SSE PLC (LON: SSE) have reported a first half profit, causing shares to jump during Wednesday trading. This comes after a tough period of trading for SSE and a proposed sale involving Ovo.
Shares of SSE trade at 1,310p spiking 1.56%. 13/11/19 11:47BST.
The Chief Executive of SSE noted that he wanted the next government to address environmental concerns, and to take action on promoting renewable power at the front and centre of their climate change legislation.
He said: “The climate emergency needs action now and offshore wind has proven itself to be one of the most cost effective ways this country can decarbonise and get on the road to Net Zero.
“Coupled with lifting the moratorium on onshore, the next Government could deliver at least another 10GW of clean, green energy, before the end of its term – enough to power over seven million homes.”
The FTSE100 (INDEXFTSE: UKX) listed firm reported that profit rose to £128.9 million from a loss of £284.6 million last year, as SSE experienced a stagnated financial 2018, hence these results will be even sweeter.
Earnings per share reached 6.2p, up from -26.4p in 2018, which will certainly please shareholders.
However, the British Energy supplier did note a £489.1 million impairment on the sale of its household energy and services business in the UK, which Ovo Energy agreed to buy in September for £500 million.
The deal with Ovo is expected to be completed by early 2020, after the CMA triggered an investigation to check regulatory compliance.
In the energy industry, many firms have seen stagnating trading figures following tough market conditions.
Earlier this year, both Centrica (LON: CNA) and EON (ETR: EOAN) saw their shares crash following slumps in operating profits and poor trading periods.
Richard Gillingwater, chair of SSE, said: “SSE is progressing well in the execution of its low–carbon strategy with the sale of SSE Energy Services leading to group more focussed on renewable energy and regulated electricity networks.
“Clearly some headwinds remain in the sector with political uncertainty and aspects of UK government policy being subject to judicial process, however, we have strong optionality to create value through the low carbon transition and deliver our dividend commitments.”
Smiths Group plc (LON: SMIN) have seen their shares rally following a bullish trading update, published on Wednesday morning.
Shares of Smiths Group are trading at 1,674p seeing a 3.46% rise. 13/11/19 11:28BST.
Smiths Group said that its annual expectations remain unchanged following a strong trading period leading to double digit revenue growth in the first quarter.
In September, shareholders of Smiths Group saw shares rally after a ICU Medical (NASDAQ: ICUI) revived their interest in the British Engineering firm, however this approach was rejected.
The FTSE 100 (INDEXFTSE: UKX) listed engineer said revenue for the three months to the end of October was up 11% on an underlying basis, thanks to continued “good” growth in John Crane in both original equipment and aftermarket.
Elsewhere, Smiths reported strong growth in its Detection division, helped by contract wins, while the Interconnect unit was hurt by a slowdown in the semiconductor market.
The Flex-Tech Division reported organic growth after applications were reported in the aerospace and industrial sector.
“For the full year, the group expects year on year growth to be weighted towards the first half and to result in a more even balance in overall performance between the first and second halves of the year,” it said.
In an industry which is becoming increasingly competitive, rivals have also made gains.
Ultra Electronics (LON: ULE) gave a trading update that was inline with expectations, additionally Boeing (NYSE: BA) experienced a strong trading year with continued demand.
For the full year, the London-headquartered company said it expects year-on-year growth to be weighted towards the first half.
After a strong trading update from the British engineer, shareholders will be pleased about the performance from the FTSE100 listed engineer.
This could be the start of a strong trading year for Smiths Group, and throughout 2019 the firm alluded to technical and operational developments in their products.
Shareholders should remain optimistic about future outlook following the reassurance provided in this morning’s update.
Shares of Tullow Oil plc (LON: TLW) crashed on Wednesday after the oil and gas firm warned shareholders about their 2019 production figures potentially missing targets following operational problems in Ghana.
In February, Tullow hit headlines after they announced that they would shift to an annual profit after a hike in revenues, which continued throughout a turbulent 2019 for the multinational oil and gas exploration firm.
The Oil market has been hit by market volatility, and big time names such as Shell (LON: RDSB) and Total SA (LON: TTA) had been hit by low oil prices leading to slumping profits.
During 2019, London-based oil producer Tullow sees production averaging 87,000 barrels of oil per day, but 2019 guidance was cut this morning.
In July, Tullow had warned production was likely to be between 89,000 barrels and 93,000 barrels, lower than the 90,000 barrels to 98,000 barrels initially guided, which caused shares to crash on Wednesday.
The FTSE250 (INDEXFTSE: MCX) listed firm said the lower than forecast production is mainly due to topside issues at the Jubilee field, which has constrained water injection and gas handling, as well as the suspension of a well at the TEN field.
