The Telegraph 13/03/19 - Vox Markets | Vox Markets

The Telegraph 13/03/19

Standard Life Aberdeen (SLA) has finally ditched its controversial co-head structure as Martin Gilbert ends his run as one of the City’s longest-serving bosses. Mr Gilbert, who has run Aberdeen Asset Management for more than three decades and earned the nickname “Teflon Gilbert” for overcoming challenges that would have ended many careers, will become vice-chairman of the group and chairman of Aberdeen’s investment arm. The move means that Keith Skeoch will become the sole chief executive less than two years after Standard Life and Aberdeen sealed their ambitious £11bn merger. Sources said no external candidates were interviewed for the sole chief executive job.

Dixons Carphone (DC.) – Carphone Warehouse has been fined a record £29.1m by the financial watchdog for mis-selling its “Geek Squad” mobile phone insurance. The Financial Conduct Authority said the mobile phone retailer failed to properly train staff to “give suitable advice” to customers. It was the biggest penalty it has imposed on a retailer. Carphone had told staff to recommend its Geek Squad insurance and technical support product to shoppers even if they were already covered by home insurance or bank account policies. The firm made £444.7m from selling Geek Squad policies, although 35% were cancelled within the first three months, the FCA said.

The chief executive behind one of Europe’s biggest technology floats of 2018 has stepped down only ten months after listing on the London Stock Exchange. Vincent Steckler, who has led anti-virus software provider Avast Software (AVST) since 2009, said that he plans to retire this year. He will be succeeded by the president of the company’s consumer business, Ondrej Vlcek. In May 2018, Mr Steckler led Avast to its debut as the largest UK technology float on the London Stock Exchange, with a market value of more than $3bn (£2.5bn). Mr Steckler also led the Czech company through its major acquisition of AVG and is credited with growing its revenues from $20m to $800m in a decade.

Hikma Pharmaceuticals (HIK) has swung back into profit after putting the hefty costs associated with an acquisition two years ago behind it. The Jordanian generic drug maker made a $293m (£223m) pre-tax profit in 2018, compared to a $738m loss a year earlier, when it booked a massive impairment charge and paid restructuring costs for its acquisition of Roxane Laboratories, now renamed West-Ward Columbus. Siggi Olafsson, Hikma’s Icelandic chief executive, said 2017 had been a tough year, but that the teething problems related to Roxane were now behind it. “We have a new team in place and are on track with our plan for growth,” he added.

Britain’s biggest insurer has shifted billions of pounds worth of assets into Luxembourg ahead of Brexit, joining the long list of banks, asset managers and insurers that have moved nearly £1 trillion out of the UK. Prudential (PRU) revealed that it had spent £27m preparing for Brexit, which includes setting up an operation in Luxembourg, and has transferred £37bn in customer assets to the EU hub. The figures emerged days after think tank New Financial identified more than 275 firms that have moved or are moving some of their business, staff, assets or legal entities from the UK to the EU in preparation for Brexit.

Troubled Provident Financial (PFG) swung to a profit as it prepares to convince City investors that a £1.3bn hostile takeover bid is a bad idea. Chief executive Malcom Le May is set for a series of one-on-one meeting with top shareholders to convince them that the doorstep lender has a “very compelling story” and does not need to be bought. “I’ll keep articulating that to whoever wants to listen to me, including those shareholders who initially saw merit [in a takeover by Non-Standard Finance],” he said. Non-Standard Finance (NSF) launched its surprise attack on the business last month, when Provident chairman Patrick Snowball received a voicemail at 6.45am giving him a 15-minute warning of the offer.

Morrison (Wm) Supermarkets (MRW) has signalled its confidence in its turnaround by handing shareholders their third special dividend in a year after reporting rising sales, despite customers becoming more “savvy and cautious”. The Bradford-based supermarket unveiled a 4p special dividend and boosted its total dividend by more than a quarter to 12.6p. Morrisons has so far shunned the dealmaking of its larger grocery rivals and has instead focused on building its wholesale business through supply deals with Amazon’s Fresh delivery service, petrol forecourt shops, and convenience chains, such as McColls.

GSK boss still paid less than science chief despite jump to £5.9m. GlaxoSmithKline (GSK) boss Emma Walmsley received a 20% pay jump to £5.9m last year but still took home less than the company’s chief scientific officer. Britain’s biggest drugmaker revealed in its annual report that Dr Hal Barron was paid £6.6m last year and got both a higher basic salary and annual bonus than the chief executive. Glaxo said at the time of Ms Walmsley’s appointment that her remuneration was set “at a level to reflect the fact that this was her first chief executive role”. It was set below the market rate and 25pc less her male predecessor Sir Andrew Witty after investors demanded that her salary be reduced to reflect her experience.

Pendragon (PDG) focuses on second-hand market as new car sales slide. Drivers reluctant to splash out on a new vehicle because of Brexit-related economic uncertainty have put a dent in the profits of Pendragon, one of Britain’s biggest car dealers with almost 200 outlets. Posting annual results, the company, which owns Evans Halshaw and Stratstone chains, said the 6.8% decline in UK new car registrations last year was down to worries about making a major purchase with the country set to leave the European Union. Trevor Finn, chief executive, said: “It’s not a new story. People have been nervous about such a big purchase for a long time.”

