UK shares gave up their morning gains on Wednesday, pulled lower by financial stocks as NatWest Group (NWG) became the first bank to appear in court on criminal charges over money laundering.
In Asian trading, Japan’s Nikkei 226 and China’s SE Composite indices gained 0.3%.
Gold prices continued recent gains, adding 0.4% to $1,906 per ounce and Brent Crude was 0.75% higher at $69.1 a barrel.
At midday the FTSE 100 index of leading shares was down 15 points or 0.2% to 7,012 points with banks offsetting gains in housebuilders and betting stocks.
CORPORATE NEWS
In a trading update for the four months ended April, quality assurance and testing company Intertek (ITRK) said like-for-like revenues grew 2.7% in constant currencies.
Growth accelerated to 9.3% between March and April with the products division recording revenue growth of 13.8% and the trade division growing 5.3%.
Looking ahead, the company said it was on track to deliver 2021 targets in revenue, margin accretion and free cash flow. The shares dropped 4.5% to £56.76, making them the worst performers in the FTSE.
Shares in clothing and food group Marks & Spencer (MKS) leapt 7.8% to 168p after posting full year pre-tax losses of £259.7 million (££335.9 million) with clothing and home revenues slumping 32%, offset partly by 1.3% like-for-like growth in food.
Excluding hospitality and franchises, like-for-like food revenues grew 6.9%. Revenues fell 10% to £9.16 billion.
The company’s online grocery joint venture with Ocado (OCDO) delivered 44% revenue growth over the 52 weeks to 28 February and contributed a share of net income of £78.4 million. Ocado shares edged 0.2% lower to £20.02.
Power utility SSE (SSE) said full year adjusted earnings per share rose 5% to 87.5p, within the 85p-to-90p guidance range, while adjusted operating profit grew 4% to £1.06 billion.
SSE declared a final dividend of 56.6p pence per share, a rise of 1.2% in line with average retail price inflation, making a full-year dividend of 81.0p. The shares dropped 0.8% to £15.38.
British Land (BLND) said full year pre-tax losses to 31 March narrowed to £1,053 million from £1,116 million year-on-year, as net rental income increased to £478 million from £367 million.
The value of the portfolio was down 10.8%, with offices portfolio down 3.8%, retail down 24.7%, residential down 10.6% and Canada Water down 2.5%.
The company declared a full year dividend of 15.04 pence per share, down from 15.97p last year, but in line with its 80% pay-out of underlying earnings per share. The shares drooped 2% to 509p.
HEALTHCARE M&A
Shares in hospital group Spire Healthcare (SPI) surged 24% to 240p after it had agreed to be acquired by Australia's Ramsay Health Care for £999.6 million.
Spire shareholders would receive 240p per share, a 24% premium to the company's latest closing price.
Ramsay chief executive Craig McNally said, ‘the proposed combination builds a broader platform to take advantage of the opportunity for sustained growth in the £5.8 billion UK private hospital sector, with the aim of delivering best-in-class healthcare to all patients.’
Private healthcare group Mediclinic International (MDC) which holds 29.9% of Spire Healthcare, said it supported the offer but would withdraw its support if a competing offer appeared which was ‘not less than 10%’ greater than the 240p offer on the table.
The company also said full year revenues fell 3% to £3.0 billion and adjusted operating profit fell 32% to £221 million.
The company said it expected to deliver growth in revenue and operating earnings across all three of its divisions in the 2022 financial year. The shares gained 5% to 323p.
Meanwhile, shares in inhaled-treatment focused company Vectura (VEC) rocketed 32% to 161p after it had agreed to be acquired by US private equity firm Carlyle Group for about £958 million.
Vectura shareholders would receive 136p per share, which the company said represented a 32% premium to its closing price of 103p on Tuesday. They also would be entitled to a 19p per share dividend.
The shares traded at a significant premium to the offer price, suggesting investors expected a higher offer would be needed to secure the transaction.
UPGRADE
IT services company Softcat (SCT) said its annual earnings would be ahead of market expectations after it achieved double-digit revenue growth in the third quarter.
The company delivered double-digit year-on-year growth in revenue, gross profit and operating profit in the three months through April.
The company added, ‘we remain confident of the road ahead and expect to see further growth in normalised EBIT in the 2022 financial year, likely to result in reported EBIT being broadly in line with the upgraded performance now anticipated for the 2021 financial year.’ The shares jumped 5.2% to £18.97.
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