Persimmon (PSN), Vistry (VTY), Taylor Wimpey (TW.), Barratt Developments (BDEV), WeWork (US:WE), Associated British Foods (ABF), Restaurant Group (RTN), Watches of Switzerland (WOSG), 4imprint (FOUR), Foxtons (FOXT), XP Power (XPP), RS Group (RS1), Hilton Food (HFG) and Zotefoams (ZTF)
Shares in the FTSE 350 housebuilders rose this morning after Halifax said house prices increased for the first time since March. Persimmon (PSN) and Vistry (VTY), which also posted trading updates, were up 4 per cent in early trading, while rivals Taylor Wimpey (TW.) and Barratt Developments (BDEV) were up 2 per cent.
The value of the average UK home ticked up 1.1 per cent in October on a seasonally adjusted basis after six consecutive months of falling prices. "Prospective sellers appear to be taking a cautious attitude, leading to a low supply of homes for sale," said Halifax. "This is likely to have strengthened prices in the short-term, rather than prices being driven by buyer demand, which remains weak overall."
In its update, Persimmon posted a drop in sales and completions and said it had increased sales incentives due to buyer hesitancy. Meanwhile, as per its shift towards bulk pre-sale activity, Vistry revealed an £812mn deal to deliver 2,915 homes for two private equity funds who plan to rent the properties. ML
Read more: Is it fair to be down and out about housebuilders?
WeWork collapses into bankruptcy
WeWork (US:WE), the flexible office operator that private markets had once valued at $47bn, has collapsed into bankruptcy. Founded by Adam Neumann, the company has never made a pre-tax profit and has billions in liabilities from bank loans used to fuel its expansion and lease debt used to rent its buildings.
The company said its locations outside of the US and Canada are not part of the bankruptcy process, a relief for the UK landlords who have WeWork as a tenant. "Now is the time for us to pull the future forward by aggressively addressing our legacy leases and dramatically improving our balance sheet,” said chief executive David Tolley. ML
Read more: WeWork's peril presents an opportunity for rivals
Pizza Express owner goes cold on Wagamama
Pizza Express owner Wheel Topco has decided against making a competing offer for Wagamama owner Restaurant Group (RTN).
Last month, Wheel Topco asked for information on Restaurant Group as it pondered making an offer for the business to top the £701mn bid already received from private equity giant Apollo. However, this morning Restaurant Group said that Wheel Topco isn’t planning to bid, “due to market conditions”. Restaurant Group shares fell by 3 per cent in early trading. CA
Foxtons chases steadier profits
Foxtons (FOXT) has bought a lettings agency for £10mn as it further shifts its business towards the high activity of the London rental market. The £119mn market cap London-based agency snapped up Ludlow Thompson, which comprises seven London branches and generates 70 per cent of its revenue from lettings, to "drive recurring and non-cyclical earnings growth".
"The acquisition reflects continued progress against our acquisition strategy and our focus on growing recurring lettings revenues, and further supports the delivery of our £25m to £30m operating profit ambition in the medium term," said Foxtons' chief executive Guy Gittins. ML
Read more: The FTSE's hidden property gems
XP Power raises £45mn to prop up balance sheet
Shares in beleaguered equipment maker XP Power (XPP) jumped by almost a quarter this morning after the results of a fundraise were announced A total of 3.8mn shares have been placed by Investec Bank, raising gross proceeds of £43.9mn. Meanwhile, over 130,000 new shares have been subscribed for in a retail offer, raising approximately £1.5mn. Together, the offer shares represent a fifth of XP Power’s existing share capital.
The proceeds of the fundraise will be used to reduce net debt, improve liquidity and refinance capital investments. Last month, XP Power was forced to slash its profit guidance and suspend its dividend after low demand put it at risk of breaching its banking covenants. JS
Hilton Food trading in line
Hilton Food (HFG) shares rose by 4 per cent in early trading after the multi-protein food business said that trading in its third quarter was in line with management expectations and that its troubled UK seafood business was profitable in the period. The company also pointed to “strong volume and revenue growth” in Australia and New Zealand, as well as growth in Europe. CA
