Online grocery technology company Ocado (OCDO) booked a deeper first half loss after the fire which destroyed its Andover warehouse in February.
But the share price soars to the top of the FTSE 100 leader board on Tuesday with investors are comforted by Ocado’s positive outlook comments, with management saying that ‘we have never had as many opportunities to grow as we do today.’
That sends shares in Ocado soaring to the top of the FTSE 100 leader board on Tuesday, rallying more than 5% to £12.32, not too far off the record £14.09 levels hit in April.
Ocado is due a hefty £562.5m upfront payment from Marks & Spencer (MKS) next month from the pair’s previously-announced retail joint venture deal.
Pre-tax losses for the six months to 2 June ran up to £142.8m, compared to losses of £13.6m last year after the Andover blaze cost the firm £110.3m in lost capacity and other expenses. Revenue rose 10.9% to £882.3m.
Overall UK markets are modestly on the back foot on Tuesday with the mood dampened by ongoing uncertainty to US interest rates cuts, with the Fed becoming less dovish in recent days tanks to robust US economic data.
The FTSE 100 has opened at 7,537.82, down around 12 points or 0.13%, while the FTSE 250 opened at roughly 55 points off at 19,526.83.
TRANSPORT HEADACHE HURTS EDDIE STOBART
Transport and logistics group Eddie Stobart (ESL) has warned of lower half year profits as the group struggles to manage logistical and warehousing issues across its trucking network.
The company said its first half results would be affected by slower-than-expected productivity in its contract logistics and warehousing businesses, as well as the short-term adverse effects on the operational efficiency of its transport network, due to ‘exiting a problematic contract.’
Shares in Eddie Stobart, whose heavy goods delivery trucks are often spotted on motorways up and down the country, have slumped more than 6% in early trade to 68p, valuing the business at about £258m.
This news comes alongside a trading update for the six months to 31 May showing a 25% jump in headline revenues, or 8% higher on an organic basis, thanks to several new business wins.
The company also says it believes it will still be able to deliver full year results in line with expectations. Consensus forecasts for the year to 30 November 2019 are currently pitched at £58.3m of pre-tax profit on £964.6m revenue.
FTSE 100 IT infrastructure business Micro Focus (MCRO) has reported a 1.8% rise in first half earnings to $662m after it squeezed more profit from the legacy software it provides to companies.
Revenue fell 5.3% to $1.65bn, which was in line with market expectations, the company said.
It repeated its guidance that revenue faces a decline this year of between 4% and 6%.
The shares dip 2.5% to £20.455, although that must be seen against a strong run this year for the stock. The share price closed out 2018 at £13.83.
HOME IMPROVEMENT
UK housebuilder Bovis Homes (BVS) said it expects to report a significant improvement in first half profit, with demand for new homes fuelling an improved operational and financial performance.
The homebuilder said it delivered 1,647 completed homes in the six months to the end of June, 4% up on the previous year's 1,580.
The average selling price in the period climbed to £342,000, up from £334,700. That was driven by improved geographical spread of sales outlets, the company said.
The shares nudge 0.4% higher to £10.18.
Mike Ashley's Sports Direct (SPD) is closing in on its £51.9m takeover of video games retailer Game Digital (GMD).
The company today tells the market that its offer has gone unconditional after it attracted backing from shareholders owning nearly 16% of shares. Added to the 38.5% stake already owned by Sports Direct, it now means that the company has backing from shareholders representing 54.3% of Game Digital.
The offer will remain open to Game Digital shareholders until the 1pm deadline on Thursday, 11 July.
This is all largely as expected and does little or nothing to either company’s share price, Sports Direct flat at 261.2p, Game Digital unmoved at 30p.
