Fears that Lonrho (LONR) would have to raise a slug of cash in the market have proved incorrect after reassurances from the fish supplier-to-hotels business, sending its shares up 32% to 6.6p. Trading has been tough in parts of the Africa-focused conglomerate, resulting in a pre-tax loss in today's financial results. Lonrho is enjoying fast growth in its fish business yet this comes at a price as it requires large amounts of working capital. Investors have been worried about the group's ability to fund its rapid growth, causing recent share price weakness. Yet the following line has helped to reverse the share price trend: 'Following the careful review of on-going performance, and after making due enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue operational existence for the foreseeable future.'
A full-year pre-close statement from the London Stock Exchange (LSE) revealed a mixed performance across the group's now diversified business model, with the counter down 0.5% at £13.18. In summary: UK secondary equities trading was poor; greenshots have appeared in the IPO pipeline (see Shares cover story, 14 Mar); Italian fixed income trading good; clearing activities flat to down; FTSE Group performance good.
Electricity supplier giant National Grid (NG.) is in demand having confirmed the relative safety of its vital dividend stream. The £27.5 billion cap will raise its annual payout to at least match RPI inflation in the foreseeable future, offering comfort for income seekers. The shares, up 14p at 765p, offer a 5.5% yield based on an anticipated 40.85p payout this year, although several other utility groups are promising above inflation hikes down the line.
Gold producer Petropavlovsk (POG) advanced 5.1% to 231.2p despite reporting a pre-tax loss for 2012. Net debt is lower than expected by some analysts and 2013 gold production guidance has been marginally increased to a range of 760,000 to 780,000 ounces, versus the previous range of 740,000 to 780,000 ounces.
Packaging group RPC (RPC) crashed 11.7% to 398.1p after flagging a series of problems within the business. It is struggling with unfavourable foreign exchange rates, rising raw material prices and weaker market conditions, as we discuss in detail here.
Electrocomponents (ECM) nudged ahead 1.2% to 249.2p on a trading update. Shore Capital has downgraded its forecasts, although it says it was previously above market expectations. It says investors seeking to buy technology distributors as recovery trades will get greater leverage via Premier Farnell (PFL) with its larger US and electronics exposure.
Food and drink ingredients giant Tate & Lyle (TATE) sweetened up 12.5p to 837.5p on a well-received trading statement. The £3.8 billion cap, guided by chief executive officer (CEO) Javed Ahmed, said trading for the year to 31 March met expectations and investors can expect 'modest progress' for the year. Investment bank Panmure Gordon has upgraded its price target from 730p to 750p. Although the broker has trimmed its March 2013 taxable profits forecast from £331 million to £327 million and earnings from 56.1p to 55.4p, estimates for 2014 are upgraded from £359 million to £365 million, taking earnings up from 59.8p to 60.7p.
Shares in Continental Farmers (CFGP:AIM) cultivated an impressive 46% surge to 35p after the agricultural group with farming operations in northern Poland and western Ukraine recommended a cash offer from a Saudi Arabian consortium. Pitched at 36p, the bid represents a 50% premium and values Continental Farmers at £61.5 million.
International models and collectibles group Hornby (HRN) was derailed, reversing 2.5p at 73p on news long-serving CEO Frank Martin will move to a deputy chairman's role ahead of his retirement next year. The £28.7 million cap behind Hornby model railways as well as the Scalextric and Airfix brands has had a tough time in recent years, with patchy consumer demand and supply chain problems behind profits disappointments.
Investors lined up for Lo-Q (LOQ:AIM) as it extends a theme park Q-band deal. The queuing software system supplier saw its shares edge 10p higher to 615p after confirming a water park extra installation with a major, albeit unnamed, US theme park operator.
Fledgling film-production group Intandem Films (IFM:AIM) has warned that it needs to raise cash within the next three months if it is to stay in business. The shocking news sent the share price down 28.3% to 0.82p. Half-year results today show increased losses of £651,496 for the six months to 31 December, against £369,942 last time. Robert Mitchell, formerly a non-executive director since 2011, was appointed in February as the new CEO. His pedigree may be impressive, with a 17-year stint at Hollywood studio giant Walk Disney (DIS:NYSE) to his name, but the market is yet to buy into his new strategy to increase investment into the company's UK distribution.
Shares in home automation technology tiddler JSJS Designs (JSJS: AIM) were flat at 0.26p, despite the £1 million cap stating that 'most of the significant investment' in its product ranges is now complete and will soon begin to reap rewards. Annual results to September 2012 posted this morning failed to set investors' pulses racing, revealing reduced losses of £761,443 (2011: £869,196) on lower turnover of £1.1 million (2011: £2.2 million).
Fulcrum Utility Services (FCRM:AIM) slumped 28.7% to 9.62p on a major profit warning. It has blamed a weak construction sector for lower utility connections, causing delays in securing larger contracts and reticence among smaller firms to invest in capital projects.