McColl’s shares crash 16% as firm swings to annual loss
Shares in McColl’s Retail Group PLC (LON:MCLS) have crashed on Wednesday afternoon as the firm gave shareholders a disappointing update.
The retail firm noted that it had swung to an annual loss, as revenues across stores had declined. Additionally, the firm added that store closures had lead to a suspension in final dividend.
Within their financial year, which ended on November 24 – the firm posted a pretax loss of £8.6 million compared to a pretax profit of £7.9 million one year ago.
McColl’s said that this was largely due to a one-off, non cash goodwill impairment of £98.6 million.
Revenues also declined by 1.8% to £1.22 billion from £1.24 billion, as like for like sales remained flat. On an adjusted basis, pretax profit slumped by 30% to £7.3 million from £10.5 million.
As a result, McColl’s have declared that their total dividend will be 1.3p, down from the 4p figure a year ago.
Jonathan Miller, Chief Executive, said:
“We have stabilised the business and refocused on retail execution in 2019, in line with our key priorities for the year. Against challenging trading conditions we have made good operational progress, whilst reducing debt and making appropriate levels of investment.
Looking ahead to FY20, we are embarking on a strategic change programme, refining our model and better tailoring our offer to the customers and communities we serve, using the learnings to build the foundations for future growth.
The fundamentals of the convenience sector remain strong and, with our improving customer proposition, I am confident in delivering sustainable returns for shareholders over the long term.”
Avast report earnings climb across 2019
Avast PLC (LON:AVST) have seen their earnings climb in 2019, as their annual results met expectations.
The software firm noted that full year performance had remained within expectations, as the firm reported double digit profit growth.
Across 2019, the firm saw its revenues climb 7.8% to $871.1 million from $808.3 million, as adjusted billings also increasing 5.7% to $911 million from $862.1 million.
On a better note, pretax profit surged 18% from $339.3 million to $400.1 million.
Looking at customer numbers, Avast also saw an increase of 3.5% to 12.6 million from 12.2 million. Average revenue per customer also edged 3.6% higher $51.02 from $49.24.
As a result of these strong results, the firm lifted its full year dividend by 8.1% to 14.7 cents per share.
Ondrej Vlcek, Chief Executive of Avast, said:
“I’m pleased to report another year of good performance for Avast in 2019, with results in line with the Board’s expectations. Group Adjusted Revenue was $873.1m, with organic growth of 9.1%1, driven by double-digit growth in our Consumer Direct Desktop business. We also sustained a high level of profitability with Adjusted EBITDA margin2 at 55.3%.
“The core of the Avast business and our fundamental strengths remain unchanged. Our focus on cross-sell and upsell, our localisation strategy, and new product releases continue to drive good growth. There is an exciting pipeline of product launches for the year ahead. We continue to expect healthy growth in 2020 and remain confident in the long-term prospects for the business.
“For the full year 2020 we expect Group mid-single digit organic revenue growth, and a stable EBITDA margin percentage.”
Avast build from strong consecutive performances
In October, the firm posted its third quarter results – which also saw a rise in total sales. The cyber security firm said revenue rose 9% year on year for the quarter ending in September. Revenues were totaled at £170 million. For the nine months, adjusted Ebitda grew 6.6% to £358.5 million. The results achieved were consistent with expectations laid out in its half year results results back in August. The global cyber security firm stated its guidance for adjusted revenue to be at the higher end of single digit growth. Avast have enjoyed strong demand for VPN’s and privacy software amidst the battles of Brexit, and are one firm who do not seem to be phased by Britain’s status within the European Union. The firm also published impressive figures of EBITDA growing by 6% to $385.5 million. Shares in Avast trade at 403p (-2.28%). 26/2/20 12:05BST.Weir Group shares bounce 6% despite swinging to annual loss
Weir Group PLC (LON:WEIR) have seen their shares jump nearly 7% despite the firm giving shareholders mixed annual results.
The engineering firm noted that it had swung to an annual loss, due to an impairment charge it tase over its North American assets.
The CEO commented: “North American oil and gas market conditions deteriorated significantly through the year and we undertook a major cost reduction programme in response. While the long-term prospects for shale remain positive, current market dynamics mean it now has a very different investment case to our premium mining technology positions. We are therefore taking actions so that we can maximise value for shareholders whenever the right opportunity is identified”
On a better note, Weir Group reported that it had seen a rise in orders and revenue, which is a positive for shareholders.
Across 2019, the Glasgow based firm reported a pretax loss of £372 million compared to a profit of £86 million one year ago.
