London’s FTSE 100 ended Thursday’s trading session materially lower after US producer prices data came in ahead of forecasts, the blue chip benchmark closing down 0.4% at 7,193.23 points despite better than expected UK GDP figures.
In the US the S&P 500 was flat at 4,447.27 points by 4.30pm UK time.
STOCK SPIRITS RECOMMENDS CVC OFFER
In company news, central European branded spirits producer Stock Spirits (STCK) soared 44% to 385p after the board recommended a 377p per share cash bid from private equity firm CVC.
The bidder described Stock Spirits as ‘an attractive business with significant future growth potential’ given its leading positions in central and eastern Europe.
Shares in aerospace firm Meggitt (MGGT) were 1.5% lower at 818p after surging 16% late yesterday following the news that US aerospace firm TransDigm had approached the firm with a 900p per share offer, rivalling Parker Hannifin’s existing 800p offer.
IN OTHER NEWS
Shares in gaming company Entain (ENT) traded 1.2% lower at £19.43 following the announcement of a strong set of interim results.
The company reiterated its full year guidance, and income investors will take comfort from the expectation that the divided will be reinstated with the final results in March. Moreover, the company highlighted a further £100 million of cost savings.
Group earnings before tax interest depreciation and amortization increased by 12% to £401 million, however this figure was held back by the performance of the retail division where gaming revenue was down 46% reflecting real estate closures through most of the period.
In contrast, the performance of its digital business was extremely robust with net gaming revenue up 28% and EBITDA increasing by 35% to £496 million.
Insurance and asset management company Aviva (AV.) announced first half results for the six months to June with a disappointing miss in operating profit which was 7% below consensus at £725 million, predominantly due to a poor performance in the UK and Irish Life division.
The General Insurance business and the Canadian operation recorded more positive performances, the former benefiting from a reduction in claims and the latter delivering operating profits 28% ahead of consensus expectations.
Aviva’s mixed results were overlooked given the group’s announcement that it intends to return at least £4 billion to shareholders by the end of the year against market expectations of £3 billion. The group is starting with an immediate £750 million share buyback. Shares traded 3.5% higher at 421p.
Cinema operator Cineworld (CINE) posted a 59% decline in first half revenues from $712.4 million to $292.8 million and an EBITDA loss of $21.2 million compared with a prior year profit of $53 million.
However, investors looked beyond the numbers to news that the group is considering a listing of its Regal movie chain on the US market, where it derives most of its revenues. Shares traded 4% higher at 64p.
Elsewhere, soft drinks bottler Coca-Cola HBC (CCH) cheapened 1.8% to £26.70 despite serving up news of a 14.7% rise in revenues for the six months to the end of June.
PROFIT WARNING FROM McCOLL’S
McColl’s Retail (MCLS) was marked down 25.5% to 21.6p as the convenience stores operator announced a £35 million fundraise at a discounted 20p to accelerate its growth strategy and reduce debt.
The neighbourhood retailer also issued a full year profit warning pinned on supply chain disruption as it reported downbeat first half results. These revealed widened losses after Covid-19 costs and subdued like-for-like growth of 1% against a strong pandemic-boosted comparator.
Just Group (JUST), the provider of retirement income products and services, announced a strong set of results for the first half of 2021.
Adjusting operating profit was 47% higher at £90 million, driven by an increase in new business and favourable experience variances. The group recorded an IFRS loss before tax of £87 million.
According to chief executive David Richardson, ‘the fundamentals in our core markets are strong. We are confident in our outlook as we deliver sustainable and profitable growth across the group.’ Shares were 7.4% lower at 98.2p by the close.
