Cobham shares up with turnaround plan on track
Shares in defence tech company Cobham (LON:COB) rose on Wednesday, after it confirmed its turnaround plan was on track and trading for 2017 was in line with expectations.
The positive news comes after Cobham was forced to issue a string of profit warnings over the last two years, as “onerous contracts, including the KC-46 tanker programme, and other legacy issues” led to a fall in performance.
However earlier this year the company began a turnaround plan focusing on its three operation priorities of customer focus, leadership and simplification and control and execution. In a statement on Wednesday, the group said “performance in the first ten months of 2017 has been largely as expected”, inspiring investor confidence in its progress and sending shares up in early trading.
“As previously stated there remains a range of potential outcomes for full year performance and, as in prior years, this includes a significant level of trading activity in the final two months of the year”, the Board continued.
“Overall, the Board’s expectations for Group performance in 2017 remain unchanged.”
Shares in Cobham are currently trading up 2.20 percent at 129.80 (1036GMT).
Who remembers 2013? Bitcoin’s first amazing bull run
James Trescothick, Senior Global Strategist at easyMarketsFor me, 2013 has long stayed in my memory as a year that affected me personally – a year where one key event impacted me directly. Looking back on it now though, its seems that there are several things that occurred that year, which are now repeating. Firstly, Obama was sworn in for his second term in the big job, whereas this year we have seen another POTUS also get sworn in. Secondly, North Korea’s 2013 nuclear test caused international outrage, if not the heated exchanges of words we’ve seen this year. We also had a number of catastrophic storms back in 2013 with the tornado in Moores, Oklahoma being particularly devastating. However, there are two things in particular that come to mind that look like a direct repeat of 2013. One is the approaching potential shut down of the US Government in December. The second is the incredible bull run of bitcoin.
2013: the first year of bitcoin
In 2013, the now infamous cryptocurrency was only five years old. This was the time it first started to gain real attention from the market. In January 2013, Bitcoin was trading around $12.15 per coin and hadn’t yet showed up on anyone’s radar. Then a financial crisis occurred in March which kickstarted an incredible run for the remainder of the year. In March 2013, a financial crisis gripped the small Mediterranean island of Cyprus. The country was forced to request a $13billion bailout from the European Union and the International Monetary Fund. The terms of the rescue package were that Cyprus Central Bank had to raise $7.5 billion by taxing bank deposits. Cash restrictions on the populous were implemented to avoid a potential bank run and large depositors ended up losing as much 10% of their held capital. One of major retail banks was forced to close and banks across the country were closed for a number of weeks. I live in Cyprus and it wasn’t pleasant. Despite Cyprus having a population of fewer than one million people, these events caught the attention of the media all over the globe and the island was in many a headline. Interestingly, it also caused people to take note of the potential of bitcoin. Due to what had happened with the Cypriot Banks, bitcoin started to gain in popularity due to the fact that it was unregulated and no government or bank could touch it. At the beginning of March 2013, bitcoin was trading at around $32.20 per coin. By the end of March, following the Cyprus crisis, it had risen to $90.52 per coin. It continued it move higher over the course of April, touching an all-time high (of the time) of $234.52. During the following months, it traded between a low of $66.83 and a high of $196.24. Then, suddenly, in November 2013, bitcoin exploded. Bitcoin opened the month at $194.42 per coin. By the end of the month, it closed at a huge $1,113.06 per coin. 2013 for the first time was hailed as the year of bitcoin. The following month, bitcoin went on to hit a new high of $1,242 per coin due to increased demand from consumers in China – until the Chinese Government thought enough was enough and stepped in and barred all banks from handling bitcoin transactions. After that intervention, and a number of high profile court cases and rumours of hacks, bitcoin collapsed, hitting a low of $100.91 per coin in August 2014. However, that is the lowest it went. From there, over the next two years, it traded fairly side wards until January 2017 – and we all know what has happened since then! Now the question to ask, of course, is:Will we see a repeat of what happened at the tail end of 2013?
