Member Info for MY21

Bovis Homes, ahead of its AGM at noon, the housebuilder said it was on track to deliver expected growth and increase shareholder returns

Aberdeen’s Ithaca Energy generates $100 million cash from North Sea operations: North Sea-focused Ithaca Energy has said it generated $100 million (£63 million) cash from its operations in the first quarter indicating oil and gas firms can still make plenty of money in the area amid the downturn in the sector.

Cairn Energy highlights appeal of West Africa and North Sea: The Chief Executive of Cairn Energy has said the firm’s exploration success in Senegal could be a company maker while its hefty investment in the North Sea will pay off in spite of the oil price fall.

Banking newcomer Aldermore posts 7% increase in first quarter lending both to homeowners and small businesses: British banking newcomer Aldermore Group saw its lending rise 7% in the first quarter as it added more customers including homeowners and small and medium-sized businesses.

Alliance Trust Boss Katherine Garrett-Cox claims her £1.3 million pay package would not have been criticised so much if she was a man: The Boss of Alliance Trust has come under fire after claiming her £1.3 million pay package would not have attracted so much criticism if she was a man

High street chain Poundworld sells majority stake to U.S. investors: A former market stall trader and his family will bank more than £75 million after selling a majority stake in their Poundworld store chain to U.S. private equity firm TPG.

Hill & Smith on road to returns: Hill & Smith might not work in the most exciting of sectors, but increased government spending on the U.K.’s ageing road network means that this crash barrier manufacturer is well underpinned for the long term. Revenue for the four months to the end of April increased 6% to £153.2 million, at higher operating profit margins than last year. There was strong demand in the U.K. for motorway crash barriers as investment steadily comes through. In the U.S. business there was a solid start in sales to electricity infrastructure, but sales of metal fastenings to keep pipes in place was hampered by bad weather. Its galvanising operations, which are the largest contributor to group profits, saw a strong U.S. market, steady U.K. and weaker conditions in France. The tonnage of products sold increased 2% on the same stage last year. Market consensus is for full year, pretax profits of about £50.3 million, from revenue of £475 million, giving 48.5p in earnings per share. The shares offer a prospective yield of 2.8% and have gained 17%, or more than £1 per share, since we said they looked too cheap (Buy, 603p, March 10). Now, trading on 14.6 times forecast earnings, they remain a steady income share Hold. Hill & Smith at 709½p+8p. Questor Says “Hold”.

Grater expectations: BL has reported first, with Land’s numbers due next week. On the face of it, the BL team led by Chris Grigg has performed impressively. Net asset value — the sliver of the property portfolio attributable to each share — is 20% higher at 829p. Profits before tax rose 5.4% to £313 million. NAV is the preferred measure of performance in real estate, because profits can be tweaked up with property disposals. The benchmark has little solidity in routs of the kind experienced in the late noughties, though. Then, NAVs tumbled. But the white-bearded deity of real estate may be poised to smite tower builders. If inflation and base rates rise, so would bond yields, reducing the appeal of dividend-rich stocks such as BL. The prospects for a share that has appreciated 70% in three years depend on the private sector smoothly taking up slack created by a lessening of central bank support.

Adding ex-spy Sawers to BP board could spook nervous customers: A board needs strength in depth, which is why BP has hired Sir John Sawers, former head of MI6. The oil Minister of Berserkistan could still feel nervous of Sir John if he believes the non-exec saw the saucy snaps taken of him at that honey trap in Istanbul in 2003. For the 74-year period during which the U.K. government held a big stake in BP, the company was suspected in the oil industry of providing MI6 agents with cover, via foreign jobs. Such stories may well be urban myths, universal in character if specific in local detail. A big U.S. insurer is rumoured on Wall Street to have a similar relationship with the Central Intelligence Agency. Sprinkling boards with ex-spooks is a funny way for companies to demonstrate their arm’s length relationship with the state. The riposte is that in most of the world, all large companies are assumed to harbour spies. At any rate, Sir John could find he has interests in common with Igor Sechin, Chairman of BP’s Russian partner, Rosneft. Mr Sechin is widely believed to have served in the KGB.

