The following stocks are the leading risers among London Main Market small-caps on Wednesday.
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SMALL-CAP - WINNERS
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Xaar PLC, up 17% at 74.4 pence, 12-month range 64p-150p. The inkjet printing technology company estimates revenue for 2024 declined to £62.7 million from £70.6 million in 2023. Says revenue growth ‘has been encouraging’ in new markets ‘but ongoing and significant weakness in ceramics, particularly through the second half year, has held back overall results’. Nonetheless Xaar expects to report ‘modest’ adjusted pretax profit ‘in line with previous expectations’ as gross margin rates are as expected and have been ‘coupled with careful cost management’. Net cash position ‘remains robust’ at around £8.2 million, up from £5.7 million. Company also says Paul James is now its permanent chief financial officer, effective immediately, promoting him from interim CFO, a role he has held since late November.
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Galliford Try Holdings PLC, up 6.5% at 384.5p, 12-month range 231p-396p. The construction company says trading for the half year that ended December 31 was ‘ahead of both the prior year period and the board’s expectations’ and that it is ‘performing well, winning a number of key projects and places on strategic frameworks’. Adds: ‘Given our continued project wins and improved framework participation, revenue and profit before tax for the full financial year are expected to be at the upper end of current market expectations, reflecting continued progress towards our margin targets.’ Company-compiled forecast anticipates full-year revenue between £1.80 billion and £1.84 billion, with pretax profit between £34.0 million and £35.4 million. Order book stands at £3.9 billion as of December 31, up from £3.7 billion one year prior. ‘We also see a good pipeline of opportunities across our chosen sectors, supported by our strong track record and focus on the public and regulated sectors alongside high-quality private clients,’ Galliford says.
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Asos PLC, up 4.4% at 397.1p, 12-month range 333.4p-446p. JPMorgan raises its price target on Asos shares to 280p from 250p, although the bank maintains a ’neutral’ rating on the stock. The fast fashion retailer also announces changes to its global distribution network to ‘optimise’ cost efficiency. US customers will be served from Asos’s automated UK distribution centre, starting in the second half of financial 2025, as well as from a smaller and ‘more flexible’ US site. Intends to ‘mothball’ its Atlanta distribution centre during the second half year ‘and will formally market the site following the completion of the multi-year warehouse automation project’. Asos expects a neutral impact on full-year adjusted Ebitda, followed by annualised Ebitda benefit worth between £10 million and £20 million from financial 2026 onwards. Expects a neutral impact on this year’s cashflow and around £190 million ‘of adjusting items predominantly relating to non-cash fixed asset impairments, resulting in a corresponding negative impact on reported profit’. However the US ‘remains a core market’ which Asos ‘believes can return to sustainable revenue growth and generate about 8% adjusted Ebitda margins in the medium-term’.
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