Maitland/AMO Morning Monitor – 27 September 2018

27th September 2018

What really matters... COVID-19

The FTSE is expected to open down. The German DAX and French CAC opened up.

Asian markets are down following comments on inflation by the US Federal Reserve Chairman following his decision to raise interest rates.


Stock market moves


In other news

  • Sky due to be sold for £11.6bn
  • US Federal Reserve raises interest rates
  • Goldman Sachs opens its first UK consumer bank

Corporate announcements

* Maitland Client

TUI Group* Pre-Close Trading Update
  • FY18 is closing out in line with their expectations and they reiterate their guidance of at least 10% growth in underlying EBITA.
  • Customer volumes in Sales & Marketing are up 4% on prior year for Summer 2018, benefitting in particular from increased capacity to Turkey, Greece and North Africa as well as smaller destinations such as Bulgaria.
  • Sales & Marketing trading for Winter 2018/19 (which is low season for most markets) is at a relatively early stage, with around one third of the programme sold.
  • Friedrich Joussen, CEO, said: “Whilst at an early stage, trading for future seasons is overall in line with our expectations. Our strong positioning as a leading holiday product provider with own distribution, as well as our balanced portfolio of destinations and markets, mean that we are well positioned to continue to deliver against our growth strategy. We therefore reiterate our guidance of at least 10%1 underlying EBITA growth in FY18.”
DCC PLC Pre-Close Trading Statement
  • The company expects that Group operating profit for the six months ending 30 September 2018 will be in line with expectations.
  • Operating profit was in line with expectations.
  • The company has spent approximately £270m.
DCC PLC DCC Technology acquires Jam Group in North America
  • The company has acquired the Jam Group of Companies, a market-leading North American specialist sales, marketing and services business, serving the professional audio, musical instruments and consumer electronics product sectors.
  •  The initial enterprise value of Jam is US$170m (c. £130m).
  • Donal Murphy, Chief Executive of DCC plc, said today: “The acquisition of Jam significantly strengthens DCC Technology’s position in the North American market. DCC Technology now has approximately US$600 million in revenue in North America with a strong, service-led, specialist focus on professional audio and visual, musical instruments and consumer electronics. The growing and fragmented nature of these markets will provide DCC Technology with further opportunities for development in the coming years.” 
Halma PLC Trading Statement
  • The company has made good progress in this period, in line with the Board’s expectations.
  • Cash generation remained strong. This, together with the company’s robust financial position, will support continued investment in growth, both organically and by acquisition.
Entertainment One Ltd Trading Update
  • The annual independent library valuation has been completed and the value of the Group’s library assets has increased to US$2.0 bn as at 31 March 2018 (2018: US$1.7 bn).
  • The outlook for the underlying financial performance for the full year remains in line with management expectations. Group net debt: EBITDA is anticipated to be approximately 1.8x at the end of the current financial year in line with previous guidance.
  • Darren Throop, CEO, said: “The Group’s ongoing commitment to investing in its content portfolio has driven current year earnings and created future value, reflected in another increase in the independent library valuation.The financial performance of the business remains in line with management expectations for the year.”
Sirius Minerals PLC Quarterly Progress Update
  • Construction is progressing in line with 2018 guidance.
  • Stage 1 royalty funding of US$250 million received.
  • Chris Fraser, Managing Director and CEO of Sirius, commented: “The business made excellent progress during the third quarter of 2018, achieving a number of key milestones. Procurement is now substantially complete for the major construction packages including the STRABAG AG agreement for the mineral transport system. The coming months are a pivotal period for the Company as we work towards fully financing the construction of our world-class long-life polyhalite project.”
Sirius Minerals PLC Half Year Results
  • Operating loss: £10.8m (2017: £14.7m).
  • Loss for the financial period: £95.3m (2017: £151.3m).
  • Chris Fraser, Managing Director and CEO, said: “Construction activities at our sites continue at pace and significant milestones have been achieved in the first half of the year, such as breaking ground at Wilton.  This, combined with excellent progress to our procurement process, has ensured the Project remains on track to deliver first polyhalite production on time in 2021.”
IG Group Holdings PLC Directorate Change
  • Peter Hetherington will step down as CEO of the Group with immediate effect.
  • During the interim period while the Board searches for a new CEO, Paul Mainwaring, IG’s CFO, will assume the additional role of Interim CEO until a successor is appointed.
  • Andy Green, IG’s Chairman, said: “I would like to extend our sincere thanks to Peter for his tremendous contribution to the Group. Peter has been pivotal to the success of IG during his many years of service, particularly during the last three years during which he has successfully steered the Company through an unprecedented period of regulatory uncertainty whilst delivering strong earnings and profits growth. I particularly commend Peter for his strong ethical leadership of IG and his management of its recent performance. The Company will continue to focus on the delivery of its immediate priorities that Peter has set which the Board believes are successfully positioning IG for its next stage of development.” 
SAGA PLC Half Year Results
  • Underlying profit before tax down 3.7% to £106.8m (2017: £110.9m).
  • Available operating cash flow down 0.1% to £89.5m (2017: £89.6m).
  • Lance Batchelor, Group CEO, said: “At the end of last year, we announced our intention to invest in new customer acquisition.  I am pleased to report significant progress in the first half of the year. Our Retail Broking policy count is back to the levels seen in the first half of 2017, despite a more competitive pricing landscape. Underwriting results continue to be strong, with another excellent claims management performance.”
Mitchells & Butlers PLC Pre-Close Trading Update
  • On a reporting basis like-for-like sales growth was 0.8% in the past 8 weeks, and 1.2% in the year to date.
  •  Total sales have increased by 0.5% in the year to date impacted by the disposals in the prior year.
  • Phil Urban, CEO, commented: “We are pleased to have seen like-for-like sales growth improve to 2.2% following the period of sustained hot weather and the World Cup over the summer.  We are building momentum as a result of our focus on our strategic priorities and are seeing encouraging results from the second wave of transformation activity.  Work continues to mitigate the cost headwinds impacting the industry and we remain confident of delivering full year results in line with the Board’s expectations.”
888 Holdings PLC Half Year Results
  • Group revenue up 1% to US$273.2m (H1 2017: US$270.1m).
  • Adjusted Profit before tax increased by 13% to $42.5m (H1 2017: $37.6m).
  • Profit before tax was $60.1m (H1 2017: $17.3m loss).
  • Itai Frieberger, CEO of 888, commented: “We are pleased with 888’s performance during the first half of the year which has resulted in further progress against the Group’s strategic objectives. 888 has continued to focus on enhancing compliance and customer protection, delivering growth in regulated markets and exciting product innovation.”