UK WINNERS & LOSERS SUMMARY: Imperial Brands Sees No Hit From Covid-19

Tue, 31st Mar 2020 11:15

(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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Melrose Industries, up 18%. The industrial turnaround specialist late Monday suspended the payment of its final dividend for 2019 of 3.4 pence per share due to the Covid-19 pandemic. Melrose said from January to mid-March, it traded in line with management expectations. However, in the second half of March, Melrose noted a significant deterioration in trading and the end markets it serves. As a result of the uncertainty surrounding the virus outbreak, the group said it cannot currently provide a meaningful outlook, but is closely monitoring all developments.

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Imperial Brands, up 12%. The tobacco company said that it has seen no material impact on performance to date from Covid-19 pandemic, and current trading remains in-line with expectations. "Our operations benefit from a diversified supply chain and factory footprint, which is prioritising the manufacture of major product lines to build contingency stocks. Our distribution business, Logista, which serves Italy, France and Spain has increased the levels of finished goods stock in its regional distribution hubs and continues to deliver product to retailers," the Davidoff cigarette maker said. Imperial also said that it has secured a new EUR3.5 billion multi-currency revolving credit facility from a syndicate of 20 banks.

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Flutter Entertainments, up 9.5%. Flutter's shares were higher after the UK Competition & Markets Authority cleared the merger between the Paddy Power owner and Canadian peer Stars Group. The UK regulator said that although both companies compete strongly, the presence of other competitors like bet365 and William Hill means the merger will not worsen the offering to people who choose to bet online. FTSE 100-listed Flutter welcomed the phase one merger clearance, but said the merger is still subject to approval by both Flutter shareholders and Stars group shareholders at general meetings scheduled for April 21 and April 24, respectively. Midcap bookmaker William Hill was up 10%.

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FTSE 100 - LOSERS

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Taylor Wimpey, down 2.0%. JPMorgan downgraded the housebuilder to Neutral from Overweight.

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FTSE 250 - WINNERS

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St Modwen Properties, up 3.7%. The property company said it remains confident that it is well positioned for the future, thanks to a strong liquidity position. St Modwen said it has GBP169 million of cash on a see-through basis and no significant debt maturities until December 2023. St Modwen also confirmed that, as of Tuesday, just over 200 employees, being 33% of the company's workforce, has been placed on furlough, but everyone is paid their normal salary in full. At the same time, the board has voluntarily agreed to accept a 20% reduction in pay and fees, the company said. Looking ahead, St Modwen said it believes that it is not now appropriate to pay its final dividend for 2019 of 5.1 pence per share - or GBP11.3 million in the aggregate.

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FTSE 250 - LOSERS

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Morgan Advanced Materials, down 1.0%. The ceramic materials manufacturer said it will not be paying a proposed final dividend for 2019 as its sales declined amid coronavirus. The firm said it has wound down non-essential operations and closed sites in geographies where required. Elsewhere - in healthcare, food production, energy and critical infrastructure - Morgan said it is continuing operations with heightened safety measures where appropriate. Sales for the 12 weeks to March 21 were 3.2% lower year-on-year, on an organic constant-currency basis, the FTSE 250-listed company said. Excluding China, sales were 0.2% lower than the prior year. Morgan said it is seeing improvements in China, with all of its factories there reopening. However, the Covid-19 outbreak has escalated globally. As of Tuesday, the company said it has six businesses closed across Italy, India and South Africa. Therefore, the company has withdrew its previous guidance for 2020.

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By Arvind Bhunjun; arvindbhunjun@alliancenews.com