Maitland/AMO Morning Monitor – Friday 18 October 2019

18th October 2019

Market Information

The FTSE is expected to open up this morning while the CAC and DAX are expected to open down.

Asian stocks were mixed today after China GDP growth disappoints.


In the news

  • Draft Brexit deal struck between the UK and EU is due to face a vote in British Parliament tomorrow
  • Turkey agrees to pause its military operations in Northern Syria to allow Kurdish forces to withdraw from an area along the border
  • China's GDP growth falls to a new low of 6 percent

The political day

  • Prime Minister Boris Johnson is due to attend day two of the European Council
  • Pensions minister Steve Webb and shadow pensions minister Jack Dromey are to participate in a panel debate at Pensions and Lifetime Savings Association Anuual Conference
  • Sajid Javid joins G20 finance ministers meeting ahead of IMF and World Bank annual meetings in Washington DC

Top Financial Announcements

* Maitland Client

London Stock Exchange Group PLC Trading Statement
  •  Strong Q3 performance across all parts of the Group – LCH continues to grow strongly in OTC products; FTSE Russell performing well with growth in subscription revenues.
  •  Q3 total income up 12% to £587m.
  •  On a nine-month year-to-date basis total income up 9% to £1,727m.
  •  Proposed acquisition of Refinitiv continues to progress.
  • David Schwimmer, CEO, said: “The Group continues to perform well and has delivered a strong Q3 performance. LCH’s OTC clearing services saw continued strong volumes during the period in both member and client clearing.  In Information Services, FTSE Russell reported 10% growth as subscription revenues remained strong.  Capital Markets also produced a good overall performance against a backdrop of continued challenging market conditions. During the quarter, we announced the proposed acquisition of Refinitiv, a leading global provider of data, analytics and financial markets solutions.  This is a transformational transaction that accelerates our Group’s strategy, positioning us in key areas of future growth as a global financial markets infrastructure leader. Together, we will create a multi-asset class capital markets business and bring world class data content, management and distribution capabilities to our customers on an open access basis.  The transaction offers substantial strategic and financial benefits to our shareholders, customers, employees and other stakeholders.”
London Stock Exchange Group PLC LSEG Directorate Change
  • London Stock Exchange Group today announces that David Warren, Group Chief Financial Officer has informed the Group of his intention to retire from the company and step down from the Board by the end of 2020.
  • David Warren will continue in his current role as Group CFO and a member of the Board through the close of the Refinitiv transaction to ensure a smooth transition to his successor.
  • LSEG will undertake a global search, which will be led by the Board’s Nomination Committee.
  • David Schwimmer, CEO, said: “David has been an outstanding contributor to the Group’s success. I’d like to thank him for his partnership during my first year at LSEG. I look forward to continuing to work closely with him to drive our core business and to deliver the Refinitiv transaction.”
InterContinental Hotels Group PLC 2019 Third Quarter Trading Update
  • 4.7% YOY net system size growth to 865k rooms; on track to exceed 5% for full year 2019.
  • 13k rooms opened, taking the total to 42k rooms YTD.
  • Signed 25k rooms in the quarter, 73k rooms YTD.
  • Group Q3 comparable RevPAR down 0.8%, flat for Q3 YTD.
  • Keith Barr, CEO, said:”Our continued strategic focus on driving net rooms growth enabled us to deliver a 4.7% increase in net system size despite a strong comparable. This will accelerate in the coming quarter and we are on track to deliver industry leading net system growth over the medium term. Third quarter Group RevPAR was down 0.8%, impacted by tougher trading conditions in the US and China, and ongoing unrest in the Hong Kong SAR. We have made further progress executing against our strategic initiatives, with the first franchise applications already received for Atwell Suites, our new upper midscale brand which was launched for franchise sales at the end of the quarter. We also strengthened our loyalty offer through an exclusive partnership with world-renowned travel club and boutique hotel specialists, Mr & Mrs Smith. This will more than double our luxury and boutique offering to IHG Rewards Club members in new and iconic locations and enhance the loyalty member value proposition.”
Avast PLC Third Quarter Trading Update
  • For the third quarter, Adjusted Revenue excluding FX, Discontinued Business and the sale of Managed Workplace rose 9.0% to $218.3m (Q3 2018: $203.4m).
  • For the third quarter, Adjusted EBITDA increased 8.7% to $121.9m, For the year to date, Adjusted EBITDA increased 6.6% to $358.5m, resulting in an Adjusted EBITDA margin year to date of 55.4%.
  • At 30 September 2019, net debt / LTM (“last twelve months”) Adjusted EBITDA per the banking covenant was 1.9x and net debt / Adjusted Cash EBITDA was 1.8x.
  • Ondrej Vlcek, CEO, said: “I’m pleased to report that Avast has delivered good growth in the third quarter, consistent with our expectations at the time of the Half Year Results in August. We continue to successfully execute our growth strategy, underpinned by our platform distribution model and our global installed base of more than 435m users.”