Old Mutual share price down despite strong figures
Financial giant Old Mutual (LON:OML) saw shares sink in early trading on Friday, despite reporting strong figures for the first half.
Pre-tax operating profits jumped to £969 million, from £708 million the year previously, increasing its interim dividend by 32 per cent to 3.53 pence.
Earnings per share rose 33 per cent to 10.6p.
The company’s share price sunk on the news however, as investors question whether the company is really on the road to recovery after being hit badly by a fall in the South African rand earlier this year.
In a statement, the company said its main markets “remain subject to significant political and economic uncertainties but our businesses are well managed and resilient”.
June sees slowdown across car production and construction sectors
Industrial output rose 0.5 percent in June, according to official figures from the Office for National Statistics on Thursday.
Whilst this jump surprised analysts, it is likely to be down to a of seasonal oilfield maintenance, which normally slows output. Instead, the drop will be reflected later in the year.
The same batch of figures from the ONS showed another worrying drop in car production in June, falling by 3.6 percent. This follows a 2.3 percent drop in May and signals the sharpest slowdown in nearly four years.
The construction sector, one of the UK’s largest industries, also suffered a fall in June. It fell by 0.1 percent and dropped by 1.3 percent in the second quarter as a whole.
Savills shares get boost from 30pc rise in pre-tax profits
Estate agency group Savills (LON:SVS) saw shares rise nearly 2 percent on Thursday morning, after reporting a 27 percent rise in profits.
Pre-tax profits hit £32.4 million in the first half of the year, driven by a foreign investment boom in the office market. Savills operate globally and derive two thirds of their revenue from foreign markets.
Underlying profit rose to £32.4 million in the half-year, up from £25.5 million in the same period in 2016. This was driven in part by performance in its Asian markets, alongside better-than-expected results in the UK in the face of economic uncertainty.
In the UK, the company said: “Increased levels of political and economic uncertainty created by the general election and the ongoing negotiations to leave the EU make it difficult to predict market volumes for the rest of the year.”
Savills shares are currently trading up 1.60 percent at 924.50 (1218GMT).
Bank of England announces position designed to review staff conflicts of interest
The Bank of England has announced a new position designed to identify potential conflicts of interest among its staff, in the wake of the resignation of deputy governor Charlotte Hogg.
Hogg stepped down from her post after a being reprimanded by a parliamentary committee for not declaring the fact that her brother held a position at Barclays.
The recommendation for a new position to review conflicts of interests came after a review of the Bank’s practices by the Bank’s non-executive directors. BoE Governor Mark Carney said:
“I welcome this review and its recommendations, which will be implemented in full.”
Worldpay and Vantiv seal £9.3bn merger
Payment giants Worldpay and Vantiv sealed their £9.3 billion merger on Wednesday, one month after the deal hit the headlines.
Vantiv, the US payment processing heavyweight, will merge with UK-based rival Worldpay, in a deal that will see Vantiv shareholders owning 57 percent of the business. Vantiv will pay 397p for each share, plus another £1.3 billion to cover debts.
Worldpay said: “The combination of scale and presence the merger will bring is an exciting step in the creation of a truly global leader in payments.” The board will consist of four Worldpay and seven Vantiv directors, and the combined company’s global and corporate headquarters will be in Cincinnati, Ohio. Its “international headquarters” will be in London.Hargreaves Services shares up after swinging from loss to profit
Shares in logistics group Hargreaves Services rose 8 percent on Tuesday, after swinging from a loss to £4 million profit.
The company’s performance was aided by a significant reduction in exceptional costs, to £470,000 from £12.4 million the year before. The group reported a pretax profit of £4.4 million, an impressive improvement on a loss of £12.4 million the year before.
The company, who are a logistics for for the solid fuel supply and bulk material industries, said annual revenue for the year hit £342.9 million. The company saw the biggest progress in its german operations, which generated a £25.5 million of inflow, after contracting new assets.
