Equities have dipped back only marginally after yesterday's decent showing as Chinese data confounds again. Click here for The Trader Nicole Elliott's latest views.
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Shares in Laird (LRD) plunged 48 per cent after the wireless connectivity group warned the expected second-half rally in performance had failed to materialise. Management said the ramp-up in production of mobile devices came much later than in previous years, visibility on volumes remains poor, and the group’s margins have suffered from “unprecedented” pricing pressure and operational factors. The upshot was a weak third-quarter performance. Under review.
One of Aim’s star performers of recent years has outgrown its original home. Medicinal marijuana specialists GW Pharmaceuticals (GWP) have today announced its intention to de-list from London’s junior market and set up camp exclusively on the tech-savvy NASDAQ index, where it has had a dual listing since 2013. Since joining Aim in 2001 GW Pharma’s share price has multiplied by more than 4.5 times - pretty impressive for a company that still isn’t making any money. Existing shareholders will now have the option to convert their ordinary shares into American Depository Shares (ADS).
Horizon Discovery (HZD) has signed an agreement with yet another new partner for the licensing of its novel cell lines. The partner remains un-named for now and the agreement represents the first subscription deal for Horizon and will be valued at a minimum of £500,000. Investors will no doubt be relieved by a bit of good news after a few months of a falling share price following the group’s decision to close down its Boston manufacturing plant. We still like the long term prospects for Horizon which is well positioned to be a key player in the fast growing personalised medicine market. Buy.
Vedanta, a small biotech company belonging to IP group PureTech Health (PRTC), has been granted a European patent for one of its strains of bacteria. The use of good gut bacteria for therapeutic benefits - known as microbiome modulation - is a rapidly growing area of science which we don’t feel is adequately reflected in the value of Vedanta. This in turn leaves holding company PureTech undervalued, which is why we rate these shares a buy.
OMG (OMG) expects to report over £29m in revenues for the year to 30 September, ahead of market expectations. Its Vicon motion-capture business benefited from new products and the stronger US dollar in the period, while its Yotta infrastructure asset management division profited from a stronger stream of recurring revenues. Buy.
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Dettol and Vanish maker Reckitt Benckiser (RB.) hasn’t completely cleaned up in its most recent quarter of trading. The health and hygiene product manufacturer failed to register like-for-like sales growth in its Europe, North America and Australia/New Zealand division (65 per cent of revenue) for the third quarter with performance flat on the same period in the prior year. But its developing markets division made up for this with like-for-like sales in the quarter up 7 per cent to £788m. This left group like-for-likes up 2 per cent - although total sales at actual exchange rates rose 17 per cent thanks to its overseas earnings translating better into the weaker pound. It’s hygiene segment performed the best with sales up 5 per cent but its home division continues to suffer from the humidifier sanitisation product issue, which recently saw Reckitt pay out £300m in compensation to victims of lung damage and possible death in South Korea. The company is now targeting full-year revenue growth of 4 per cent instead of the “lower end” of the 4-5 per cent range which it said in July.
The mystery behind Advanced Oncotherapy’s (AVO) falling share price has been explained by the fact that residents of the Harley Street area were campaigning against the opening of the group’s proton beam cancer therapy centre. The news hit the tabloids earlier in the week when Dame Barbara Windsor signed her name on the petition. However this morning the company has announced that the residents petition has been declined and the proton beam centre will go ahead as planned. AVO’s share price has responded accordingly, up 13 per cent yesterday and another 3 per cent this morning.
Managed IT services provider Softcat (SCT) grew sales by 13 per cent in the year to 31 July, driving adjusted operating profits up 15 per cent to £46.8m. Management highlighted its focus on customer service, which helped it to win large numbers of new customers and boost spending among existing ones.
Rentokil Initial (RTO) grew sales from its continuing operations 17 per cent during the three months to the end of September. Around 13.5 per cent of this growth was due to 13 acquisitions made during the period. The pest control business increased organic sales 6 per cent, completing work in partnership with the Rio de Janeiro health authorities in advance of the Olympic and Paralympic games.
Travis Perkins (TPK) delivered a mixed trading update that pushed the share price down over 5 per cent. Consumer sales grew by 9.1 per cent in the third quarter to September, but the plumbing and heating division saw sales down by 3.9 per cent. Steps to counter this weakness include closing over 30 branches, and cash profits for the full-year are expected to be less than the current market consensus of around £415m.
London focused estate and letting agent Foxtons (FOXT) continued to experience reduced transactional volume on house sales, although strong renewals helped to underpin rental income which showed a modest increase in the third quarter to the end of September. Tight cost control has protected margins, while new business from the institutional private rented sector is growing. Full year numbers are expected to be in line with expectations, and the group remains highly cash generative with no debt.
