WINNERS & LOSERS SUMMARY: Micro Focus And Amigo Sink On Outlook

(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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Smiths Group, up 3.9%. Goldman Sachs raised the technology firm - which makes medical devices and security scanners - to Buy from Neutral.

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FTSE 100 - LOSERS

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Micro Focus, down 27%. The software firm warned that it doesn't expect to meet its annual guidance and will now record a steeper-than-expected drop in revenue. The company blamed weak sales execution and delays in customer contracts as a result of a deteriorating market environment for not meeting its previous constant-currency revenue guidance of a 4% to 6% year-on-year drop for the financial year to October 31. It now expects revenue to fall by around 6% to 8% year-on-year. For the 12 months to October 31, 2018, Micro Focus recorded revenue of USD4.06 billion. Against this backdrop, Micro Focus said it has decided to accelerate a strategic review of its operations. The review will focus on a range of strategic, operational and financial alternatives available to the company.

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FTSE 250 - WINNERS

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Homeserve, up 4.2%. UBS raised the home emergency repairs business to Buy from Neutral.

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Hunting, up 3.6%. The energy services firm said profit rose in the first half of 2019 as the company's Asia Pacific, US, and Europe the Middle East & Africa segments all posted growth. Hunting recorded USD40.1 million pretax profit for the six months to June 30, 5.5% above its USD38.0 million profit a year before, as revenue rose 15% to USD508.9 million from USD442.8 million. US revenue rose to USD181.1 million from USD147.3 million, while EMEA revenue was up at USD67.0 million from USD56.1 million. In addition, Asia Pacific revenue was USD75.1 million, improving from USD51.2 million previously. Less positively, Hunting Titan segment revenue slipped to USD206.1 million from USD216.7 million and Canada segment revenue to USD19.5 million from USD21.7 million.

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FTSE 250 - LOSERS

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Amigo Holdings, down 34%. The lender said it expects flat loan book growth through the current financial year. Amigo said it is being "proactive and pragmatic" in an "evolving regulatory and economic environment", and, as a result, will prioritise new customer lending over existing customers. This is expected to hit Amigo's repeat lending growth, due to its "enhanced" credit policy. All of which is expected to see Amigo's net loan book growth "broadly flat" in financial 2020. The company's net loan book at March 31, the end of Amigo's financial year, stood at GBP707.6 million. The company had previously guided to mid-teens growth. In Amigo's first quarter, the three months to June 30, the company's loan book grew 14% to GBP728.4 million compared to GBP638.2 the year before. Pretax profit in the first quarter increased 33% to GBP22.6 million GBP17.0 million, with revenue rising 14% to GBP71.5 from GBP62.9 million.

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Hays, down 3.0%. The recruitment firm reported a slip in annual profit on exceptional charges, but saw a rise in fees on growth from both recruitment divisions, Temporary and Permanent. In the year ended June 30, the recruiter's pretax profit fell 2.9% to GBP231.2 million from GBP238.5 million. Excluding pension charges - related to the Lloyds Bank ruling - and restructuring costs from the company's European businesses, the company's operating profit increased 2.3% to GBP248.8 million. Hays' net fees - which represents turnover minus remuneration of temp workers from other recruitment agencies - grew 5.6% to GBP1.13 billion from GBP1.07 billion. Hays upped its ordinary dividend by 4.2% to 3.97 pence per share from 3.81p distributed the year before. The company also upped its special payout by 8.6% to 5.43p.

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OTHER MAIN MARKET AND AIM - WINNERS

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Horizonte Minerals, up 44%. The nickel miner said it has secured USD25 million in funding to advance the Araguaia ferro-nickel project in Brazil. Horizonte has signed a royalty agreement with Orion Mine Finance to provide funding for the Araguaia project. Under the agreement, Orion Mine will provide an upfront cash payment of USD25 million in exchange for a 2.25% royalty on the Araguaia project. The royalty only applies to the first 426,429 tonnes of contained nickel within the final product, ferronickel, produced and sold. "We are extremely pleased to secure this royalty agreement with Orion, which enables us to build out our owner's team, advance engineering and early works packages as we proceed to the start of full construction at Araguaia. This royalty financing is non-dilutive for shareholders, and has been pre-designed to be compatible with the project funding package," said Horizonte Chief Executive Executive Jeremy Martin.

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Reabold Resources, up 15%, Union Jack Oil, up 8.8%. The companies said well testing has revealed West Newton project to be a significant oil and gas discovery, instead of the gas discovery originally expected. Initial petrophysical analysis of the West Newton A-2 well in Yorkshire, England, found an overall hydrocarbon column of 65 metres, including 45 metres gross oil column and underlying 20 metre gross gas column. Given this discovery, the extended well test has been put temporarily on hold so that it can be optimised to evaluate the oil column. Reabold's economic interest in in the licence is 24% and is held via the company's 36% holding in Rathlin Energy UK, which operates the A-2 well. Union Jack has a 17% interest in the licences containing the West Newton A-1 discovery well and A-2 appraisal well.

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