“These results demonstrate the excellent progress made by the group over the last year. The achievement of our group profit target was a positive step forward, which we believe marks a real turning point for the group,” Chairman David Morgan said.
“The independent property valuation exercise provides further confidence about the longer term value that we aim to create from our property portfolio. Whilst challenges remain to be overcome in some of our businesses, we are on track to achieve or over-acheive the three key strategic goals we set ourselves in 2016. We will continue to be careful in managing capital allocation and risk as we move forward”.
Shares in the company are currently up 7.59 percent at 376.57 (1238GMT).
Pets at Home shares bounce on strong revenue and sales
Shares in pet store group Pets at Home (LON:PETS) rose over 7 percent in early trading on Tuesday, after reporting strong growth in both revenue and sales.
Like-for-like sales for the 16 weeks to 1 April grew 2.7 per cent, with sales in the services division by by 18.8 percent. Total revenue came to £256.5 million, with £216.4 million of that from merchandise.
Ian Kellet, Pets at Home’s group chief executive, said he was “pleased with our positive start to the year”, and that the group had delivered another period of strong growth.
“We have continued our everyday lower price repositioning and reduced the reliance on short-term promotional discounts. We remain encouraged by the overall response to our pricing changes and by the number of both new customers and those we have welcomed back”, Kellet said.
Shares in Pets at Home are currently trading up 6.74 percent at 183.91 (1214GMT).
Housebuilder shares sink as government reviews help-to-buy programme
Shares in major UK housebuilders traded down over 5 percent on Friday, after a report suggesting that the government was reviewing its Help to Buy scheme.
An article in Property Week on Friday said: “The government has embarked on a review of the Help to Buy housing scheme, which could result in it being wound down or replaced before its scheduled end in April 2021.”
Taylor Wimpey (LON:TW), Persimmon (LON:PSN) and Barratt Developments (LON:BDEV) all saw their share price drop by around 5 percent on the news, with the Help to Buy scheme being one of the biggest initiatives to support an increase in housebuilding in the UK.
The scheme was launched in 2013 and was designed to make it easier and more affordable for first-time buyers to obtain a home. However, its effectiveness was questioned by a recent government report that said that 57 percent of those who signed up to it said they could have afforded to buy without access to the scheme.
UK car sales drop in the face of Brexit uncertainty
Sales of new cars in the UK fell by nearly 10 percent in July, marking the industry’s fourth month of decline in a row.
New car registrations fell by 9.3 percent last month, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT). The SMMT said the market was increasingly hit by “growing uncertainty” over the plans for Brexit. New regulations on exporting vehicles that may come into force after Britain leaves the EU is likely to have a severe effect on carmakers in the UK. Just under 162,000 vehicles were sold last month. So far this year, 1.56 million cars have been sold, down 2.2 percent from a year earlier. Mike Hawes, SMMT chief executive, said: “The fall in consumer and business confidence is having a knock on effect on demand in the new car market and government must act quickly to provide concrete plans regarding Brexit. “While it’s encouraging to see record achievements for alternatively fuelled vehicles, consumers considering other fuel types will have undoubtedly been affected by the uncertainty surrounding the government’s clean air plans.”DFS shares jump on Sofology takeover deal
Shares in sofa retailer DFS (LON:DFS) jumped at market open on Thursday, after it announced the takeover of smaller rival Sofology.
The deal is initially expected to be worth £25 million, with DFS saying the acquisition would add another “strong distinctive brand” to its business.
The news comes after DFS issued a profit warning last month, causing shares to plunge by 22 percent last month. The company hopes that adding specialist retailer Sofology to the group will allow DFS to compete better in the market, adding another network of 37 stores in the UK and a strong web presence to the group’s portfolio.
Ian Filby, DFS chief executive, said: “While the UK furniture retail market continues to be very challenging, we remain focused on making strategic progress to strengthen our position in living room furniture.”
Shares in DFS are currently up 1.71 percent at 223.50 (1129GMT).