Equities are off a little in early trading as the month looks like ending on a sombre note. Click here to find out what The Trader Nicole Elliott thinks of the latest market moves.
IC TIP UPDATES:
Things are shining a little bit more over at gambling technology company Playtech (PTEC) after its bingo division, Virtue Fusion, agreed a five-year deal with News UK to run the Sun Bingo and Fabulous Bingo websites and mobile platforms. The sites will launch in August 2016. The deal will come as good news after the group pulled out of its bid for contracts for difference platform Plus500 (PLUS) earlier this month, which sent shares down.
Electronic parts distributor Acal (ACAL) has reported strong first half figures and confirmed that it was on track to hit full-year expectations. The group reported interim revenues of £142m, with cash profits of £7.7m. The group upped its dividend 6 per cent to 2.33p. Buy.
Both revenues and cash profits rose 3 per cent at KCOM (KCOM) in the six months to 30 September. That was driven by the Kcom business, which provides telecom services to businesses outside of Hull and East Yorkshire. We maintain our buy recommendation.
KEY STORIES:
The worst quarter for emerging market fund managers since the financial crisis inevitably dented Aberdeen Asset Management (ADN) in its full-year results. A combination of investors running scared of emerging markets, and sovereign wealth funds redeeming their investments amid continued low oil prices, dragged its assets under management to £284bn at the end of September, from £324bn a year previously. Shares fell 4 per cent in early trading.
The share price of BHP Billiton (BLT) pulled back again after Brazil announced plans to sue the owners of the Samarco iron ore miner - BHP and Vale - for $5.2bn in damages caused by the fatal burst of a tailings dam. Vale and BHP said they would establish a voluntary fund for efforts to rehabilitate the Rio Doce river system, although the extent of the likely set-aside is still not clear.
The numbers seem to be roasting over at food producer Cranswick (CWK) as the acquisition of poultry company Benson Park last year kicked in. Adjusted pre-tax profits rose 22 per cent to £31.5m and it achieved record first half sales thanks to the boost from Benson, at which a “major capital investment programme” is underway to raise production ahead of Christmas.
Bookies Ladbrokes (LAD) has announced full-year results for Gala Coral, the company it is set to buy after its shareholders overwhelmingly backed the proposed deal. Total operating profits of £205m were 1 per cent ahead of last year or 30 per cent ahead if adjusted for regulatory impacts and the World Cup. Encouragingly, online operating profits of £56m were 14 per cent ahead of last year and 99 per cent up if adjusted for the same factors listed above.
Shares in fuel cell company Intelligent Energy (IEH) fell 8 per cent after management revealed a £42.8m loss during FY15, compared with a loss of £48.2m in 2014. However revenue increased by 475 per cent to £78.2m.
Johnson Service Group (JSG) has acquired specialist linen hire and laundry group Ashbon for £6.25m. Ashbon services the catering, hotel and leisure industries and is expected to be immediately earnings enhancing.
OTHER COMPANY NEWS:
Spread betting house IG Group (IGG) released a brief update stating revenue for the second quarter will be slightly ahead of the first quarter, and the company is currently on track to meet its full-year targets. In particular management is “pleased with the ongoing strength in client recruitment” across the company’s markets.
The Paris climate talks are taking up column inches, but much attention will centre on next month’s OPEC meeting in Vienna. Pressure is building on Saudi Arabia to rein in its oil output after a year of pumping full tilt. The Desert Kingdom will face increased pressure to cut back production, but with new Iranian production set to flow onto world markets, it’s doubtful if the Saudis will pay little more than lip service to its partners in the cartel – we shall see.
The IMF is expected to confirm that it will add the yuan to its basket of reserve currencies next year; a status currently enjoyed by the US dollar, sterling, the euro and the Japanese yen. The inclusion would is an effective recognition of China's growing importance in global finance.
