Equities have dipped marginally this morning after yet more mixed data from China. Click here to find out what the Trader Nicole Elliott thinks of the markets.
IC TIP UPDATES:
Financial software specialist Fidessa (FDSA) says market conditions are improving but it still posted a 3 per cent reversal in profits for the six months to June at constant currency. Recurring revenue is now at 86 per cent of the total. Our sell recommendation is under review.
Legal services and debt management business Fairpoint (FRP) accompanied a strong trading update, with the business trading ‘materially’ ahead of last year, with news of the acquisition of personal injury specialists Colemans. An initial payment of £9m in cash and shares could be followed by another £7m dependent on performance. We maintain our buy rating.
Marble quarrying specialist Fox Marble (FOX) has warned of lower than expected first half sales although the company does have a healthy order book of €2.8m, half of which should be released this year. A fire at a supplier of equipment will also hamper output from Fox Marble’s processing facility which will hit full year performance. Our recommendation is under review.
KEY STORIES:
HSBC’s (HSBA) interim results were accompanied by news of an agreed deal to sell its Brazilian business to Bradesco for $5.2bn. Meanwhile, the bank confounded analysts expectations by announcing a 10 per cent uplift in half year profits to $13.6bn after revenues rose from $31.1bn to $32.9bn. Adjusted pre-tax profits, which strip out currency movements and one-off items, were up a more modest 2 per cent at $13bn.
The government has continued to sell down its stake in Lloyds Banking Group (LLOY), it now stands below 14 per cent.
The Emirates National Oil Company has upped its offer for Dragon Oil (DGO) from 750p a share to 800p a share in an effort to close out its offer.
Trinity Mirror (TNI) continues to grow its digital business with publishing digital revenue up by 27 per cent in the six months to 28 June but continued ‘challenging’ conditions for print publishing mean adjusted profits dipped by 2.5 per cent to £47m.
Testing specialist Intertek (ITRK) says revenue momentum and margin progression have continued in the first half of its financial year which results in a 6.3 per cent rise in pre-tax profits to £149.8m.
Construction and engineering group Keller (KLR) grew first half operating profits by 6 per cent despite a 4 per cent dip in revenues after lower contributions from major projects. Meanwhile the order book is 5 per cent higher than last year.
‘Subdued’ activity from the UK and US government sector was reflected in Ultra Electronics’ (ULE) results for the six months to June. Revenues dipped by 2.7 per cent to £331.7m while underlying profits fell by 6 per cent to £47.4m. Management continues to believe that performance will be more heavily second-half weighted.
OTHER COMPANY NEWS:
Netcall (NET) traded well during the first half of the year and management expects to report record turnover and earnings for the period.
Empiric Student Property (ESP) has spent £650,000 on a development site in Stirling which could see it build a 200-bed student accommodation unit.
