Morning Financial Press Review 05/12/19
Below are the key morning press headlines, featuring the The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
has suspended trading in a property fund that manages more than £2.5 billion of assets after suffering a rush of redemptions and struggling to sell assets in a market plagued by Brexit uncertainty. The fund manager said that there had been “unusually high and sustained outflows” from the M&G Property Portfolio Fund, which is held by tens of thousands of small investors, because of “Brexit-related political uncertainty and ongoing structural shifts in the UK retail sector”. Difficult market conditions also had made it difficult to sell commercial property such as shops and offices, M&G warned. The decision to suspend trading will cause concern that other open-ended property funds will suspend investor withdrawals.
The tycoons behind had more than £11m wiped off their fortunes as an accounting fiasco sent shares in the advertising agency plummeting dramatically. A brutal sell-off saw nearly half its value wiped out after it admitted ‘adjustments’ needed to its books now totalled £11.6m – almost double a previous estimate of £6.4m. M&C said a review by auditor PwC found divisions in the firm’s UK business had overstated income and amounts owed by clients, forcing it to issue a profit warning. It cost four of the agency’s founding partners – David Kershaw, Maurice Saatchi, Jeremy Sinclair and Bill Muirhead – about £2.8m each, or £11.2m in total. And it took the stock’s losses since the accounting review was first announced in August to a staggering 76.5%. In addition, the agency, which recently lost major client Natwest, expects profits in 2019 to be between 22% and 27% lower than the previous year.
has put administrators on red alert amid fears the trucking company could collapse in a matter of days. The company has lined up Deloitte to prepare it for insolvency if investors reject a rescue led a secretive offshore fund, sources said. Eddie Stobart has struck a deal with DBay Advisors to save the cash-strapped business. However, the rescue – which includes a £55m high-interest loan in exchange for DBay taking a majority stake – must be approved by shareholders in a crunch vote on Friday. If investors reject the proposal, it is understood that plans are in place to put Eddie Stobart’s holding company into administration shortly afterwards – a move that would wipe out shareholders.
The fashion brand has made a £6.8m loss after sales fell across its high street store chain and concessions, forcing the retailer to warn of further store closures. Quiz, which operates 246 UK stores and concessions, reported a year-on-year sales slump of 11% across its UK retail estate in the six months to the end of September. The share price of Quiz, which reported a £3.8m profit in the same period last year, slumped by 16% in early trading. The company said: “The trading conditions on the UK high street have remained very challenging. A continued reduction in footfall across the group’s standalone stores and concessions have resulted in a sustained and weaker than initially anticipated negative like-for-like [sales] performance.” The high street sales slump prompted Quiz to review its UK retail estate and take a £7m non-cash charge to take into account issues such as onerous leases until it has a chance to renegotiate terms or shut stores.
The founders of have announced plans to sell shares worth up to £150 million in the online fast-fashion retailer. Mahmud Kamani, 55, and Carol Kane, 53, founded Manchester-based Boohoo in 2006 and supplied clothes to high street retailers such as Topshop. They began selling directly to consumers, undercutting their clients. The company has grown into a retailing giant with a market value of almost £3.5 billion. At yesterday’s closing price of 297¼p they would raise about £104 million and almost £45 million respectively, although the stock is expected to be placed at a discount.
A reshuffle of top team has been welcomed by analysts as the next stage of the supermarket group’s succession planning. Trevor Strain has been made full-time chief operating officer and is handing his chief financial officer role to Michael Gleeson, the trading director. Mr Strain, 44, will be responsible for commercial, manufacturing, supply chain, logistics, online and wholesale functions and will report to David Potts, the chief executive. Analysts at HSBC said: “After taking on expanded responsibilities in commercial a little while ago, this evolution in the Morrisons management team is understandable and logical.” The Bradford-based chain was started as an egg and butter stall by William Morrison in 1899. His son Ken took over in 1952.
A slump in flotations and thin equity trading volumes contributed to a 61% profit slide for the year to September at , although the broker yesterday reported a strong start to its new financial year. Numis said that revenues for October and November were ahead of last time thanks to a pick-up in deals and in share trading volumes. The mid-market group blamed the worst market conditions for flotations since 2012 for a 16.1% fall in deal fees during the year. Revenues from equities trading and research were down by 21.4%. Overall profit before tax slumped to £12.4 million, not a surprise after a profit warning in September.
blamed the crisis engulfing the Boeing 737 Max as the airline slashed passenger forecasts for the second time in less than six months, forcing it to cut flights next year and close two bases. The 737 Max was grounded in March after two crashes that claimed the lives of 346 people. Ryanair has 135 Max planes on order and had been due to receive the first one in April. However, deliveries have been suspended since the second crash as regulators investigate the causes and Boeing tries to develop a fix for the aircraft.
The City toasted after demand for its vodka in Poland helped to lift revenues across the group by 9% to £261m last year. Its vodka is so popular there that the east European spirits maker will spend £21m expanding its Polish distillation plant over the next three years. It is aiming to cash-in on demand in Poland for high-end spirits, and is selling more whisky through an agreement to distribute tipples such as Jim Beam. It was also boosted by a surge in sales in the Czech Republic, where it is the sole distributor of Diageo staples such as Baileys and Johnnie Walker. Full-year profits rose almost a quarter to £32m.
Disclaimer & Declaration of Interest
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.