Maitland/AMO Morning Monitor – Monday 13 January 2020

13th January 2020

Market Information

The FTSE, CAC and DAX are all expected to open marginally lower today.

In Asia, stock markets received a boost today on higher expectations that the US and China will sign a 'phase 1' trade deal on Wednesday.


In the news

  • Nissan accelerates contingency planning for potential split from Renault
  • Violent protests in Iran over grounding of plane move into its second day
  • UK job vacancies drop to most in a decade

The political day

  • Boris Johnson to meet with Northern Irish leaders in Stormont
  • Nominations for Labour leader from MPs and MEPs closes

Top Financial Announcements

* Maitland Client

Ferrexpo PLC* Trading Update
  • Ferrexpo continued to generate strong margins in 2019 as higher realised prices of approximately 16% offset an increase in the Group’s C1 cash cost of production to c. US$48 per tonne (2018: US$43 per tonne). The cost increase was primarily driven by a strong local currency and domestic inflation.
  • 2019 pellet production from own ore rose to 10,519kt (2018: 10,506kt).
  • Production of high quality 65% Fe pellets from own ore up 3% in 2019 to 10,116kt (2018: 9,824kt).
  • As announced on 2 January 2020, the Group declared an interim special dividend of 6.6 US cents payable on 17 January 2020. This special interim dividend reflects the Group’s strong cash generation ability and the Board’s strategy to maintain a balance between sustainable and attractive shareholder returns, investment in growth opportunities and balance sheet strength.
William Hill PLC Trading Statement and Directorate Change
  • The Group’s full-year adjusted operating profit for 2019 from continuing operations is expected to be in the range of £143m to £148m, ahead of market and management expectations, driven by favourable sporting results through the year end.
  • The Retail business, having executed the remodelling strategy, generated operating profit above the guided range of £50-70m.
  • Online UK grew in line with the market for the third consecutive quarter; weakness in gaming net revenue was offset by a strong sporting gross win margin.
  • Ulrik Bengtsson, CEO, said: “The Group has delivered a strong operating performance, ahead of our expectations and against a challenging regulatory backdrop. We made good progress on a number of fronts, including our Retail business, Online and in the US, enabling us to deliver on our long term strategic ambitions. We look forward to building on these efforts in 2020 with a strong focus on customer, team and execution.”
  • The Board of William Hill also announces that Ruth Prior, Chief Financial Officer, has informed the Board of her intention to step down as CFO and as a Director of the Company to return to the private equity sector, joining Element Materials Technology, as CFO.
Spirent Communications PLC Trading Statement
  • Good momentum continued into the final quarter of 2019, with the Group securing a number of important contract wins.
  • For the full year, revenue grew by 5.5 per cent to $503m and the group now expects to deliver an adjusted operating profit in the range of $91 to $93m, up from $77.1m in 2018.
  • Cash closed at $183m, with high cash conversion driven from continued strong working capital management.
  • Eric Updyke, CEO, said: “We are delighted to deliver another strong year of growth and earnings improvement as further evidence that our strategy is indeed working, and we expect to exceed the market’s profit expectations for the financial year 2019. We enter the new financial year with a strong orderbook and we are well positioned with leading technology to leverage more opportunities across our portfolio. Over the medium term we expect to continue to deliver mid-single digit revenue growth with a focus on increasing recurring revenue streams to enhance the Group’s visibility and effective investment in our technical platforms to drive ongoing performance.”
Assura PLC Trading update
  • Development completed at Stow-on-the-Wold, taking total to three completed year to date at a total cost of £11.8m.
  • Immediate development pipeline further increased to £90m, up from £72m at September 2019.
  • Jonathan Murphy, CEO, said: “Assura continued to make strong progress in the third quarter. We expanded our market-leading portfolio with the acquisition of six high-quality assets and completed our third development of the year in Stow-on-the-Wold. We also grew our immediate pipeline of acquisition and development opportunities, reinforcing what was already our strongest in 10 years, to £252 million including 13 developments currently on site. With the new Government enshrining in law increased funding for the NHS and taking forward the Health Infrastructure Plan, better primary care facilities for patients, staff and services are at the heart of the agenda. In this context, Assura is well positioned to deliver high-quality assets and value for money for the NHS.”
Savills PLC Year end Trading Update
  • The Group has delivered a full year performance reflecting both the robustness and geographic diversity of its market positions generally, and the strength of its less transactional businesses.
  • Savills has shown considerable resilience in a year which exposed the Group to significant challenges in the UK and Hong Kong, two of its key markets.
  • Thanks largely to an excellent performance in the UK, significant year-on-year growth in the US and a strong performance from Savills Investment Management, the Group anticipates that underlying results for the year to 31 December 2019 will be at the upper end of the Board’s expectations.
  • Looking to the year ahead, increased political stability in the UK should maintain improved sentiment in real estate markets. Global investor demand for secure income, restricted supply and expectations of continued low interest rates suggest that the medium and long term dynamics of the UK real estate market should remain largely positive.