“Ghana production has not met our expectations this year, and we are working closely with our Joint Venture Partners to ensure that both fields perform to their potential,” said Chief Executive Paul McDade.
McDade added “Tullow expects to deliver robust free cash flow for the full year. This has been supported by our continued disciplined capital investment and underlines our commitment to further reduce our debt and pay returns to shareholders”.
In Guyana, Tullow added that they were working with London listed Eco Atlantic, to develop the Orinduik block after two discoveries were made in July.
Eco Atlantic and Tullow on Wednesday said initial analysis of samples suggest the two wells contain heavy crude oil with a high sulphur content, which may not be suitable for industrial use.
“Recent analysis has shown that at these locations we have encountered heavy oil. We remain confident in the broader light oil potential of the Orinduik and Kanuku blocks located in this prolific oil basin,” said Tullow.
Eco Atlantic Chief Operating Officer Colin Kinley added: “Having spent three decades working within the heavy oil industry, we are very encouraged by the initial analysis of these wells and good parameters that define potential pathways to recovery.
“The fact the oil is already hot in the reservoir, and mobile, and has high quality porous sand to travel through, helps to eliminate a great part of the conventional heavy oil challenge.”
Tullow concluded that Kenyan operations were also making good progress, with a final investment decision to be made in the second half of 2020, which may act as a consolation for shareholders.
Shares of Tullow plummeted 22.39% as a result to 159p. 13/11/19 11:19BST.
Sponsored by OenoFuture
Despite being the home of Sassicaia, Tignanello and a host of sensational Barolo producers, Italy has long been in France’s shadow when it comes to fine wine investment.
Yet as the traditional collector’s favourite Bordeaux continues to lose market share, Italy has been a key beneficiary.
The latest figures from Liv-Ex show Bordeaux’s share of the fine wine market hitting an all-time low of 49.5% in October 2019, while in the same month Italian fine wines claimed a 11.4% market share by value. Taking a longer term view, the figures are even more compelling; according to Liv-Ex since 2015 Italian fine wines on the secondary market have risen in value from £2 million to £5m with volumes rising by 1500% over the past decade.
“No one has a crystal ball”, comments Daniele Napoletano, Head of Italian Investment at the London-based fine wine investment company OenoFuture. “We live in times when a single tweet by Donald Trump can wipe billions off the markets and we’re currently in the longest stock market rally since the Great Depression. The beauty of the wine market is that the price movements are much more straightforward. Fine wine is produced in tiny quantities yet demand is growing across the world, especially from emerging economies.
firenze 07.10.09: bibi graetz, produttore di vino foto matteo baldini/guido mannucci
I always recommend that my clients also diversify their wine investment portfolio by looking beyond Bordeaux and the traditional investment regions. The remarkable growth shown by Italy over the past couple of years proves that these wines have a very exciting future ahead of them.
At OenoFuture we are privileged to have an incredibly knowledgeable team including Italian wine expert Daniel Carnio and Master of Wine Justin Knock. They have exhaustively tasted the world’s great wines and are equipped find upcoming superstars like Bibi Graetz in Tuscany before they reach blue chip prices. This kind of insider knowledge allows us to achieve exceptional results for our investment clients.”
As well as these high potential emerging producers, investors should take inspiration from the remarkable track record of wines like Sassicaia.
First released in 1968, this stunning Super Tuscan has gone from strength to strength in recent years, with the 2016 vintage awarded 100 points by Monica Larner from Robert Parker’s Wine Advocate. From a release price of £1,270 per case of 12 this magnificent wine is now trading at around £2,200.
With results like these, it’s easy to see why Italy is fast-becoming the darling of the fine wine market in the face of Bordeaux’s continued decline.
For the moment, the market is largely dominated by Super Tuscans from producers which are able to generate volumes comparable to Bordeaux’s top estates. Piedmont, on the other hand, is more comparable to Burgundy with a plethora of smaller producers, making it more the preserve of connoisseurs and those with access to fine wine investment advisors.
For Daniel Carnio, co-founder of OenoFuture, Barolo is particularly exciting for those looking to take a longer term view; “the development of the Barolo cru system with 181 ‘crus’ or growths has been a real game-changer.
Moving forward I expect to see increasing interest in Barolo across the world, and especially in markets like China where Italian wine is almost not present. Typically for emerging markets French fine wines are the first to enter, followed by Spanish, Italian, and wines from the rest of the world. For the savvy investor wanting to be ahead of the game, now is the moment to invest in Italian fine wine.”
Coca-Cola HBC AG (LON: CCH) have given shareholders a solid third quarter update, highlighted in a trading statement released on Wednesday morning.
