(Alliance News) - CMC Markets on Friday said it expects its annual profit to come at the upper end of forecasts after enjoying its "strongest quarter" of its financial year.
The online trading company said its net operating income performance for the year ended March 31 will be a non-pandemic record. CMC saw a bump in fortunes during the pandemic amid market volatility.
CMC said the fourth quarter was the strongest quarter of if its financial year, pushing annual net operating income to the top end of guidance at around GBP280 million.
This would represent a 32% fall from GBP409.8 million a year prior, a period boosted by the pandemic. Compared to financial 2020, net operating income is up 11% from GBP252.0 million.
Operating costs for financial 2022, excluding variable remuneration, are expected to be GBP173 million, up from GBP168 million the year before. The increase primarily reflects higher personnel costs to deliver strategic objectives, CMC explained.
The company also said CMC Invest, a UK non-leveraged platform, has this week launched internally with the full market release set for mid-2022. The platform is ahead of schedule and on budget, it noted.
"This business continues to change as we look to utilise our technology to enter new markets and expand our non-leveraged offering. I look forward to updating investors as the strategy expands over both the short and long-term," said Chief Executive Peter Cruddas.
Shares in CMC were up 3.5% at 249.84 pence in early trade.
Here is what you need to know at the London market open:
----------
MARKETS
----------
FTSE 100: up 0.9% at 7,621.06
----------
Hang Seng: up 0.1% at 21,828.20
Nikkei 225: closed up 0.4% at 26,985.80
S&P/ASX 200: closed up 0.5% at 7,478.00
----------
DJIA: closed up 87.06 points, or 0.3%, at 34,583.57
S&P 500: closed up 19.06 points, or 0.4%, at 4,500.21
Nasdaq Composite: closed up just 8.48 points at 13,897.30
----------
EUR: down at USD1.0856 (USD1.0900)
GBP: down at USD1.3039 (USD1.3057)
USD: up at JPY124.09 (JPY123.85)
Gold: down at USD1,930.17 per ounce (USD1,931.30)
Oil (Brent): up at USD101.48 a barrel (USD99.08)
(changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
Friday's key economic events still to come
10:00 EDT US monthly wholesale trade
----------
UK Prime Minister Boris Johnson is set to meet the German Chancellor Olaf Scholz as they look to discuss how to help European countries wean themselves off Russian gas following the attack on Ukraine. The PM will host Scholz at Downing Street on Friday, with a press conference planned for the afternoon. Johnson is expected to offer assistance to Berlin, which is still heavily reliant on Russian gas, to reduce its dependence on Moscow's energy exports in a bid to starve Vladimir Putin's war machine of funds. It comes after Foreign Secretary Liz Truss, following a meeting of Nato counterparts in Brussels on Thursday, said she hoped to see "more countries" commit to banning Russian energy imports. The UK has pledged to end all imports of Russian coal and oil by the end of 2022, with gas to follow as soon as possible.
----------
The EU on Thursday said it had approved an embargo on Russian coal and the closing of the bloc's ports to Russian vessels over the Ukraine war. An official from the French presidency of the European Council said the moves spearhead a "very substantial" fifth round of sanctions against Moscow. That package also includes a EUR10 billion ban on exports to Russia, including high-tech goods, and the freezing of several Russian banks' assets. In addition to the sanctions, the EU also backed a proposal to boost its funding of arms supplies to Ukraine by EUR500 million, taking it to a total of EUR1.5 billion. European Council President Charles Michel said on Twitter the package would be "swiftly approved".
----------
Shanghai's grinding coronavirus lockdown is slowly clogging China's supply chains, as delays hit the world's busiest container port where staff are tangled in a morass of Covid controls. Beijing has refused to tack away from its strict zero-Covid strategy that has protected its public health system through the pandemic but at a mounting economic cost. China's financial hub Shanghai – home to multinational firms and its busiest port – has been sealed off almost entirely for a week following an outbreak fuelled by the Omicron virus variant. That has many forced companies to halt production and slow new projects, factories told AFP, while those still operating are struggling with a shortage of truck drivers on top of onerous permit and Covid testing requirements. The docks are working normally with a "single-digit" number of vessels waiting to berth, Shanghai International Port Group said this week. "But the fact is... due to restrictions caused for truck drivers, it is not really operating," Bettina Schoen-Behanzin, vice president of the EU Chamber of Commerce's Shanghai Chapter, told AFP.
