LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices midday Tuesday.
FTSE 100 - WINNERS
Carnival, up 4.3%. The world's largest cruise ship operator said Tuesday that it would add two ships to its Australian fleet in 2015 to meet surging demand for cruises in the country. In a statement, the company said that Australian cruise passenger numbers have more than doubled in the past five years and are projected to grow to one million by 2016, from 800,000 in 2013.
ITV, up 1.9%. The broadcaster received an upgrade to Hold from Sell by analysts at Berenberg Bank, reflecting both its recent acquisition of US entertainment group Leftfield and following the sharp sell off the stock has suffered since the broadcaster released its first-quarter results. ITV shares closed Monday more than 8% cheaper than they were a week ago before the latest numbers were released, and Berenberg said it is now more comfortable with the valuation.
Travis Perkins, up 1.4%. The building merchants received an upgrade to Buy from analysts at Panmure Gordon. Along with the upgrade from Hold, the brokerage raised its price target by nearly 35% to 2,066 pence from 1,540 pence.
Wolseley, up 1.3%. The plumbing and heating products distributor said it is in talks with subsidiaries of Frauenthal Holding AG about the sale of its Austrian plumbing and heating business ÖAG. ÖAG made revenue of GBP239 million and trading profit of GBP2 million in the year to July 31, 2013. The deal will need to be approved by Austrian competition authorities.
FTSE 100 - LOSERS
Vodafone Group, down 3.9%. The mobile telecoms company leads the blue chip fallers Monday after releasing its full-year results that recorded a 1.9% drop in revenue to GBP43.6 billion, and a 7.4% drop in pretax earnings to GBP12.8 billion. The group also booked impairment charges of GBP6.6 billion, covering various countries. Jefferies analyst Jerry Dellis said the results provided little to inspire confidence in Vodafone's turnaround prospects.
Marks & Spencer, down 2.6%. The high street retailer said underlying profit fell for the third consecutive year Tuesday, reporting GBP623 million for the year ended March 29, down from GBP648.1 million in the previous year. While the reported figure was slightly ahead of the consensus expectation for underlying profit of up to GBP620 million, the retailer also remained cautions about the outlook for the business, noting the competitive and promotional pricing environment in the UK. Given that management has come to the end of its three year plan to turnaround the business, the update has not been well received by investors. "This is not just any clothing sales downturn, this is the third year in a row of falling M&S profits. Having reached the end of a three year transformation plan the focus should now be very much on future delivery," said Edison Investment Research analyst Neil Shah.
Tesco, down 2.0%. Jefferies has downgraded Tesco to Hold from Buy and lowered its price target to 310.00 pence from 320.00p, saying that the recent rebound in the company's share price "is at odds with accelerating UK margins headwinds".
AstraZeneca, down 0.7%. Shares in the UK drug maker plummeted more that 10% on Monday after it rejected a final takeover offer from US rival Pfizer of GBP55.0 per share. While there remains a slim chance of Pfizer returning to the M&A table, the US company released a statement Tuesday saying that it would only increase its offer if its own share price improved, or if another suitor emerged with a better offer. Otherwise, under takeover rules, Pfizer will have to walk away for a minimum of six months after May 26.
FTSE 250 WINNERS
Homeserve, up 8.4%. the home emergency company leads the FTSE 250 gains Tuesday despite reporting a significant drop in full-year pretax profit due to the GBP30.6 million fine that it was handed by UK regulators in February for mis-selling insurance policies to its customers offsetting higher revenue. The results were broadly in line with consensus expectations and management have indicated that they will review the capital structure, "which may result in an increased dividend, special dividend or share buy-back, says Liberum Capital analyst Joe Brent.
Greencore, up 7.3%. The Irish convenience food business is higher after saying it had outperformed a buoyant food-to-go market in the UK, and also benefited from the first full year of supply to a major new customer in the US. The group raised its interim dividend by 16%, although its pretax profit took a hit to GBP8.0 million for the six months ended March 28, down from GBP12.2 million a year earlier, due to restructuring costs. Investec raised the stock to Buy from Add on the back of the positive update.
Paragon Group of Companies, up 7.1%. The specialist lender Tuesday reported a 19% increase in first-half pretax profit, supported by buy-to-let lending and its debt purchase business, Idem Capital. In a statement, Paragon said it made a GBP58.2 million pretax profit in the six months ended March 31, compared with GBP48.8 million in the corresponding period a year earlier.
