Footasylum (FOOT) has shocked investors with its second profit warning in only three months, sending shares in the shoes retailer tumbling to only a quarter of their value when they were listed less than a year ago. The chain set up by David Makin, the JD Sports co-founder, blamed weak consumer sentiment and delays opening new stores as it said that annual earnings were likely to be half those of last year.
Sir Martin Sorrell has said that WPP (WPP) search for new a chief executive has been a “complete waste of time” after the advertising giant named Mark Read as his successor. Mr Read, former head of WPP’s digital division, was confirmed as its boss yesterday after acting as co-chief operating officer since the resignation of Sir Martin in April.
Severn Trent (SVT), United Utilities Group (UU.), Pennon Group (PNN) – The water industry has been urged by the National Infrastructure Commission to go much further in plugging leaks after some of the biggest regional monopolies unveiled plans to patch up their pipelines but only at the minimum indicated by the regulator.
Royal Mail (RMG) has moved into the Canadian market and made its biggest acquisition since becoming a listed company in 2013, bulking up its booming parcel delivery division in the face of pressures on its letters business. The former state-owned postal service has spent about £213 million buying Dicom Canada, which specialises in delivering parcels between businesses.
Shares in Dechra Pharmaceuticals (DPH) lost more than a fifth of their value yesterday after the maker of veterinary drugs said that it had embarked on preparations for a no-deal Brexit. Dechra said that it would be setting up a laboratory inside the eurozone to ensure its products met European Union guidelines if Britain quit without a mutual agreement on testing and drug approvals.
Centrica (CNA) North Sea venture has struck a $387 million deal to join Hurricane Energy (HUR) in its efforts to extract oil from a new geological frontier beneath the seas west of Shetland. Spirit Energy’s deal is the latest in a wave of activity in the North Sea that has been prompted by a rebound in oil prices.
No easy games as Citi puts boot into Wetherspoon (J.D.) (JDW). “While special event dining will continue to support the high end and the structural growth in fast-food and delivery will continue to support the low end of the market, many listed operators risk being squeezed in the middle ground,” the analysts said, citing risks in 2019 around a disorderly Brexit and high levels of personal debt among British consumers, and therefore the company’s potential customers. While noting that Wetherspoon’s earnings quality had been “excellent”, they added that they did not expect it to “be immune from macro trends which could leave its valuation exposed”.
A firmer copper price and a fall in the pound boosted commodities prices and therefore mining stocks in the premier division. Anglo American (AAL) rose 29½p to £15.71, Glencore (GLEN) was up 3¼p to 316¾p and climbed 23¼p to £16.67.
Countrywide (CWD) fell by a further 9.8% to a fresh all-time low of 10½p after a stock exchange filing showed Oaktree Capital, formerly its largest shareholder, had cut its stake in the business to 18.2% from 30.1%
Future (FUTR) rose 25½p to 447p, after saying that its full-year adjusted cash profits were expected to be ahead of previous expectations. Future said that it had seen a positive performance from World Cup-related campaigns and had benefited, too, from some larger than expected product launches.
Codemasters (CDM) fell 23½p to 172½p after dealers were spooked by an announcement after the markets closed on Friday which showed that Old Mutual Global Investors had reduced its stake from 5.7% to 4.2%
Shares in a windows and doors retailer that has been locked in a legal battle with an aggressive new entrant to the sector leapt by more than 20% yesterday after it announced that it had reached a resolution. Safestyle UK (SFE) said that it had secured a settlement with the company that trades as Safeglaze UK, launched in 2018 by Mitu Misra, Safestyle’s founder and former sales chief.
Tempus – Dechra Pharmaceuticals (DPH): Steer clear. A perfectly healthy business, but with a valuation that seems indefensible
Tempus – Finsbury Food Group (FIF): Hold. It has adapted well to rising pressure in its market and moves into niche growth areas seem to be paying off.
