Markets in London have risen on the back of decent economic data from Europe.
IC TIP UPDATES:
Demand for primary care property didn’t let up during the 12 months to March, leading to a 21 per cent increase in investment property for GP landlord Assura (AGR). The property group invested £156m in already-completed medical centres, helping push rent roll up 17 per cent to £74m. A revaluation gain of £57m, up from £36m the previous year, also helped more than treble pre-tax profits. Buy.
A drop in new buy-to-let lending during the six months to the end of March meant pre-tax profits declined 1 per cent for Paragon (PAG). Management said the 33 per cent decline was as a result of an elevated level of applications during the months preceding the introduction of the stamp duty changes for landlords last year. Paragon Bank put in a better performance, with loans to customers up almost three quarters to £2.5bn. Management raised the dividend 9 per cent to 4.7p. Buy.
Meat producer Cranswick (CWK) reported like-for-like revenue was up by 12.7 per cent in the year to 31 March, or by 22.5 per cent when the acquisitions of Crown Chicken and Dunbia Ballymena are taken into account. A record £47m of capital expenditure is going towards an upgrade at its Norfolk processing facility and building a new Continental Foods facility in Lancashire. Rising pig prices and some impact from a weak sterling were largely offset by dollar denominated exports and price increases on pork products. Shares were up about 1.4 per cent in early trading. Buy.
Shares in Greencore (GNC) were up more than 8 per cent in early trading after the food manufacturer reported that revenue was up by 46.1 per cent to just over £1bn during the six months to 31 May. This was driven in part by 16 per cent increased revenue from convenience foods in the UK and Ireland, and a 220.8 increase to US convenience food revenue. The group completed the acquisition of US-based Peacock Foods, which saw volume growth of 9 per cent on a pro-forma basis. Buy.
Renew Holdings (RNWH) put in a strong performance for the half year to March 31 2017. The group grew adjusted operating profit 15 per cent on the same period last year, while revenues were up 9 per cent. Net debt was £3.5m following the acquisition of mechanical, electrical and power services company Giffen, but a net cash position is expected by the end of this financial year. Buy.
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HomeServe (HSV) increased sales by almost a quarter during the 12 months to March, after signing up a record 100 new partners in North America. Following the acquisition of USP in North America in July, the group signed 18m new affinity partner households in the region, increasing net policy income by a third. In the UK it expanded its partnership with Aviva (AV.) to include home assistance products. Overall revenue increased 12 per cent.
Touchstone Innovations (IVO) has turned down an all-share merger offer from IP Group (IPO). The terms of the possible offer would comprise 2.1490 IP Group shares for each Touchstone share, and would result in Touchstone shareholders owning around 38 per cent of the enlarged share capital and IP Group shareholders the remainder. IP Group said it had received support for the potential offer from 51.8 per cent of Touchstone shareholders. Management made the announcement alongside its intention to raise £200m in capital by way of a placing, open offer and offer for subscription.
Shares in Severn Trent (SVT) were up slightly following release of its full year results. The group grew revenues 3.7 per cent to £1.82bn in the year, with underlying profit before interest and tax climbing 4.3 per cent to £525m. The group continued to make strong progress against its AMP6 efficiency goals, locking in £610m of savings so far while increasing its target by £100m to £770m.
Banknote and identification company De La Rue (DLAR) grew revenues 2 per cent in the full year to 25 March 2017, but adjusted profits for the period remained flat. The Identity solutions business grew revenues 5 per cent to £80.6m, the first growth since 2014. Product authentication and traceability also grew, with revenues up 20 per cent and adjusted operating profit up 29 per cent. Currency, however, saw operating profit shrink 9 per cent.
