Halma, a Buckinghamshire-based company that provides hazard detection and life-saving technology, on Thursday said it has promoted Chief Financial Officer Marc Ronchetti to chief executive designate, replacing Andrew Williams when he retires next year after 18 years at the helm and 29 years with the company.
Ronchetti joined Halma in 2016 and became CFO in 2019, previously having been finance director of the UK operations of Wolseley, which is now Ferguson. He will become only the fourth Halma chief executive in 50 years.
Halma also reported results for the financial year that ended March 31. Pretax profit rose by 20% to £304.4 million from £252.9 million on a 16% increase in revenue to £1.53 billion from £1.32 billion. Halma raised its total annual dividend by 7.0% to 18.88 pence per share from 17.65p.
‘We have made a positive start to the new financial year,’ Williams said. ‘We have a strong order book, and order intake in the year to date is ahead of revenue and in line with the very strong intake in the same period of the prior year.’
Halma expects ‘good’ single-digit percentage organic revenue growth at constant currency.
The FTSE 100 stock was down 3.3% early Thursday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 1.0% at 7,204.02
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Hang Seng: down 2.4% at 20,789.29
Nikkei 225: closed up 0.4% at 26,431.20
S&P/ASX 200: closed down 0.2% at 6,591.10
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DJIA: closed up 303.70 points, or 1.0%, at 30,668.53
S&P 500: closed up 54.51 points, or 1.5%, at 3,789.99
Nasdaq Composite: closed up 270.81 points, or 2.5%, at 11,099.15
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EUR: up at $1.0417 ($1.0395)
GBP: up at $1.2127 ($1.2050)
USD: down at JP¥134.46 (JP¥134.60)
GOLD: up at $1,829.52 per ounce ($1,821.35)
OIL (Brent): down at $119.07 a barrel ($120.95)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday’s key economic events still to come
1200 BST UK Bank of England interest rate decision
0830 EDT US jobless claims
1030 EDT US EIA weekly natural gas storage report
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German Chancellor Olaf Scholz, French President Emmanuel Macron and Italian Prime Minister Mario Draghi arrived in Kiev on Thursday morning for their first visit since the Russian invasion. They will speak with President Volodymyr Zelensky about further support for the country and Ukraine’s desire to be admitted to the EU. The trio’s overnight train trip had been planned for days. But it was not officially confirmed until shortly before arrival in the Ukrainian capital for security reasons, despite media reports. Scholz flew to southern Poland on Wednesday evening. From the border town of Przemysl, the nine-wagon train carrying the leaders left shortly before midnight for Kiev.
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Russian energy firm Gazprom began reducing the volume of gas it supplies to Germany via the Nord Stream 1 pipeline to a daily maximum of 67 million cubic metres early on Thursday. The further reduction in gas supplies came after the firm’s Tuesday announcement that it would reduce the maximum delivery volume to 100 million cubic metres of gas per day, down from 167 million cubic metres. Overall, the latest cut represents an approximately 60% reduction in gas supplies to Germany within just two days. Siemens Energy said on Tuesday that one of the Nord Stream 1 gas turbines that had recently undergone repairs in Canada could not currently be shipped back from Montreal due to sanctions on Russia. The Nord Stream 1 pipeline is Germany’s main pipeline for the delivery of Russian gas. Gazprom, which is majority owned by the Russian state, cited the delays caused by the repair of the gas compressor unit as the reason for the reduced gas delivery volumes, though Germany’s Federal Network Agency disputed the claim.
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BROKER RATING CHANGES
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Barclays raises Victrex to ’overweight’ (equal weight) - price target 2200 (2060) pence
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Barclays cuts Synthomer to ’equal weight’ (overweight) - price target 323 (420) pence
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Peel Hunt raises Hochschild Mining to ’buy’, cuts Fresnillo to ’add’
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COMPANIES - FTSE 100
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Informa more than doubled the scope of its share buyback programme following ‘robust’ trading. It has scaled up its buyback programme to £725 million from £300 million, saying this is expected to see the company maintain the current level of buybacks through to year-end. The move on shareholder returns came as the events organiser and business information publisher said trading through the first five months of 2022 has been ‘robust’, with underlying revenue growth of more than 40%. Informa is on track to deliver at the upper end of full-year guidance for both revenue and adjusted operating profit, it said.
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COMPANIES - FTSE 250
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Capital & Counties Properties and Shaftesbury have agreed the final terms of their all-share merger to create a central London-focused property investor with a combined portfolio value of £5.0 billion. Shaftesbury shareholders will receive 3.356 new Capco shares for each Shaftesbury share held, giving Shaftesbury shareholders a 53% stake in the combined company and Capco shareholders 47%. The pair had first confirmed they were in merger talks back in May, and those percentages haven’t changed. Capco itself already holds a 25% stake in Shaftesbury. The combined company will be called Shaftesbury Capital PLC and will own property in the West End of London, including in Covent Garden, Carnaby Street and Chinatown.
