Maitland/AMO Morning Monitor – 4 October 2018

4th October 2018

What really matters... COVID-19

The FTSE is expected to open lower this morning, following a drop in the Asian markets over night. The German DAX has opened down, while the French CAC has opened up.

The Japanese Nikkei is down 0.2%, while the Hang Seng index in Hong Kong is down 1.7%.

Stock market moves

In other news

  • High-profile London listings of Aston Martin and Funding Circle fall on market debut
  • Theresa May vows to end austerity if the Conservative Party unite over Brexit
  • The National Cyber Security Centre has declared Russia responsible for global cyber attacks

Corporate announcements

* Maitland Client

Smiths Group PLC Smiths Group further strengthens Flex-Tek with acquisition of United Flexible for $345m
  • Smiths Group today announces that it has entered into an agreement to acquire United Flexible, a provider of flexible and rigid engineered solutions for the transfer of fluids and gases in performance-critical environments, from Arlington Capital Partners for an enterprise value of $345m.
  • United Flexible will be integrated into the Group’s Flex-Tek division.
  • Andy Reynolds Smith, CEO, said: “Flex-Tek has a track record of consistent delivery, underpinned by strong market positions and operational performance. The acquisition of United Flexible will strengthen our position in aerospace and industrial end markets globally. United Flexible is a high-quality growth business with complementary positions on a number of growing aerospace platforms and in industrial markets. I am delighted to welcome the United Flexible team to Smiths Group.”
BTG PLC Close Period Update
  • The good performance in Interventional Medicine was driven by strong growth in TheraSphere® and the cryoablation products, with good growth in EKOS.
  • CER product sales growth for the combined Oncology and Vascular portfolios, including Varithena®, is now expected to be 15-17% for the full year.
  • Louise Makin, CEO, said: “I am pleased to report positive momentum across all areas of the business. By continuing to invest in product innovation, clinical data, geographic expansion and acquisitions, we are developing leading positions in attractive growth markets and creating significant long-term value for shareholders.”
Ted Baker PLC Interim Results
  • Group revenue up 3.5% at £306.0m (2017: £295.7m).
  • Profit before tax and exceptional items up 3.5% at £25.0m (2017: £24.2m).
  • Interim dividend up 7.8% at 17.9p (2017: 16.6p).
  • Ray Kelvin CBE, Founder and CEO, said: “Whilst we believe that the second half of the year will remain challenging due to external factors, we are well positioned to continue Ted Baker’s long-term development. Our flexible business model ensures that our customer has multiple channels to engage with Ted Baker and our global e-commerce business continues to expand, supported by our digital marketing strategy and unique stores that showcase the brand.”
BTG PLC Directorate Change
  • BTG announces that Garry Watts has informed the Board that he wishes to retire as Chairman and Non-executive Director of the Company.
  • The Board has commenced a process to appoint a successor to Mr Watts, who will continue as Chairman until 31 December 2018.
  • Louise Makin, CEO, said: “On behalf of all the Directors, I would like to thank Garry for his effective leadership of the Board since his appointment in January 2012. He has guided us through a period of significant growth and transformation into a strong product sales business.”
ICG Enterprise Trust PLC* Interim Results
  • NAV per share of 1,026p – total return of 8.1% in the six months.
  • Realisations at 31% uplift; 2.3x multiple of cost.
  • Highly cash generative Portfolio – £85m of proceeds received.
  • Emma Osborne, ICG, said: “The Portfolio continues to deliver, with underlying profit growth and realisation activity driving strong returns. As our managers continue to take advantage of the favourable environment to sell companies, we remain disciplined and selective when deploying capital, focusing on defensive companies in sectors with non-cyclical growth drivers, such as education and healthcare. We have a high quality Portfolio, a strong pipeline of opportunities and we believe the Portfolio is well-positioned to continue to generate significant shareholder value.”
Electrocomponents PLC Trading Update
  • Like-for-like revenue growth remained strong at 10% in the second quarter leading to H1 like-for-like revenue growth of 10%.
  • Given good progress to date, we expect half-year adjusted profit before tax to be around £100m (H1 2018: £79.0m).
  • Outlook: We continue to take advantage of the strong momentum in the business to increase investment to support future growth. In particular we plan to invest in Asia Pacific in both digital and customer acquisition to drive faster longer-term growth in this important region. We are also investing to further develop our capabilities in Electronics and Single Board Computing.
DFS Furniture PLC Preliminary Results
  • Revenues up 14.1% at £870.5m (2017: £762.7m).
  • Reported profit down 48.5% at £25.8m (2017: £50.1m).
  • Ian Filby, CEO, said: “We have continued working to develop the Group’s strategic and market position; however financial results for the year reflected the exceptional downturn in market demand we saw in the fourth quarter. We are pleased to note that the market has recovered since the start of the new financial year, with the Group seeing like-for-like order growth across all brands over the first nine weeks. We believe, however, we are benefiting from deferred purchases in the prior financial year and overall we expect the market to remain subdued into 2019, constrained by political risk and weak consumer sentiment.”