Neil Woodford will today be forced to defend his struggling investment empire. In his half-yearly performance update for Woodford Patient Capital Trust (WPCT), the 59-year old is expected to insist he is committed to his long-term investing approach. Shares in Patient Capital have halved in value since January and the trust trades at a 35% discount to the underlying value of the assets it holds. Woodford’s performance is overseen by an independent board which is now under pressure to axe the fund manager. Woodford has been criticised for collecting £7.8million in fees since savers were frozen out from his flagship Equity Income fund on June 3.
Newly appointed Royal Bank of Scotland Group (RBS) boss Alison Rose faces seeing the bank dragged into court over allegations that staff illegally altered a date on a wealthy customer’s £10million loan and then accused him of fraud. The case, scheduled for the New Year, is believed to be the first involving allegations of a bank falsifying loan documents and will dash hopes that Rose’s appointment next month will draw a line under the bank’s past misconduct issues. Accountant Gary Wyatt is locked in battle with RBS over the length of a £10.5million loan that his property company Grove Park Properties (GPP) agreed with the bank in 2007. Wyatt claims the loan was for ten years, but RBS insists it was for five years.
It’s exactly five years since Tesco chief executive Dave Lewis alerted the City to a black hole in the supermarket’s accounts. This year, Tesco (TSCO) made thousands redundant to pave the way for potentially leaner times and bolster its balance sheet in the face of stiff competition from Aldi and Lidl. But Lewis must also take credit for one of the biggest turnaround jobs the retail sector has ever seen. Analysts expect that improvements to the bottom line will continue even if the top line at its core UK supermarket chain remains sluggish. Barclays said in a report ahead of the publication of interim results on Wednesday that Tesco has ‘a good story to tell’ on improving volume growth. ‘We expect these results to paint an encouraging picture on profit growth and cash generation,’ said the bank’s seasoned analyst, James Anstead, who has an ‘overweight’ rating on the stock.
This week brings Marks & Spencer Group (MKS) ‘capital markets day’ with analysts, when we can expect the company to unveil more details about its ambitious food plans under grocery boss Stuart Machin. Change at the food division is coming thick and fast – and Shore Capital’s Clive Black, a house broker, said the day is an opportunity to illustrate how talk of lower prices and improving ranges is being put into practice. That may help support the share price, which this month hit lows not seen since 2000.
Investors will have been thinking whether Thomas Cook Group (TCG) woes breed opportunity. Mark Benbow, manager of Kames Capital’s Short-Dated Yield Bond Fund, sees TUI AG Reg Shs (DI) (TUI) as a beneficiary as it is ‘the sole remaining’ travel firm ‘with any sort of significant retail store base’. He says that Tui should see a significant portion of Thomas Cook’s market share in both Britain and Germany head to them. Benbow adds: ‘The public may be worried about a repeat of the collapse of Thomas Cook at Tui but both companies have materially different balance sheets. ‘What ultimately caused Thomas Cook’s decline was not Brexit, nor margin pressures, nor a hot British summer. It was ultimately the banks pulling their funding lines. ‘They only do this when worried about a firm’s liquidity position. With Tui having almost £1.5billion of cash on hand, it is an entirely different story to Thomas Cook.’
Energean Oil and Gas (ENOG) is sizing up bidders for a $200million portfolio of assets as it focuses on becoming the biggest gas producer in the eastern Mediterranean. The firm’s chief executive Mathios Rigas has received about a dozen unsolicited expressions of interest for 19 oil and gas assets in the UK North Sea and offshore Norway – including a 25% stake in the Chinese-owned Glengorm gas field near Aberdeen. Energy analyst Kevin Swann, of Wood Mackenzie, says private equity-backed firms which could be in the running include Omani-supported Petrogas Neo, North European player Chrysaor, and Neptune Energy, founded by former Centrica chief Sam Laidlaw.
An audacious swoop on the London Stock Exchange Group (LSE) by its Hong Kong rival faces a setback after a shortfall of nearly £2billion emerged in the funding for the offer. It said a firm offer, with an October 9 deadline, would include £7.3billion in cash and new shares in HKEC worth £22.3billion.Analysts said that would require 884million new shares being issued. But a slide in the share price since then has shaved £1.7billion off the value of the bid.
The chief executive of BP (BP.) is planning to retire after almost ten years steering the oil giant back from the brink after the Gulf of Mexico disaster. Bob Dudley, an American who turned 64 this month, has reportedly held detailed talks about his retirement with BP chairman, Helge Lund. Dudley could announce his exit by the end of the year, Sky News reported. He took over as chief executive in 2010 after Tony Hayward left amid public anger over the Deepwater Horizon explosion and oil spill, which killed 11 people and cost BP around $65billion (£53billion) in fines and compensation.
MIDAS SHARE TIPS: Profit from Begbies Traynor Group (BEG), the firm that booms while others are going bust. MIDAS VERDICT: After 30 years at the helm, Traynor is as committed to Begbies Traynor as ever. He is determined to take revenues to £100million over the next three years and increase profits substantially along the way, through organic growth and acquisition. Tough economic and political conditions are likely to help him achieve his ambitions. At 74p, Begbies shares are a buy.