3i: three eyes: Congratulations, Mr Borrows. But the new 3i remains an odd proposition for shareholders. At the core of the group is a PE business that invests in midsized companies: retailers, widget makers and the like. In 2014 the value of its investments rose 24% — a good year. 3i is deliberately shrinking its portfolio from 125 companies in 2012 to 30-40 over the next few years. Any new investments that 3i does make will come from its own capital, not from the third-party money that most other PE firms target. 3i counters that investors in its debt and infrastructure funds have different return targets to the group itself. Fair enough. But there remains the question of what sort of company 3i is. Does PE (investing 3i’s money) belong with asset management (investing other people’s money)? Asset management provides steady fee income, in contrast to the lumpy cash flows of PE. But this is not a reason to keep them together. The worry is that management retains the fee businesses as a source of funding for illiquid years in private equity — despite the fact that they might be worth more to a buyer with more scale than 3i. And asset management is a scale game.

Old Mutual: here and there: Superficially, Old Mutual’s first quarter trading update on Thursday shows the London-listed financial services group to be doing fine. Gross sales, most of them from its U.K.-based wealth Manager, were almost a fifth higher at £7.3 billion. Yet Old Mutual — for all its guerrilla-like attack and retreat, expanding into and retracting out of businesses in the U.K., the U.S. and elsewhere — still earns two-thirds of its operating profit in its South African homeland. Giving up the U.K. domicile and listing would not be easy, though. And, depending on the success of outgoing Chief Executive Julian Roberts’ strategy, it could make sense to stay. Since he became Chief in 2008, Mr Roberts has done much of the work needed to solve the stay-or-leave conundrum. He has sold assets acquired in Old Mutual’s foreign forays, including much of Skandia (bar its U.K. wealth Manager) and a U.S. life assurer. He has listed a U.S. asset Manager and cut debt. He has also been on the attack, bolting U.K. investment Manager Quilter Cheviot on to Old Mutual Wealth, and expanding in Africa. Mr Roberts will pass the helm to Bruce Hemphill before the result of his strategy is known. He will, however, leave his successor a potential solution to the conundrum. Assume for a moment that the combined OMW and Quilter Cheviot achieves operating profit of £400 million in two years’ time. Apply, say, a Rathbone Brothers multiple to the prospective after-tax earnings of OWM and it could be worth £5 billion (Old Mutual’s current market capitalisation is £11 billion). If that prompts a re-rating of Old Mutual, pressure to split might subside. If not, it will be a signal that investors do not like either Old Mutual’s emerging market bias or its conglomerate status.

U.K. rail fares on long distance routes rise 71% in 10 years: Rail fares on long distance routes in the U.K. have risen by an average of 71.2% in the past 10 years, or by more than 30% after adjusting for Retail Price Inflation, despite patchy service and poor punctuality

Continental Resources’ Chief vows shale will bounce back: Harold Hamm, Chief Executive of Continental Resources, said he disagreed with claims by a Saudi official, reported in the Financial Times, that the lower oil price had deterred investment in higher-cost sources of oil such as shale.

Petrobras scandal looms large in Shell’s plan to buy BG Group: As Royal Dutch Shell seeks to finalise its £55 billion takeover of smaller U.K.-based rival BG Group, it will be closely watching the situation at Petrobras, Brazil’s state-controlled oil company that is engulfed in scandal.

Telecoms takeovers are bad for customers, claims TalkTalk Chief: The Game of Thrones style merger-mania in the British telecoms industry is bad news for customers and could put up prices, the TalkTalk Boss Dido Harding has warned.

Average London house to cost £1 million by 2030: The average price of a home in London could crash through the £1 million barrier by 2030, spiralling further out of reach for the average resident.

British Land reaches for the sky as London powers on: Record rents and galloping home prices in two of London’s most exclusive areas have provided a double bonus for British Land.

Wealth of U.K. households soars by £1.5 trillion in a year: British households collectively became £1.5 trillion richer last year in the largest annual increase of wealth as the value of property and financial assets increased

At 0330GMT today, Brent crude oil one month futures contract is trading 0.05% or $0.03 higher at $66.62 per barrel. Yesterday, the contract declined 0.33% or $0.22, to settle at $66.59 per barrel, extending its decline from the previous session amid indications that oil producers would continue to boost output.

Property development and investment giant British Land met forecasts with a small increase in profits in the year ended 31 March. The company, which owns London office and residential properties and a national retail portfolio, reported an underlying pre-tax profit of £313m, up 5.4% on the previous year. Diluted underlying earnings per share increased 4.1% to 30.6p, more or less in line with consensus estimates.