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Tuesday Update

DB Live: Virgin Money jobs axed; housebuilders stock rises

REFRESH PAGE FOR UPDATES

5pm: William Grant buys distillery in Mexico

Drinks firm William Grant & Sons has bolstered its position in Tequila and other agave spirits with the acquisition of a distillery in Mexico, aimed at supporting the growth of its Milagro label.

Full story here

4.30pm: Investors buy into bombed out stocks

Housebuilders were the main risers after an encouraging construction PMI reading. British Land gained 4.7%, Barratt Developments closed up 2.7%, Persimmon was 2.6% higher and Taylor Wimpey gained 2.9%.

The FTSE 100 swung between shallow losses and gains to end the day just 7 points (0.12%) higher at 5,949.94.

On the FTSE 250 Watches of Switzerland lifted its full-year guidance and was rewarded with a 26% uplift in its shares.

Virgin Money

Financials were also higher, OneSavingsBank by 7%, while Virgin Money was up 6.53% after confirming 400 anticipated job cuts across the group. These are part of the forecast reduction of c.16% of FTE roles across the combined group, which was announced at the acquisition of Virgin Money by CYBG in 2018.

Investors were also hungry for shares in bombed out entertainment and travel sectors with WH Smith, TUI, Cineworld and easyJet all enjoying strong gains of between 8% and 11.4%.

It was a good day for Scottish shares on AIM. Omega Diagnostics, the Scottish medical testing company working on up to five different types of Covid-19 tests, saw its shares soar 11.7% following an investor presentation yesterday.

Calnex Solutions, which floated on Monday, enjoyed an 8.8% rise to close at 55.5p.

4pm: FSB demands support

A small business group has written to First Minister Nicola Sturgeon urging the Scottish Government to outline the support it will provide to firms if new coronavirus restrictions are announced (see below). 

Full story here

12.30pm: ‘No plan to shut down economy’ says Sturgeon

Nicola Sturgeon says there is no plan to impose another lockdown, “not even on a temporary basis”.

Full story here

11am: Seedrs loss

Seedrs, the crowdfunding platform favoured by Andy Murray, has revealed an annual loss a day after announcing a merger with Crowdcube.

Full story here

8.15am: London lower

The FTSE 100 defied predictions of a higher opening on the back of uplifts in Asia and the US (see below). It was trading 15 points (0.25%) lower at 5,927.83.

Scottish tech firm Calnex Solutions was trading at 52p just ahead of last night’s 51.5p debut close on AIM.

Surging to the top of the FTSE 250 was Watches of Switzerland, jumping 20% after upgrading guidance.

Revenue for the first 10 weeks of the second quarter amounted to £202.7 million, up 20% at constant currency and 18% on a reported basis. The second quarter ends on 25 October.

Premier Oil shares rose 14% after agreeing an all-share merger with Harbour Energy’s UK operating company, Chrysaor.

Restaurant Group was up 6.3% despite reporting a widened interim loss (see below). It said post-lockdown trade has been encouraging.

7.45am: Restaurant Group trading strongly

Wagamama, service, hospitality, restaurant

The Restaurant Group has reported encouraging trading since its estate reopened.

Having closed 128 underperforming sites since lockdown and placing Chiquito and Food and Fuel into administration, the group said that it had “confidence for the future, even if we must adapt to further challenges”.

It reported a £62.6m loss before tax for the first six months of 2020.

Wagamama was the best performing part of the business, reporting like-for-like sales growth of 11% on an adjusted basis.

Income in the 26-week period to 28 June were £227.2m, compared to £519.9m in 2019.

Chief executive Andy Hornby, the former boss of HBOS, said: “Since reopening, I am genuinely pleased with the strength of our trading performance.”

7.20am Pogo bounces

Edinburgh software development startup Pogo Studio said it is planning to grow its headcount before the end of the year following a series of recent client wins.

These include Signal Mutual, one of the US’s largest shipping and port authority insurance groups, NHS Scotland, Royal Bank of Scotland/NatWest, Miller Homes and social enterprise Hey Girls.

Founded by CEO Jack Francis in 2016 it is planning to add at least four people to its headcount of 10.

Co-operative

7am: Coop Bank CEO steps down

Andrew Bester is to step down as CEO of Co-operative Bank and as a director of its parent company Co-operative Bank Finance.

Bob Dench, chairman, has begun the process to find a successor to Mr Beester who has committed to remain until that process is complete.

He joined the Bank in July 2018 and has led a complex transformation programme delivering key milestones including separation of IT systems from The Co-op Group and a significant digitalisation programme, while also re-energising the brand and improving customer satisfaction levels.

This represents the delivery of key elements of the Bank’s strategy, enabling a simpler future, and as the Bank enters the next stage of its turnaround, he said he feels this is the right moment for new leadership and a new personal challenge.

Premier Oil and Chrysaor to merge

Chrysaor

Premier is to merge with Harbour’s UK operating company Chrysaor, creating the largest independent oil and gas company listed on the London Stock Exchange.

The all-share deal will create a company with combined production of over 250 kboepd (as at 30 June 2020). 

Full story here

Sigma buoyant

Profit before tax at the property rental firm rose 12% to £16.4m as it said the long-term opportunity is strong with family rental housing market remaining critically undersupplied.

Steve Smith, chairman of the PRS REIT, commented: “The PRS REIT continued to make good progress in its third year of activity, despite the impact of the COVID-19 pandemic.

“While construction was suspended in the fourth quarter, we reached the milestone of our 2,000th completed rental home by mid-June, and over the year as a whole added 909 new homes.  We are now at 2,634 completed homes, with a further 2,369 homes under way as we approach our target of 5,200 rental homes.”

Donald Trump with face mask

Markets bounce on Trump return

Stock markets bounced back Monday as US President Donald Trump was discharged from hospital, following treatment for coronavirus, and he immediately pledged to get back on the election campaign trail.

Traders were also cheered by hints from Congress about a new stimulus package.

Global equities recovered from Friday’s slump which followed news of Mr Trump’s illness in the run-up to the 3 November presidential election.

Asian stock markets advanced to a two-week high with Japan’s Nikkei Average risin 0.41%.

The Dow Jones Industrial closed 1.7% higher, while the S&P was 1.8% up and the Nasdaq 2.3%.

Oil prices also began recovering after last week’s heavy losses. West Texas Intermediate and Brent prices rose by around 6%. U.S. crude last stood at $39.27 up 0.13% and, Brent crude rose 0.2% to $41.37.

In London the FTSE 100 closed 0.7% higher at 5,942.94.

Today’s Agenda

* Prime Minister Boris Johnson delivers keynote Tory conference speech

* First Minister Nicola Sturgeon meets advisers to consider new lockdown measures

Today’s top Daily Business headlines

Second lockdown ‘would be unacceptable’ says Allan

Record referrals points to healthy rental market

Forbes backs call to retain tax-free visitor shopping



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