3i (III), Balfour Beatty (BBY), ITV (ITV), John Wood Group (WG.), Watches of Switzerland (WOSG) and Avon Protection (AVON)
Private equity and infrastructure specialist 3i (III) propped up the FTSE 100 after reporting its full-year results. The market showed concern at the 16 per cent fall in the company’s total return during a time of “challenging trading conditions”. 3i’s total return came in at £3.84bn, or 23 per cent of opening shareholder funds, compared with the £4.85bn it reported in 2023. The company also increased the dividend by 15 per cent to 61p a share.
The highly concentrated nature of 3i’s portfolio was exemplified by the prominence of the company’s Netherlands-based discounting chain Action. A decent trading performance from the chain underpinned its valuation growth of £3.61bn for Action, in addition to dividends paid to 3i of £375mn. 3i also received proceeds of £762mn from Action via a pro-rata share redemption scheme. JH
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Balfour Beatty progresses trio of projects
Balfour Beatty (BBY) said it continues to expect an increase in earnings after trading in line with expectations so far this year. It also reported progress on three projects, for which it expects “major orders” to follow. The first of these is an upgrade to the electricity transmission networks in the north of Scotland, where it is currently carrying out early works on nine projects that “are expected to convert to full awards at a later date”.
It also highlighted a letter of intent from BP (BP.) and Equinor to proceed with the Net Zero Teeside Power project, which will combine a power plant with a carbon capture scheme, and in Derby it has been chosen as a partner by Rolls-Royce (RR) to work on an expansion the engine maker will carry out to meet an expected growth in demand from the Military of Defence’s AUKUS submarine contract. Balfour Beatty’s shares were flat in early trading but have gained 15 per cent so far this year. MF
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John Wood records margin improvement
John Wood Group (WG.) delivered a mixed first quarter trading update a day after it rebuffed a prospective £1.42bn takeover approach from Sidara, a Dubai-based engineering and consulting group. Group revenue was down 6 per cent to $1.36bn (£1.08bn), largely due to timing issues linked to engineering, procurement and construction work within the project division. However, the adjusted group cash margin increased by 4 per cent, mirroring improvements across all of John Wood’s business units, including projects. Results — and cash flows — will be weighted towards the second half of the year and the group still expects “high single digit growth” in adjusted cash profits before the impact of disposals. MR
Find out why we’re bullish on John Wood Group
MoD comes calling for Avon
Avon Protection (AVON) reported an agreement first signed in 2018 to supply the Ministry of Defence with respirator equipment has been extended for another four years, with five further one-year option periods. The extension is worth £38mn to the company, and was described by chief executive Jos Sclater as “strategically important” to the company. Avon’s shares rose by 2 per cent. MF
