The CSI 300 index - replicating the performance of the top 300 stocks traded in the Shanghai and Shenzhen stock exchanges - was trading slightly higher before market close, despite two days of trade negotiations between the US and China ending without a clear breakthrough. Click here for The Trader Nicole Elliott's latest thoughts on the markets.
IC TIP UPDATES:
Computacenter (CCC) profits rose 24.3 per cent in the first half of the year, driven by demand for cybersecurity services and as more companies moved to cloud data services. Services revenue increased by 2.3 per cent to £575m, while technology sourcing revenue jumped 26 per cent to £1.43bn. As indicated earlier this year, the group’s German markets were particularly strong, with revenue growth of 11 per cent. Buy - under review.
Demand from housebuilders for land with planning consent helped Henry Boot (BOOT) to boost profits in its land development arm by 83 per cent to £15.2m in the six months to June and the shares were up nearly 5 per cent in early morning trading. Buy.
KEY STORIES:
Camellia (CAM) more than trebled pre-tax profits from continuing operations during the first-half, despite continued pricing pressure in some agricultural markets. Tea production was up 7 per cent to 39.2m kg, while macadamia harvests improved following two years of drought. The food producer acquired engineering services business Black Gold Oil Tools and 80 per cent of speciality tea producer Jing Tea.
Shares in Kingspan (KGP) jumped 8 per cent on the morning the insulation panels manufacturer recorded a 15 per cent increase in turnover and a 10 per cent rise in trading profits. Acquisitions contributed 15 per cent to sales growth although margins were a little lower.
Shares in Shire (SHP) are up more than 2 per cent this morning after the US Food and Drug Administration approved Takhzyro, the group’s preventive treatment for Hereditary Angioedema. The drug performed well in studies - leading to an 87 per cent reduction in mean monthly attacks vs placebo. However, this latest announcement does nothing to alleviate our concerns about the group’s potential merger with Takeda, or its high level of debt. Sell.
Serco (SRP) has successfully rebid for its contract with the Australian Defence Force. The outsourcer will provide a range of services such as catering, waste disposal and ground maintenance in the military’s Middle Eastern bases. The contract has an initial three year term with the option for two, one-year extensions. It has a total value of AU$135m (£77m) if all options are exercised. Hold.
OTHER COMPANY NEWS:
Petrofac (PFC) is to sell its 20 per cent stake in the Greater Stella Area to field operator Ithaca Energy, in a deal which also sees the oil services group dispose of its 25 per cent holding in the field’s floating production facility. Together with deferred and contingent considerations, Petrofac could net up to $292m from the sale, though the transaction is expected to result in a post-tax write down of $55m when it completes at the start of 2019. Ithaca Energy was sold to Delek Group last year.
Stevia making company Purecircle (PURE) realised a statement this morning saying that the directors are “not aware” of any sensitive information that would be behind recent movements in its share price. Shares are down more than a fifth over the past week and now trade at 308p. The statement said the directors of the company have noticed the increase in trading volumes and share price volatility over the past few trading sessions.
