Shares in London took the rise in inflation to 3.1 per cent in their stride to post more gains. Click here for The Trader Nicole Elliott's latest thoughts.
IC TIP UPDATES:
Joules (JOUL) investors will be pleased with the solid progress announced as part of a pre-close update this morning. Covering the 26 week period to 26 November 2017, revenues rose by 18.2 per cent to £96.2m, which is said to reflect the brand’s evolution, a growing number of customers and the strong performance of recent collections. E-commerce is lending a helping hand, sending retail revenues up by more than 16 per cent, while wholesales revenues grew by more than a fifth thanks to a healthy forward order book. We remain buyers.
The board of student accommodation specialist Empiric Student Property (ESP) has fired chief executive Paul Hadaway with immediate effect. He will be replaced by Tim Attlee, co-founder and chief investment officer. The company issued a profits warning in November citing a number of financial and operational inefficiencies that will lead to narrower margins and a cut in the dividend. A full operational review is expected to redress these issues in 2018. We retain our buy recommendation.
Shares in Robert Walters (RWA) were up 9 per cent this morning after a short trading statement from the group, announcing its pre tax profits for the year to December 2017 would be “materially ahead of current market expectations”. This is the result of strong trading across all of the group’s regions. Buy.
John Laing Group (JLG) has sold its 100 per cent stake in a the Llynfi Wind Farm to John Laing Environmental Assets (JLEN), the latter was spun out 2 years ago and now operates as a completely separate legal entity. The stake was sold for £43m, bringing the total realisations for the JLG in the year to £299m. Buy.
KEY STORIES:
Shares in stricken retailer Carpetright (CPR) fell another 7 per cent this morning as the group reported interim losses across its European business. That largely offset the fact that the UK business reported in line with analysts’ expectations, and accounted for the group missing overall forecast targets. What’s more, the outlook is pretty grim, with managers taking a more cautious approach to the second half. Underlying pre-tax profits for the full year are now expected to be towards the bottom end of the current range of market expectations.
Equipment hire giant Ashtead (AHT) beat profit expectations with its first half results, released today. Adjusted cash profits were up 22 per cent to £503m. Sunbelt, the group’s largest division by far, was involved in clean-up efforts for hurricanes Harvey, Irma and Maria, which led to increased rental revenues. The group expects “a number of years of good earnings growth and significant free cash flow generation, and as a result is carrying out a share buyback worth £500m-£1bn over the next 18 months.
The shutdown of the Forties pipeline in the North Sea has been good for oil and gas share prices this morning. After all, Brent crude has sailed through $65 a barrel. For others – including inflation-hit consumers and Ineos, the private group which bought the Forties from BP just six weeks ago – the development is hardly a positive. Add to that list Serica Energy (SQZ), which confirmed this morning that production forecasts from the BKR assets will this year have been revised down to 2,000 barrels of oil equivalent per day while the line is repaired.
The sale of Gem Diamonds’ (GEMD) Ghagoo mine is not a done deal after all. In August, the precious gems miner said it had received an offer, but discussions have not been successful. The Botswanan project will be placed on care and maintenance.
OTHER COMPANY NEWS:
Boku (BOKU), the direct carrier billing specialist, has signed a new agreement with EE, the UK’s largest mobile network operator. This will enable EE customers to pay for items from the EE marketplace on their EE phone account.
