Below are the key morning headlines from today’s papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Patisserie Valerie owner on brink of collapse. The future of Patisserie Holdings (CAKE) was hanging by a thread last night after the café chain warned investors that it would not be able to continue “without an immediate injection of capital”. Luke Johnson, the chairman and 37% shareholder, is understood to be considering making a significant cash injection into the Aim-listed operator of Patisserie Valerie in a desperate attempt to save the company from going bust. In the event of a failure to secure funding, the company is believed to have put PWC’s Birmingham office on standby to step in as administrator, casting a cloud over 2,500 jobs. PWC is already tax adviser to the business and in recent days its forensic accounting investigators have been helping to assess its true financial position.
Scotsman owner Johnston Press puts itself up for sale to stave off insolvency. The troubled newspaper publisher Johnston Press (JPR) has put itself up for sale in an attempt to attract a rescuer before it is forced into insolvency by a debt repayment deadline. Johnston Press, which owns the i national newspaper and dozens of regional titles including The Scotsman and the Sheffield Star, is due to repay £220m in bonds next summer. After exploring restructuring options for more than a year it said its adviser Rothschild would run a formal sale process. The process is expected to take weeks rather than months and could bring to an end years of uncertainty for thousands of Johnston Press staff across the country.
Sir Martin Sorrell set to seal second deal since leaving WPP. Sir Martin Sorrell is closing in on another acquisition at his newly listed advertising venture, potentially placing further strain on his relationship with WPP (WPP) . The tycoon told the Festival of Marketing in London yesterday that he was “in the midst of doing a second thing” after his €300 million cash-and-shares acquisition of Media Monks, a Dutch agency that creates advertising campaigns for large companies. S4 Capital (SFOR) , his new vehicle, floated at the end of last month via a reverse takeover of Derriston Capital, a cash shell, marking a speedy return to the stock market after Sir Martin had resigned as chief executive of WPP in April. His three decades in charge of the world’s largest advertising group ended after an investigation into allegations of personal misconduct and abuse of company assets. He denies the accusations.
WH Smith (SMWH) is to “wind down” its initiatives to revitalise its high street arm and close six shops following a “detailed review” of the business, as its traditional stores struggle in weak trading conditions. Shares in the firm plummeted more than 12% to £17.74 on the back of the news that the stationer will halt projects such as its franchised stores, WH Smith Local, and its budget greetings card chain Cardmarket, shifting its focus to more lucrative travel outlets in airports and railway stations. The review comes after a challenging year in its traditional stores, which reported a 3% fall in trading profits to £60m and a 3% slide in like-for-like sales in the year ending August 31. The company booked £11m in costs on its high street arm, relating to the closure of stores. This knocked pre-tax profits at the group level 4% to £134m. Overall revenues rose 2% to £1.3bn
Plus-size specialist Brown (N.) Group (BWNG) tightens belt after putting online first. The group behind the clothing labels Jacamo, Simply Be and JD Williams has cut its interim dividend and warned that revenue will be lower as it prioritises its online business over shop sales. N Brown’s share price fell by almost 20% yesterday after it said that it expected lower shop sales to hold back revenue in the short term. It also said that it intended to reduce its dividend by 50% to 2.83p to bring it back to a “more sustainable level”. The retailer disclosed the dividend cut when it reported a 5% fall in adjusted pre-tax profit to £30.6 million on group revenue of £457.8 million in the six months to September 1.
Keller Group (KLR) , which specialises in ground engineering projects such as house foundations and tunnels, plummeted 300p, to 662p. Keller released a trading update saying that its Asia Pacific division now expected to make a loss of between £12million and £15million for the year, rather than the ‘small profit’ it had previously guided towards. Deteriorating market conditions in the countries of the Association of Southeast Asian Nations, especially Malaysia, were to blame for the decline, it said. Management had recently changed in both its Asia Pacific division and waterway branch, which prompted a ‘reassessment’ of how their projects were performing. Keller will now launch a ‘strategic review’ of both businesses
Ebiquity (EBQ) has been given the thumbs-up from the UK’s competition regulator to sell its advertising intelligence business to rival Nielsen. The £26million deal hit a brick wall when the Competition and Markets Authority announced a probe but its concerns have been provisionally allayed. Ebiquity’s shares shot up 9p, to 69.5p. Ebiquity wants to focus on its core consultancy business, and is aiming to reduce its debt pile
Backers of James Bond’s favourite car maker Aston Martin Holdings (AML) will be feeling shaken and stirred after a rocky first week on the stock market concluded with a major investment bank advising them to sell. Jefferies analysts, led by the automotive expert Philippe Houchois, initiated their coverage of the historic firm with an ‘underperform’ rating. Long-term investors, who bank on Aston Martin’s value going up over time, are likely to stay ‘on the sidelines’, Houchois said. This is because the lock-up period, which prevents company insiders from selling their own shares straight away, is a relatively short six months, implying they may not have much faith the company will continue to climb.
The competition watchdog is investigating British Airways and other airlines over fears about transatlantic flights. Under the Atlantic Joint Business Agreement, International Consolidated Airlines Group SA (CDI) (IAG) , American Airlines, Iberia and Finnair have teamed up on certain routes between the US, Canada, Mexico and Europe, co-operating on pricing, capacity and schedules. They say that it means passengers are able to mix and match flights across the airlines, use any of their websites, and connect between routes more smoothly. When the deal was struck in 2010, the airlines agreed to make landing and take-off slots available to competitors. However, those commitments run out in 2020. The European Commission could reassess the agreement but may no longer be responsible for competition in the UK due to Brexit. Therefore, the CMA has decided to review the deal.
The founders of Hargreaves Lansdown (HL.) were more than £220million poorer last night after shares tumbled. The company warned that the savings and investment industry is having a tough time attracting new money from clients nervous about the outlook for the markets. The downbeat assessment sent shares sliding 5 per cent, or 97.5p, to 1850.5p, knocking £164million off the value of 32.2% stake owned by Peter Hargreaves, who co-founded the firm with Stephen Lansdown in 1981.
Trading volume in Asiamet shares are 600% above the monthly average, as investors look to take advantage of the recent dip in price the company experienced following the speculation regarding protests in the Nagan Raya area where its Beutong asset is located.
Andalas Energy (ADL), recently released its corporate presentation to the public underlining its new ongoing strategy. The oil and gas exploration and production company explores opportunities in assets in the UK and Indonesia.
Read a roundup of This Week’s Trading Updates: Broker and Tipster Sentiment by Stockomendation Analyst James Bowden.
On today's podcast: David Ciclitira, Executive Chairman of Live Company Group (LVCG) talks about their recent acquisition of Bright Bricks and about general progress at the company. Also Russ Mould, Investment Director at stockbroker AJ Bell talks about: Zytronic (ZYT), Redcentric (RCN) & Tharisa (THS).
SP Angel morning note on commodities featuring: Scotgold Resources* (SGZ LN) – Cononish update
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Five financial stories, trending today in a 70 second podcast, including: Food sales saw their steepest drop in three years in September as consumers tightened their belts after the unusually hot summer, the Office for National Statistics (ONS) has said. Sales of food were down 1.5% in the month, contributing to a 0.8% fall in total UK retail sales.