Afternoon Financial Press Highlights
Paul Kettle
PM Press Review -2 min read
16:24, 12th February 2019

Below are the key headlines from today’s updated papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.

Online trading platform Plus500 Ltd (DI) (PLUS) FOLLOWhas fallen victim to an EU regulatory crackdown with shares tumbling more than a third on Tuesday. The Israeli company said profits would be “materially lower” than City expectations as European regulations are implemented to curb the use of highly speculative financial bets. The stock market selloff will be welcomed by a clutch of hedge funds, which have built large short positions against Plus500. Trading income for 2018 rose by two-thirds to $720m (£560m) and pre-tax profit almost doubled to $503m. However, with much of this good news priced into the company’s stock market valuation, shares sank to a 12-month low. They have almost halved since August.

AA (AA.)FOLLOW insisted this morning that its recovery plan remained on track as it reported trading in line with expectations but revealed declining membership figures. The London-listed company said that earnings were “not less than” £340 million in the year to January 31, having guided the market to a range of between £335 million and £345 million. Executives are seeking to revive the company’s fortunes. The roadside services group was formed by four driving enthusiasts in 1905 and now has 13 million members. But its more recent history, since it was floated by private equity owners in 2014, has not been straightforward. Corporate contracts with the likes of Jaguar Land Rover and Volkswagen now account for the lion’s share of AA’s services, with about ten million business-to-business members. Paid personal memberships fell by about 2% to 3.21 million across the year, it said. The company said that this decline was anticipated and put it down to regulatory pressures, competition and the decision to “re-phase our summer marketing campaign”

A British data firm has snapped up a US rival to build out its identity verification business in the US in a £232m deal. GB Group (GBG) FOLLOW, an Aim-listed data company, confirmed it will buy out IDology, an Atlanta-based competitor, which will allow it build its presence in North America. The Chester-headquartered company provides background-checking services and ID verification on 4.4 billion people globally, with clients including payments giant Stripe, betting shop William Hill and Waitrose. The deal will see GBG raise an additional £160m in financing through a new share placing plus a new £84m bank facility. GBG’s share remained steady at 424p.

TUI AG Reg Shs (DI) (TUI) FOLLOWshares fell today after the holiday company reported its losses widened in the first quarter. Like its competitors, Tui blamed unusually warm weather over the summer and a weaker pound for the loss, which rose to €111.9million in the three months to the end of December, from €68.3million a year earlier. Most losses came from its tour operator business and airlines, but this was partly offset by profits in its cruises division and holiday ‘experiences’.However, Tui, which slashed its annual profit forecast just last week, said its growth strategy is still ‘intact’, and anticipates profits to be largely stable in 2019. Turnover in the quarter rose 4.4% to €3.7billion

The huge importance of the London economy to the rest of the country was highlighted on Tuesday by figures showing that the capital accounts for almost half of all services exported by the UK. In 2016 — the most recent year for which figures are available — London businesses sold services abroad worth £117.3 billion out of a total for the UK of £251.2 billion, according to data from the Office for National Statistics. The City and Westminster alone accounted for more than £60 billion of services exports. This is more than the combined figure for Scotland, Wales, the North-East, North-West and South-West regions of England. Tower Hamlets, which includes most of the Docklands financial district, was responsible for almost £12 billion of services exports.

Shares in bookmakers galloped ahead on Tuesday as investors breathed a sigh of relief that racing will recommence after an outbreak of equine flu. The British Horseracing Authority last night announced a “risk-managed” return — with health security measures in place — to the sport tomorrow. The update came after meetings were called off last week when a number of horses tested positive for equine influenza. The City took a punt on investing again today, driving shares in FTSE 100 firms Paddy Power Betfair (PPB) FOLLOWand Ladbrokes-owner GVC Holdings (GVC)FOLLOW up 43.6p to 6408p and 6.25p to 661.25p respectively.

Shares in logistics firm Wincanton (WIN) FOLLOWgained 3.06p to 240.06p. The business revealed it has won a five-year contract with HMRC. Wincanton will work with the Government to check inbound shipments into the UK, and provide storage and distribution services.

AIM-listed Firestone Diamonds (FDI) FOLLOWsparkled on Tuesday after it announced it unearthed a 70-carat white diamond in its Liqhobong mine in Lesotho. One of its other most recent discoveries — a 46-carat diamond — sold for more than $1 million (£780,000).

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The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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