Shares in the world's biggest advertising agency WPP (WPP) plunge more than 7% to £11.88 in early trade on Tuesday, heading the FTSE 100 loser board, after posting lower revenues in its first half results.
The group, which confirmed Mark Read as its new chief executive yesterday, also raised its sales expectations for the full year, not that investors are giving it much credit for doing so.
Read takes on the top job at a tricky time for WPP, which issued a number of warnings about growth last year, and saw the departure of its founder and long-standing boss Sir Martin Sorrell.
WPP reported a headline profit before tax £735m, down 7.4%, or 2.5% lower at constant currencies.
Leading the FTSE 100 higher on Tuesday is packaging firm DS Smith (SMDS) as volume growth in the first quarter helped the group offset margin pressure from higher raw materials costs.
The company, one of many in the industry to be milking the shopping shift to online, has seen its share price performance weaken in recent weeks as concerns grow about valuation and an intensifying acquisitions splurge.
Shares in DS Smith are up around 1.7% at £16.45, having come back from highs of £17.86 in past weeks.
The wider markets start Tuesday very modestly on the front foot with the FTSE 100 index of the UK’s largest companies a handful of points higher at 7,506.99, reflecting a fairly flat open for many European markets.
SAFE AS HOUSES
UK homebuilder Redrow (RDW) has seen profits rise by a fifth, making it a fifth year straight of record profits.
The company also offsets recent concerns about house prices across the UK, saying that demand for new homes was proving ‘robust’ in the face of Britain’s planned exit from the European Union.
The shares are up 1.5% at 565p after Redrow posted a better-than-expected 21% jump in full year pre-tax profit.
British bicycles-to-car-parts retailer Halfords (HFD) maintained its full year profit guidance on Tuesday as it reported a rise in underlying sales in a tough trading environment.
Its share prices rallies more than 5% to 346.4p with investors clearly relieved given the bloodletting across the UK retail space for much of this year.
Defence contractor Chemring (CHG) has adjusted its guidance for the full year following an explosion at a UK factory last month. The company is now saying full year underlying operating profit will be ‘around the middle’ of an earlier estimate of between £10m and £20m. Chemring shares nudge 1.3% higher to 199.8p.
AIR PASSENGER NUMBERS UP
Europe’s largest low-cost airline Ryanair (RYA) flew 9% more passengers in August than a year ago, it said on Tuesday. Its purchase of Austrian carrier Laudamotion is helping offset the impact of strikes and staff shortages, keeping its shares steady at €14.17.
Lease financing software provider Alfa Financial Software (ALFA) has confirmed a challenging first half to 30 June, with adjusted earnings before interest and tax slumping 60% to £8.6m on revenues down 27% to £32.9m.
The company, which looks likely to be ejected from the FTSE 250 later this week, sees its share price hammered again, down more than 12% at 139p, valuing the business at less than £420m.
British convenience retailer McColl’s Retail (MCLS) posted lower like-for-like sales in the third quarter and said that the collapse of cigarette wholesaler Palmer & Harvey last year continues to disrupt its supply chain.
McColl’s stock is trading marginally lower in early deals at 142.5p, having slipped from above 200p levels just a few weeks ago.
