London shares lurch southwards once more amid interest rate concerns and more aggression on the Korean peninsula. Click here for The Trader Nicole Elliott's latest thoughts.
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JD Wetherspoon (JDW) reported a 4.1 per cent improvement to the top line for the full year (comprising 53 weeks), with an 80 basis point rise in the operating margin. The company cited better sales, lower utility and interest costs, and disposals of some lower-margin pubs as contributors to performance. During the year, 10 pubs opened and 41 closed, leaving 895 trading pubs. The company’s shares rose 9 per cent following the results announcement. Recommendation under review.
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The Gym Group (GYM) has acquired 18 gyms from Lifestyle Fitness for £20.5m, in a deal expected to complete later this month. The sites are located within the North of England and Midlands, 10 of which will be converted to the Gym brand by the first quarter of 2018 at a cost of £450,000 each. The 18 sites earned cash profits of £3.45m in the 12 months to 31 December 2016, with revenues of £11.1m.
Avon Rubber (AVON) revealed that trading was strong over the second half, and it now expects adjusted profit before tax for its September year-end to be in line with market expectations. In its Protection business, the company said it expects to deliver 152,000 M50 gas mask systems and 144,000 spare filter pairs under its sole source contract with the US Department of Defense [sic]. Meanwhile, the dairy market has continued to be positive, with milk prices filtering through, leading to improved confidence amongst farmers.
Following its major patent setback at the start of September, Indivior (INDV) is fighting back. The US focused pharma company has launched another patent appeal against six of the companies which have developed a generic version of its opioid addiction treatment, Suboxone. The latest appeal relates to the drug’s delivery mechanism - it is absorbed into the bloodstream via a thin film placed under the tongue - which Indivior was granted a patent for in June this year. Shaun Thaxter, Indivior’s chief executive, also reiterated the group’s decision to appeal US regulator’s recent approval of a competitive drug made by Indian pharma group Dr Reddys.
Shares in recruiter SThree (STHR) are up this morning after the group said it expected to beat consensus profit forecasts for 2017. As has been seen elsewhere, the group has struggled in the UK and Ireland, with gross profit down 10 per cent due to challenging trading conditions. The company generates 80 per cent of its gross profit outside of the UK and Ireland, however, and its focus on industries rooted in science, technology, engineering and mathematics has placed it well to capitalise on the continued demands from those industries. Gross profit from temporary roles across engineering, life sciences and energy were up 10, 13 and 37 per cent respectively in the period.