Additionally, Coca Cola have announced that the Christmas truck will return for the ninth consecutive year.
Kris Robbens, marketing director at Coca-Cola Great Britain and Ireland, said: “Whilst Christmas is a moment of celebration, it’s also incredibly important to remember those that need support throughout the season. So we’re really pleased to partner with Crisis and whilst guests at the tour enjoy a refreshing Coca-Cola zero sugar, when they recycle their can they’ll be helping to support an amazing charity.”
After the announcement was made, shares of Coca Cola rallied 5.93% to 2,499p 13/11/19 10:36BST.
The soft drinks giant, who have established themselves as a FTSE100 (INDEXFTSE: UKX) made a bold move when they purchased Costa Coffee from Whitbread (LON: WTB) in a reported £3.9 billion deal in 2018.
The company reported “a solid performance in a quarter where poor weather impacted industry volumes in our geographies”, which led to shares rising during Wednesday trading
Coca Cola reported that FX-neutral revenue growth of 3.4%, or 2.3% excluding the impact of the Bambi acquisition.
Additionally, volumes increased by 1.1% in the quarter, -0.1% excluding Bambi whilst established markets volumes increased by 1.2%, an acceleration on the first half and prior-year period.Emerging markets volumes increased by 3.0%, or by 0.8% excluding Bambi, whilst ongoing volume growth in Romania, Ukraine and Nigeria was reported.
Group net sales revenue grew 5% from 2018 to €1,961.4 million, and bullish performance in emerging markets led to net sales climbing 9.8% to €869.4 million.
Additionally, developing markets volumes declined by 4.0%, with very strong volume growth of 11.3% in the prior-year period, which may act as compensation for stagnating growth in some EMEA Markets.
In EMEA markets, there was solid performance however trading did stagnate in Greece and Switzerland, as the soft drink giant alluded to poor weather conditions hampering trading.
Zoran Bogdanovic, Chief Executive Officer of Coca-Cola HBC AG, commented: “In a quarter in which unseasonably cold and wet weather significantly depressed industry volume growth in a number of our countries, we are pleased to have gained or maintained share in the majority of our markets and to have made progress with our commercial strategy which delivered a step-up in price/mix and ongoing growth in key areas of strategic focus such as Trademark Coke, Adults, Zeros and innovation. We are also proud to have been named by the Dow Jones Sustainability Index (INDEXDJX: W1SGI) as Europe’s most sustainable beverage company for the 6th time in 7 years.
Bogandovic added “As we look to the full year, we are pleased to have seen an acceleration in Q4, giving us confidence that 2019 will be a year of solid top-line growth and good margin expansion.”
Coca Cola also updated other investors on activity including the recent acquisition of acquisition of Acque Minerali S.r.l, a privately-held natural mineral water and adult sparkling beverages business in Italy.
This will come as a relief to shareholders of Coca Cola, who have seen a relatively successful financial 2019 with positive results being posted throughout the year.
Coca Cola expect to deliver full year FX-neutral revenue growth of 4.0-4.5%.
Avon Rubber (LON:AVON) businesses traded strongly in the second half and there is more to come this year from the acquisition of 3M’s ballistic protection business. How much it contributes will depend on the timing of US approvals of the acquisition.
Full year figures will be published on Thursday. Protection generates more than two-thirds of group revenues and dairy equipment the rest. In the year to September 2019, pre-tax profit is expected to improve from £27.2m to £30.4m.
The best performer was the military business as deliveries of new aircrew masks and powered air systems to the US Depa...
Speedy Hire (LON: SDY) is reporting interims on Thursday and growth continues to come from the smaller company customer base.
A pre-close trading statement has reassured investors that trading is in line with expectations. The equipment hire and services provider is expected to generate growth in first half revenues of 6%, with most of the growth coming from services rather than hire. Services revenues are expected to rise by 13%.
Smaller company accounts grew revenues by 27.5% in the first quarter and 25% growth is forecast for the first six months.
These are continuations of trends that mana...
The UK’s largest property investment and development company Land Securities Group plc (LON: LAND) posted underwhelming fundamentals for the half year ended 30 September.
More uplifting updates from the property sector came with Shaftesbury plc (LON: SHB) booking robust leasing activity, Berkeley Group Holdings Ltd (LON: BKG) restating its confidence in the South-East market and Redrow plc (LON: RDW) posting strong results and completions.
While the Land Securities’s revenues bounced 0.4% year-on-year to £225 million, the Group swung from a £42 million profit to a £147 million loss on-year. Further, Land Securities’s valuation deficit widened from £188 million to £368 million.
