UK Gilt Market's Medium Term Outlook Challenging, Barclays Says
1139 GMT - The medium-term outlook for the U.K. gilt market is challenging due to a sharp rise in government borrowing starting from the fiscal year 2023/24 up to 2026/27, say Barclays analysts in a note. "There's a startling rise in the U.K. medium-term financing requirements, which climbs to GBP305bn in FY23/24 and does not drop below GBP200bn until FY26/27," the analysts say. These level of public borrowing exceeds "what was seen at the height of the global financial crisis", they say. (miriam.mukuru@wsj.com)
Companies News:
Zinc Media Sees 2022 Revenue Ahead of Views; Ebitda in Line With Guidance
Zinc Media Group PLC said Monday that it anticipates 2022 revenue to be ahead of market expectations, and second-half Ebitda to be profitable.
---
Pendragon Gets UK Takeover Panel Extension to Hedin Mobility Deadline
Pendragon PLC said Monday that the U.K. Takeover Panel has agreed to extend the deadline for Hedin Mobility Group AB to either make an offer for the company or walk away until Dec. 9 in order to finalize the necessary documentation.
---
TT Electronics Completes Pension Buy-in for GBP6 Mln Cash Flow Benefit
TT Electronics PLC said Monday that it has completed a buy-in of all its U.K. defined benefit pension liabilities, giving it an immediate 6 million-pound ($7.1 million) cash-flow benefit.
---
Compass Group FY 2022 Pretax Profit Rose on Sector Reopening, To Buy Back GBP250 Mln
Compass Group PLC reported on Monday a better-than-expected pretax profit increase for fiscal 2022 driven by a robust recovery on volumes and new business growth amid lower costs, and announced a further capital return to shareholders as it expects further growth in fiscal 2023.
---
Keywords Studios Sees 2022 Revenue, Adjusted Pretax Profit Ahead of Views
Keywords Studios PLC said Monday it expects 2022 revenue and adjusted pretax profit to be comfortably ahead of current consensus, and that its 2023 performance will be at the upper end of current analysts' forecast range.
---
Pod Point Market Growth Slowed in 2H; Sees 2022, 2023 Earnings Losses
Pod Point Group Holdings PLC said Monday that market growth slowed significantly in the second half of the year on supply chain issues and it expects to report earnings losses for both 2022 and 2023.
---
Real Good Food Secures GBP2.5 Mln in Extra Funding to Support Reform
Real Good Food PLC said Monday that it has secured 2.5 million pounds ($3.0 million) in additional funding from Hilco Private Capital, to support its turnaround.
---
Virgin Money FY 2022 Pretax Profit Rose on Robust Income, to Buy Back Shares
Virgin Money UK PLC said Monday that pretax profit for fiscal 2022 rose driven by stronger income and well-controlled costs, and that it will further return capital to shareholders.
---
Diploma FY 2022 Pretax Profit Rose on Strong Organic Revenue Growth
Diploma PLC said Monday that fiscal 2022 pretax rose on an increase in organic revenue, driven by initiatives, demand and pricing, and that fiscal 2023 has begun well, consistent with its guidance.
---
Accrol Saw Significant Growth in 1H; Sees FY 2023 Revenue, Profit Rising
Accrol Group Holdings PLC said Monday that it performed well in the first half of fiscal 2023, with significant growth in volumes, revenue and profit and a stronger market position, and sees its full fiscal year results rising.
---
Ncondezi Energy to Raise GBP520,000 for Mozambique Project
Ncondezi Energy Ltd. said Monday it conditionally raised 520,000 pounds ($618,176) via a discounted share placing and a subscription, and that it will use the proceeds for general working capital purposes.
---
Trafalgar Property to Buy Hydroponic Facility for GBP30,000; Shares Rise
Shares in Trafalgar Property Group PLC rose Monday after the company said that it has entered a conditional agreement to buy assets and leasehold premises for a hydroponic research and development facility for 30,000 pounds ($35,664) from May Barn Horticultural Consultancy Ltd.
---
Headlam Group Appoints Adam Phillips as Chief Financial Officer
Headlam Group PLC said Monday that it has appointed Adam Phillips as chief financial officer, and that he will join the board by April at the latest.
---
Genedrive Shares Fall on Widened FY 2022 Pretax Loss
Genedrive PLC shares fell Monday after the company said fiscal 2022 pretax loss significantly widened on lower revenue due to a lack of coronavirus-related income, and reported material uncertainty that could impact its ability to continue as a going concern.
---
Allergy Therapeutics Appoints Martin Hopcroft as Interim CFO
Allergy Therapeutics PLC said Monday that it has appointed Martin Hopcroft as interim chief financial officer, replacing Nick Wykeman who is stepping down at the end of the month.
