UK WINNERS & LOSERS SUMMARY: Ocado Rallies Amid Encouraging M&S Switch

(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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Ocado, up 5.4%. The grocer said retail revenue in its third quarter surged by more than 50%, driven by a shift to online grocery shopping in the UK and a positive customer response to its switch from Waitrose products to Marks & Spencer goods. For the 13 weeks to August 30, Ocado Retail revenue rose by 52% to GBP587.3 million, compared to GBP386.4 million in the 13 weeks to September 1, 2019, as the channel shift to online grocery in UK continues, with weekly orders increasing due to a combination of strong demand, a phased reopening of the website to new customers, and a normalising of shopping patterns. Average orders per week also rose 9.6% to GBP345,000. Ocado highlighted that while the average order size has continued to normalise from Covid-related peaks to GBP141, it remains above pre-crisis levels.

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Rio Tinto, up 2.4%. The miner was higher after ratings upgrades from both Barclays and JPMorgan. The former upgraded Rio to Equal Weight from Underweight, while the latter raised the stock to Overweight from Neutral.

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FTSE 100 - LOSERS

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J Sainsbury, down 1.0%. Figures from Kantar showed Sainsbury's sales rose 8.0% to GBP4.42 billion in the 12 weeks to September 6, but its market share slipped to 14.9% from 15.3%. In the period, Ocado was the fastest growing retailer, with sales up by 41% year-on-year to GBP515 million. Market share inched higher to 1.7% from 1.4%. Among the "Big Four" UK grocers, Tesco saw a 11% sales rise to GBP7.94 billion, but its market share remained flat at 26.8%. Walmart's Asda had a 6.3% annual sales rise to GBP4.30 billion, but its market share fell to 14.5% from 15.1%. At Wm Morrison Supermarkets, sales rose 13% year-on-year to GBP3.01 billion, with market share up to 10.1% from 9.9%. Tesco shares were up 0.4% and Morrisons shares down 0.5%.

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FTSE 250 - WINNERS

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FirstGroup, up 8.7%. The transport operator said its trading has been stronger than expected with the bus operator adding that it is seeing more "clarity", despite the ongoing impact of Covid-19. Adjusted operating profit and cash from operations were ahead of internal expectations in the period between April 1 and August 31. The company now expects a "small adjusted operating profit for the seasonally weaker first half of the financial year", ahead of its forecasts from earlier this summer. For the six months ended September 30, 2019, FirstGroup had posted adjusted operating profit of GBP97.7 million. FirstGroup added that it is "resolutely focused" on selling some North American units and noted it has already seen "significant interest from potential buyers".

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FTSE 250 - LOSERS

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Watches of Switzerland, down 6.3%. US-based investment manager Apollo Global Management LLC has sold 33.0 million ordinary shares in UK retailer Watches of Switzerland at 310 per share, raising GBP102.3 million, global coordinator for the share sale Barclays Bank said. The shares were sold by Jewel Holdco Sarl, a company owned and controlled by AIF VII Euro Holdings, an affiliate of investment funds managed by an affiliate of Apollo Global. Barclays said the placing was upsized from 27.5 million shares due to strong demand during the bookbuild process. Following the completion of the share sale, Apollo Global will continue to own 67.7 million shares, or 28%, in Watches of Switzerland. Watches of Switzerland will not receive any proceeds from the share placing.

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OTHER MAIN MARKET AND AIM - WINNERS

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Schroder European Real Estate, up 5.5%. The real estate investment trust that focuses on continental Europe announced a better-than-planned third interim dividend, following the positive progress made with the Paris Boulogne-Billancourt refurbishment project and the stabilisation in rent collection levels. It will pay a third interim dividend of 1.39 euro cents per share, which is 75% of the previous target before Covid-19. This is up from the 0.925 cents, or 50% of its pre-Covid target, it had planned to pay when announcing half-year results in June. The company's net asset value per share at June 30 was 133.4 cents per share, which is a 2.1% reduction compared to March 31 which was at around 130.6 cents per share, and was driven by capital expenditure commitments at Paris Boulogne-Billancourt and a valuation decrease at the company's sole shopping centre in Seville.

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By Lucy Heming; lucyheming@alliancenews.com

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