UK stocks finished higher on Friday as optimism over a stronger economic recovery held sway. Slightly weaker than expected February inflation data in the US gave bond prices a boost, pushing yields lower and supported gains in equities.
At 4.30pm the FTSE 100 index of leading stocks was up 1% to 6,742 points, led by miners and consumer-facing ‘recovery’ stocks.
COMPANY NEWS
Mining group Kaz Minerals (KAZ) gained 2.9% to 864p after the firm revealed it had received an improved offer of 850p per share from Nova Resources, valuing the business at £4 billion.
The increased and final offer is accompanied by a special dividend of 27c per share, taking the total value of the offer to 869p per share.
Insurer Aviva (AV.) announced the sale of its Polish business to Germany’s Allianz for €2.5 billion in cash, increasing its own net asset value by £1.8 billion or 46p to 493p per share.
Chief executive Amanda Blanc described the deal as ‘an excellent conclusion to the refocusing of our portfolio announced just eight months ago’. The firm has now sold eight non-core businesses for £7.5 billion in cash. The shares gained 0.3% to 401.1p.
Industrial equipment maker Smiths Group (SMIN) posted a 5% fall in organic revenues to £1.15 billion for the first half to the end of January although it pointed to an ‘improving trend’ in the second half.
Cash generation was positive, leading to a 6% rise in the interim dividend to 11.7p per share. The stock was the best performer on the FTSE, rising 6.8% to £15.57.
Bus and rail operator Stagecoach (SGC) reiterated its outlook for the year to May although chief executive Martin Griffiths admitted it was ‘difficult to accurately forecast the precise timing and extent of how our profitability will recover as we emerge from the COVID-19 situation’.
Its UK regional bus operations are still running at less than 50% of pre-Covid revenues, while its London bus unit it back to full service and should generate better than expected operating profits. The shares accelerated 5.3% higher to 98.8p.
Medical devices firm TT Electronics (TTG) announced the MHRA had approved its Virolens rapid Covid-19 screening device for sale in the UK. The shares gained 4.3% to 243p having already had a good run from 211p this week.
Sales are dependent on TT’s partner iAbra converting expressions of interest into sales, therefore the firm cautioned there was ‘a wide range of potential commercial outcomes and hence no certainty as to the financial impact on TT’.
AIM ROUND-UP
Infrastructure services group Renew Holdings (RNWH:AIM) said first half trading is expected to be ahead of the previous financial year, and in-line with management's expectations. The shares gained 6.4% to 566p.
The firm also announced the £29.5 million acquisition of water services business J Browne to boost its utility and infrastructure operations in the South East. ‘The acquisition represents an excellent strategic fit, adding material scale to Renew’s water business and brings new water clients into the group,’ said chief executive Paul Scott.
Real estate investment trust Urban Logistics (SHED:AIM) revealed it had sold a portfolio of assets for £30 million, generating a total return of 78.8% since purchase and a 35% uplift to the value of the assets as of last September. The shares added 1.2% to 148.8p.
Software firm Idox (IDOX:AIM) released a positive first quarter trading update showing similar revenue and earnings growth to the same period a year ago with ‘no significant impact on the business from the third lockdown’.
The company also reported a ‘material reduction’ in its net debt, from £27 million to £18 million, and confirmed it would pay a final dividend for last year. The shares gained 0.9% to 62.5p.
