Woodford Patient Capital Trust (WPCT), which is managed by Mr Woodford’s firm but is overseen by an independent board, disclosed in its half-year results yesterday that it had made preparations should the “ongoing economic viability” of his business be at risk. The admission that the trust is braced for the possible collapse of Woodford Investment Management underscores the seriousness of the crisis facing the man once lauded as Britain’s most successful fund manager.
Prudential (PRU) is under pressure to compensate thousands of customers quickly after the City regulator fined it almost £24 million for serious breaches in annuities sales. Prudential was found to have failed to consistently advise customers, including potentially vulnerable people, that they might get a better deal by shopping around. It also was found have operated a risky sales incentives scheme, including spa breaks and weekend holidays. The Financial Conduct Authority said that the breaches covered July 2008 to September 2017 and that Prudential has offered about £110 million in redress to 17,240 customers. The compensation is expected to rise to £250 million for about 35,000 people as part of a review of 183,000 sales. Prudential has set aside a total of £400 million, which also includes the costs of the review.
Burford Capital (BUR) has launched action in the High Court seeking to obtain the identities of traders allegedly behind the manipulation of its shares during a recent short attack. Burford Capital was rocked by a report by Muddy Waters in August, alleging that, among other things, Burford was “egregiously misrepresenting” its return on investments. The company has accused Muddy Waters of “factual inaccuracies, simple analytical errors . . . and fallacious insinuations”. It wants the stock exchange to identify the traders that it alleges manipulated the share price. In a statement submitted by Quinn Emanuel Urquhart & Sullivan, the legal firm, Burford claims that an analysis of publicly available trading data over August 6 and 7 shows that a large part of the share price decline was the consequence of unlawful trading activity known as “spoofing” and “layering”.
Ferrexpo (FXPO) has denied that authorities in Ukraine suspect its chief executive of embezzling funds from a bank that he used to own. The troubled ore producer insisted that Kostyantin Zhevago, 45, its majority shareholder, had not “received a notice of suspicion in accordance with Ukrainian law” and that he “strongly denies any allegations of wrongdoing”. Shares in Ferrexpo fell on Friday after it was reported that Olha Varchenko, first deputy chief of Ukraine’s State Bureau of Investigations, had said on Facebook that a notice of suspicion had been handed to Mr Zhevago’s lawyer after he had failed to appear for questioning in Kiev.
Goals Soccer Centres (GOAL) warned yesterday that it could owe the taxman more than it thought as the five-a-side football operator cancelled its shares from trading. The company, which had believed that it owed up to £12 million to HM Revenue & Customs for unpaid value added tax, said that it was working with advisers to establish the final sum. “The actual liability may be materially higher than that previously announced, dependent on the approach and working assumptions that could be adopted by HMRC in assessing the misdeclaration,” it said.
H&T Group (HAT) has stepped in to resolve the crisis caused by the abrupt closure of 113 stores run by Speedloan Finance under the Albemarle & Bond brand. H&T Group said that it had signed a deal to acquire all 113 of Albemarle & Bond’s pledge books, effectively acquiring its competitor’s customers and their loans. After completion of the £8 million purchase, on which the Financial Conduct Authority has been consulted, H&T will move the precious items to the owner’s nearest Albemarle & Bond shop, where they will be able to redeem or extend their existing pledges. The deal appears to address the fears of Albemarle & Bond customers, who since the closure of its shops had become increasingly concerned over the future of their valuables.
Centrica (CNA) signed a deal to buy gas from Louisiana in 2013, the deal was hailed by the British Gas owner as a “landmark agreement” that would help to “ensure the UK’s future energy security”. Yesterday the company said that the first cargo of liquefied natural gas it had purchased from the site in America’s Deep South had finally set sail — a year later than planned and destined for France. The shipment is the first under a 20-year contract with Cheniere to buy gas from its Sabine Pass liquefaction plant, one of several new developments exporting abundant fracked gas from the United States. The company reiterated yesterday that the gas it had agreed to buy was “equivalent to the annual gas demand of over two million UK homes”, but it also confirmed that it expected much of the gas to go to Asian markets, where prices are higher, as well as elsewhere in Europe.
Marks & Spencer Group (MKS) shares may have more than halved in value over the past two years, analysts at Berenberg warned yesterday that no relief was in sight. The company is in the middle of yet another transformation as it looks to address long-running issues, particularly in its multibillion-pound clothing division. Berenberg’s team expect the decline to continue, given that the clothing division’s problems are “far from fixed”, which they believe will weigh on the group’s overall performance in future. The problem, apparently, is not merely the number of M&S stores but their size, which forces the retailer to stock lines just to take up space. “Closing the top or basement floors in some of its stores could reduce the amount of inventory in the business, cut headcount (and therefore employee costs), potentially lower its rates bill and, ultimately, improve sales densities on its open space. “Without reducing store size, we believe M&S must continue to buy tail products to have sufficient range to fill its space at the expense of backing its bestsellers.”
BT Group (BT.A) edged higher on the back of weekend reports that Boris Johnson is set reveal a £5 billion subsidy to help to fund fibre broadband provision in rural areas. Analysts said that would be a boon for BT and would reduce the risk of a dividend cut.
Travis Perkins (TPK) fell after Jefferies warned that growth was likely to have slowed when the builders’ merchant publishes its third-quarter update this month, from 8% in the first half to about 4.4% over the past quarter. Jefferies said that trading in the retail division was likely to have been “difficult” over the summer, pointing to weak construction data as the UK edges towards the October 31 Brexit deadline.
Metro Bank (MTRO) enjoyed a minor resurgence amid reports that an activist investor was looking to take a stake in the challenger bank. The Sunday Times reported that Elliott Advisors was among a clutch of investors looking at Metro, which had to postpone a £250 million bond sale last week.
Advanced Oncotherapy (AVO) marched higher after it bumped up the size of its recent open offer as investors bought into the proton therapy hype. The amount raised rose to £2.9 million from £2.5 million and comes after the £18.4 million raised in July to fund the development of the company’s new Light cancer treatment system. In the past proton therapy facilities have been pricey and large, requiring a space the size of a football pitch. Light, however, is being built in the basement of a townhouse in Harley Street, central London.
Tempus – Target Healthcare Reit Ltd (THRL): Buy. Tied in to structural growth in private healthcare and reliable increases in rental income
Tempus – Computacenter (CCC): Hold. Solid long-term performer but parts of the group have been weak
