Restaurant Group (RTN) rocked as chief executive makes ‘untimely’ exit with the company still reeling from £559m Wagamama takeover. Shares in the Garfunkel’s and Chiquito owner tumbled 12% in early trading as news of the boss’s ‘untimely’ departure triggered a sell off. McCue broke the news to shareholders today that he will step down from his post because of ‘extenuating personal circumstances’. He will remain at the company until a successor is found. The resignation swiftly follows the group’s £559million acquisition of Japanese food chain Wagamama, which raised eyebrows when it was first announced last October. It came at tough time for the eating-out sector, with many firms axing branches and making cuts to help fend off a slowdown in consumer spending. Although the acquisition was green lit by investors, just under 61% of shareholders supported the deal.
Scandal-hit cake chain Patisserie Valerie rescued in eleventh-hour bid by Irish private equity firm. The firm, Causeway Capital Partners, struck a deal for the business in the early hours of this morning, preserving up to 2,000 jobs. The new owner intends to keep 97 of Patisserie Valerie’s 120 remaining branches open, and current chief executive Steve Francis will remain on board. Causeway is understood to have paid £13million for the business, which had a market value of £440million just a few months ago. Another brand within the Patisserie Holdings (CAKE) group, Philpotts, which has 21 stores, has been bought by family owned business A.F Blakemore & Son Ltd.
AstraZeneca’s sales of cancer drugs increased by 50% in the last year, the group’s latest results reveal. Cancer drug sales surged to £4.7billion, with a new drug for metastatic non-small cell lung cancer called Tagrisso seeing sales rise by 95% over the period. Within the last three months of the year, strong sales of new medicines and growth in emerging markets gave drugmaker AstraZeneca (AZN) a further balance sheet boost. While other companies are fretting over Brexit, with some suggesting a shortage of medicines could be on the cards, AstraZeneca is confident it is well prepared. The group said: ‘All guidance and indications provided assume that the UK’s anticipated forthcoming exit from the European Union, even in the event of no deal, proceeds in an orderly manner such that the impact is within the range expected, following the Company’s extensive preparations for such eventuality.’
Easyjet eyes fresh swoop on collapsed airline Alitalia in a tie-up with Delta Airlines and Italian rail operator. easyJet (EZJ) is eyeing a swoop on the collapsed airline Alitalia in a tie-up with Delta Airlines and Italian rail operator Ferrovie dello Stato Italiane. The budget airline confirmed last night it is discussion with the two companies about a bid for Alitalia. The Italian carrier collapsed into administration in 2017 for the second time in a decade as it continued to lose money and struggled to compete with budget rivals such as Ryanair and Easyjet. The Italian government has been searching for a buyer since. Easyjet has previously expressed an interest in making a grab for Alitalia, but talks were delayed by a political deadlock in the country as a result of a hung parliament.
Gambling giant has been stung with a £49million tax bill in Greece and Germany. The bookie said a German court found it owes £36million related to a 2012 tax assessment of Betfair Exchange, which operated there until November that year. It was also hit with a demand for taxes from 2012, 2013 and 2014 financial years which it said was related to paddypower’s interim licence in Greece. This found that the company owes £13million in taxes, which it said is much higher than the total revenue it earned in the country.
Estate agent Countrywide (CWD) said profits halved in 2018 as it fought off collapse and struggled with a market slowdown. The beleaguered company now expects full-year earnings to be £33million following the turmoil, down from £65million in 2017. Group sales fell 7% to £627million, and it wrote off £2million because some assets are worth less than previously thought. Countrywide had to raise £140million in emergency cash last year to tackle debts and has been coping with slowing growth in house prices. It comes after the business, which is behind the Bairstow Eves and Hamptons brands, issued four profit warnings last year.
Clinigen Group (CLIN) is a company that has grown to become one of AIM’s biggest constituents with a market capitalisation north of £1bn. It calls itself a speciality pharma company, but is actually much more than this. As well as having an impressive medicine cabinet of niche drugs, it organises access to life-saving medicines that don’t always have regulatory clearance. Shares rose 134.5p, to 872p, after it did a deal with Novartis to acquire US rights to a cancer drug.
The nightmare for Rolls-Royce Holdings (RR.) over faulty jet engines may be almost over, according to analysts at Credit Suisse. Rolls has been suffering for major issues with its Trent 1000 engines for the Boeing 787 Dreamliner but Credit Suisse says these problems could finally be fading. If it can concentrate on making engines rather than fixing faulty ones then it looks much more capable of hitting exacting financial targets, the broker reckons. The key for Credit Suisse is free cash flow – the spare funds thrown off by Rolls after it has invested in its operations. This can be used for expansion, reducing debt or, crucially, plumping up the dividend. With less turbulence expected, Credit Suisse raised its recommendation on shares to ‘outperform’. The focus now, from an investor standpoint, should be the reorganisation the company is undergoing and the reported strong performance of its XWB engines.
Whitbread (WTB) shares rose 2.9% to 4901p after it said it could afford to give around £2.5billion back to investors following the £3.9billion sale of Costa Coffee. Ahead of its capital markets meetings, broker Liberum was seeking more clarity following the Costa disposal. Some in the Square Mile think Whitbread, which also owns the Beefeater and Brewers Fayre pub-restaurants, is a prime takeover target, with Intercontinental Hotels Group and Marriott International tipped as potential bidders.
It was another down day for the tour operator TUI AG Reg Shs (DI) (TUI), as brokers took out the red pens in the wake of first-quarter results on Tuesday which were preceded by a profit warning last week.
Relx plc (REL) found itself on the wrong end of a downgrade to ‘hold’ from Deutsche Bank. Its media team prefers shipping journal Lloyd’s List publisher Informa (INF) which it reckons could rise 30%.
Investors chose to focus on the positives from Galliford Try (GFRD) first-half results, which came in ahead of expectations. Its Linden Homes division appears to firing on all cylinders and it expects to recover some money on the scheme to build a bypass around Aberdeen once it has wrapped up negotiations with Transport Scotland.
Shares in Tullow Oil (TLW) were in demand after it reported its first net profit in five years and said it planned to pay a dividend. Some analysts would prefer to see it reduce some of its £2.4billion debt pile instead.