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Car dealership chain Inchcape said recent trading has exceeded expectations, primarily driven by its Distribution business. ‘We also have greater confidence in relation to our second half performance based on the strength of order books in our markets and an improved outlook for supply,’ it added. As a result, Inchcape expects to deliver full-year pretax profit from continuing operations between £350 million and £370 million, well above a company-cited consensus figure of £301 million.
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COMPANIES - SMALL CAP
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Online clothing retailer Asos reported flat sales in the three months to May 31 and cut its outlook, as it flagged inflationary pressures are ‘increasingly impacting our customers shopping behaviour’. In addition, Asos promoted Chief Commercial Officer Jose Calamonte to chief executive and Non-Executive Director Jorgen Lindemann to chair. Sales in the three months to May 31 were marginally lower at £983.4 million versus £987.9 million a year before. UK sales rose 4% and US sales were up 21%, contrasting with boohoo’s outturn, while EU sales slipped 5% and rest-of-world declined 20%. Gross margin declined by 310 basis points to 44.0%. Looking ahead, Asos said full-year sales are now expected to grow in a range of 4% to 7%, ‘reflecting market volatility and an increased returns rate’. It expects to take a gross margin hit of between 150 basis points and 200 basis points amid elevated returns. Adjusted pretax profit was given in a new range of £20 million to £60 million. In January, and before the outbreak of war in Ukraine, Asos had guided to revenue growth around 10% to 15% and adjusted pretax profit of £110 million to £140 million. Asos, freshly moved from AIM to the London Main Market, is set to join the FTSE 250 index on Monday next week.
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Fast fashion peer boohoo reported a decline in revenue and margins, though backed full-year guidance. Revenue for the three months to May 31 was down 8% year-on-year at £445.7 million. Compared to the pre-pandemic period in its 2020 financial year, however, sales were up 75%. boohoo blamed the annual decline on ‘lockdowns driving prior year comparative strength’. On an annual basis, boohoo suffered a chunky 26% decline in US sales, while UK sales were down 1%. ‘We have seen promising signs from the group’s sales performance in the UK, which has improved month-on-month in the period and we are looking ahead towards our key summer trading season as holidays ramp up and customers look to the latest fashion from across our brands,’ said Chief Executive John Lyttle. Gross margin in the period was 52.8%, down 220 basis points on a year before, but noted this ‘improved through the quarter’.
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Online beauty products seller THG also was in the news early Thursday. Belerion confirmed that it, together with King Street Capital Management LP, does not intend to make a takeover offer for the firm. THG, in its own statement, noted that all recent approaches have been unsolicited. These were also ‘unacceptable and significantly undervalued the company’. THG said it did not consider it appropriate to provide due diligence access to any of these parties. ‘While THG is clearly aware of the macro-economic challenges, the company continues to perform well, and in line with its own expectations,’ said THG.
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COMPANIES - GLOBAL
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Elon Musk will reiterate his desire to acquire Twitter Inc when he meets employees at the microblogging firm on Thursday, the Wall Street Journal reported. Citing a person familiar with the matter, the WSJ said Musk will talk about Twitter’s strategy, including the role of advertising as well as a subscription-based offering. He also will comment on remote work, the newspaper added. Musk, also chief executive of Tesla, has told employees at the electric car maker to come back to the office for a minimum of 40 hours per week.
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Danish toy company Lego said it will build a $1 billion carbon-neutral run factory in the US state of Virginia. The toy company said the facility, which is slated to commence production in late 2025, ‘will be a highly energy efficient site and 100% of its energy needs will be matched by onsite renewable sources.’ Lego said that it will invest $1 billion over 10 years in its seventh factory, which will be located in Chesterfield County some 180 kilometres south of the US capital Washington.
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Thursday’s shareholder meetings
AEX Gold Inc - GM re name change to Amaroq Minerals Ltd
AEX Gold Inc - AGM
Anexo Group PLC - AGM
Anpario PLC - AGM
Baillie Gifford China Growth Trust PLC - AGM
Bisichi PLC - AGM
Engage XR Holdings PLC - AGM
EPE Special Opportunities Ltd - AGM
Evraz PLC - AGM
Informa PLC - AGM
Kape Technologies PLC - AGM
Martin Currie Global Portfolio Trust PLC - AGM
Ruffer Investment Co Ltd - EGM re authority to issue shares
S4 Capital PLC - AGM
TBC Bank Group PLC - AGM
UK Commercial Property REIT Ltd - AGM
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