Former Tesco executive Carl Rogberg cleared of fraud. The former UK finance director of Tesco (TSCO) has been acquitted of a fraud in the latest embarrassing blow for the Serious Fraud Office and Britain’s largest supermarket group. Carl Rogberg, 52, was formally found not guilty this morning at Southwark crown court after the SFO said that it had no evidence to present against him. It comes nearly a year after the first trial was abandoned when Mr Rogberg had a heart attack and just over a month after a second trial, involving two other former Tesco employees, collapsed when a judge ruled that the SFO had no case. The final acquittal today means that more than four years after Tesco first revealed a potential accounting fraud and agreed to pay a fine of £129 million as part of a deferred prosecution agreement (DPA) with the SFO, no Tesco executive has been found guilty of any fraudulent activity.
Metro Bank profit warning rattles investors. More than £600 million has been wiped off the value of Metro Bank (MTRO) following a profit warning that sparked concerns that it may have to raise more capital. Shares in the challenger high street bank plunged by 656p, or 29%, to £15.46 after it revealed in an unscheduled trading update that its capital position had tumbled and that its annual profits had fallen well short of market expectations. Although underlying pre-tax profits more than doubled to £50 million in 2018 from £21 million in 2017, they still significantly missed analyst forecasts for £59 million. Metro’s capital ratio — a gauge of the bank’s financial strength — also fell to 15.8% from 19.1% at the end of September, spurring speculation that the lender might have to sell shares to bolster its finances.
Computacenter upgrades its revenue to £4.1bn. Higher IT spending in Britain and Germany has helped Computacenter (CCC) to upgrade its full-year results forecast, sending its shares to the top of the mid-cap index. In a trading update, the provider of cloud services and seller of PCs, servers and software to big listed companies, said that overall revenue for the year ended December 31 grew by 7% to about £4.1 billion, excluding currency fluctuations. The group’s international division saw a 13% rise in fourth-quarter revenue, against a 10% rise in the UK, an 8% rise in Germany and a 4% fall in France. It comes after the company reported a 3% dip in third-quarter revenues in October, sending shares down 13% in a single day. However, the board now expects full-year results to be marginally ahead of expectations. Investors were impressed, with the statement sending shares up 72p, or 7%, to £10.90.
Patisserie Valerie goes bust as rescue talks fail. More than 3,000 jobs at risk after £40m ‘fraud’ sinks café chain. Patisserie Holdings (CAKE) collapsed into administration yesterday, putting more than 3,000 jobs at risk, after an alleged £40 million fraud that left it unable to pay back huge overdrafts. The announcement brought to a close months of speculation about the future of the café chain, which revealed in October that it had discovered “significant, potentially fraudulent accounting irregularities”, prompting an investigation by the Serious Fraud Office. Once a darling of the junior Aim market, the company rose to be valued at £511 million at its peak last June. Its value is now destroyed, with Luke Johnson, its executive chairman, losing an estimated £189 million personally.
Easyjet counts £15m cost of drone disruption at Gatwick. Disruption to aircraft caused by rogue drone flights in and around Gatwick has cost easyJet (EZJ) £15 million. The largest airline operator at Britain’s second biggest airport said that it was seeking compensation from Gatwick after a drone sighting brought flights to a standstill during the pre-Christmas travel rush. Revealing the impact alongside its first-quarter results, Easyjet said that 82,000 customers had been affected and more than 400 flights cancelled. Easyjet said that it had lost £5 million in revenues and £10 million in costs, including for customer “welfare”, such as hotel accommodation and food vouchers. The airline, which is based in Luton, was founded in the mid-1990s by Sir Stelios Haji-Ioannou, who remains its biggest shareholder, and expanded by offering lower-cost flights to the mass market on its fleet of A320 Airbus jets. The company is valued at about £4.9 billion and employs more than 10,000 people. Johan Lundgren, Easyjet’s chief executive, said that the drone disruption had been a “wake-up call for a lot of airports” and not only a “UK issue”. However, he was “disappointed that it took a long time to resolve” the problem at Gatwick.
Pets chain makes sure Brexit will be no dog’s breakfast. Up to £8 million of dog food and other products are set to be stockpiled by Pets at Home Group (PETS) as the retailer braces for a hard Brexit. The pet accessories and veterinary chain said that it had drawn up plans to buy extra stocks in the event of disruption at British ports. It joins other retailers, including Tesco and Marks & Spencer, that have said they are building up reserves to prepare for a “no-deal” Brexit. Pets at Home sources the majority of its products from Britain and the Far East, but it said that it was nevertheless a “sensible and pragmatic” move to prepare for potential upheavals in supply lines from mainland Europe.
Sirius fears mine project delay as ministers cut funding guarantee. Funding plans for a giant fertiliser mine under the North York Moors have been delayed after the government sought to limit taxpayers’ exposure to the project. Sirius Minerals (SXX) is counting on government loan guarantees to help it to secure the $3 billion of debt and as much as $600 million in other funding that it needs to develop the Woodsmith mine near Whitby. It had been expecting to reach a point where conditions had been satisfied and it could consider accessing the funding this quarter, but Chris Fraser, its chief executive, admitted yesterday that it was likely to take longer under revised plans drawn up after the Treasury asked it to “minimise the risk to the taxpayer”.