The impairment charge faced totaled £546 million, and was recorded within the Oil and Gas North American cash generating unit.
Weir noted that challenging market conditions, and market uncertainty led to estimates of future cash flows featuring lower revenues and margin assumptions.
Pretax profit also slipped 2% from £310 million to £303 million on an adjusted basis.
Weir saw their revenues increase by 9% to £2.66 billion from £2.45 billion the prior year. On a constant currency basis, revenue rose 8% but slipped 4% on a like for like basis.
The firm also told the market that total orders increased by 8% on a constant currency measure to £2.79 billion.
Weir declared a final dividend of 30.45p, which brings the total payout to 45.95p which sees an increase from 46.20p the year before.
Jon Stanton, Chief Executive Officer said:
“2019 saw a strong performance from our mining businesses with margin expansion in both Minerals and ESCO. Our innovative technologies are helping mining become more sustainable as shown by the record £100m Iron Bridge order for our energy-saving Enduron® HPGR technology. We have a major role to play in enabling net zero in mining underpinned by our commitment to reduce our own environmental footprint including cutting our CO2 emissions by 50% by 2030.
Looking to the year ahead, there is uncertainty over the impact of coronavirus (COVID-19) on the global economy and demand for natural resources. Assuming underlying demand does not change, we expect further good constant currency growth in our mining-focused businesses to be offset by the continued challenges in North American oil and gas markets.”
Shares in Weir Group PLC trade at 1,333p (+6.64%). 26/2/20 11:50BST
UK Government plans to review British Foreign Policy
The UK Government, has pledged to change the nature of British Foreign Policy following a governmental review.
PM Johnson has a lot to balance at the moment, amid battling with Brussels and the European Union, the coronavirus situation only seems to be getting worse and worse.
Since the recent Cabinet Reshuffle, nearly a fortnight ago – the face of the Cabinet and Government has changed.
Rishi Sunak, the new Chancellor has expressed his intentions to reveal the budget on March 11 and has confirmed his plans to produce a budget which is beneficial for the British people.
Today, the UK Government has conducted an in-depth review of British Foreign Policy.
Notably, the Diplomatic Service which handles issues such as crime, technology and use of military supplies will be facing a full review.
British Foreign Policy has been under scrutiny over the last 20-30 years, many saying that the ‘special relationship’ with the United States has often meant that Britain has followed the United States in overseas action.
The cases of intervention in states such as Iraq or Afghanistan spring to mind with this hypothesis – and the UK Government has still not healed from the wounds caused by both these conflicts.
Many political authors argue that even with US and UK intervention in Afghanistan, not much has really changed – posing a question as to whether the UK Government needs to review its approach to Foreign Policy.
The review will also seek “innovative ways” to promote UK interests while committing to spending targets.
Boris Johnson, in his Conservative Manifesto noted that the UK would continue to spend 0.7% of gross national income on international aid. Interestingly, there was also a pledge to exceed the NATO target of 2% of gross domestic product on defense.
The UK Government has expressed its intentions to strengthen ties with China, but there has been speculation over the possibility of this with the involvement of Chinese companies into projects such as HS2.
The review has been set to put the following issues into question:
* define the government’s ambition for the UK’s role in the world
* set out the way in which the UK will be a problem-solving and burden-sharing nation
* determine the capabilities needed for the next decade and beyond to pursue objectives and address threats
* identify the necessary reforms to government systems and structures to achieve these goals
The government says it will “utilise expertise from both inside and outside government for the review, ensuring the UK’s best foreign policy minds are feeding into its conclusions and offering constructive challenge to traditional Whitehall assumptions and thinking”.
The review will conclude later this year, and the results and approach taken by PM Johnson and the UK Government will be certainly interesting to note.
William Hill see revenues slip across 2019, however praise strong US and Online peformance
William Hill plc (LON:WMH) have noted that revenues slipped across 2019, as the firm released their annual results on Wednesday morning.
The bookmaker said that revenues fell, however its loss narrowed sharply following less impairment costs on retail stores.
The firm commented: “We have made good progress on the commitment made in 2018 to develop William Hill into a digitally led, internationally diverse sports betting and gaming business of scale with a strong online position and access to fast-growing markets, particularly the US.”
Across 2019, William Hill noted that net revenue had fallen 2.4$ to £1.58 billion from £1.62 billion a year ago. Their pretax loss also narrowed from £37.6 million from £721.9 million – which will be a pleasing take for shareholders.
William Hill told the market that in 2018, the faced an impairment total charge of £922.1 million within its retail sector, following governmental cuts in the maximum stake in fixed-odds gaming terminals to £2 from £100.
