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Profit warning weighs on Renold; Digital Barriers, Ironveld fall

A look at some the biggest risers and fallers in London today
Share price fall
Renold said it now expected adjusted operating profit to be slightly below the lower end of current forecasts

Renold plc(LON:RNO) was a big faller in mid-afternoon trading, shedding 8.7% to 47p after the industrial chains company issued a profit warning.

Reporting on the six months to the end of September, the company said trading had been mixed, and it now expected adjusted operating profit for the year to 31 March 2018 to be slightly below the lower end of the current range of analyst forecasts.

finnCap responded to the update by lowering its profit before tax forecast for the current year by £500,000 to £15.7mln and trimming its earnings per share estimate by 3.4% to 5.0p. The broker also downgraded its rating for the stock to ‘hold’ from ‘buy.’

Elsewhere, Digital Barriers PLC (LON:DGB) lost 7.1% to 16.25p as the surveillance and security services provider revealed it is still trying to get shareholder support for the £27.5mln sale of its video business to private equity firm Volpi Capital.

So far, Digital Barriers said, it has received irrevocable undertakings and letters of intents in favour of the disposal from holders of an aggregate of 98.8mln shares, representing 56% of the entire issued share capital of the company.

And Ironveld PLC (LON:IRON) shed 9% at 2.02p after it said it is still in exclusive talks to acquire the Middleburg Smelting facility in South Africa, adding it is "confident" it will secure the funding it needs for the acquisition.

Ironveld’s chief executive Peter Cox said: "The acquisition of Middleburg Smelting remains a core focus of the company and on completion would transition Ironveld into a production led mining company."

1.15pm: Carillion up as it reveals approaches for its healthcare business

Carillion PLC (LON:CLLN) saw its shares leap 8% higher to 47p in early afternoon trading after the troubled construction and support services firm revealed it has approaches for its healthcare business.

In a statement, the small cap firm said: “In view of media speculation about a possible sale of Carillion's UK Healthcare business, the Board of Carillion confirms that, consistent with Carillion's announcement on 29(th) September 2017, it has received proposals from more than one credible counterparty for a possible acquisition of that business.”

It added: “A further announcement will be made as and when appropriate.”

Among other gainers, AIM-listed Xtract Resources PLC (LON:XTR) jumped by 25% to 3.55p after announcing that Omnia Mining, one of the contractors working the Manica mine in Mozambique owned by  Xtract, has now commenced production on the western half of the concession.

The group said alluvial collaboration agreement was concluded on 18 June 2017 and  provides for monthly payments to Xtract’s wholly-owned Mozambican subsidiary, Explorator Limitada, against monthly-run-of mine performance.

11.35am: HSBC names new CEO; Lloyds unveils big pensions deal

Banks were in focus approaching midday following some big news from both Lloyds Banking Group PLC (LON:LLOY) and HSBC Holdings PLC (LON:HSBA) today.

HSBC shares fell 1.1% to 750.1p as the global lender revealed that John Flint, currently chief executive of its Retail Banking and Wealth Management division, will succeed Stuart Gulliver as group chief executive next year.

The group said Flint – who is no relation to former HSBC chairman Douglas Flint - will takeover over from 21 February 2018 after Gulliver has stepped down from his roles and retired from the bank.

But Lloyds saw its shares take on 0.2% at 66.66p after the FTSE 100-listed lender announced that it has entered into an agreement with Swiss insurer Zurich AG to acquire its UK workplace pensions and savings business with assets under administration of £19bn.

The bank said the transaction enhances the current offering of its Scottish Widows' business, which already manages more than £124bn of funds of which £35bn is workplace pensions business.

10.45am: Elegant Hotels firmer after reassuring update

Elegant Hotels Group PLC (LON:EHG) found good gains in mid-morning trading, adding nearly 6% at 85p after the firm said trading since its interim results in June has remained in line with market expectations.

The AIM-listed owner and operator of seven hotels and a beachfront restaurant in Barbados said that bookings are currently ahead of the same period last year after 12 days of its new financial year.

