Tullow Oil (TLW) shares dropped although the trading update had few real surprises sent it plunging into the red. Scrapped exploration projects, a lower assumption about what oil prices will be in the long term and a re-evaluation of how much oil is at some of its sites in Ghana mean it will take a one-off hit of £1.2billion in its 2019 results. It has also had to suspend a pilot project in Kenya because heavy rain at the end of the year destroyed roads that led up to it. The £1.2billion blow comes after a horrific year for Tullow, when its shares lost almost two-thirds of their value, a vaunted discovery off the coast of South America turned out to be a dud and chief executive Paul McDade made a hasty exit. But, as Bank of America put it, this was an update with ‘no new shocks’. SP Angel analysts believe the £1.2billion write-down ‘will have been expected’, but that the massive drop in its share price could now make it a takeover target.
Provident Financial (PFG) made a sharp move after putting out an update that leaves the bigger picture little changed. It traded in line with its own forecasts in the three months to December and still expects full-year profits to be the same – as a strong performance in its credit card subsidiary Vanquis was cancelled out by impairments at its car finance division Moneybarn.
Aston Martin Holdings (AML) managed to shake off a downbeat broker note from analysts at Jefferies, who said the luxury car maker will need to raise ‘at least’ £400million of new cash.
Goldman Sachs took a shine to Capita (CPI), adding it to its ‘Conviction List’ and raising its price target to 240p from 200p. Capita’s shares rose to 172.45p, as analysts at the US investment bank said the risk has been taken out of the outsourcer since Boris Johnson’s landslide election victory last month.
Royal Bank of Scotland Group (RBS) fell after Barclays brokers downgraded their rating on its stock to ‘underweight’ and warned the restructuring of its Natwest Markets and Ulster arms will require patience from investors.
Top-notch results from early tests of a gold project in the Ivory Coast sent shares in IronRidge Resources Limited (DI) (IRR) up to 11.75p. The AIM-listed exploration firm, which is based in Australia, said the ‘exceptional’ data from the Zaranou site indicates a lot of high-quality gold. The area borders Ghana and is close to several other mines run by companies such as Newmont Mining. Ironridge plans to do more drilling when it has reviewed the results in more detail.
Everyman Media Group (EMAN) raked in record revenues and profits last year as film fans flocked to see hits such as Knives Out, Vice and Green Book. Blockbusters including Joker and The Lion King also drew in crowds, but Everyman said it was the less well publicised and independent movies that boosted business. Profits rose 30% to £12million in the 52 weeks to January 2, the group said in a trading update. Revenues jumped 25% to £65million – which included sales from seven new cinemas that opened in 2019.
Greggs (GRG) has joined forces with Just Eat (JE.) as it prepares to expand its home delivery service nationwide following a successful trial. The bakery chain’s decision is a coup for the takeaway app after Greggs tested it alongside rival Deliveroo in several cities last year. Greggs said that it had decided to work exclusively with Just Eat and will begin to roll out delivery this week, launching first in Bristol and Birmingham. The service will be expanded in the spring to include Manchester, Leeds, Sheffield and Nottingham, with a plan to achieve national coverage by the end of the year. Greggs chief executive Roger Whiteside said: ‘We know from the trials we have carried out that our customers love the idea that they can get Greggs delivered directly to their door.’
Persimmon (PSN) has reported a fall in revenues for 2019 after being beset by scandals over poor housing quality. The company completed about 600 fewer homes last year, with housing revenues falling by 3.5% to £3.42billion, as controversy wracked the firm. Persimmon wrote that the revenue decline ‘reflects the action being taken to ensure the Group delivers improved levels of quality and service to its customers.’ Its new-build homes only sold for an average £137 more than they did last year, at a price of £215,700, with the firm’s Westbury Partnerships division comprising a greater share of its sales. Group chief executive Dave Jenkinson commented: ‘While our plans for delivering a sustained improvement in quality go far beyond a focus on the criteria of the HBF customer satisfaction survey, our current rating, which is trending strongly ahead of the Four Star threshold, is tangible evidence of the improvement we are making.’
Vistry Group PLC (VTY) says it expects to report record profits this year. The Kent-headquartered firm believe pre-tax profits will rise above market expectations of £181.6million for the year, compared to £168.1million last year. The company recently changed its name after completing the acquisition of Galliford Try PLC businesses, including Linden Homes for £1.14billion. Vistry completed 3,867 homes – up 108 on the year before – in the 12 months to December 31, with the average selling price rising from £273,200 to £279,000. The average selling price of private houses rose to £341,000 from £337,400. It added that uncertainty arising from the general election and Brexit impacted on sales, with the cost of new homes decreasing between 1 and 2% in the last six months of the year.
Quiz (QUIZ) has seen its share price fall sharply after becoming the latest casualty of sluggish sales over Christmas. While the group fared fairly well over the Black Friday period, in the seven weeks to 4 January sales ‘softened’ and revenue slipped over 9%. Online sales fell 14.8% over the period, with the group blaming its termination of a string of deals enabling it to sell its goods via certain third party websites. The chain bemoaned falling footfall at its in-store and concession sites over the last year, revealing that sales at its bricks-and-mortar outlets fell by 7% over Christmas. Quiz websites saw revenues rise 5.9% over the period, driven by a rise in full-price sales as the company cut its promotions against the previous year.
Revolution Bars Group (RBG) says its locations raked in more than £65,000 each on average over the Christmas holidays. The Revolucion de Cuba brand operator saw both higher half-year and Christmas trading revenues last year as the firm closed three poorly performing bars and focused on improving their existing estate. Revolution reported earning £81.2million in revenue for the six months to 28 December, a £2.7million increases on the first half as well as a like-for-like sales increase of 1.2% in the four weeks to New Year’s Eve. This is the seventh year in which the Revolution Bars Group saw greater sales in the festive trading period. It now expects its full-year underlying earnings to ‘have improved in line with market expectations.’
