Morning Financial Press Review
Paul Kettle
AM Press Round-Up -3 min read
06:03, 14th May 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.

Vodafone offloads New Zealand arm as regulator blocks merger. Vodafone Group (VOD) FOLLOW has agreed to sell its New Zealand operation to a private equity consortium for €2.1bn (£1.8bn) after an attempt to merge it with a pay-TV broadcaster was blocked by competition watchdogs. The deal was unveiled by chief executive Nick Read on the eve of annual results that are widely expected to include a cut to Vodafone’s dividend, prompted by the debt burden of its expansion in Europe. Mr Read said the exit from New Zealand demonstrated the company’s commitment to bringing down debts which, after an €18bn cable takeover in Germany, are due to top €50bn – more than three times earnings.

Shorters ‘make £500m’ from Metro Bank as shares plunge again. Hedge funds have made more than £500 million betting against Metro Bank (MTRO) FOLLOW in the past year after a slump in its share price. Shares in Metro fell another 11% to a new low of 475p yesterday over concerns about an imminent capital raising and reports over the weekend about customers withdrawing their cash. The bank is understood to be in talks with institutional investors and sovereign wealth funds from the US, Europe and Asia about becoming a cornerstone investor in a £350 million fundraising.

British Gas owner Centrica (CNA) FOLLOW warns of ‘challenging’ markets as customer losses continue. The owner of British Gas has raised fears of a dividend cut after warning investors that profits will take a hit in the first half of the year. The home energy giant blamed the Government’s energy tariff cap, warm weather and falling natural gas prices for a “challenging” environment in the first four months of the year, as it lost another 234,000 UK household customers. The FTSE 100 company said these factors, including a £70m one-off hit from the energy price cap, would mean lower profits in the first half and further pressure on its full-year outlook, despite swinging job cuts to help improve its efficiency.

US activist ‘will keep coming’ at FirstGroup (FGP) FOLLOW in ‘supreme battle’ to overhaul board. A US activist investor insists it is “not going anyway” in its bid to oust the board of troubled rail and bus operator FirstGroup and “will keep coming” at executives until it has achieved its goal. Coast Capital Management, FirstGroup’s biggest shareholder, outlined details of its plans to remove six directors and appoint seven new board members in their place. It attacked FirstGroup bosses six months ago, accusing them of “driving the bus off the cliff”. Subsequently, Coast has tried to persuade the company to bolster its board behind closed doors. Reigniting its public attack on Monday, Coast requisitioned an extraordinary general meeting to force through its boardroom changes.

Angling retailer charts trip into foreign waters. Britain’s biggest angling equipment retailer is planning to fish in foreign waters for acquisitions to tap into growing international demand for tackle. Darren Bailey, chief executive of Angling Direct (ANG) FOLLOW, said that the Aim-listed company had held talks with potential overseas takeover targets and would consider buying a chain of shops that had an established online presence. The move came as Angling Direct reported that it had swung to a £266,000 pre-tax loss for the 12 months to the end of January from a £159,000 profit a year earlier. Mr Bailey said that the loss was due to the investment that the company undertook during the year, which included opening native language websites in Germany, France and the Benelux countries.

A sharp drop in the number of deaths so far this year has hit profits at funeral services firm Dignity (DTY) FOLLOW. Official figures show 159,000 people died in the first quarter – down 12% on the same period last year. The decrease – which the firm said was ‘significantly lower than expected’ – was put down to a mild winter, including a particularly warm February. Its revenues fell 15% to £81million in the first quarter. The company said it believes full-year profits will fall by as much as £4million.

Provident Financial (PFG) FOLLOW has been accused of unfairly casting doubt over the financial health of a rival battling to buy it. The doorstep lender suggested that Non-Standard Finance (NSF) FOLLOW will have to raise up to £130million from investors if its hostile takeover succeeds. But NSF has hit back at the claims, as tension between the two companies escalates. NSF is fighting to win backing for its takeover from Provvy shareholders ahead of a deadline tomorrow. A spokesman said: ‘Provident has made incorrect assertions regarding NSF’s capital position – which were completely unfounded, based on invalid premises and incorrect assumptions. ‘These are the actions of a Provident management team which has run out of ideas.’

Investors in Stobart Group Ltd. (STOB)FOLLOW , the owner of Southend Airport and part of the consortium which recently bought struggling airline Flybe, were alarmed as it revealed it would delay the publication of its full-year results by two weeks. Stobart sold its air division to Connect Airways, the new company it formed along with Virgin Airways and Cyrus Capital to buy Flybe. It said it would restate last year’s accounts to reflect this disposal, but it is understood that matters have been delayed because Stobart did not see several documents relating to the Flybe deal until weeks after it was announced in February. Although the firm said it was confident of delivering full-year revenue and profit in line with expectations, shareholders were clearly concerned that the results delay was a bad omen.

A narrowed focus at online teaching firm Wey Education (WEY) FOLLOW is beginning to pay off, as turnover shot up in the six months to February. The firm, which owns the Interhigh online high school and teaching resources business Academy 21, reported a 54.7% rise in turnover to £2.7million. Losses widened to £895,000 from £153,000 due to closures of some operations such as the London Learning Centre, as Wey tried to simplify its structure.

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