Elegant Hotels also confirmed its Treasure Beach hotel is "on track to reopen for business at the start of the peak tourist season".

Elsewhere, Just Eat PLC (LON:JE.) was the top FTSE 250 gainer, ahead 5.8% at 744p after being given provisional approval by UK competition authorities to complete its acquisition of rival online food ordering website Hungryhouse.

Broker comment a focus

Among the blue chips, discount airline easyJet PLC (LON:EZJ topped the FTSE 100 risers, up 2.6% at 1,323p as broker Canaccord Genuity upgraded its rating  for the stock to 'hold', while traders also cited news that German carrier Lufthansa AG said it is to sign a deal to buy part of insolvent peer Air Berlin.

Analysts noted that Air Berlin is also understood to be in talks with easyJet, and that any sign of consolidation in the industry was positive.

Meanwhile, luxury goods group Burberry PLC (LON:BRBY) was also helped by broker comment, adding 2.4% at 1,891p  as Deutsche Bank raised its target for the blue chip firm, while French broker Mirabaud Securities upgraded the stock to 'buy'.

And on the second line, Spire Healthcare PLC (LON:SPI) rose 2.8% to 227.8p after being upped to 'buy' at Investec, but shares AA PLC (LON:AA.) drove 2% lower to 154.7p after being downgraded to 'hold' by German broker Berenberg.

9.15am: Independent O&G surges on gas reserves boost

Independent Oil and Gas PLC (LON:IOG) surged 89% higher in early morning trading to 30.25p after the explorer revealed a new assessment of gas reserves for its Vulcan Satellites, Blythe and Elgood assets in the southern UK North sea.

The AIM-listed group said a competent persons report has set a proved and probable (2P) gas reserves of 303bn cubic feet, which would amount to 54mln barrels oil equivalent. It represents a huge upgrade from the previous estimate, of 34bn cubic feet of gas.

Mark Routh, IOG’s chief executive, said: “This is a major landmark for our portfolio and clear vindication of our strategy of acquiring neglected and stranded assets at low cost, to be commercialised via our gas hub strategy using the Thames Pipeline export route.”

Another good AIM gainer was Active Energy Group PLC (LON:AEG), up 6.7% to 2.40p as the firm, which is now focused on forestry management and biomass fuel products, marked the next milestone in its forestry aims in Newfoundland.

The group said it has submitted all final documents to the Ministry of Fisheries and Land Resources through its affiliate, Timberlands International Limited (TIL), for a Crown Timber Licence and Forestry Management Agreements on the Forestry Management Districts 17 and 18.

And Base Resources Ltd (LON:BSE) added 1.4% at 18.50p as the firm updated on a positive September quarter at its Kwale mineral sands operation in Kenya and raised its 2018 production guidance for zircon and ilmenite.

Other Proactive news headlines:

Liquid biopsy company ANGLE PLC (LON:AGL) has raised an additional £2.8mln after it agreed to let an investor subscribe for additional shares. ANGLE raised £12.2mln last week and the investor wanted to take part in that fundraising but “due to the compact timelines” wasn’t able to complete the necessary paperwork in time.

WideCells Group PLC announced it will launch its stem cell healthcare insurance plan in Spain following the product’s debut here in the UK and alongside its imminent roll-out in Brazil. The local agent for the CellPlan, which costs £170 a year, will be a company called Stem Cell Banco Celulas Madre, a provider of stem cell storage services. Under the re-seller model, the tie-up should generate £50 per sale (after commissions and reinsurance costs).

Minds + Machines Group Limited (LON:MMX) said its top level domains .law, .work, .beer and .shopping have been granted approval by the Chinese regulator, MIIT, for use in China.

Harvest Minerals Limited (LON:HMI) has recorded first sales of its fertiliser replacement KPfertil. The sales were is response to requests from customers even though the company is waiting for formal certification for KPfertil as a remineraliser from the Brazilian Ministry of Agriculture.

APQ Global Limited (LON:APQ), the emerging markets income company, has appointed fintech specialist Gregory Van den Bergh to its International Advisory Council.


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