Pile ‘em high, sell ‘em cheap sports and leisure goods retailers Sports Direct (SPD) has taken an £85m hit from its investments in struggling Debenhams, it which it has a strategic stake of just under 30%.

The news comes alongside full year results showing pre-tax profit falling 72.5% to £77.5m with Debenhams (DEB) having an £85.4m impact due to ‘current year fair value adjustments’.

Overall revenue rose 3.5% helped by a boom in overseas sales and premium products. Sports Direct has a strategy in place to smarten up its stores and sell more top name brands which command better profit margins.

Investors are nervous, however, given that Sports Direct also owns a big stake in House of Fraser, which is undergoing its own painful restructuring at the moment, hence the 3.5% share price sell-off in early trade to 420.6p.

A host of FTSE 100 heavyweights are also on the back foot on Thursday, holding back gains to a minimum. The UK’s blue-chip index can barely manage single-digits progress, nudging about 2.5 points higher to 7,678.52, while FTSE 250 midcaps go modestly into reverse.

MORE LOST CUSTOMERS AT ENERGY FIRM

Among the bigger faller on Thursday is ‘big six’ energy firm SSE (SSE), Britain’s second-largest energy supplier. It sees its share price loses close on 3% to £13.475 as its reveals it lost another 320,000 customer accounts in the first quarter, hurt by competition from newer, smaller rivals offering promotional deals, and the summer heatwave.

The energy giant has taken a hit of around £80m in its first quarter from the heatwave and higher gas prices and warned this could hit its full year results. SSE said households used 10% less gas than expected over the three months to 30 June as temperatures soared.

The group revealed a further fall in customers to 7.45m, down from 7.77m a year earlier and 7.58m in March.

SSE is in the process of trying to merge its energy and supply business with rival Npower, although that tie-up is dependent on watchdog Ofgem giving the OK, something that cannot be relied on.

Also modestly lower are shares in consumer goods maker Unilever (ULVR) after the group reported lower than expected second quarter sales, hurt by a Brazilian transport strike and weak pricing.

Unilever saw pre-tax profits fall to €3.2bn, down from €3.3bn for the same period in 2017. But underlying sales rose 1.9% in the second quarter of 2018, compared to the same period in the previous year.

The shares are off 18p, or about 0.4%, at £41.85 with the consumer goods giant saying full year expectations remain unchanged.

NEW FINTECH START-UP

Price comparison website Moneysupermarket (MONY) sees its share price jump more than 8% to 334.5p in early trade as investors get excited about its new fintech start-up plans.

The 50/50 joint venture with HD Decisions, called Podium, will allow people to compare and apply for mortgages online. ‘Mortgage market is ripe for disruption’, says Andy Hancock, managing director at the company.

Investors are encouraged by rising UK sales at online white goods retailer AO World (AO.), the company reporting first quarter revenue in the UK rise of 8%. This reflects a strong start to its year in April and May, although it said demand weakened in June.

But the company reckons its remains ‘on track to deliver its long-term strategic plan and the board's expectations for the full year remain unchanged.’

Last year the company ran-up operating losses of £16.2m as it funded expansion in Europe. Shares in the company rally 3.5% to 149.4p, valuing the internet business at £686m.

British aero-engineer Babcock (BAB) lowered its full year revenue growth target on Thursday as a government review of spending on the delivery of submarines hit its marine division.

Analysts had been anticipating barely 3% revenue growth this year to 31 March 2019 anyway, to £5.53bn, which may imply precious little growth at all now. That news understandably drags on the share price, which falls 7% to 747p.

COPPER DRIVES ANGLO GROWTH

Mining giant Anglo American (AAL) on Thursday reported a 6% increase in total output on a copper equivalent basis in the second quarter compared with a year earlier. That, of course, excludes disruption following a leak at the Minas-Rio iron ore project in Brazil.

Anglo shares nudge about 1% lower to £16.772 as investors remain concerned about trade wars and other macroeconomic factors impacting global commodities demand.

Among AIM market runners, research and development software minnow Sopheon (SPE:AIM) jumps more than 10% to 855p after putting out another upbeat trading update.

The company reports that ‘sales activity remains high and this means ‘we expect revenue, EBITDA and profit before tax for the first half of 2018 to be significantly ahead of prior year performance’.

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Issue Date: 19 Jul 2018