The long-awaited restructuring of Punch Taverns' (PUB) borrowings sent the pub operator up 21% to 13p. A rejig of its securitised bonds means that net debt will immediately be reduced by £137 million without having to issue any new shares.
There will also be a £463 million reduction in debt service payments over the next five years. It's not a done deal quite yet as the proposals need 75% bondholder support. 'For some time, Punch’s shares have been an option on the group successfully navigating its way through very difficult waters but today’s announcement represents a significant step in that direction,' says leisure analyst Mark Brumby of Langton Capital.
A bullish third quarter update sent Supergroup (SGP) 15% higher to 729p and triggered a wave of upgrades by analysts on the stock. Like-for-like sales have risen 10.6%. New store openings have been weighted in favour of large European cities and not the UK. Canaccord Genuity analyst Wayne Brown reckons this could represent 'the start of step change towards its European expansion which, in our view, will be an increasingly important driver of growth over the next few years.' Click here for the full story.
Travel operator Thomas Cook (TCG) was up 16% at 82.25p as it reduced an underlying first quarter loss from £93 million to £70 million. The group insists its 'business transformation programme' is on track. Yet some City experts are still cautious. Stockbroker Numis believes the turnaround will be very difficult. Peel Hunt says the early part of the restructuring 'was always going to be the easiest'. It adds: 'The real test of how far it can go, and how sustainable the recovery is, will come in 2014 and beyond.'
Vodafone (VOD) nudged up 1.3% to 172.55p on its interim management statement. This is despite a 2.6% decline in service revenue being slightly worse than consensus forecasts of 2.4%. This was due to a poor show in the UK and Africa. Liberum Capital reiterated its 'buy' rating on the grounds that there could be a 'value realising event in the US' and resolution to disputes in India. Speculation is growing that Verizon (VZ:NYSE) will soon pay another special dividend which will benefit Vodafone as 45% shareholder.
Food delivery group Ocado (OCDO) has doubled in price since November, helped by the surprise appointment of former Marks & Spencer (MKS) boss Stuart Rose as chairman and a £36 million placing which removed fears over the strength of its balance sheet. Full-year results today take the shares up 13.6% to 118p after losses narrowed.
Stockbroker Panmure Gordon notes that if you ignore exceptional costs Ocado made a £1 million profit. It says the debate now moves on to whether the company's assets are attractive to either M&S or Morrison (MRW) as both lack, and need, an online food offer. It says Ocado's net asset value is 39p per share, which should be used as a starting point for its valuation from a takeover perspective. The stockbroker puts a 50p target price on the stock, more than half today's trading price.
Among the small caps, Stellar Resources (STG:AIM) soared 27% to 2.13p after impressive exploration results for gold in Wales. The company now plans to drill the property to get a better understanding of the metal content in an old mine. Click here for the full story.
Pharmaceutical group Reneuron (RENE:AIM) advanced 13.6% to 2.5p after a progress update with its stroke clinical trial. Investors voiced their disappointment at plans by Renewable Energy (REH:AIM) to delist from Aim in the first half of this year as a cost-saving measure. Its shares crashed 26.7% to 1.38p.
Iron ore producer Strategic Minerals (SML:AIM) ended this year's rally by issuing new shares at a 23% discount to last night's closing price. It has raised £4.2 million as working capital for its tailings processing operations in New Mexico. Its sector peer Afferro Mining retreated 5.7% to 75p, after saying that it had rejected an approach from Jindal Steel & Power. The West African resources group continues to be in bid talks with International Mining & Infrastructure (IMIC:AIM) although some analysts don't believe its offer is credible.
Real estate groups ISIS Property Trust (IPT) and IRP Property Investments (IRP) announced plans to merge, creating a £130 million business to be called F&C Real Estate. Shareholders are warned that both sides should expect slightly less dividend income.