(Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Thursday.
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FTSE 100 - WINNERS
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BAE Systems, up 5.1%. The defence firm said profit declined in the first half of 2020, with higher operating costs playing a significant role in this, though maintained its dividend. Farnborough, England-based BAE posted a GBP689 million pretax profit for the six months ended June 30, down 11% from GBP776 million a year before. While revenue rose 5.9% to GBP9.18 billion from GBP8.67 billion a year prior, operating costs increased by 7.0% to GBP8.45 billion from GBP7.90 billion, depressing operating profit to GBP801 million from GBP836 million. On top of this, BAE's share of results of equity accounted investments shrank to just GBP7 million from GBP60 million the previous year. BAE maintained its dividend at 9.4p per share. Including its two recent acquisitions, BAE predicts its annual sales will increase by a low-single digit percentage from 2019, thanks to increased volumes from the F-35 combat jet, Combat Vehicles, and electronic defence portfolio growth. This is expected to offset the commercial business's shortfall.
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AstraZeneca, up 2.9%. The pharmaceutical firm posted a rise in earnings for the first half of 2020, as it also said Tagrisso has been granted Breakthrough Therapy Designation in the US for the treatment of patients with early-stage non-small cell lung cancer. For the six months ended June 30, AstraZeneca posted revenue of USD12.63 billion, up 14% from USD11.31 billion recorded for the first half of 2019. Pretax profit was USD1.89 billion, doubled from USD899 million the year prior. Core earnings per share rose 24% to USD2.01. Looking ahead, Astra said its 2020 full-year guidance was unchanged at high single-digit to low double-digit percentage growth in revenue and mid- to high-teens growth in core EPS. It also promised a "broad and equitable" supply of any Covid-19 vaccine that it develops during the pandemic at no profit.
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FTSE 100 - LOSERS
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Lloyds Banking Group, down 8.1%. The lender reported a loss for the first half, as the "profound" effect from the coronavirus pandemic forced the lender into large credit impairments. For the six months to June 30, Lloyds recorded a pretax loss of GBP602 million, compared to a GBP2.90 billion profit the year before. Lloyds took a GBP3.82 billion impairment charge in the period, sharply higher than the GBP579 million hit a year before. For 2020, Lloyds expects its impairment to be between GBP4.5 billion and GBP5.5 billion. The sharp rise reflects a "significant deterioration" in the forward looking economic outlook. Net income was down 16% year on year to GBP7.41 billion from USD8.82 billion, with net interest income dropping 11% to GBP5.48 billion from GBP6.15 billion.
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Anglo American, down 3.5%. The miner reported a slump in production in the first half due to Covid-19, leading to a drop in revenue, poor profit margins and a reduced dividend. For the six months to June 30, underlying earnings before interest, tax, depreciation and amortisation were down 39% to GBP3.35 billion from GBP5.45 billion a year before. This was due to a decrease in price for the Anglo American's basket of products and the impact of Covid-19 on production across its southern African assets. These two factors decreased underlying Ebitda by USD1.10 billion. Profit attributable to equity shareholders of the company also took a massive knock of 75% to GBP471 million from GBP1.88 billion. The mining company's revenue in the first half was down 16% to GBP12.47 billion from GBP14.77 billion the year prior.
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FTSE 250 - WINNERS
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Hastings Group, up 3.8%. Hastings on Wednesday said it has been approached by a consortium over a possible cash offer for the insurer. A consortium, headed up by Sampo Oyj and Johannesburg-listed Rand Merchant Investment Holdings, has approached Hastings to acquire the rest of the shares in the company it does not already own. Rand owns about a 30% stake in Hastings. "There can be no certainty that any firm offer will be made for the company, nor as to the terms on which any offer might be made," Hastings said. It has established an independent board committee, which excludes Herman Bosman - Rand's representative - "to consider this approach". Hastings shares closed up 18% on Wednesday.
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OTHER MAIN MARKET AND AIM - LOSERS
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Tullow Oil, down 5.0%. Berenberg cut the oil and gas firm to Hold from Buy. The stock closed down 5.3% on Wednesday after warning of an impairment of up to USD1.7 billion in the first half.
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By Lucy Heming; lucyheming@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
Tullow Oil (TLW)
Astrazeneca (AZN)
Anglo American (AAL)
BAE Systems (BA.)