UK stocks added to early gains on Tuesday in quiet trading ahead of the UK budget tomorrow.
At 12pm the FTSE 100 index was up 0.44% to 6,618 points while the FTSE 250 mid-cap index was virtually flat at 21,227 points.
Gaming and sports betting group Flutter Entertainment (FLTR) revealed a 27% increase in turnover for last year and a 20% increase in earnings before interest, taxes, depreciation and amortisation (EBITDA), excluding any contribution from its US businesses.
The firm flagged an acceleration in channel shift towards online and a 19% increase in recreational players as its share of the market rose. The shares dropped 2.5% to £14.00 as investor attention shifted to tough comparatives for 2021 earnings.
However, lower working capital needs and tight controls on spending meant it ended the year with net cash of £719 million or £170m more than the previous year, even after £1.3 billion of land purchases., meaning the company could re-start its dividend programme.
Despite a sharp rally across the sector yesterday on talk of a mortgage guarantee scheme being unveiled in this week’s budget, the shares were almost at the top of the FTSE leader board again with a rise 2% to 169.95p.
Shares in builders’ merchant Travis Perkins (TPK) fell 3% to £14.33 after the company posted results for last year showing a near-11% drop in organic revenues and a near-50% drop in adjusted operating profits due to site closures during the pandemic.
On a positive note, the Wickes de-merger process has begun with chief executive Nick Roberts saying the retail business is ‘in great shape to embark on its journey as a standalone entity’.
However, rental income for the third quarter was only 1% lower than the previous year, ahead of the market, while cash flow hit a record at the end of the quarter. The shares dropped 1% to £39.77.
Precision engineering firm Rotork (ROR) reported a 7.4% fall in revenues and just a 3.4% fall in operating profits for the year to December, better than expected given the drop-off in industrial demand and disruption to the firm’s logistics.
Profits were helped by the firm’s Growth Acceleration Plan which kept costs under control while maximising cash generation. At the year-end, net cash was £178 million and return on capital employed (ROCE) was an impressive 31.9%. The shares gained 4% to 371.8p.
RENISHAW ON THE BLOCK
Precision measurement specialist Renishaw (RSW) put itself up for sale after the executive chairman Sir David McMurtry and non-executive deputy chairman John Deer indicated to the board they intended to sell their joint 53% controlling stake in the firm.
There are no current discussions with potential suitors, so under the formal sale process set out by the Takeover Panel interested bidders have to contact investment bank UBS and sign a non-disclosure and standstill agreement. The shares jumped 17% to £67.67.
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