The FTSE 250 listed firm also added that the revenue decline was down to the maximum stake limit being applied, but this was offset by better performance in the US and Online divisions.
William Hill cut their dividend from 12p a year ago to 8p – which puts a slight sour note on the update for shareholders.
Ulrik Bengtsson, Chief Executive Officer, commented:
“2019 was a year of transition during which we executed on our ambition to diversify internationally with the acquisition of Mr Green and the continued strong growth of our US business. The Group delivered a strong operating performance, ahead of our expectations and against a challenging regulatory backdrop.
“We move into 2020 in a stronger position. Almost a quarter of revenue is now generated outside the UK compared to 15% in 2018. We made positive progress with our digital platform, launching our purpose-built platform in the US and product developments in the Online business in 2019. We will invest in our proprietary technology as we continue to improve the competitiveness of our customer offering. We have also made great progress embedding a culture of safer gambling across the Group.
“This is an exciting time to be William Hill’s CEO. Our industry is evolving and this brings great opportunities, underlining the importance of our efforts to reposition the business. We look forward to building on these foundations with a renewed focus on customer, team and execution.”
William Hill change their CFO
Last week, William Hill announced that they had appointed a new CFO. The online and in-store bookmaker said that DS Smith’s PLC current CFO Adrian Marsh, is set to join the company. William Hill said that Marsh will join the company and be appointed as an Executive Director to the William Hill Board later this year. Notably, the company’s current CFO, Ruth Prior will be leaving the Company to join Element Materials Technology. William Hill praised the prior experience of Marsh, saying that he had been Group CFO at DS Smith for the past seven years. Under the guidance and leadership of Marsh, DS Smith won an elite promotion from the FTSE 250 to the FTSE 100. William Hill concluded by saying that they will announce the formal appointment of Marsh and the departure of Ruth in due course. Shares in William Hill trade at 173p (-1.76%). 26/2/20 11:22BST.Restaurant Group shares crash 6%, following plans to scrap final 2019 dividend
Shares in the Restaurant Group PLC (LON:RTN) have crashed on Wednesday, as the firm noted that it would be suspending dividends.
On Wednesday morning, the Restaurant Group released their annual results – and shareholders have not reacted so optimistically.
Shares in the firm trade at 109p (-6.55%). 26/2/20 10:59BST.
The Restaurant Group, who own a range of different brands including Wagamama said that no final dividend will be paid for 2019.
In 2019, notably the firm did pay a dividend of 2.1p however this fell significantly below the interim dividend reward of 6.8p in 2018.
The Restaurant Group said that the dividend would be suspended to allow the business to grow Wagamama along with its Concessions and Pubs businesses.
Interestingly, the firm also said that it will close sites and operations within its Leisure Unit, with a reduction between 260 and 275 by the end of 2021.
Across the yearly period, the firm did note that like for like sales rose 2.7%, as total sales rose 56% to £1.07 million – the firm praised the strong performance of Wagamama across this period.
However – The Restaurant Group posted a pretax loss of £37.3 million, as it swung to a loss from £13.9 million profit from the year before.
Profit was bruised by an £111.8 million impairment, largely spawning from the Leisure business.
In the first six weeks of the year, the firm noted that it had seen year-on-year like-for-like sales growth of 5.3%.
Andy Hornby, Chief Executive Officer, commented:
“Having joined the business in August last year I am particularly pleased with the continued and significant progress made following the acquisition of Wagamama and the integration of the business into the Group, which has transformed the Group’s growth trajectory and momentum.
Our three growth businesses of Wagamama, Concessions and Pubs are all out-performing their respective markets and have clear potential for further growth. I am also acutely aware of the challenges facing our Leisure business and the wider casual dining sector.
It is therefore clear that our strategic priorities need to evolve in order to maximise shareholder value in the medium term. Following extensive review we have defined three clear strategic priorities for the next two years:
· Grow our Wagamama, Concessions and Pubs businesses;
· Rationalise our Leisure business; and
· Accelerate our deleveraging profile
In order to support these strategic priorities, the Board has taken the decision to temporarily suspend the dividend. This will allow us to continue investing in our three high growth businesses, whilst facilitating an acceleration of our Leisure estate rationalisation and reducing our net debt.
We have made an encouraging start to the new financial year with like-for-like sales up 5.3% for the first six weeks of 2020.”