Domino’s Pizza Group (DOM) defends growth plans after serving up ‘mixed year’. Domino’s Pizza has refused to backtrack on its ambitious growth plans despite serving up a “mixed year” and warning store openings will slow over the coming months. The company’s expansion plans have been knocked off course as its franchisees dig their heels in and demand a larger slice of the profits. Domino’s is the master franchisee in the UK, Ireland and a handful of European countries. It relies on its franchise partners to open new stores and boss David Wild has committed to a target of having 1,600 in its home market. But after a record 95 openings in 2017, Domino’s was forced to downgrade its projections and ended last year with 59 new sites.

888 Holdings (888) defies headwinds to post record profits. Online bookmaker 888 Holdings believes “the pain in the UK is behind us now” after posting record annual profits. The FTSE 250 gambling operator refused to be blown off course by a series of “headwinds” with its casino and sports faring particularly well over the last 12 months. Pre-tax profit rose sharply to $109m (£83m) on broadly flat revenue of $541m. The company’s bottom line was boosted by the conclusion of a string of German tax assessments and regulatory investigations. A crackdown by UK regulators to curb problem gambling had taken its toll on revenues over the past 18 months, 888 said, as it pointed to “encouraging trends” in Britain more recently.

Tax dispute pushes Cairn Energy (CNE) to huge loss. Cairn Energy’s long-running tax dispute with the Indian government has dragged the London-listed oil explorer to a huge annual loss. The embattled oil producer laid bare the toll of its Indian legal woes after revealing earlier this week that a resolution of the 7-year dispute was not likely until late this year. It conceded a further hit to its full-year financial results by downgrading its flagship North Sea project after the Kraken field failed to live up to expectations. Cairn took a $166.3m charge after cutting its Kraken reserves by a fifth following sluggish production from the field. It made the downgrade despite assurances from the field operator, EnQuest (ENQ), that Kraken was back on track.

Ailing travel group TUI AG Reg Shs (DI) (TUI) slipped to a new record low after a tenth of its aircraft were grounded by the rush of countries banning the Boeing model involved in two fatal crashes. European airlines were caught up in the fallout from Sunday’s Ethiopian Airlines crash after the UK Civil Aviation Authority banned the 737 Max jet from its airspace, with France, Germany and Ireland following suit. Reports claimed that a ban covering the rest of Europe will also soon be confirmed. Tui revealed that a total of 15 aircraft will be grounded out of its 150-strong fleet with five planes operating in the UK affected.

Mothercare (MTC) sells off Early Learning Centre to cut debt. Mothercare is to sell the Early Learning Centre to toy retailer The Entertainer for £13.5m as it grapples with its turnaround. The embattled retailer, which staved off collapse last year by shutting 60 stores and going cap in hand to shareholders to raise £30m, said the sale of the baby toy business was its “next step toward being free of bank debt”. As part of its radical rescue plan Mothercare is shifting its focus from its shrinking UK business towards its international arm, which makes the bulk of revenues.

French Connection sales slide as search for buyer goes on. French Connection Group (FCCN) has blamed a “difficult” retail backdrop in the UK for another heavy slide in sales as the company searches for a new owner. The fashion brand, which peaked in the 1990s on the back of its cheeky FCUK logo, put itself up for sale last October and said on Tuesday that it expected to conclude the process by the first half of the year. It is understood that septuagenarian founder Stephen Marks, who owns a 42pc stake, wanted the business to make a profit before letting go of the chain and today toasted a meagre £100,000 of operating profits, although it continued to make a £9.3m loss on a pre-tax basis.

G4S (GFS) fields offers for armoured van business as profits plunge. British private security firm G4S is reviewing offers for a potential sale of its armoured van division after reporting a 55% plunge in full year profits. A number of private equity firms and public companies have shown interest in the asset, although G4S warned a sale was not guaranteed. The FTSE 250 company added that it could still spin the delivery unit off in a demerger, partial separation or public listing. Chief executive Ashley Almanza said: “We are 12 weeks into the separation review. All of the options are credible. It is better for us to have more than one option [and] we’re pursuing all of them.”

Questor: Brexit fears have depressed shares in this fast-growing currency firm. Buy. Questor share tip: Fairfx Group (FFX) made sales of £8m in 2015 and £25.5m in 2018. Profits are growing nicely too, but the shares look cheaply valued

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Mentioned in this post

avst
Avast Software
CNE
Cairn Energy
DC.
Dixons Carphone
DOM
Domino\'s Pizza Group
ENQ
EnQuest
FCCN
French Connection Group
FFX
Fairfx Group
GFS
G4S
GSK
GlaxoSmithKline
HIK
Hikma Pharmaceuticals
MRW
Morrison (Wm) Supermarkets
MTC
Mothercare
NSF
Non-Standard Finance
PDG
Pendragon
PFG
Provident Financial
PRU
Prudential
SLA
Standard Life Aberdeen
TUI
TUI AG Reg Shs (DI)