Capita (CPI) is mulling the sale of a clutch of businesses as chief executive Jon Lewis ploughs ahead with a strategy to simplify the company. Lewis is planning to sell the recently restructured specialist services division, which includes an events management arm and translation services, according to reports. Lewis took over at Capita, which has around 63,000 employees, in December 2017 when the company had been buffeted by a string of profit warnings. He wants it to move away from low-value, labour-intensive contracts to focus on hi-tech work, such as IT and providing other services to businesses, so that it stands out against competitors. Capita declined to comment.
Intu Properties (INTU) is planning to raise as much as £1billion in cash as early as next month. Intu, which owns Manchester’s Trafford Centre and Lakeside in Essex, wants to kick off a huge rights issue alongside its annual results at the end of February or soon after. Intu has told the City it is considering a number of ‘self-help’ measures. In a trading statement last year it said it was ‘likely’ to raise more cash to balance its books – which are weighed down by a £4.7billion debt pile.
One of Saudi Arabia’s richest families has become a major shareholder in Burford Capital (BUR), the litigation funder under attack from American short seller Muddy Waters. City sources said the Al Rajhi family is backing Mithaq Capital, which late last year bought a 5.1% shareholding in Burford Capital, one of the largest firms on London’s junior stock market AIM. Public documents show Faisal Al Rajhi sits on the board of Riyadh-based Mithaq Holding which, sources told The Mail on Sunday, is linked to Mithaq Capital. Faisal Al Rajhi is in turn believed to be linked to Sheikh Sulaiman Al Rajhi, who is considered the richest Saudi Arabian not a member of the kingdom’s royal family. Forbes estimates Sheikh Al Rajhi, who reportedly has 23 children, is worth $7.7 billion (£5.9 billion).
Britvic (BVIC) will overhaul its executive pay policy after being criticised for excessive bonuses ahead of its annual meeting. Chief executive Simon Litherland was paid £3.45million over the year to September 29, 2019, while new finance chief Joanne Wilson earned £732,000 after working at the company for just three weeks. Wilson’s payout was largely a £706,300 ‘golden hello’ to compensate for the loss of incentives she would have received from Tesco, where she was chief financial officer at its customer data arm Dunnhumby. Litherland’s £623,500 base salary was boosted by £2.66million of ‘performance related pay’, plus a £153,400 pension contribution and other benefits. Shareholder advisory firm Glass Lewis said it has ‘severe reservations’ and urged shareholders to vote against the firm’s remuneration report at its AGM on January 31. It said: ‘Our concerns are heightened by the generous incentive arrangement… with remuneration running consistently in advance of corresponding levels at the company’s peers.’
The Gym Group (GYM) has revealed membership numbers jumped 9.7% in 2019. The group now plans to expand into smaller towns where a full-sized gym isn’t feasible with between five and eight of these smaller gyms planned for 2020. The low-cost chain, which already has 175 gyms across the country, said that, by December 31 2019, membership had risen to 794,000, from 724,000 in 2018. The group said the aim is to open more sites in towns that may not be economically viable for a full-sized 15,500 sq ft Gym Group outlet, but could work with smaller premises. In addition, Gym Group plans to open 15 to 20 standard-sized gyms in 2020. Gym Group revenues are up 23.6% to £153.1 million, this includes average revenue per member per month – a key measure for the business – up 7.6% to £16.02 in December. Bosses put this down to increased sign-up to the company’s Live It membership programme which includes multi-site access and a bring-a-friend initiative.
GVC Holdings (GVC) has announced ‘excellent’ trading over 2019 despite the impact of new restrictions on fixed-odds betting terminals (FOBTs). The betting giant said earnings before tax and interest for the year to December 31 were at the top end of its expectations of between £670million and £680million. Despite posting lower sales from its high street bookmakers, the firm said trends in its UK retail arm are currently performing ahead of its forecasts. In April, the Government reduced the maximum stake on the terminals from £100 to £2 in a bid to help address problem gambling. Gambling firms including GVC announced significant high street closures as a result, with Ladbrokes ploughing ahead with plans to close 900 shops by April 2021.
Dixons Carphone (DC.) will update the market on its performance over the key Christmas period with a trading statement on Tuesday January 21. Investors will be hoping the chain has outperformed its rivals during what has turned out to be a difficult Christmas for retailers. The update comes amid a testing period for electronics retail, with some of Currys PC World’s rivals in the sector posting declining sales over the festive season. John Lewis & Partners said electronics and home technology sales dived 4% for the seven weeks to January 4, despite a jump in Black Friday sales. Meanwhile, retail analyst Nick Bubb said that Dixons Carphone shareholders may have been ‘concerned’ after Sainsbury’s claimed its Argos business ‘outperformed the market’ in consumer electronics. Nevertheless, investors in Dixons have had hopes raised by investment bank Goldman Sachs advising investors to buy shares in the company and raising its target share price from 130p to 170p ahead of the trading update.
MIDAS SHARE TIPS: Property group Harworth Group (HWG) brings prestige to pit clash site of Orgreave. Midas verdict: The UK needs more homes and it needs to boost productivity. Harworth helps on both fronts and its regional focus is a further plus. The company is well managed, finances are sound and prospects are fair. At £1.54 the shares are a buy.
