Maitland/AMO Morning Monitor – Tuesday 22 October 2019

22nd October 2019

What really matters... COVID-19

The FTSE, CAC and DAX are expected to open up.

Asia Pacific markets were mixed on Tuesday. The Hang Seng and Nikkei were up while the Shanghai Composite closed down.

Stock market moves

In other news

  • Boris Johnson will make a final attempt today to push Brexit through by the 31 October
  • WeWork is considering a rescue proposal from SoftBank that would value the company at $8bn
  • A joint UK and US investigation has revealed a Russian cyber espionage unit has hacked Iranian hackers to lead attacks in over 35 countries

Politics today

  • Prime Minister Boris Johnson is expected to chair Cabinet today
  • Brexit Committee holds session on the progress of UK-EU negotiations

Corporate announcements

* Maitland Client

Bunzl PLC Trading Statement
  • The Group’s expectations for the year ending 31 December 2019 remain unchanged.
  • Overall trading is consistent with the slowing underlying revenue growth indicated in previous announcements this year due to the impact of the continued mixed macroeconomic and market conditions across the countries and sectors in which the Group operates.
  • Group revenue growth for the third quarter was 4% at actual exchange rates.
  • Growth through acquisitions is an important part of the ongoing strategy of the Group with total committed spend on acquisitions so far this year of approximately £100m.
Whitbread PLC Interim Results
  • Like-for-like accommodation sales declined 3.6%, impacted by continued weak regional market conditions.
  •  Adjusted profit before tax decreased by 4.1% in-line with like-for-like sales decline, a decrease in operating margin offset with a benefit from lower finance costs.
  • Revenue broadly flat at £1,078m, supported by contribution from new capacity.
  • Alison Brittain, CEO, said: “We have delivered a resilient first half profit performance despite challenging market conditions in the UK. Whilst the near-term market conditions in the UK remain uncertain, we have confidence in the long-term structural opportunities available in the domestic budget travel markets in the UK and Germany.”
Reckitt Benckiser Group PLC Q3 2019 Trading Update
  • Like-for-like growth increased by 1.6%.
  • Like-for-like performance in Health was -0.3%, after lapping the supply disruption in the IFCN business in the prior year.  An underlying decline of around -4% reflects improving but continued share loss and cautious retailer purchasing ahead of the ‘flu season. 
  •  Full year 2019 net revenue growth target reduced to 0-2% (like-for-like), reflecting the reduction in retailer inventory levels of seasonal products in Q3 and the inherent uncertainties of the season and associated stocking.
  • Laxman Narasimhan, CEO, said: “RB’s performance in Q3 was disappointing. We delivered another quarter of consistent growth in Hygiene Home.  Our Health business, despite good market growth and stable consumer offtake, delivered a weak net revenue performance. This performance is a reflection of an extended period of significant change and disruption in the company. I am confident we can restore RB to the levels of performance that it is capable of achieving, and build a purpose-driven, responsible company.”
Travis Perkins (TPK) Q3 2019 Trading Update
  • Total Group sales grew by 3.4% on a like-for-like basis.
  • Across the Group, year-to-date sales price inflation has been lower than in previous years, at around 1.5%, primarily concentrated in the merchanting businesses.
  • Merchanting businesses continued to outperform in challenging market conditions.
  • Strong Wickes performance across both core DIY and K&B; demerger on track for Q2 2020.
  • Nick Roberts, CEO, said: “The Group delivered a solid performance in Q3, despite trading conditions becoming incrementally more challenging through the course of the summer as a result of the on-going market uncertainty. Though the Group maintains a cautious outlook for the near-term, full year performance remains in line with our expectations.”
HgCapital Trust PLC Hg invests in Argus Media
  • Hg, the Manager of HgCapital Trust PLC, today announces that it plans to invest in Argus Media, a leading global provider of energy and commodity price reporting.
  • This transaction is subject to regulatory approval.
  • HgCapital Trust plc will invest approximately £31.6m in Argus, with other institutional clients of Hg investing alongside the Company through the Hg Saturn Fund.
  • Based on the 31 August 2019 NAV, the Company’s liquid resources available for future deployment, including all announced transactions and the dividend to be paid on 25 October 2019, are estimated to be £134m (14% of the pro-forma 31 August 2019 NAV of £984.3m)