UK WINNERS & LOSERS: Contrarian Price Moves For ITV And Weir Shares

LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices midday Wednesday.

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FTSE 100 - WINNERS

Weir Group, up 6.5%. Despite reporting a fall in profit and revenue for the full-year 2013, the engineering solutions firm said it expects to return to underlying growth in 2014. It increased its final dividend to 33.2 pence from 30.0p, lifting its total annual dividend 11% to 42.0 pence from 38.0 pence.

Anglo American, up 0.4%. The major diversified mining company plans to cut jobs at the Drayton thermal coal mine in Australia later this year. It said it will now move to a five-day roster rather than seven days at the site, after delays to planning approvals held back the expansion of a nearby project designed to extend the mine's life.

HSBC Holdings, up 0.4%. The group has agreed to sell SB JSC HSBC Bank Kazakhstan to JSC Halyk Bank for USD176 million in cash, as it continues its policy of streamlining its operations and disposing of businesses it considers non-core. HSBC Bank Kazakhstan was sold at a premium to its USD160 million net asset value.

Fresnillo, up 0.2%. The precious metals miner said that the Mexican Ministry of Defense has granted a new explosives permit for the Herradura mining unit at its 56% owned joint venture Minera Penmont. Penmont can now resume the use of explosives on the Herradura mine and will begin operations next week.

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FTSE 100 - LOSERS

ITV, down 5.1%. The television broadcaster's shares are falling despite announcing a special dividend, raising its total dividend, reporting a rise in pretax profit in 2013, and giving a bullish forecast for 2014. It reported a 30% increase in pretax profit, which rose to GBP435 million from GBP334 million, and posted a total dividend of 3.5 pence for the year, up from 2.6 pence in the previous year. Additionally, it posted a special dividend of 4.0 pence. Not everyone is impressed, however, with some analysts disappointed that investors will not receive higher cash returns. The full-year results were "disappointing from our perspective", says Liberum Capital analyst Ian Whittaker, who was looking for a bigger beat to consensus forecasts.

EasyJet, down 5%, and Diageo, down 1.6%. The companies are amongst the biggest fallers in the index after going ex-dividend Wednesday.

Tesco, down 3.7%. The food and drug retail sector leads the falls Wednesday, with Tesco the biggest faller, as the UK supermarkets get stuck into a new price war. At an event on Tuesday, Tesco updated investors and analysts on its long-term strategy. The headline announcement was that Tesco will cut its annual group capital expenditure to GBP2.5 billion for at least three years. Tesco also is planning to focus on lower regular pricing rather than sporadic offers. Asda immediately replied, saying it too will increase its focus on price cutting. Shore Capital said the announcements are likely to lead to further earnings downgrades for the supermarket giant.

Travis Perkins, down 1.7%. Travis Perkins shares are amongst the biggest fallers in the blue-chip index, despite reporting an increase in both profit and revenue for the 2013 full year, as margins continued to come under pressure and the company's guidance remained unchanged. The building merchant posted pretax profit of GBP312.6 million for 2013, up from GBP299.2 million a year earlier, as revenue rose by more than 6% to GBP5.15 billion from GBP4.84 billion in 2012. However, while the group's results were ahead of market expectations, there was no change to the group's guidance, says Jefferies analyst Sam Cullen. Furthermore, while volume trends improved significantly in 2013, margins remain under pressure in most divisions, and were flat in general merchanting.

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FTSE 250 - WINNERS

International Personal Finance, up 7.1%. The home credit lender said its pretax profits for 2013 rose by 45% after solid revenue growth, driven by expansion into new markets and an increase in the credit it issued. Pretax profit rose to GBP130.5 million from GBP90.3 million in 2013, as revenue rose by 10% to GBP746.8 million. Excluding exceptional items, pretax profit grew by 24% to GBP118.1 million

CSR, up 6.7%. The chip maker signalled its confidence for 2014 Wednesday as it announced plans to return up to USD50 million via a share buyback in 2014 and hiked its final dividend by 14% to USD0.091 per share, although it swung into a pretax loss in 2013 due to write-offs for its Cameras unit. It posted a pretax loss of USD52.5 million, versus a pretax profit of USD102.0 million in the previous year, as revenue dropped to USD960.7 million from USD1.03 billion, and it posted a USD76.9 million impairment charge relating to its Cameras unit.

Direct Line Insurance, up 2.2%. The insurer reported a rise in 2013 pretax profit, as it suffered fewer claims from major weather events over the course of the year, despite a surge in claims in the fourth quarter. Pretax profit for 2013 rose by 70% to GBP423.9 million, ahead of the GBP367 million analysts had been expecting, according to consensus provided by the company. Additionally, on top of a 5% increase in its full-year dividend to 12.6 pence per share, Direct Line declared its second 4 pence special dividend of the year.

Stagecoach Group, up 2%. The bus and rail operator said its adjusted earnings per share expectations for the current financial year remain unchanged, as its overall profitability has remained satisfactory in recent months despite the severe weather that has hit its UK and US markets. It said like-for-like revenues were up 4.6% in its UK regional bus operations in the 40 weeks to February 2, up 3.1% in its London bus operations, 3.9% in UK rail, 5.4% in North America, and up 5.7% at its Virgin Rail joint venture.

