(Alliance News) - Intermediate Capital Group on Tuesday reported "record profits" for both its Fund Management Co and Investment Co, as the financial firm posted a big improvement in annual results.
Intermediate Capital raised its total dividend for the financial year that ended March 31 by 10% to 56.0p per share. It noted this marked the 11th consecutive rise in the annual dividend.
Group pretax profit multiplied to GBP507.7 million from GBP110.0 million in financial 2020. The Fund Management Co's pretax profit rose by 10% to GBP202.3 million, while the Investment Co swung to a pretax profit of GBP305.4 million from a GBP72.3 million loss the year before.
Third-party assets under management rose by 19% to USD56.15 billion on March 31 from USD47.25 billion a year before.
"These results, delivered during a period of unprecedented disruption, demonstrate the strength of the ICG business model," said Chair Mervyn Davies, adding: "Our purpose is to provide capital to help companies develop and grow. As society recovers and adjusts following the shocks of the last 18 months, the structural tailwinds of this industry remain in place."
Intermediate Capital shares were up 5.9% early Tuesday, the top FTSE 100 gainer.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.1% at 7,083.55
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Hang Seng: down 0.2% at 28,738.36
Nikkei 225: closed down 0.2% at 28,963.56
DJIA: closed down 126.15 points, or 0.4%, at 34,630.24
S&P 500: closed down 3.37 points, or 0.1%, at 4,226.52
Nasdaq Composite: closed up 67.23 points, or 0.5%, at 13,881.72
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EUR: down at USD1.2180 (USD1.2197)
GBP: down at USD1.4156 (USD1.4172)
USD: up at JPY109.45 (JPY109.23)
Gold: up at USD1,897.01 per ounce (USD1,893.07)
Oil (Brent): down at USD70.97 a barrel (USD71.43)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
World Bank global economic prospects report
1100 BST Ireland industrial production and turnover
1100 CEST EU gross domestic product estimate
1100 CEST EU employment
1100 CEST Germany ZEW indicator of economic sentiment
0830 EDT US international trade in goods & services
1630 EDT US API weekly statistical bulletin
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Over-25s in England are to be offered a first dose of a coronavirus vaccine six months after the first jab was administered in the UK – as ministers continue to weigh up whether remaining lockdown restrictions will be lifted on June 21. Health Secretary Matt Hancock announced that those aged 25 to 29 in England – around three million people – will be invited to book their jabs from Tuesday as the NHS hailed reaching the "home straight" of the biggest vaccination programme in its history. Hancock also told members of Parliament on Monday that it was too early to say whether England's remaining coronavirus restrictions will be lifted on June 21, as case rates rose in more areas of the UK than at any point since early January. Reports have suggested the final step in the government's road map could be delayed by two weeks, with The Times saying ministers were given a "downbeat" briefing on the latest data on Monday by Chief Medical Officer Chris Whitty and Chief Scientific Adviser Patrick Vallance. Hancock said a decision on moving to Step 4 would be delayed as long as possible, with a final announcement to be made next Monday – a week before any changes could come into effect. Downing Street said there was "nothing in the data" to suggest a delay would be needed.
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German industrial production unexpectedly took a step back in April. It fell 1.0% month-on-month in April, confounding expectations, according to FXStreet, for growth of 0.7% after March's 2.2% increase. Year-on-year, however, industrial production shot up 26% in April after growth of 4.8% in March. In mid-March 2020, the coronavirus pandemic began to cause disruption in Europe and resulted in stringent spring lockdowns. Compared with February 2020, the month before Covid restrictions were imposed in Germany, production in April 2021 was 5.6% lower, statistics body Destatis said.
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Japan's economy contracted 1.0% in the three months to March after the government reimposed coronavirus restrictions in major cities as infections surged, second preliminary data from Cabinet Office showed. This is an improvement on 1.3% contraction showed by the first preliminary reading in May. The quarter-on-quarter fall came after the world's third-largest economy grew for two quarters to December, but the expansion was stopped in its tracks by a winter increase in coronavirus cases. The government imposed new virus states of emergency in January in response, urging people to stay at home and calling for restaurants to close earlier. The annual contraction, meanwhile, was also better than initially estimated, at 3.9%, from the earlier 5.1% figure. According to FXStreet, economists had expected the annualized contraction rate of 4.8%.
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Washington reiterated its desire to forge a "common approach" with allies over a possible boycott of next year's Beijing Winter Olympics, as called for by growing numbers of US lawmakers. "With regard to the Olympics, we're consulting very closely with allies and partners to look at the common concerns that we have, and ideally to establish a common approach," Secretary of State Antony Blinken told a congressional hearing in Washington. There will be "more on that in the weeks to come," he added. Republicans are calling for an outright boycott of the Beijing Games over alleged human rights violation by the Chinese government, in particular its repression of Uyghur Muslims in the Xinjiang region – treatment that has been described by Washington as a "genocide" despite Beijing's protests.
