Morning Financial Press Review
Paul Kettle
AM Press Round-Up -3 min read
06:30, 12th April 2019

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.

Prospect of Brexit-free summer clears airlines’ shares for take-off. Airline stocks took off yesterday after Brussels agreed to postpone Britain’s departure from the European Union by six months, easing fears of disruption during the summer holiday season. Shares in easyJet (EZJ) FOLLOWThomas Cook Group (TCG) FOLLOW and the owner of British Airways, all rose. A so-called relief rally also helped domestically focused businesses such as housebuilders and banks. The latest delay to Brexit — until October 31, unless parliament approves a deal earlier — eradicated the risk of Britain leaving without a deal today. Industry leaders warned MPs not to squander the latest extension, lamenting the “serious damage” the process has already inflicted on the economy. The shares of tourism groups rose on the London market. TUI AG Reg Shs (DI) (TUI)FOLLOW, the German travel giant that also owns First Choice, enjoyed its best ever day of trading. Its shares were up by 8% or 59¼p to 775½p. Shares in International Consolidated Airlines Group SA (CDI) (IAG),FOLLOW the owner of BA, rose 30½p or 6% to 545½p while Easyjet was up 88½p or 8% to £11.44½. Thomas Cook Group gained 5% or 1¼p to 24½p.

Barclays urges investors to snub Edward Bramson’s ‘simplistic and flawed’ arguments for board seat. Barclays (BARC) FOLLOW has urged investors to snub activist investor Ed Bramson’s overtures, arguing that his analysis of the bank was “simplistic and flawed” and he had little banking experience. The secretive investor, who owns more than 5% of the lender through his fund Sherborne Investors, this week urged Barclays investors to elect him on to the bank’s board next month. Mr Bramson said the issues facing Germany’s Deutsche Bank were a “cautionary sign” for the UK bank as both have “similar strategic weaknesses”. In a blistering response to the corporate raider, the lender said he “does not possess the banking experience and skills” necessary for a board seat.

Sports Direct launches share buyback with fresh swipe at Debenhams board. Sports Direct International (SPD) FOLLOW has announced a new share buyback that will return up to £15m to shareholders, while launching a further broadside at the directors of Debenhams (DEB) FOLLOW. The buyback equates to just under 1% of the total number of shares outstanding in Sports Direct and follows a larger £100m buyback launched by the company early last year. The move means that founder and chief executive Mike Ashley, who already owns 61% of the company, will marginally boost his control. Sports Direct has engaged Liberum Capital to conduct the buyback on its behalf.

Entertainment One signs music deal to tune of £178m. The maker of the PJ Masks and Peppa Pig cartoons is splashing out £178 million on a music publisher whose work has been used in hit television series including Bodyguard and Killing Eve. Entertainment One Limited (ETO) FOLLOW was finalising a £191 million share placing last night to fund the takeover of Audio Network, which licenses music to film, television and online video producers. It is the largest acquisition in Entertainment One’s near five-decade history, eclipsing the £140 million it paid for a controlling stake in the producer of Peppa Pig in 2015. The deal could mean life-changing payouts for Audio Network’s founders and senior staff. The company was established in 2001 by Andrew Sunnucks, 53, and Robert Hurst, 54, who were colleagues at Boosey & Hawkes, the classical music publisher. Their idea was to build a catalogue of songs and incidental music that could be licensed to film and TV production companies, sparing them the trouble of seeking permission from myriad rights holders.

Bullish WH Smith (SMWH) FOLLOW lifts dividend with travel stores top of the pile. WH Smith’s statutory profits may have fallen but it said that it was in rude health as it upped its interim dividend. The newsagent and stationer said pre-tax profit dipped by 21% to £65 million even though group revenue jumped by 8% to £695 million in the six months to February 28. The group had booked £16 million of exceptional costs linked to its purchase of In Motion, an American travel rival, and a restructuring programme. At an underlying level WH Smith’s business performed solidly, particularly its travel divisions in airports and train stations, where its trading profit rose by 7% to £44 million on sales that were up 18% at £364 million. In a sign of confidence for the rest of the year, WH Smith said that it would increase its interim dividend by 8% to 17.2p.

Adhesive maker Scapa Group (SCPA)FOLLOW , which manufactures the sticky part of bandages and plasters as well as industrial tape and cable casing, rose after delivering record sales and profit. The healthcare side of the business did particularly well, helped along by two acquisitions. The industrials branch suffered from a slowdown in the car manufacturing and cable markets, but overall revenue was still up 7% to £311.8million.

Grafton Group Units (GFTU) FOLLOW cemented a £113million deal to acquire Dutch ironmongery business Polvo. Grafton’s boss Gavin Slark said the acquisition would increase the firm’s presence in the fast-growing Dutch market, and shares jumped by 50p, to 868p

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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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