London equities started the day in a more positive mood, but have since dipped back and are currently flat on yesterday's close.
IC TIP UPDATES:
Shares in Chemring (CHG) have taken a tumble this morning despite decent interim results as news of chief executive Mark Papworth’s unexpected departure has hit confidence, he is being replaced by internal appointee Michael Flowers. Mr Papworth had been brought in to turn the business around and today’s results showed an uplift in revenues from £227.4m to £297.4m and profits up from £18m to £25.2m but operating losses widened to £63m. Our recommendation is under review.
Full year results from Carpetright (CPR) reflected continued tough trading with group revenues down by 2.2 per cent and underlying pre-tax profits halved at £4.6m. Like for like revenues in the UK dipped by 0.2 per cent and in Europe by 8.6 per cent. We retain our sell rating.
Development Securities (DSC) has acquired an office building in Dublin in a joint venture with US real estate firm Colony Capital, for €40.5m with a view to redeveloping the site into new offices. Buy.
Galliford Try (GFRD) has reached financial close on a £100m 25 year contract with Kent County Council for seven supported housing schemes for vulnerable adults with ongoing support service contracts. We keep our buy rating.
KEY STORIES:
Land Securities (LAND) has sold The Bridges shopping centre in Sunderland for £152m to clients of AEW Europe.
Tullow Oil (TLW) says that further appraisal drilling in Northern Kenya on the Ngamia-2 well has encountered more oil. Meanwhile, testing on the Agete-1 well has flowed 500 barrels of oil per day.
Bowleven (BLVN) has signed a $250m conditional farm out agreement with LUKOIL and New Age for the Etinde prospect in Cameroon, in which Bowleven will retain a 25 per cent interest.
Oil services business Petrofac (PFC) has reiterated guidance for pre-tax profit in the region of $580m-$600m for the full year, although it will be weighted towards the second half. The company has added $6.8bn or orders in the year so far and now has a backlog worth $20.1bn.
Full year results from processor technology specialist Imagination Technologies (IMG) showed a 13 per cent rise in revenues to £170.8m but slower growth in smart phones and higher one-off expenses resulted in reduced operating profits of £24.1m, down from £33.5m.
OTHER COMPANY NEWS:
Recently floated retailer Shoe Zone (SHOE) posted reduced revenues of £82.9m for the six months to 5 April but improved profits of £2.7m, up from £200,000.
Animal feed and fuel distributor NWF (NWF) says trading for the year to May has been strong and results are expected to come in at the upper end of expectations.
Kalibrate Technologies (KLBT), which provides technology to the petroleum retailing industry, says that strong trading means earnings will be ‘comfortably ahead’ of market forecasts.