----------
BROKER RATING CHANGES
----------
Jefferies raises Volution Group to 'buy' (hold) - price target 480 (560) pence
----------
COMPANIES - FTSE 250
----------
Johnson Matthey said it expects to report full year results in line with market expectations, buoyed by good performances from its Clean Air and Efficient Natural Resources units. The speciality chemicals company said growth was driven by improved performance in Clean Air, where it saw increased activity in autos as end markets partially recovered and support from the continued delivery of its transformation programme. The Efficient Natural Resources arm had a strong year, it said, with operating performance expected to be materially above the prior year, driven by PGM Services which benefited from higher average precious metal prices. Johnson Matthey added that the Health unit was below expectations and, as previously announced, it agreed the disposal of this business which is expected to complete in mid-2022. Looking ahead, Johnson Matthey said it was entering a period of "greater political and economic uncertainty" with both the ongoing disruptive effects of Covid-19 and the impacts of the conflict in Ukraine.
----------
Ferrexpo reported total iron ore pellet production of 2.7 million tonnes in the first quarter of 2022, in line with the same period in 2021, and 11% below the fourth quarter due to operational and logistical constraints following Russia's invasion of Ukraine. Ferrexpo said production continued to comprise entirely of high grade forms of iron ore, which are those with an iron ore grade of 65% Fe or above. It also generated first-quarter sales of 2.6 million tonnes, scaling production activities to meet accessible pellet demand. Logistics pathways to Europe via rail and barge remain open, while activities at the Black Sea port of Pivdennyi continue to be suspended, it explained.
----------
COMPANIES - SMALL CAP
----------
Jet2 guided to a slightly widened full-year loss but pointed to an improvement in travel conditions towards the end of its financial year. The travel operator expects a loss before foreign exchange revaluation and tax for the year ended March 31 of between GBP378 million and GBP383 million. This compares with the GBP373.8 million loss it reported the year before. The firm reported a hit over winter from the Omicron variant and the reimposition of international travel restrictions, but said the relaxation of UK travel restrictions in early 2022 has resulted in a material increase in bookings with average load factors for February and March approaching seasonal norms. Positively, average load factors for the Summer 2022 season are only just behind pre-virus levels. "Additionally, we are currently 95% hedged for jet fuel for Summer 2022 and approximately 65% hedged for Winter 22/23 in line with our normal policy," said Jet2.
----------
COMPANIES - GLOBAL
----------
Biotechnology company Biogen on Friday noted that the US has imposed curbs on its Aduhelm Alzheimer's treatment. Aduhelm has not been included by the Centers for Medicare & Medicaid Services, part of the US Department of Health & Human Services, in the final Medicare coverage list. "These coverage restrictions, including the distinction between accelerated approval and traditional approval, have never been applied to FDA-approved medicines for other disease areas. When additional data from this new class of treatments become available, Biogen urges CMS to reconsider today's decision for all FDA-approved amyloid-beta targeting therapies," Biogen says.
----------
The head of Swiss food giant Nestle defended Thursday his company's continued presence in Russia, saying that access to food, in particular for babies, is a fundamental right even in a time of war. Last month the company was called out by Ukrainian President Volodymyr Zelensky, who addressed a demonstration in Bern via video link, and calls for Nestle to boycott Russia have since multiplied. Nestle halted its investments in Russia following Moscow's invasion of Ukraine on February 24 as well as exports of products Nespresso coffee capsules and San Pellegrino sparkling water. But it initially continued to ship basic food items as well as pet food, which following activist pressure it reduced to just essentials like baby food and nutritional products.
----------
Amazon told a federal agency it will file "substantial" objections to last week's worker election in New York that established the company's first union in the US, according to a filing released Thursday. In a letter to the National Labor Relations Board, the retail giant requested more time to compile and present evidence about alleged problematic election conduct on the part of the union and the board's officials. "This election involves more than 8,300 eligible voters, and voting spanned over 50 polling hours," Amazon attorneys with the firm Hunton Andrews Kurth said in a motion to the NLRB. "It is simply infeasible for Amazon to sufficiently investigate the myriad of objectionable conduct within five business days."
----------
Friday's shareholder meetings
Path Investments PLC - GM re DG Innovate purchase and name change
Rio Tinto PLC - AGM
----------
By Lucy Heming; lucyheming@alliancenews.com
Copyright 2022 Alliance News Limited. All Rights Reserved.
CMC Markets (CMCX)
Jet2 (JET2)