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News & Tips: Lookers, TP ICAP, Chemring & more

The car dealer's shares fall by as much as 40 per cent as chief exec Andy Bruce exits
November 1, 2019

IC TIP UPDATES: 

Lookers (LOOK) chief executive Andy Bruce and chief operating officer Nigel McMinn will step down from the board of the beleaguered car retailer today, which issued a torrid profit warning this morning. Lookers has underperformed the new car market for the first time in years, recording a 3.2 per cent fall in like-for-like new car sales over its third quarter, with like-for-like new car sales to retail customers down 11.5 per cent. Lookers has lowered its full-year forecast for underlying pre-tax profit to around £20m, down from consensus forecasts of £38m. Chairman Phil White will as of today take on the role of executive chairman and non-executive director Richard Walker will assume a part-time executive role, with both in place until successors for Mr Bruce and Mr McMinn are found. Lookers shares plummeted by as much as 40 per cent in early trading. Sell.

OTHER COMPANY NEWS: 

Market intermediary TP ICAP (TCAP) thinks “current geopolitical uncertainties…may have an impact on transaction volumes in the fourth quarter”, and has left full-year guidance for single-digit revenue growth unchanged. That’s despite a strong three months to September, in which group revenues rose 13 per cent at constant currency. However, the top-line for the core global broking division remains down so far this year.

Chemring (CHG) announced in a year-end trading update that the defence engineer had outperformed its own expectations for adjusted operating profit, sending shares up in early trading. It has also secured an order for a further 75 Aerosol and Vapor Chemical Agent Detector units from the US Department of Defense, which it expects to deliver in Chemring’s 2020 financial year.

Rentokil (RTO) has acquired Florida Pest Control for an undisclosed amount, with the deal expected to complete later today. Providing services to both the commercial and residential sector, the acquisition is in line with the group’s strategy to build scale in key local markets and increase customer density. Together with previous pest control acquisitions, Rentokil is expanding its presence in the South East of the US. Shares are up 1 per cent.