Online shareholder chat forums are a “disgrace” and should be shut down, the boss of Sirius Minerals (SXX) has claimed. Chris Fraser said that the Financial Conduct Authority should investigate the bulletin boards where retail shareholders in Sirius and other companies discuss their investments. Sirius has some 85,000 retail shareholders, some of whom have said that they have invested life savings in the mine developer. “No investment adviser with a licence would tell you to do that,” Mr Fraser, Sirius’s chief executive, said, suggesting that some had been poorly advised after turning to the online forums. “They have these people sitting in their basements in their sweatpants, giving them investment advice — unregulated, unlicensed — and people follow them.” Sirius Minerals still sees a light at end of the tunnel. Despite running low on cash the miner continues to work underground on its ambitious project.
Ramsdens Holdings (RFX) has taken advantage of the recent surge in precious metal prices and scrapped some of the gold jewellery that it had been struggling to sell. The company said that the decision would provide a one-off boost of about £600,000 to its first-half profit. Gold is seen as having “safe haven” status for its ability to retain its value even when the economic outlook is gloomy. It has been in high demand recently because of trade wars, slowdowns in leading economies and continued Brexit uncertainty.
A turnaround expert with a background in the industrial sector has been appointed chief executive of De La Rue (DLAR). The struggling banknote printer said yesterday that Clive Vacher would oversee a recovery effort intended to end more than year of turmoil at the company. Mr Vacher was previously at Dynex Power, a maker of industrial equipment, and has held senior positions at Pratt & Whitney and Rolls-Royce, the engine makers, in the past. He replaces Martin Sutherland, 50, whose planned departure from De La Rue was announced alongside a profit warning in May.
China does not plan to offer key trade concessions demanded by the United States when high-level talks resume this week. Liu He, China’s vice-premier and leading trade negotiator, has told American officials that Beijing will not commit to reforms of Chinese government subsidies and industrial policy, according to Bloomberg. The latest round of trade talks, which are due to begin in Washington on Thursday, aim to put an end to a trade war that began early last summer, with both sides imposing import tariffs on goods worth hundreds of billions of dollars.
The crisis in the construction industry was laid bare by SIG (SHI) yesterday, with the roofing and insulation group warning of rapidly deteriorating activity in the sector. That sent its shares plunging towards eight-year lows in early trading. Yesterday SIG said: “The group has been reporting during the year a deterioration in the level of construction activity in key markets and highlighting a number of key indicators pointing to further weakening of the macro-economic backdrop, notably in the UK and in Germany. This deterioration in trading conditions has accelerated over recent weeks and political and macroeconomic uncertainty has continued to increase. “The recent further weakening of the trading backdrop as the group has entered its traditionally strongest trading months of the year means that the board is now anticipating, in both the specialist distribution and roofing merchanting businesses, significantly lower underlying profitability for the full year than its previous expectations.”
Time Out Group (TMO) turned to investors in a £17.1 million cash-call with intent on feeding a growing appetite for its international branded food and drink markets. The group placed just under 13.5 million shares at a price of 127p each, a tiny premium to its closing price on Friday of 126½p. Using brokers at Liberum Capital to help with the fundraising, Time Out issued stock worth just under 10 per cent of its overall share capital. The company said that it had successfully completed the deal shortly after the market closed last night, by which time its shares had dipped ½p to 126p.
has dismissed reports that it is preparing to close almost all House of Fraser stores after the Christmas shopping season. An article in The Sunday Telegraph said that the company was either not paying rent or preparing to end the leases on 52 House of Fraser sites, having left the rest empty, so that Mr Ashley could end his association with the department stores chain more easily. However, a spokesman for Sports Direct said that the “fresh papers from administrators EY” referred to by the newspaper alluded to leases signed before Mr Ashley’s involvement and added that the company had entered into new leases on most of the chain’s stores and that it was negotiating with landlords over the rest of the estate. “As a result of this erroneous misreading of the administrators’ report from EY, staff across the House of Fraser group have today woken up to a false sense of job insecurity,” the spokesman said. “Sports Direct is working rapidly on our investment programme with the House of Fraser brand and it is therefore totally incorrect to assume that there will be large numbers of store closures in the new year. We are taking legal advice with regards to this unbelievable level of misreporting.” Mr Ashley has previously described problems at the business as “nothing short of terminal”.