Market Talk:
Accrol Shares Look Very Good Value on Strong 1H
1126 GMT - Accrol has delivered a very strong first half, successfully passing through all of its cost inflation and taking market share as private label volumes are now higher than prepandemic levels, Liberum says. The tissue maker's private label market share is growing at an unprecedented rate against that of traditional brands and the company looks like a strong structural growth story, Liberum analysts say in a research note."Revenue growth is accompanied by rising margins and with an improving free cash flow profile, we see the shares as offering very good value," the brokerage says. Liberum retains its buy rating and 60 pence price target on Accrol's stock. Shares are up 6.8% at 27.4 pence. (joseph.hoppe@wsj.com)
Accrol Shows Resilience with Bright Times Ahead -- Market Talk
1122 GMT - Accrol's first-half update is mostly positive, highlighting its well-invested base, excellent management and strong operational capabilities, Shore Capital says. The tissue maker has faced a lot of headwinds in recent years, and it is good to see its resilience and strong base making progress for all stakeholders from here on as it expects to "at least" meet market expectations for fiscal 2023, Shore analysts Tom Fraine and Clive Black say in a market note. "Against what have been multiple and major headwinds for the group, we see this as a very creditable update," the investment group says. Shore doesn't have a recommendation on Accrol's stock. Shares are up 6.8% at 27.4 pence. (joseph.hoppe@wsj.com)
TT Electronics Pension Buy-In Will Ease Cash Flow Concerns
1115 GMT - TT Electronics has completed a buy-in of its U.K. defined benefits scheme at no cost, immediately benefiting cash flows, RBC Capital Markets says. There have been concerns around the electronic components manufacturer's cash flow and net debt to Ebitda ratio in 2022 after a working capital spike to support its extended order backlog--this should help ease those concerns and increase market confidence, RBC analysts say in a research note. "Our current fiscal 2023 free cash flow yield forecast is an already attractive 8.5%, before the benefit of this additional GBP6 million per annum. We see it as a significant positive and retain our outperform rating," the Canadian bank says. RBC retains its 250 pence price target. Shares are up 10% at 159.8 pence. (joseph.hoppe@wsj.com)
Virgin Money Gains After Robust FY Results, Returns
1111 GMT - Virgin Money shares jump 13% after the U.K. challenger bank reported higher annual pretax profit and said it would return further capital to shareholders. A robust set of results, big cash returns, lower-than-expected impairments and the company's comfortable cash position pleased investors, AJ Bell says. "Combined with a beaten-down valuation, it's no surprise its shares were in heavy demand today," AJ Bell investment director Russ Mould writes. "The better-than-expected dividend and buyback are good news on their own, but are also crucial for what they say about management's confidence in the outlook for the business. Virgin Money has significant exposure to the mortgage market, although looking at its loan book, it seems to have done a decent job of managing its risks." (philip.waller@wsj.com)
Severn Trent's 1H Sees Interest Rates, Bond Yield Effects in Focus
1106 GMT - Severn Trent's interim results on Tuesday will be closely watched for comments on the effects of higher interest rates and higher government bond yields, factors that have become even more acute in the chaos following September's mini-budget, AJ Bell says. The U.K. water utility, like peers, offers some degree of inflation protection to investors as revenues can be index-linked, but aren't usually seen as sources of capital growth, the brokerage says in a research note. "The higher bond yields go, the more attractive fixed income looks relative to utility equities, and vice-versa--so the relative calm in the Gilt market after the sacking of Kwasi Kwarteng and appointment of Jeremy Hunt as chancellor may have helped Severn Trent's autumn share price rally," the brokerage says. (joseph.hoppe@wsj.com)
Compass Margin Recovery May Be Tougher Than Hoped
1036 GMT - Compass Group drops 2% after the contract caterer reported higher annual operating profit, though margin progression may have dampened investor sentiment, analysts say. Underlying operating margin improved by 170 basis points year-on-year to 6.2%, with H2 2022 at 6.5%, and Compass forecast an underlying operating margin above 6.5% in 2022/23. Margin recovery is proving harder than perhaps the market had hoped for, but it was still pleasing to see sequential growth coming through in the second half, Hargreaves Lansdown says. "Compass needs to take a pragmatic view of this, because if it raises its prices too high, then some of the benefits its customers enjoy start to evaporate," HL's head of equity research Derren Nathan writes. (philip.waller@wsj.com)
Contact: London NewsPlus; paul.larkins@wsj.com
(END) Dow Jones Newswires
11-21-22 0733ET