First of all, like 2013, we’ve had further intervention by the Chinese authorities and other governments. However, as yet it hasn’t stopped this year’s incredible bull run. We’ve also seen many voices crying out “bubble” and “scam,” but again bitcoin traders have brushed this off. The biggest difference between this year and 2013 is that, despite the skeptics, we’re now seeing some real players in the market start to embrace bitcoin, with the CME Group the latest exchange to announce its intention to launch bitcoin future contracts. So will we have a reversal with bitcoin like we saw at the end of 2013? Only time will tell for sure. However, as long as the interest in this cryptocurrency continues, the chances that bitcoin could keep on rising may remain intact. Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd-CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd- AFS license No. 246566). Blue Capital Markets LimitedUK inflation stays steady at 3% in October
UK inflation remained at 3 percent in October, according to the latest figures from the Office for National Statistics, its highest ate for over five years.
Groceries saw the biggest price increase over the month, with market researcher Kantar Worldpanel saying grocery inflation was at 3.4 percent in the 12 weeks to November 5th.
This was marginally offset by a fall in fuel prices and furniture but the majority of prices have been hit negatively by the impact of Brexit, which has increased the cost of important goods. The figures were not unexpected, with the Consumer Prices Index expected to rise after the Bank of England forecasted it would peak at 3.2 percent this autumn. This remains well above the government’s 2 percent target.ITV shares sink despite increase in online presence
ITV’s (LON:ITV) share price sunk in early trading on Tuesday, after broadcast and online revenues sunk in the nine months to September.
Total ITV Studios revenue rose 9 percent to £1,009 million over the period, up from £923 million during the same period last year, boosted by good organic growth. However, total external revenue fell 1 percent to £2,132 million with broadcast & online revenues also down 4 percent to £1,470 million.
ITV reiterated that it remained on track to deliver full year commitments for 2017, with good organic revenue growth keeping profit broadly in line with last year.
ITV’s performance was boosted by the attraction of a younger audience, with Online and Pay services achieving double digit revenue growth. Online viewing saw a 41 percent increase, proving that the broadcaster’s investment in digital businesses, including the ITV Hub and Britbox US, may have paid off. ITV Hub has 21 million registered viewers, including around 75 percent of the UK’s 16 to 24 year olds.
Investors failed to be impressed by the broadcaster’s online growth, however, with shares in ITV currently trading down 2.45 percent at 150.22 (1048GMT).
FirstGroup share price drops as hurricanes hit profits
Shares in transport operator FirstGroup (LON:FGP) fell over 2 percent in early trading on Tuesday, as an increase in revenue failed to offset a £2 million loss.
Group revenue rose 8.1 percent, as the new South Western rail franchise and favourable foreign exchange had had a positive impact on figures. Even excluding these factors group revenue saw an increase, moving up 0.9 percent.
Poor weather in the Americas hit profits, with severe hurricanes in the region affecting contracts in Puerto Rico and sending adjusted operating profits down 9.1 percent. Solid trading in other regions offset these figures to see operating profits as a whole remain flat.
However, its share price was hit on Tuesday morning as the Group, which operates three rail services in the UK and the Greyhound bus service in the US, reported a £2 million loss for the six months to September. This is a sharp drop from the pre-tax profit of £11 million reported in the same period in 2016.
Commenting, Chief Executive Tim O’Toole said:
“The overall trading performance and significantly increased free cash generation of the Group in the first half was consistent with the plans we outlined at the start of the financial year.
“In the second half we will benefit from our normal seasonal bias, our ongoing focus on cost efficiencies and from additional business which commenced in the period, including the South Western Railway franchise. We expect to make further progress and deliver substantial free cash generation for the year as a whole.”
Shares in First Group are currently trading down 2.27 percent at 107.40 (1016GMT).
Toshiba hit again as sold business arm records highest sales
Troubled electronic manufacturer Toshiba (TYO:6502) recorded an increase in operating profits in the half-year to September, despite most of the increase coming from a business they have agreed to sell.
The company’s 76 percent jump in operating profit was driven almost entirely by an increase in sales at its memory chip business, which it agreed to sell in September to a group led by Bain Capital for around $18 million.
Toshiba agreed to sell the business to offset liabilities issuing from its US nuclear unit Westinghouse, which almost bankrupted the company last year. The giant came close to having its shares delisted this year after delaying the publication of its financial results for a second time as it struggled to get its accounts in order.
Despite reporting a big increase in operating profits, Toshiba still posted a $436 million net loss during the most recent period. Its shares are currently trading down on the Tokyo exchange, down 2.49 percent at 313.00 (1206GMT).