Hays, up 1.2%. The recruiter said its half-year pretax profits rose by 10%, driven by net fee growth and improving market conditions in the UK and Asia. It made a GBP62.5 million pretax profit for the six months to the end of 2013, compared with GBP56.7 million for the corresponding period in the previous year. Net fees increased to GBP363.4 million from GBP360.3 million.

Henderson Group, up 1.1%. The group revealed that pretax profit rose by 24% to GBP127.4 million in 2013, up from GBP102.7 million. Its full-year dividend per share was lifted by 12% to 8.00 pence.

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FTSE 250 - LOSERS

Beazley, down 7.4%, and Playtech, down 4.8%, are two more big fallers, suffering after going ex-dividend Wednesday.

St. Modwen Properties, down 4.5%. The company has released its plans to raise GBP100 million through the offering of guaranteed convertible bonds due 2019, which it will use to refinance existing bank debt. A coupon of between of 2.6% and 3.1% a year is expected to be payable semi-annually in arrears. The initial conversion price is expected to be set at a premium of between 27.5% and 35% above the volume weighted average price of the shares from market open to close of trading on Wednesday.

Taylor Wimpey, down 4.5%. Like Persimmon on Tuesday, Taylor Wimpey has produced strong results, but finds itself amongst the biggest fallers in its index. The UK housebuilder said pretax profit before exceptional items rose by almost 50% as its full-year results beat analyst expectations. It posted profit before tax and exceptional items of GBP368.4 million for 2013, versus GBP181.8 million a year earlier, while pretax profit rose to GBP306.2 million from GBP204.2 million in 2012. Revenue increased to GBP2.30 billion from GBP2.02 billion in the corresponding period. Analysts had expected adjusted pretax profit of GBP281.1 million and revenue of GBP2.28 billion.

HellermannTyton Group, down 2.6%. The supplier of products for fastening, fixing, identifying and protecting cables said it signed a new five-year EUR230 million credit facility. The new facility replaces an existing secured bonds and the one of cost of refinancing is EUR5 million, which includes the 1% redemption premium paid to bondholders. HellermannTyton is due to announce preliminary full-year results on March 3.

The Restaurant Group, down 2.3%. The firm reported higher profits and revenues for its last financial year, driven by new pub and restaurant openings and higher sales from existing outlets, and said it will open a further 36 to 43 new restaurants in 2014. However some analysts are cautioning that shares are looking expensive. "We continue to be impressed by the business model and roll out story," says Shore Capital analyst Martin Brown. However, trading at 20x 2015 forecasts, the analyst says shares "are more than fully discounting the current rate of expansion".

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AIM - WINNERS

Conroy Gold & Natural Resources, up 8.7%. The exploration company said the structural study at its Clay Lake gold target in Ireland has confirmed the presence of gold bearing anticline structures. It said the structural study, which was carried out by independent consultant structural geologists, previously found one gold mineralised anticline at the Clay Lake gold target with intense shearing and has now found another gold mineralised anticline to the northwest of the first structure.

Savannah Resources, up 8.4%. The firm said it has made two executive appointments, Paul O'Donoghue, as country manager in Mozambique, and Durair A'Shaikh, a geologist with over 18 years experience.

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AIM - LOSERS

Evocutis, off 33%. The company said it has finally sold all the intellectual property rights for its Labskin product and SYN1113 investigational acne product, as well as related equipment, after months of talks. Clinical research organisation Venn Life Sciences separately said it had bought the assets for GBP210,000 in shares plus future royalties on sales of the acquired products.

Synectics, down 19%. The advanced surveillance technology company, reported higher profits for 2013 but said that its year-end order book had declined significantly. Pretax profit was up 41% to GBP6.6 million in 2013, from GBP4.7 million in 2012. However, the order book now stands at GBP28.1 million, compared to GBP36.9 million at the 2012 year end, which suggests the group will struggle to maintain earnings momentum.

Clinigen, down 15%. The pharmaceuticals and pharmaceuticals services company posted pretax profit of GBP9.6 million, up from GBP3.7 million in the previous year. While this is broadly in line with consensus forecasts. Numis Securities has downgraded the stock to Hold from Buy. Numis believes the company will put in a similar performance in the second half, meaning there are no significant changes to forecasts. However, shares have risen by 60% over the past five months and Numis see no further upside until new product acquisitions are announced.

Hume Capital Securities, down 15%. The company is a heavy faller despite reported that it had narrowed its pretax loss in 2013. Its pretax loss for the ended August 31 2013, came in at GBP3.7 million, narrowed from the GBP4.5 million recorded in the previous year. Revenue also improved, coming in at GBP6.0 million, up from GBP5.3 million. The company also said that trading in the first five month of the current full-year has been stronger than the year before.

Sareum Holdings, down 12%. The group has reported that its first-half pretax loss for the six month to the end of 2013 widened to GBP375.000 from a loss of GBP305,000 in the previous year. Its loss on ordinary activities after taxation widened to GBP350,000, from GBP269,000.

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By James Kemp; jameskemp@alliancenews.com; @jamespkemp

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