Restaurant Group see turbulence
In November, the firm saw its shares crash despite a strong performance from its headline brand, Wagamama. The FTSE250 listed firm reported that Wagamama had continued to outperform the market in tough trading conditions. Wagamama reported strong second quarter gains, as revenues rose 11% year-on-year to £93.5 million, with like-for-like revenue growth coming in at 6.3%. Restaurant Group’s own financial year aligns with the calendar year. Overall, the brand delivered a 5.1% outperformance of the UK market, the company said, and has consistently outperformed over the past five years. Certainly – this is an interesting update from the Restaurant Group. Wagwama is the biggest brand under their wing, and hopefully the plans to expand will produce results in the future.Taylor Wimpey beat company completions record, but stay cautious on political turbulence
Taylor Wimpey (LON:TW) have seen their shares dip modestly following the releasing of their annual results.
The British house builder said that across 2019, revenues had climbed and completions had risen to a company record.
The firm did note that 2020 may still hold further political turbulence, with the firm saying:
“During a period of wider macro-economic uncertainty, the new build market has proved to be resilient and house prices have remained stable. As we look ahead, we see the removal of Help to Buy as a continued risk, but having had visibility of, and time to plan for, the changes, we consider it as one that can be managed.
Whilst we recognize that the ongoing trade discussions with the European Union may create some volatility in sentiment in the housing market in the near term, we see the clearer political outlook as providing a longer period of stability for our customers. We are mindful of the changing regulatory environment for the sector in the short to medium term and will continue to monitor this closely to ensure we are able to respond.”
Looking at revenue figures, the British firm noted that 2019 revenue was 6.4% higher at £4.34 billion from £4.08 billion the year before.
On an even better note, pretax profit also spiked 3.1% from £810.7 million to £835.9 million – which is impressive considering the volatile nature of the property market.
Before exceptional items, pretax profit dipped 4.1% to £821.6 million from £856.8 million. Taylor Wimpey noted that the company made a £14.3 million gain from such one-off items, swinging from a £46.1 million loss.
Market consensus and forecasts which had been predicted by Taylor Wimpey had noted that pretax profit before exceptional items could total £821.5 million, which has remained consistent with the company.
On a better note, and probably the headline take from today’s update – the home builder reported completions of 16,024, up 5.0% from 15,275 the year before.
Taylor Wimpey lifted its full year dividend by 22% to 7.64 pence per share from 6.24p in 2018.
Pete Redfern, Chief Executive, commented:
“The Group delivered a good performance in 2019, with a record sales rate and home completions increasing by 5%. During the year, we continued to strengthen our business and build a sustainable advantage, improving our core customer proposition and business flexibility through investments in customer service, quality, build capacity and direct labour. These investments will strengthen the business for the long term.
In 2020, we will focus on further embedding and leveraging these improvements across the business while increasing our focus on cost discipline and process simplification.
The new year has started well, with a good level of customer demand and a clearer political outlook.”
Taylor Wimpey’s second half produces strong results
In November, Taylor Wimpey reported strong second half demand for their housebuilding services, despite tough market trading conditions. The FTSE 100 listed home builder, reported a 12.5% rise in its orders, to £2.7 billion as it exploited strong demand coupled with lower interest rates and the governments Help to Buy scheme boosting demand. Total order book, excluding joint ventures, stood at 10,433 homes as at November 10 from 9,843 homes a year earlier. Taylor Wimpey did warn homebuilders about potential rising costs in 2020 – and this sentiment has remained consistent within the results today. Shares in Taylor Wimpey trade at 210p (-3.88%). 26/2/20 10:49BST.Rio Tinto post steady final results, boosted by rising iron prices
Rio Tinto plc (LON:RIO) have produced a steady set of final results that have been published on Wednesday.
Shares in Rio Tinto trade at 3,918p (+0.064%). 26/2/20 10:25BST.
The firm said that revenues had risen across 2019, which was largely down to rising iron prices – however profits dipped slightly across the year.
In Rio Tinto’s 2019 financial year, the firm noted that sales revenue climbed 6.5% to $43.17 billion from $40.52 billion, but pretax profit slumped 35% to $11.77 billion from $18.20 billion.
Looking at net losses, the mining titan reported that they faced a $291 million net loss on consolidation and disposals, compared to a $4.6 billion surplus just one year ago.
Notably, impairment charges faced were $3.49 billion, which was a significant increase from the $132 million gain in 2018.
Rio Tinto added that its full year ordinary dividend per share was 24% higher at 382 cents from 307 cents – however total dividend fell 19% to 443.0 cents from 550.0 cents in 2018.
The mining firm also noted that they are currently assessing the impact of the coronavirus on operations and production, which the firm said could cause uncertainty in the short term.