Further, although the Company’s dividend per share rose 2.7% to 23.2p on-year, their basic EPS swung from 5.9p earnings to a 19.6p loss. Also, during the six months between March and September, the Group’s net assets per share fell 3.2% from 1,341p to 1,298p.
Land Securities comments
Responding to the update, Chief Executive Robert Noel, said,
“Landsec had a good first half, delivering resilient results in unsettled market conditions.”
“We have made excellent progress on our £3.0bn pipeline of development opportunities, with 1.0 million sq ft now on site. Our new products, Myo and Fitted, have landed well with customers. We have been proactive in the tough retail market, maintaining high occupancy and protecting income. We have extended our leadership in sustainability by setting further stretching targets. And we’ve upped our pace in innovation, introducing better ways to design, construct and manage space.”
“With a general election next month and the UK’s proposed exit from the EU further delayed, we remain alert to market risks. However, Landsec enters the next six months with confidence; we’re in a strong financial position, have an exciting development pipeline and are agile enough to seize value-creating opportunities as we see them.”
Investor notes
The Company’s share price rallied 0.38% or 3.40p to 895.40p per share 12/11/19 16:35 GMT. Peel Hunt analysts reiterated their ‘Hold’ stance on Land Securities stock. The Group’s p/e ratio is 14.94, their dividend yield is inviting at 5.09%.
Managed IT services provider AdEPT Technology Group PLC (LON: ADT) saw its share price drop during trading on Tuesday, despite a sharp hike in the Company’s financial performance fundamentals during the half year to September 30th.
The Company’s revenues bounced 26% to £30.8 million year-on-year. The majority of revenue came from managed services, which jumped 39% to £25.1 million and now make up 82% of total Company revenues.
Additionally, AdEPT’s EBITDA increased by 18% to £6.1 million while adjusted profit after tax rose 4% to £3.9 million.
AdEPT shareholders also enjoyed similar progress, with the Company’s adjusted fully diluted EPS and interim dividend both up 4% to 15.3p and 5.10p per share respectively.
AdEPT comments
Ian Fishwick, Chairman, commented:
“The Group has continued with its transformation into a managed service provider for unified communications and IT whilst bringing the Group closer together under the ‘One AdEPT’ initiative christened ‘Project Fusion’. I am delighted to see the organic revenue growth that has been achieved alongside successfully continuing with our acquisitive growth strategy. The results for the period demonstrate the strength of our capex-light highly cash generative business model which is focused on high levels of recurring revenue.”
“I am pleased to see the positive results of our efforts, as trading continues to be in line with management’s expectations. We have a fully supportive investor base and funding partners, and in this converging and fragmented marketplace we will continue to pursue our strategy to identify earnings-enhancing acquisitions whilst retaining the ability to continue with our progressive dividend.”
Investor notes
Despite what appeared to be a positive update, the Company’s shares fell 9.19% or 34.00p during trading on Tuesday, down to 336.00p per share 12/11/19 15:49 GMT. The Group’s p/e ratio is 12.42, their dividend yield stands at 2.86% and their market cap is £81.30 million.
Infineon Technologies AG (ETR: IFX) booked progress in its revenues during the final quarter of the full year. Meanwhile, its other fundamentals looked appealing in a year-on-year comparison, while its income dipped in comparison with the previous quarter.
The Company saw revenue growth of 2% during the quarter, up to EUR 2.06 billion. This capped off a year of good progress, with the Group’s full-year revenues up 6% on-year, to EUR 8.03 billion.
Similar financial progress in the tech sector was enjoyed by Echoh PLC (LON: ECK), who boasted strong first half results, dotDigital Group plc (LON: DOTD), who saw their profits surge and Microsaic Systems PLC (LON: MSYS), who saw their revenues bounce.
However, Infineon Technologies did also book a notable retraction in net income between the third and fourth quarters, narrowing by 28% from EUR 224 million to EUR 161 million. Further, both its generic and adjusted gross margins dropped by approximately a percent apiece, while adjusted EPS saw a sharp dip of 17% between Q3 and Q4, down to EUR 0.19.
Infineon Technologies comments
Dr. Reinhard Ploss, CEO of Infineon, said,
“We have achieved our targets for the fourth quarter, bringing a challenging fiscal year to an end on a good note. Demand was particularly strong for our power semiconductors for renewable energy applications and our sensors for consumer devices,”
“We are feeling the effects of weak global auto demand and do not expect any improvement for the time being. The general economic environment remains fraught with macroeconomic and political uncertainty. We do not expect markets to recover before the second half of the fiscal year.”
Investor notes
The Company’s share price has bounced 6.17% or 1.14p to 19.65p 12/11/19 14:39 CET. Their dividend yield stands at 1.46%, their market cap is €23.15 billion.