Substantial cuts could be looming at HSBC’s European and American businesses under plans to shed up to 10,000 jobs. The bank is targeting both regions for cost-cuts because they have been perennial underperformers, in contrast with its fast-growing Asian business. HSBC Holdings (HSBA) employs 238,000 people worldwide, so 10,000 redundancies would be a reduction of 4 per cent. HSBC did not comment on the potential job cuts, which were first reported by the Financial Times. The drive to cut costs has been launched by Noel Quinn who was appointed interim chief executive when John Flint was ousted in August in a move that shocked the City. A large part of the reduction in employee numbers could come from selling HSBC’s retail business in France, which has been put under review. However, the bank is not planning to leave France entirely as it has picked Paris as its European hub after the UK leaves the European Union.
Marks & Spencer Group (MKS) Per Una women’s fashion range has been given a new look. “Frilly” is out and “stylishly feminine” is in. The revamp is part of a wider push by M&S to appeal to a younger audience and comes as the company puts a growing emphasis on digital sales. The retailer said that the investment behind Per Una would be across all channels, from billboards and print ads to influencers and social media.
London’s biggest companies are undervalued compared with their overseas peers, according to UBS. It also reckons that investors are starting to come round to the idea of investing in UK-listed stocks, given how cheap they are starting to look due to the recent move in sterling and outperformance of domestic shares. One way of finding unloved but decent stocks, they claimed, was to look at companies whose valuation was low compared with their ten-year median. Based on this, UBS flagged up British American Tobacco (BATS), Barclays (BARC), International Consolidated Airlines Group SA (CDI) (IAG) and Berkeley Group Holdings (The) (BKG) and Persimmon (PSN), two builders. UBS looked to unearth some gems, too, screening for businesses with a high free cashflow yield and a ratio of debt-to-earnings before tax and other charges below its ten-year average. That test threw up names such as WPP (WPP), Taylor Wimpey (TW.), and Polymetal International (POLY), while IAG and Persimmon appear again.
Micro Focus International (MCRO) hit an 18-month low after analysts at Numis slashed their forecasts ahead of a strategic review, the findings of which are due early next year. The company, which supports banks and retailers that use old IT systems, began the review at the end of August, after lowering its full-year guidance. Numis thinks that “everything is up for review”, including the possibility of both asset sales and acquisitions, although the broker believes that margins will be compromised whatever happens as investment in certain parts of the business is raised.
Totally (TLY) extended two contracts with the NHS worth £16.6 million. Its Vocare subsidiary will handle out-of-hours calls for 111 services in southwest London for another year, while a contract for the Scarborough Integrated Urgent Care unit will run on until March 2022.
GVC Holdings (GVC) should consider a move for Stars, the Canadian gambling company, according to analysts at Peel Hunt. Stars struck a deal with Flutter Entertainment (FLTR) last week to create the world’s largest online betting group worth about £10 billion. Peel Hunt maintains that Stars would fit better with GVC Holdings, which has shown that it can bed in new additions. “GVC seems to be doing a good job of optimising the performance of Ladbrokes, Coral, bwin and Party Gaming, the businesses it has acquired,” the analysts said in a research note. Peel Hunt assumes that GVC would have to table an offer about 10% above the C$32.80-a-share bid submitted by Flutter. That would leave the company with an “eye-watering” ratio of net debt-to earnings-before tax and other charges of seven times and cash interest cover of barely two times. However, synergies and strong net cash generation would lift those ratios rapidly, it said.
Tempus – Avon Rubber (AVON): Hold. Strong momentum and acquisitions justify rating