FTSE 250 LOSERS
Afren, down 4.5%. The oil and gas exploration and production company has reported a drop in profits for the first quarter as revenue fell sharply. It posted a pretax profit of USD55.8 million for the three months to end-March, down from GBP138.8 million a year earlier, on the back of a 30% drop in revenues and higher finance costs. Revenue in the quarter fell to USD269 million, down from USD386 million a year earlier, which it said was due to a reduced share of production and liftings from the Ebok field, in which it has a 50% working interest, following cost recovery.
Intermediate Capital Group, down 3.1%. The specialist asset manager's shares have dropped despite it saying that its annual pretax profit increased on higher gains on investments. It said it made a GBP158.7 million pretax profit for the year to end-March, compared with GBP142.6 million a year earlier. Revenue increased by 17% to GBP434.6 million, with higher gains on investments and fee and other operating income more than offsetting a fall in finance income. However, the results were "weaker than expected", says James Hamilton, analyst at Numis Securities. Adjusted pretax profit of GBP175.1 million was up from GBP148.3 million in the previous year, but fell short of Numis'GBP248.2 million estimate.
Cobham, down 2.8%. The defence and aerospace products supplier's shares have fallen after it announced that it will buy US-based test systems and wireless communications business Aeroflex Holding Corp for about GBP869 million in cash, including debt. It will finance the deal through its bank facilities, but also launched a placing of about 65 million shares, or 6% of its current share capital, so that it maintains an "appropriate" level of gearing.
Entertainment One, down 2.3%. The firm is among the biggest losers in the mid-cap index despite saying that its pretax profit more than doubled in its full-year, as strength across the business was boosted by improved margins in its Film division, increased programming in the Television division and a number of new distribution deals. Entertainment One also declared its inaugural dividend. In its full-year results for the year to end-March, pretax profit rose to GBP21.0 million from GBP5.5 million in 2013. Reported revenue also rose strongly, up 30% to GBP819.6 million from GBP629.1 million the previous year.
BTG, down 1.7%. The healthcare company reported higher pretax profit for its recent financial year, as higher revenue and reduced impairment charges more than offset increased research and development spending and the costs of launching varicose vein treatment Varithena. It reported a pretax profit of GBP33.3 million for the year to end-March, up from GBP24.1 million a year earlier, as revenue rose to GBP290.5 million, from GBP233.7 million. However, while revenues beat expectations, largely thanks to the EkoSonic acquisition, profits were broadly in line with expectations on the back of higher operational expenditure, says Peter Welford, an analyst at Jefferies. Moreover, initial full-year revenue guidance of between GBP330 million and GBP345 million is "light", the analyst says. It is below Jefferies' current estimate of GBP358 million, while consensus is already at the top-end of the range at approximately GBP343 million, Welford says.
AIM ALL-SHARE - WINNERS
Vatukoula Gold Mines, up 18%. Vatukoula Gold Mines PLC Tuesday reported a wider loss for the first half of its financial year as production declined and gold prices fell, but its shares soared as it said it had cut costs sharply, was improving ore grades and gold recovery rates, and had started receiving funds from its recent investment deal. The company reported a pretax loss of GBP9.4 million in the six months to February 28, from GBP2.6 million a year earlier, as revenue fell to GBP15.0 million, from GBP20.8 million. "It has been a hard time for VGM, but it now has an opportunity to deliver some improvements," said WH Ireland analyst Paul Smith.
Trading Emissions, up 8%. The speciality finance company said Tuesday that it intends to distribute GBP20 million, or 8 pence per share to shareholders.
Rurelec, up 6.1%. The electricity company said it expects to receive its settlement for the seizure of its stake in Bolivia's largest power producer in 2010 shortly, after a key council of ministers in Bolivia gave the necessary approval for the payment to be made. The two sides have agreed that Bolivia will pay Rurelec USD31.5 million as settlement after Rurelec spent over three years fighting to get compensation after the country's government nationalised its 50.001% stake in subsidiary Empresa Guaracachi, the largest power producer in the country, by force in 2010.
AIM ALL-SHARE - LOSERS
UBC Media Group, down 48%. The multi-media content and service company has currently lost nearly half its value and leads the AIM fallers. Shares plunged after the company said intends to raise GBP6 million through a placing and share subscription so that it can acquire digital music services company 7digital Group Inc for GBP16.5 million, as it homes in on the digital music market. The reverse takeover will see UBC change its name to 7digital Group and will involve a 1-for-10 share consolidation.
Sinclair (William) Holdings, down 35%. The company, which produces horticulture products for garden centres and other customers said it will report a significant underlying net loss for the year ending September 30 and said it intends to scrap its interim dividend, after a weak trading performance resulted in higher-than-expected net debt. WH Ireland had previously forecast the company to make an adjusted pretax profit of GBP0.4 million for the current year, but has now withdrawn its forecast and put its recommendation under review.