said this was due to a cost action programme bringing a GBP190 million one-off charge, offsetting foreign exchange benefits. Looking ahead, Chief Executive Officer Dominic Blakemore said expectations for Compass's new financial year are positive, though it does remain "cautious" on trading conditions in Europe.
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FTSE 250 - WINNERS
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Pets at Home Group, up 9.8%. The pet products retailer said profit quadrupled in the first half of its financial year, as well as reporting higher revenue from both Retail and Vet Group divisions. The firm's pretax profit for the 28 weeks ended October 10 was GBP34.0 million, more than four times its GBP8.0 million profit a year prior. This was due to a GBP16.2 million impairment loss on receivables the year before. Another major contributor to the profit rise was a 9.4% increase in Pets at Home's revenue to GBP546.3 million from GBP499.3 million. This included an 8.1% rise in Retail revenue to GBP479.8 million from GBP443.7 million Vet Group revenue, meanwhile, increased 20% to GBP66.5 million from GBP55.6 million. Pets at Home maintained its interim dividend at 2.5 pence per share.
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Pennon Group, up 2.5%. The water company hiked its interim dividend after profit jumped on cost-cutting measures. For the six months ended September, pretax profit widened 22% to GBP163.1 million from GBP133.6 million the year prior. This was despite revenue falling 4.6% to GBP712.4 million from GBP746.7 million the year before. Profit was helped by a reduction in costs during the period as well as gains related to its derivative holdings. Pennon proposed a 13.66 pence per share interim dividend, up 6.4% from 12.84p the year before.
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Tate & Lyle, up 2.2%. Goldman Sachs raised the food ingredients producer to Buy from Neutral.
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FTSE 250 - LOSERS
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Greencore Group, down 6.7%. The sandwich maker reported a decline in revenue following a reset of the group's business. For the financial year ended September 27, Greencore made a pretax profit of GBP56.4 million, more than tripled from GBP17.8 million the year before. On a reported basis, the profit included an exceptional gain of GBP55.9 million in profit from the disposal of Greencore's US business, and a GBP25.4 million charge on the restructuring of debt following the sale. In November 2018, Greencore completed the sale of its entire US business to Hearthside Food Solutions for USD1.08 billion. Revenue however, declined by 3.5% to GBP1.45 billion from GBP1.50 billion the year before, the drop driven by the impact of site disposals such as in Hull and Evercreech in the UK, and the phasing out of manufacturing of longer-life ready meals at its Kiveton facility.
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Shaftesbury, down 4.0%. The London West End-focused property investor said profit fell sharply in its recent financial year, due to a deficit on the revaluation of its investment properties. For the year ended September, the company reported pretax profit of GBP26.0 million, down 85% from GBP175.5 million the year before. This was due to a deficit on the net revaluation on investment properties of GBP15.3 million, compared to a gain of GBP123.1 million. Looking ahead, Shaftesbury said the mood of Brexit uncertainty, which has grown since the 2016 referendum, will take some time to improve, and current forecasts for the national economy do not show any sign of a return to confidence. However, the trust remained positive on the long-term growth prospects for its markets of London and the West End, saying that they are much less affected by national concerns than other sectors.
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OTHER MAIN MARKET AND AIM - WINNERS
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XP Power, up 7.5%. Berenberg started coverage on the power control component manufacturer with a Buy rating.
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OTHER MAIN MARKET AND AIM - LOSERS
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De La Rue, down 20%. The banknote printer axed its dividend to manage debt levels. De La Rue will not be returning any cash to shareholders for the six months to September 28, having paid out 8.3 pence per share the year before. Net debt at the end of the period was GBP170.5 million, far higher than GBP107.5 million six months earlier. De La Rue blamed the rise on adverse working capital movements, prior dividend payments, pension contributions, and capital expenditure. The company said its debt position, and the ratio of net debt to earnings before interest, tax, depreciation, and amortisation, were significantly higher than expected, though it will remain within banking covenants. De La Rue warned further deterioration in trading, further costs, and lower-than-expected margins could put this at risk, however. Looking at the interim results, De La Rue posted a 9.8% drop in revenue to GBP232.3 million, and a pretax loss of GBP12.1 million versus a GBP5.4 million profit a year before.
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By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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