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The US Justice Department announced that it has recovered more than half of the USD4.4 million paid by Colonial Pipeline to Russia-based ransomware extortionists Darkside, who had forced the shutdown of a major fuel network. "Today, we turned the tables on Darkside by going after the entire ecosystem that fuels ransomware and digital extortion attacks, including criminal proceeds in the form of digital currency," said Deputy Attorney General Lisa Monaco. The seizure came one month after the group gave the US government a security scare by breaking into the computer systems of Colonial and forcing the shutdown of its 5,500 mile pipeline serving much of the eastern US. The Justice Department said the US Federal Bureau of Investigation was able to track the 75 bitcoin Colonial paid in ransom – USD4.4 million at the time – as it moved through multiple anonymous transfers. Eventually it was able to seize from a cryptocurrency wallet 63.7 bitcoin, which due to the digital currency's fall over the past month, was only worth USD2.3 million on Monday.
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BROKER RATING CHANGES
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GOLDMAN SACHS CUTS IAG TO 'NEUTRAL' (BUY) - PRICE TARGET 204 (190) PENCE
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GOLDMAN RAISES EASYJET TO 'BUY' (NEUTRAL) - PRICE TARGET 1150 (840) PENCE
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GOLDMAN RAISES RYANAIR PRICE TARGET TO 19.20 (17.90) EUR - 'BUY'
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RBC INITIATES PETS AT HOME WITH 'SECTOR PERFORM' - TARGET 450 PENCE
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COMPANIES - FTSE 100
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British American Tobacco said it continues to expect this year will be a "pivotal" one for the business as it upgraded revenue guidance. The cigarette maker now expects constant currency revenue growth of above 5% for 2021, ahead of prior guidance of 3% to 5%. For combustibles, BAT said group value and volume share are both up 10 basis points in the year-to-date, with full-year cigarette volumes expected to be ahead of the industry, which itself is expected to be down 3%. Meanwhile, BAT reported accelerating addition of non-combustible product consumers, up by 1.4 million to 14.9 million in the first quarter. "We are accelerating our transformation with increased investment capitalising on our growing momentum in the New Categories, and a record quarter for consumer acquisition. This, together with our strong business performance, is reflected in our upgraded group revenue growth guidance of above 5% for 2021," said Chief Executive Jack Bowles. "The momentum across the business is strong, and I am excited about the future for BAT."
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COMPANIES - FTSE 250
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Oxford Instruments posted full-year profit growth and brought its dividend above pre-pandemic levels. Revenue for the financial year ended March 31 crept up 0.3% to GBP318.5 million, while growth on a constant-currency basis was up 1.7%. The company noted this was against a "challenging backdrop", while order growth was strong at 5.3% to GBP353.7 million. Pretax profit jumped 35% to GBP52.2 million, helped by a foreign exchange gain of GBP7.3 million versus a loss of GBP1.4 million a year ago. Oxford Instruments is an Abingdon, England-headquartered company, which makes products, systems and tools for research and industry. It will pay a dividend for the year of 17.0 pence, after deciding not to pay anything for the previous financial year due to Covid-19 uncertainty. For the financial year ended in 2019, it paid out a dividend of 14.4p. Oxford Instruments said its robust performance, strong order book and diversified end markets position it well for progress in the year ahead despite anticipated currency headwinds and ongoing coronavirus uncertainty.
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Dechra Pharmaceuticals boosted its outlook following strong year-to-date trading. The veterinary products firm said it has continued to benefit from strong market fundamentals as well as lower costs due to Covid-19. This, combined with the completion of the UK pre-Brexit inventory unwind and further easing of lockdown restrictions, means the board is "increasingly confident" that this strong performance will continue for the remainder of the financial year ending June 30. As a result, Dechra expects full-year revenue to be ahead of current consensus expectations.
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COMPANIES - GLOBAL
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Nvidia is seeking approval for its USD40 billion takeover of UK chip designer Arm from the Chinese regulator, the Financial Times reported. The application could take between a year and 18 months, according to Chinese antitrust lawyers, the FT reported. If it does take that long, the process will exceed the 18-month timeline set out by Nvidia when it unveiled the deal last September. The FT said China's own chipmakers - such as Huawei's HiSilicon and Semiconductor Manufacturing International Corp, as well as state-backed chip investment group E-Town Capital - oppose the deal.
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Tuesday's Shareholder Meetings
Advanced Medical Solutions Group - AGM
DP Eurasia NV - AGM
Honeycomb Investment Trust PLC - AGM
MetalNRG PLC - AGM
Oilex Ltd - AGM
Pharos Energy PLC - AGM
Phoenix Spree Deutschland Ltd - AGM
RA International Group PLC - AGM
RM Secured Direct Lending PLC - AGM
Trident Royalties PLC - AGM
TruFin PLC - AGM
Xpediator PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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