Halfords shares fall as weak sterling impacts on costs
Shares in retailer Halfords (LON:HFD) fell over 6 percent on Thursday morning, after profits were hit by the weaker pound.
The company reported a strong increase in revenue over the financial year, with total group revenue up 3.8 percent and 1.5 percent on a like-for-like basis. Halfords said that it anticipated
group profit before tax for the 2018 financial year to be in line with current market expectations.
However correlating with previous guidance, the depreciation of Sterling is likely to have a continued impact and add a £25 million cost increase, £15 million of which was evidence on the cost of goods in the first half.
Jonny Mason, Chief Financial Officer & Interim Chief Executive Officer, said the group’s “mitigation plans are on track”, pointing investors towards the “positive sales growth for this period, despite the poorer summer weather and the uncertainty in the UK economy”, rather than the profit impact of higher costs.
“Looking ahead, we have strong plans both in-store and online for the Cyber, Christmas and winter peaks”, Mason said.
Shares in Halfords sunk on Thursday morning, however, and are currently trading down 5.80 percent at 313.39 (1139GMT).
Burberry shares fall 10pc on growth plan costs
Shares in luxury brand Burberry (LON:BRBY) tumbled over 10 percent on Thursday morning, as investors shied away from the high costs of CEO Marco Gobbetti’s growth plan.
The group made the announcement alongside a strong set of first half results, with revenue rising by an underlying 4 percent to £1.26 billion over the six months to September. Comparable sales rose by a better-than-expected 4 percent, with adjusted operating profit up 17 percent to beat forecasts at £185 million.
The company also laid out a growth plan for going forward, in the wake of the shock resignation of Chief Creative Officer Christopher Bailey. It aims to enhance the brand’s exclusivity, cutting sales to non-luxury stores and creating a new range every season.
However investors baulked at the cost of the plan, with Chief Financial Officer Julie Brown telling reporters that total restructuring costs would likely hit £110 million, almost double the previous estimate.
Capital expenditure would be £150-160 in the 2019 and 2020 financial years, growing to £190-210 million after.
CEO Marco Gobbetti said he was “pleased” with the group’s performance over the first half, adding that “consumers responded positively to fashion and newness, particularly in rainwear and leather goods” Digital revenue grew in all regions, led by mobile, while growth was strongest in Burberry stores in Asia Pacific. “I look forward to building on our strong foundations as we implement our strategy to drive Burberry forward”, Gobbetti concluded. Shares in Burberry are currently trading down 9.87 percent at 1,789.00 (1031GMT).Tencent snaps up 10pc share in Snapchat, despite weak results
Chinese internet giant Tencent has taken a ten percent share in Snap (NYSE:SNAP), with the announcement coming just a day after the company reported a disappointing set of earnings for the third quarter.
The Chinese company have taken a roughly 10 percent stake in Snapchat parent Snap, according to documents released on Wednesday from the Securities and Exchange Commission, furthering their already large investment in the company.
The news will come as a welcome show of confidence in Snapchat, after the social media app shocked analysts with a poor set of figures for the third quarter. Revenue came in at $207.9 million, lower than the $236.9 million expected, with daily active users also well beneath the expected figure of 181.8 million.
Average revenue per user also disappointed, at $1.17 instead of $1.30 expected. The company also posted a net loss of $443.2 million, furthering speculation that the company has been grossly overvalued since its IPO in March.
Snap shares fell over 11 percent in pre-market trading.
OneSavings Bank shares jump on strong loan book growth
Challenger bank OneSavings (LON:OSB) saw its share price jump nearly 4 percent on Wednesday, after it increased its full expectations for loan book growth to 20 percent.
The bank hit a 17 percent increase in its loan book during the first nine months of the year, with net loans and advances rising by £997 million pounds to £6.9 billion. After the better-than-expected performance in the first half of the year, OneSavings raised its growth estimate from a figure in the high teens to 20 percent.
In 2016 the group grew its loan book by 16 percent to 5.9 billion pounds.
OneSavings bank, a ‘challenger’ bank hoping to offer a more modern alternative to the traditional banks with increased online services and transparency, recently increased its focus on professional landlords. Going forward the bank are aiming to lend more to professional institutions rather than amateur buy-to-let investors.
Shares in OneSavings are currently trading up 3.50 percent at 411.40 (1403GMT).