Maitland/AMO Morning Monitor – Thursday 16 December 2021

16th December 2021

In the news

  • The UK hit a record 78,610 Covid-19 cases in the past 24 hours, the highest number since the pandemic began, as retail, manufacturing, travel and healthcare companies raised warnings about staff shortages.
  • Economists expect the Bank of England to keep the interest rate at 0.1 per cent after prices surged at their highest rate for a decade.
  • President Xi of China has pledged to support Russian demands for guarantees that Nato will not expand any further into eastern Europe.
  • US borrowers have breached loan limit guidance at a record pace as one-third of loans sold to investors this year came from companies that borrowed more than watchdogs recommend.
  • European football authorities have chosen Citigroup to spearhead a support package for the region’s clubs as fears mount over disruption from the Omicron variant.

Politics today

  • The House of Commons answers transport questions at 9.30 am, followed by any urgent questions and ministerial statements at 10.30 a.m.
  • The central bank’s monetary policy committee decides on interest rates at noon. Inflation surged to 5.1 percent on Wednesday.
  • Polls have opened in North Shropshire for voters to elect a replacement for former Tory MP Owen Paterson, who resigned after being found to have breached parliamentary lobbying rules.

Stock market moves

  • In the US, the S&P 500 rose 1.63%, while the Nasdaq 100 rose 2.35%.
  • In Asia, the Kospi index rose 0.51%, Hang Seng Index increased 0.35% and the Shanghai Composite Index gained 0.75%.
  • In Europe, the FTSE 100 is trading up 1.1%.

Corporate announcements

* Maitland Client

LXi REIT PLC* Accretive £58.9M acquisition let to Sainsbury’s
  • The Board of LXi REIT today announces the acquisition of a long-let property which has been independently valued by Knight Frank LLP at £58.9 million.
  • The Property is fully let to Sainsbury’s Supermarkets Limited (the principal trading company of the Sainsbury’s group) with 19 years unexpired to first break.
  • The rent increases five yearly in line with RPI inflation, collared at 1% pa and capped at 4% pa.
  • Simon Lee, Fund Manager, LXI REIT Advisers said: “We are pleased to acquire this well-let asset underpinned by a long, inflation-linked lease to a FTSE 100 company, with good asset management opportunities to enhance income and capital returns. The consideration predominantly takes the form of the issue of new shares in the Company at a material premium to NAV, which further enhances the accretive nature of the transaction.”
Schroders PLC Response to media speculation
  • Schroders notes recent media speculation and confirms that it is in advanced talks with Greencoat Capital, a leading European renewables infrastructure manager, about taking a significant stake in the business.
  • There is no certainty these talks will lead to any final agreement.
  • Schroders continues to evaluate potential acquisition opportunities in line with its strategy to build a comprehensive private assets platform and enhance its leadership position in sustainability.
Pearsons PLC Directorate Change
  • Pearson PLC today announces the appointments of Omid Kordestani as a Non-Executive Director and Chair Designate and Tim Score, Senior Independent Director, as Deputy Chair Designate.
  • Omid will join the Board from 1 March 2022 succeeding Sidney Taurel as Non-Executive Chair upon conclusion of the company’s AGM in April 2022.
  • Tim will also take on the role of Deputy Chair upon conclusion of the AGM.
  • Andy Bird, Chief Executive, said: “Omid has been a driving force behind the growth of a number of world-changing tech companies. I am thrilled that he will now be bringing that expertise to Pearson, enhancing our strategic direction and growth potential. I am also delighted that Tim will support Omid as Deputy Chair given his wealth of experience in UK plc. Together they will be a formidable team.” 
Hipgnosis Songs Fund LTD Half-year Report
  • The Board of Hipgnosis Songs Fund Limited today announcesthe Company’s interim results for the six months ended 30 September 2021.
  • Operative NAV increased by 2.5% to $1.7242 per Share over the six month period.
  • Net revenue grew by 31% to $74.1m (six months ended 30 September 2020: $56.7m).
  • EBITDA increased by 16.2% from $47.0m to $54.6m.
  • Net debt at 30 September 2021 was $550.9m.
  • Merck Mercuriadis, Founder, said: “As we look forward, despite the emergence of the Omicron variant of COVID-19, we continue to see a promising outlook for the music industry and our Catalogues.”
IntegraFin Holdings PLC Final Results
  • IntegraFin Holdings PLC today reports its results for the year to 30 September 2021.
  • Profit after tax of £51.1m (+12%).
  • Funds under direction £52.11bn (+27%).
  • Gross inflows of £7.70bn in the year (+34%).
  • Alexander Scott, Chief Executive Officer, said: “Great customer service is front and centre in everything we do. To achieve this, we continue to develop our systems and processes and, most importantly, invest in our people.  It is their commitment to living up to the values we set for ourselves, and the Group collectively, which keeps our service standards so high.”
Domino's Pizza Group PLC Resolution with franchisees
  • Domino’s Pizza Group today announces that it has reached resolution with its franchisees to unlock the significant latent potential of the Domino’s system and accelerate both near-term and long-term growth. Specifically, the Company has committed to:
  • One-time capital investment of approximately £20m, spread over three years, in digital acceleration, personalisation, ecommerce app development and in-store innovation to enhance the customer experience and drive top-line growth;
  • Increased marketing investment to support new national campaigns and promotions.
  • Dominic Paul, Chief Executive Officer, said: “Our business continues to perform strongly, and we are looking to the future with confidence. Combined with our new strategic plan which is focused on accelerating our growth in both delivery and collection, the resolution we are announcing today can unleash the power of the Domino’s brand, and enable us to deliver long-term, sustainable growth which will benefit all our stakeholders.” 
Airtel Africa PLC Chimera Investment LLC invests $50m in Airtel Africa's mobile money business
  • Airtel Africa today announces the introduction of Chimera Investment LLC as an additional investor in Airtel Mobile Commerce BV (AMC BV) through a $50m secondary purchase of shares from a subsidiary of Airtel Africa plc
  • AMC BV is the holding company for several of Airtel Africa’s mobile money operations and ultimately is intended to own and operate the mobile money businesses across all of Airtel Africa’s fourteen operating countries.
  • Chimera Investment LLC, through its subsidiary Chimetech Holding Ltd., now holds a minority stake in AMC BV alongside the other minority investors, with Airtel Africa continuing to hold the majority stake.
  • The Transaction is a continuation of the Group’s pursuit of strategic asset monetisation and investment opportunities, and it is the aim of Airtel Africa to explore the potential listing of the mobile money business within four years.
  • The proceeds from the Transaction will be used to reduce Group debt and invest in network and sales infrastructure in the respective operating countries.