“Our world-class portfolio and strong balance sheet serve us well in all market conditions, and are particularly valuable in the current volatile environment. We are closely monitoring the impact of the Covid-19 virus and are prepared for some short-term impacts, such as supply-chain issues. Our products are currently reaching our customers.
Full year production guidance remained consistent, however full year guidance at the Pilbara iron ore operations were slashed following damaged caused by cyclone Damien.
Going forward, mined copper production is expected lie within the 530,000 to 570,000 tonne ball park, which is below total 2019 output of 577,000 tonnes.
Finally, aluminium production is expected to be between 3.1 and 3.3 million, which remains consistent with last year’s total figure.
Rio Tinto Chief Executive J-S Jacques said:
“We have again delivered strong financial results with underlying EBITDA of $21.2 billion, underlying EBITDA margin of 47% and return on capital employed of 24%. This performance allows us to return a record final ordinary dividend of $3.7 billion, resulting in a full-year ordinary dividend of $6.2 billion and total cash returns of $7.2 billion.
“In line with our disciplined approach to capital allocation, we invested $2.6 billion in development projects, including high-return iron ore and copper. Longer term, our $624 million exploration and evaluation expenditure in 2019 adds to our pipeline of attractive options.
“Our resilience and value over volume strategy mean we can invest in our business and deliver superior returns to shareholders in the short, medium and long term.”
Rio Tinto face damage from Cyclone Damien
Just over a week ago, Rio Tinto noted that they would be lowering their annual shipments guidance. The firm said that shipments are expected to be lower at its iron ore operations in Western Australia following damage caused by Cyclone Damien. Across 2020, the FTSE 100 lister miner now expects shipments at its Pilbara operations to be between 324 million and 334 million. Notably, this sees a formidable slump from previously guided range which was in the 330 million and 343 million ball park. In 2019, Rio Tinto reported iron ore shipments at Pilbara of 327 millions which saw a 3% slip on 2018 – which gave shareholders a pre warning before the final results were announced today.Morgan Advanced Materials offsets market decline with growth across its sectors
Manufacturer of specialist products Morgan Advanced Materials (LON:MGAM) reported on Tuesday that it booked a solid set of fundamentals for the full-year ended 31 December 2019, and that the reduction of its leverage had continued to illustrate its strong trajectory over the last three years.
The company took in £1.05 billion of revenue, up 1.5% from £1.03 billion for the year before. This led the Group’s impressive 7.6% rise in headline operating profit, up from £124.8 million, to £134.2 million.
Morgan Advanced Materials attributed its success to ‘strong growth’ in its semiconductor and electronics, chemical and petrochemical, and healthcare and aerospace sectors, which it said were able to offset declines in industrial and automotive markets.
The situation was equally stable for the company’s shareholders, with headline EPS up 4.9%, from 26.7p to 28.0p, while its dividend per share remained flat at 11.0p.
Morgan Advanced Materials reaction
Responding to the update, company CEO Pete Raby commented, “I am pleased with the further strategic and financial progress we have made in 2019, with our strategy continuing to deliver, enhancing our growth and profitability. In our third successive year of organic growth, revenue and headline operating profit* grew 0.8% and 4.3% respectively in a challenging environment. We expanded our headline operating profit margin* to 12.8% reflecting good operational cost control and the benefit from organic revenue* growth in our faster growing market segments.”Investor notes
Following today’s news, the company’s shares were up 2.21% or 6.40p, to 295.40p per share 25/02/20 16:38 GMT. Analysts from Peel Hunt reiterated their ‘Buy’ stance on Morgan Advanced Materials stock. The Group’s p/e ratio is 10/92, its dividend yield stands at 3.72%.FCA faces data breach after accidentally publishing customer information
The Financial Conduct Authority (FCA) warned of a data breach on Tuesday as it admitted to revealing the details of roughly 1,600 people by mistake.
“As soon as we became aware of this, we removed the relevant data from our website,” the FCA said in a statement.
The FCA said that, in a response to a Freedom of Information Act request published on its website last November, personal data “may have been accessible”.
The response related to the number and nature of new complaints made against the FCA between 2 January 2018 and 17 July 2019, the financial regulator continued.
In many cases, only the name of the person making the complaint was leaked.
The FCA warned, however, that in some instances an address, telephone number or other information were also revealed.
“Where this is the case, we are making direct contact with the individuals concerned to apologise and to advise them of the extent of the data disclosed and what the next steps might be,” the financial regulator said.
It emphasised that no financial, payment card, passport or other identity information were included.
“We have undertaken a full review to identify the extent of any information that may have been accessible,” said the FCA.
“Our primary concern is to ensure the protection and safeguarding of individuals who may be identifiable from the data.”