Shares in London are up marginally but positive momentum is proving elusive. Click here for The Trader Nicole Elliott's latest thoughts on the markets.
IC TIP UPDATES:
Debenhams (DEB) announced that Rachel Osborne will join the retailer as chief financial officer next month. Ms Osborne most recently held the same role at Domino’s Pizza (DOM), but left in June to “pursue other career opportunities”. She had been Domino’s fourth chief financial officer in four years. We retain our sell recommendation.
The shift towards a more technology-focused approach has been yielding results at Costain (COST). Improving margins led to an 8 per cent increase in underlying operating profits, in spite of a £102m drop in revenues against the first half of last year, due to the completion of a number of large projects in the comparative period. While the revenue drop off might concern some investors, the group’s order book has remained steady. Buy.
OTHER COMPANY NEWS:
Go-Ahead Group (GOG) is on the hunt for a new chief financial officer after the transport group announced that Patrick Butcher would be leaving the company to join Capita (CPI). Mr Butcher will stay on over the next few months to help the transport company find a successor.
Hansteen Holdings (HSTN), which invests in urban multi-let industrial property, saw its property valuation increase by 3.7 per cent over the half-year to June. Pre-tax profits came in at £29.3m, up from £12.6m, while the dividend was lifted from 2.3p to 2.4p. Over the period, the group sold its IMPT portfolio for £116m, saw the compulsory purchase of its Saltley Business Park and returned £145m of capital to shareholders. Management says the investment case for urban multi-let industrials “is stronger than ever”. Still, it anticipates being net sellers “for the foreseeable future”.
For the half-year to June, EVR Holdings (EVRH) – which creates virtual reality music content – saw sales of £6,831. These were its first reported revenues since flotation in 2016. Its flagship MelodyVR platform launched just weeks before the end of the reporting period, in tandem with the launch of Facebook’s Oculus Go – meaning revenues over the period were “influenced by the initially limited distribution and accessibility of Facebook's VR Headset”. Further down the income statement, pre-tax losses expanded to £4.4m from £2.6m, incorporating the cost of sales and higher administrative expenses. The shares fell nearly a tenth in morning trading.
A trading update from Proactis (PHD) marked up the spend control software group’s shares this morning. As at 31 July, it had delivered net annualised cost savings of around £5m which were anticipated at the time of the major acquisition of Perfect Commerce last August. Deal intake over the year was strong, with 64 new names and a total initial contract value of £8.7m and 120 upsell deals valued at £3.6m in total. Proactis continues to expect revenues of around £52m, up from £25.4m, with adjusted cash profits of around £17m (up from £7.9m) and adjusted pre-tax profits of £11m (up from £5.1m). Back in April, its shares plummeted on the news that revenue had been dampened by unexpected customer losses and a stronger pound.
During the first half gaming technology company Sportech (SPO) signed an agreement with Sportradar for sports betting data, trading, risk management, and technology platforms as part of its strategy to take advantage of the US sports betting market. It’s also working with key constituencies in Connecticut to secure the proper licence to operate in the state. Sales were flat at constant currency at £31.6m, as were cash profits before sports betting investments at £3.3m. Shares fell more than 3 per cent in early trading.
