Shares in London slipped back once more as investor confidence remains subdued. Click here for The Trader Nicole Elliott's latest thoughts on the markets.
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Superdry (SDRY) has a new chief product officer in the shape of former Tommy Hilfiger global head of womenswear, Brigitte Danielmeyer. Alongside the appointment, the group has also announced a new range - Superdry Preview - which it calls “a series of new disruptive fast-fashion ranges...designed to capture a younger, more fashion-driven customer.” The limited edition collections will move from the design stage to shop floor within six weeks and will be available online too. An accompanying social media campaign will directly target 16 to 24 year olds. We remain sellers.
Given its relatively high cost profile, investors in Atalaya Mining (ATYM) could have been forgiven for feeling nervous about the effect of falling copper prices in recent months. But judging by interim numbers, the second half of 2018 might be a lot less painful than expected. Second quarter production leapt 15 per cent on the previous year, while cash costs declined considerably – from $2.27 to $1.88 per pound. A fall in capital expenditure also boosted the net cash position. Still, full-year operating costs have been left unchanged in the $2.15 to $2.30 range, suggesting management may expect cost pressures later this year. Under review.
Revenues for construction software group Elecosoft (ELCO) grew 5.4 per cent to £10.6m over the half-year to June, while pre-tax profits rose 17.5 per cent to £1.2m. Net cash climbed from £0.26m to £2.7m, and the interim dividend rose from 0.20p to 0.28p. As previously announced, post-period-end, the company acquired Shire Systems – a UK provider of computerised maintenance management software. We also learnt that finance director Simon Morgan has resigned with immediate effect to pursue other interests, replaced by Benjamin Moralee – formerly Elecosoft’s interim deputy finance director since March. The shares were down 6 per cent this morning. We’re still buyers.
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After it was revealed that the Financial Reporting Council (FRC) had asked it to hand over paperwork, Sports Direct (SPD) has confirmed, ahead of its AGM today, that it still expects to report between a 5 per cent and 15 per cent rise in underlying cash profits for the current financial year. That excludes the recent acquisition of House of Fraser. Today, that deal was described by the group’s chief executive Mike Ashley as a “game changer”. Yesterday, a High Court judge ordered Sports Direct to hand over documents to the FRC as it looks into the audit of the company’s 2016 results by accounting firm Grant Thornton. The shares fell heavily in response.
After raising $460m in its London initial public offering, Energean Oil & Gas (ENOG) ended its half year to June with its balance sheet (and plans to develop the enormous Karish and Tanin fields offshore Israel) substantially strengthened. But legacy Greek operations also contributed, as a 50 per cent climb in output drove down operating costs and helped the group swing to a first-half operating profit of $10.2m.
OTHER COMPANY NEWS:
Even for a company whose business is risk and compliance, Wilmington (WIM) faced considerable hurdles to implement General Data Protection Regulation (GDPR) in its full-year to June. With some 50 per cent of revenues coming from information services, compliance with the new rules delayed deals and created extra work for its subscription models. With that out of the way, the final dividend has been lifted, the group is on course to reduce net debt by around £5m this year, and management today sounded a more confident tone.
Ten Entertainment Group (TEG) reported a 7.7 per cent increase in sales to £37.8m during the six months to July, or up 3.1 per cent on a like-for-like basis, with adjusted cash profits up 4.8 per cent to £9.8m. Chairman Nick Basing said sales growth was achieved despite “extraordinary weather conditions” during the period. The operator of family entertainment centres acquired four new sites during the period and refurbished two locations. Shares were up nearly 1 per cent in early trading.
Dunelm (DNLM) shares sprang back to life this morning following the group’s annual results release. The numbers were largely in line with the fourth quarter statement, therefore containing few surprises, but shareholders are clearly glad to sailing on smoother waters after a challenging. Crucially, the group has now closed the underperforming website associated with its Worldstores acquisition, while chief executive Nick Wilkinson is busy building a brand new campaign for autumn, aimed at improving the brand awareness across the UK.
Credit hire and legal services group Anexo (ANX) has reported its maiden half-year results, after floating on Aim in June. In 2017, management had decided to concentrate on motorcycle claims and settling current claims instead of new claims generation – causing lower activity during the six months to December 2017 and into the first half of 2018. But it reversed this strategy in late 2017 after the decision to IPO. The vehicle fleet rose from 1,568 to 2,293 and vehicles on hire climbed 27 per cent. Revenues grew 2.5 per cent to £23.5m – up 6.9 per cent against the second half of 2017. Pre-tax profits fell 37 per cent year-on-year to £5.3m.
