(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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JD Sports Fashion, up 4.0%. The athleisurewear retailer has agreed to buy San Jose, California-based Shoe Palace for USD325 million. Of the cash consideration, USD100 million has been deferred and will be paid over the next 12 months. JD Sports said the acquisition will be funded from its existing cash resources and bank facilities. For 2019, Shoe Palace delivered pretax profit of USD52 million on revenue of USD435 million. It was started in 1993 by the Mersho family and has 167 stores, most of which are under the Shoe Palace brand. About half the stores are in California, with some presence in seven other US states. Shoe Palace will continue to be run by four brothers from the Mersho family but will start to share ideas with JD's other US operation, JD Finish Line, from next year.
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FTSE 250 - WINNERS
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Chemring Group, up 12%. The defence technology firm announced double-digit rises in annual profit and revenue, both ahead of management expectations. For the year to the end of October, Chemring posted a pretax profit of GBP43.3 million, up 62% from GBP26.7 million the year before, as non-underlying costs dropped to GBP8.4 million from GBP12.7 million. On an underlying basis - excluding one-off costs - pretax profit rose by 30% to GBP51.7 million from GBP39.7 million the prior year. Revenue grew by 20% year-on-year to GBP402.5 million from GBP335.2 million, as Chemring's countermeasures facilities in Salisbury and Australia remained operational throughout the period. Looking ahead, Chemring said trading so far in its current financial year is in line with expectations, and the group's expectations for the period remains unchanged. Chemring has an order book of GBP476 million, of which GBP326 million, or 78%, is set to be recognised as revenue.
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Drax, up 4.1%. The electrical power station operator has agreed to sell the four combined cycle gas turbine power stations that make up Drax Generation Enterprise to VPI Holding for GBP193.3 million. This includes GBP29.0 million in contingent consideration related to the option to develop a new plant at Damhead Creek. Drax said the power stations have performed well since being acquired at the end of 2018, but they don't form part of its renewable generation strategy. The sale price represents a premium to book value, Drax said. The company also provided a trading update on Tuesday. A robust recent performance means its expectations for 2020 adjusted earnings before interest, tax, depreciation and amortisation remain in line with market expectations, which Drax put at GBP397 million. This would be down 3.2% from GBP410 million in 2019.
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FTSE 250 - LOSERS
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Airtel Africa, down 19%. JPMorgan Securities said an undisclosed institutional seller has sold 60 million shares in the Anglo-Indian provider of telecommunications and mobile money services. The shares were sold at 80p each, a 13% discount to Monday's closing price of 92.20p.
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Shaftesbury, down 3.7%. The London West End landlord reported a severe swing to a loss for its most recently ended financial year. Shaftesbury reported a pretax loss of GBP699.5 million, compared to a profit of GBP26.0 million the year before. This was due to a deficit on the net revaluation on investment properties of GBP698.5 million, widened from GBP15.3 million the prior year. Shaftesbury reported a net asset value per share of GBP7.43 as at September 30, down 24% on GBP9.82 a year ago. The firm said its portfolio valuation decreased on a like-for-like basis by 18% to GBP3.1 billion over the year. Looking ahead, Shaftesbury said pandemic control measures are likely to remain for most of 2021, however the impact is reducing, with a gradual return of local and domestic footfall as confidence returns. On Monday, that suffered a setback, however, when the UK government announced that London, parts of Essex and Hertfordshire will enter Tier 3 restrictions from Wednesday, following "very sharp, exponential rises" in cases.
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OTHER MAIN MARKET AND AIM - WINNERS
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Purplebricks, up 23%. The online estate agent said it expects full-year adjusted earnings to beat consensus forecasts. Purplebricks reported a 6.2% fall in interim revenue to GBP44.2 million from GBP47.1 million a year ago, though swung to a profit of GBP4.3 million for the six months to October 31 from a GBP2.3 million loss. Administrative and establishment expenses were reduced to GBP14.3 million from GBP16.3 million, and marketing costs down to GBP9.0 million from GBP12.3 million. "Whilst there are reasons to remain cautious on the economic outlook, we are confident in the levers which are under our control, and we currently expect adjusted Ebitda for the full year to exceed the upper end of the current range of consensus," Purplebricks said.
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By Lucy Heming;Â lucyheming@alliancenews.com
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Drax (DRX)
Chemring (CHG)
JD Sports (JD.)
Airtel Africa (AAF)