It’s game on as Dixons Carphone lifts sales. Strong demand for televisions and gaming equipment boosted sales at Dixons Carphone (DC.) over Christmas. The electricals retailer said that like-for-like group revenue had risen by 1% in the ten weeks to January 5, including a 2% comparable sales increase in its UK and Ireland electricals business. Though like-for-like sales in its struggling mobile phones business fell by 7%, Alex Baldock, chief executive, said that the group was still on track to make a full-year, pre-tax profit of £300 million.
Kier chief makes tracks after rights issue failure. The chief executive of Kier Group (KIE) has left the construction group following a failed deeply discounted rights issue last month. Haydn Mursell, 48, will be replaced temporarily by Philip Cox, who will become executive chairman until a new chief executive is appointed. Mr Cox said: “The board believes that, following the completion of the recent rights issue, now is the right time for a new leader to take Kier forward to the next stage of its development.” Kier, a housebuilder and construction company involved in projects such as Crossrail, launched the £264 million rights issue on November 30 to reduce debt and bolster its balance sheet after the banking sector reduced its exposure to the construction sector in the wake of the collapse of Carillion.
Ex-Janus boss Andrew Formica snapped up by Jupiter Fund. The former chief executive of Janus Henderson who quit the asset manager unexpectedly last year is to become the next boss of Jupiter Fund Management (JUP). Andrew Formica, who had shared his role at Janus Henderson with another executive, is to replace Maarten Slendebroek at Jupiter later this year. Mr Formica, 47, had surprised the City by stepping down from Janus Henderson last July, when he left with $12 million in severance pay. Jupiter was founded in 1985 as an investment boutique. Its shares have slumped by more than 40% in the past 12 months after investors, nervous of volatile markets, pulled out their funds. Its assets under management slid by £5 billion to £42.7 billion in the final quarter of last year. Jupiter said that it had sped up its plans to find a replacement for Mr Slendebroek, 55, who has led the business since 2014, after Mr Formica unexpectedly became available.
Redcomb brews up Young’s deal. A pub and restaurant business founded ten years ago by two friends is in talks with Young’s over a sale that could value the company at about £30 million. Young & Co’s Brewery ‘A’ Shares (YNGA), the pub chain, is understood to be in advanced discussions about a deal to buy Redcomb Pubs, which runs 15 sites in London and the Home Counties, including The Old Shades in Whitehall and the Station Hotel in south London. Redcomb was set up by Dan Shotton and Mark Draper in 2009. A deal would add to Young’s estate of more than 250 managed and tenanted pubs, which are mainly in London and the South East.
The world’s biggest listed miner may have repaired the physical damage from its runaway iron ore train, but it is still nursing the financial wounds from the debacle. The train tore more than 50 miles through the Australian outback in November without a driver before being deliberately derailed, damaging a one-mile stretch of track and temporarily halting its iron ore exports. Yesterday said that the fallout from the crash had resulted in its iron ore production in Western Australia being four million tonnes lower than expected in the six months to December. Together with further problems at two copper mines, it said that “productivity” in the half-year had taken a $600 million hit. That compares with $1 billion of productivity gains that it had been targeting over its financial year, which runs to the end of June. The company said that it was still on track to meet its production volumes for its financial year, thanks to a stronger performance expected in the second half — in fact, it upgraded its outlook for copper production — but it also said that “productivity guidance for the full year is currently under review”, with revised guidance to be issued alongside its half-year results.
Aggreko (AGK), which provides temporary power to events, fell 37p, or almost 5%, to 711p after Peel Hunt downgraded the stock to “reduce”, from “hold”. The broker cited fears that the “fragile global macro-economic backdrop” was likely to lead to “customer hesitancy” and greater “off-hire risk,” where companies opt to cut power consumption.
Zoo Digital Group (ZOO), a provider of cloud-based subtitling services for television and film, lost nearly half its market value after warning of lower revenues because of the loss of a “material” contract and lower revenues from the processing of legacy DVD and Blu-ray titles in the second half. It said that the DVD and Blu-ray market decline had accelerated more quickly than anticipated as it cut its full-year revenues forecast by 10%. Stuart Green, chief executive of Zoo and its biggest shareholder, said that with several big media companies announcing their intention to launch streaming services, there was “no doubt that the market will continue to expand significantly and with it the growing demand for the premium services offered by Zoo”. Its shares fell 50½p to 64½p.
Accrol loses its finance chief . The finance chief of Accrol Group Holdings (ACRL) has stepped down from his role, only a day after the troubled tissue paper maker said that it was being investigated by the City watchdog Steve Townsley has given up the role for health reasons less than a year after taking it on last June. Accrol emphasised that his exit was not linked with the Financial Conduct Authority’s inquiry, which is examining statements that the business made to the stock market between April 1 and November 20, 2017, when Accrol announced an £18 million fundraising to shore up its finances. News of Mr Townsley’s decision came as Accrol unveiled a first-half loss before tax of £9 million, up from £6 million a year earlier, and a 20.3% fall in revenues to £57.6 million. However, the board said that it expected the company to turn a pre-tax profit of about £1 million for the year to the end of April.
Tempus – Cairn Energy (CNE): Hold. Uncertainty over tax case decision but patient shareholders could benefit from share price appreciation and chance of special dividend
Tempus – IG Group Holdings (IGG): Hold. Market leader should recover as the regulatory environment stabilises
