UK stocks opened slightly lower on Wednesday despite news that the UK had become the first country to approve the Pfizer-BioNTech vaccine for emergency use with vaccinations expected to start next week. In contrast, shares of BioNTech jumped 8% in Frankfurt on the news.

By midday the FTSE 100 was was up just 12 points or 0.2% at 6,396, with consumer stocks such as AB Foods (ABF), Coca-Cola Hellenic (CCH) and Imperial Brands (IMB) making gains while supermarket groups Morrison (MRW), Sainsbury (SBRY) and Tesco (TSCO) drifted lower.

Sterling traded 0.6% lower against the US dollar at $1.3340,  Brent crude oil prices were 0.1% lower at $47.4 a barrel.

CORPORATE ROUND-UP

GardaWorld upped its takeover offer for G4S (GFS) by 23.6% to 235p valuing the company at £3.68 billion.  The threshold for acceptance was reduced to 50% plus one share while the company also secured agreement with the pension fund providing a £770 million support package.

The deadline for acceptances is 16 December at 1pm. The shares added 8.5% to 245.5p.

Supermarket Tesco announced it would repay the £585 million of rates relief, and said the costs related to dealing with the pandemic would amount to £785 million this year.

Chief executive Ken Murphy said, ‘While business rates relief was a critical support at a time of significant uncertainty, some of the potential risks we faced are now behind us.’ The shares dropped 1.3% to 226p.

Personal protection company Avon Rubber (AVON) upped its full year dividend by 30% to 27.08p per share after adjusted pre-tax profit grew 27% to £28.2 million and 8.8% organically.

The company said it had a strong opening order book of $101.7 million (£79.8 million) which provides excellent visibility and confidence for 2021. Despite the positive news, the shares dropped 4.7% to £44.10.

AIRLINES LOSE ALTITUDE

Low-cost carrier Wizz Air (WIZZ) said it carried 85% fewer passengers during the month of November as the pandemic continued to crunch demand for travel.

Passenger volumes in November amounted to 456,487, down from 2,974,812 in November 2019.

Flying capacity dropped 79% and the company’s load factor shrank by around 25 percentage points to 68.2%. The shares dipped 0.2% to £45.65.

Fellow low budget carrier Ryanair (RYA) said it carried 82% fewer passengers during the month of November as the pandemic continued to bite.

Passenger volumes in November fell to 2.0 million, down from 10.9 million in November 2019. The shares dropped 0.5% to €15.70.

Workspace operator IWG (IWG) touted potential revenue recovery in 2021 following an improvement in sales activity and announced the launch of a £300 million convertible bond offering.

The bonds would be issued at par and expected to carry a coupon of between 0.50% and 1.25% a year payable semi-annually in arrears in equal instalments.

The initial conversion price was expected to be set at a premium of between 35% and 40% above the volume weighted average price of an share on the London Stock Exchange between launch and pricing of the offering on 2 December. The shares sank 6.9% to 327p.

In a trading update for the year to December,  performance nutrition company Science In Sport (SIS:AIM) said underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for the year through December was expected to be around £1.0 million, compared to a £0.3 million year-on-year loss.

The improvement was expected despite an anticipated modest fall in annual revenue to £49.8 million, down from £50.6 million in 2019.

The company said total online revenues were 39% ahead year on year at £23 million to the end of November and are expected to grow to approximately 51% of total revenue for the full year, compared with 38% in 2019. The shares rallied 5.6% to 30p.

Shares in bars/cafes/restaurants operator Loungers (LGRS:AIM) jumped 9% higher to 242p after saying it has seen a strong recovery since reopening. For the 24 weeks to 4 October revenues declined 33% to £26.3 million reflecting 11 weeks of lockdown.

Like-for-like sales grew 25.1% from 4 July to 4 October with strong trading maintained until the second lockdown on 5 November.

The company said it had 60 sites in England that will remain closed under Tier 3, with 91 sites trading in Tier 2 and three sites trading in Tier 1.  In Wales it has 14 sites that will be subject to increased restrictions from 4 December.

Loungers said it expected to return to an annual run-rate of opening 25 new sites a year during the next financial year to April 2022.

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Issue Date: 02 Dec 2020