Gilt Yields Fall Across The Curve Since BOE Meeting
U.K. borrowing costs have been falling across all maturities since the Bank of England relaxed its stance on the outlook of interest-rate rises at its March meeting, says Rabobank. On Monday, "gilt yields finished lower across the curve, with the 2-year down by 5.4bp, the 10-year by 7.8bp and the 30-year by 10.5bp," analysts at the Dutch bank say. The move was triggered by "a dovish turn from the Bank of England Governor Bailey who noted that the Bank had softened its guidance at its 17th March meeting owing to a looming squeeze on real household incomes that is set to exceed that seen in the 1970s." U.K. 10-year gilt yields last trade at 1.69% and two-year yields at 1.39%, according to FactSet.
Companies News:
Polymetal Weighs Restructuring to Spin off Russian Businesses, Shares Rise
Polymetal International PLC shares rose Tuesday after it said it was mulling several options to increase shareholder value, following media reports that it was preparing to sell off its Russian businesses.
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SSE Raises FY22 Guidance as Renewable Power Output Recovered in 4Q
SSE PLC on Tuesday raised earnings guidance for fiscal 2022, as renewable electricity production benefited from better weather conditions in the fourth quarter.
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Croda's Performance in First Three Months of 2022 Robust; Boosts Growth in Consumer Care
Croda International PLC said Tuesday that its performance in the first three months of the year has been robust, and that it was targeting sales in its consumer-care division of 1 billion pounds ($1.31 billion) by 2025.
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Ten Entertainment Swung to 2021 Pretax Profit; To Resume Dividend in 2022
Ten Entertainment Group PLC on Tuesday reported a swing to profit in fiscal 2021, underpinned by robust sales growth, and said it expects to deliver a performance ahead of market expectations in 2022 and to resume the dividend payout.
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AG Barr FY 2022 Profit Beat Pre-Pandemic Level as Sales Grew
A.G. Barr PLC on Tuesday reported higher profits for the year ended Jan. 30, reflecting strong sales growth.
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Bellway 1H Profit, Revenue Rose; Sees FY 2022 Sales Rising On-Year
Bellway PLC said Tuesday that its pretax profit rose in the first half of fiscal 2022, and it expects a strong performance for the full year.
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S&U FY 2022 Pretax Profit Rose, Raises Dividend
S&U PLC said on Tuesday that pretax profit for fiscal 2022 rose on lower used car costs, and raised its dividend payout.
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McKay Securities Gets Offer Approach From Slate Asset Management
McKay Securities PLC said Tuesday that it has received a request from Slate Asset Management L.P. for due diligence access so that it can consider a possible all-cash offer for the U.K. real-estate investment trust.
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Xaar Swung to 2021 Pretax Profit, Confident in Outlook
Xaar PLC said Tuesday that it swung to a pretax profit in 2021 as its gross margin improved, and said its outlook for 2022 was confident with a strong order book across the business.
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Mulberry Group Anticipates FY 2022 Revenue, Profit Above Expecations on Strong Sales
Mulberry Group PLC said Tuesday that it anticipates reporting revenue and profit moderately above expectations for fiscal 2022 after booking robust sales.
Market Talk:
RELX's Valuation Could Benefit From Exhibitions Business Separation
1105 GMT - There is a good case for RELX to separate its Exhibitions business given its vulnerability to earnings volatility from future pandemics and a potentially higher valuation for RELX without it, Credit Suisse says. The information-and-analytics group has said it intends to keep Exhibitions in the short term to benefit from recovery and digitization, which Credit Suisse says makes sense, adding that eventually a separation may be the better option. Berenberg has an outperform rating on the stock with a 2,650 pence target price. Shares trade up 1.8% at 2,385 pence.
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Tullow's Occidental Acquisition Is Highly Accretive
1101 GMT - Tullow Oil last week closed the acquisition of Occidental Petroleum's stake in the Jubilee and TEN oil fields in Ghana. This deal was highly accretive and increases the oil-and-gas company's core net asset value by 21 pence a share, Peel Hunt says, as the investment bank values the assets at $553 million compared with the price paid of $118 million. "We have always liked Tullow's assets, strategy and management and only moved to hold in 2021 due to valuation. However with this highly accretive acquisition and the shares lagging the oil price rally, we move to buy and increase our target price from 65 pence to 80 pence," Peel Hunt says.
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XLMedia's US Growth Seen Accelerating
1035 GMT - XLMedia's U.S. sports sales continue to accelerate and the division is now the business's dominant driver of growth and profit, says Berenberg. Significant runway for growth in 2022 and beyond is foreseen for the U.K. digital publisher, as strong trading in U.S. sports has continued into the current year and the number of states where online sports betting is legal is likely to almost double in 2022, the German brokerage says. Management is confident of delivering market expectations with the restructuring set to complete in the first half, aiding margins, and yielding annual cost savings of around $5 million to $6 million. Berenberg has a buy rating with a price target of 76 pence. Shares trade up 7.4% at 30.50 pence.
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S&U Seems on Track for Growth
1034 GMT - S&U's results for 2021 showed an important drop in loan impairments and increased dividends, indicating that the company is laying foundations for future growth, AJ Bell says. The London-listed motor finance and bridging lender posted a pretax profit of GBP47 million compared with GBP18.1 million the prior year as it benefited from a GBP33 million drop in charges. The company also raised the total dividend to 126 pence a share, above pre-pandemic peak of 120 pence, it adds. "(S&U) continues to provide a valuable service, and generate fresh momentum in its two niches, both of which the big banks appear to content to leave alone," AJ Bell says.
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Ukraine War's Reverberations to Tighten LNG Market Further
1025 GMT - Following the invasion of Ukraine, foreign energy companies are exiting Russia, which puts significant liquefied natural gas capacity under development at risk, Liberum says. TotalEnergies, which has a total direct and indirect interest of 21% in the Arctic 2 LNG project, said that it will no longer continue to fund its development. If this project isn't completed, Liberum expects a perpetual shortfall in LNG supply through the decade. In addition, Europe plans to replace 37 million metric tons a year of Russian pipeline gas with LNG by 2027, which is likely to spur project developments as the LNG market is already in deficit, the bank says. A fast way to expand regasification capacity in Europe is by using floating storage and regasification units, or FSRUs, Liberum notes.
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Bellway Shares Look Cheap on Optimistic Outlook
1013 GMT - Bellway's first-half performance ticks all the right boxes and the company is positioned for strong growth, though its share price has been driven down by bearish investors, Interactive Investor says. The house builder's prospects, like its peers, have been clouded by cost inflation, rising interest rates and supply-chain constraints, and its share price declined 25% in the last year compared to a 1.7% dip in the wider FTSE 250, the investment platform says. "Even so, and with some of the larger players in the industry, the general view of the company's prospects is optimistic, with the market consensus of the shares continuing to come in at a strong buy," Interactive Investor says. Shares are down 3.5% at 2,510.0 pence.
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Barclays Faces Reputation Issues From Bond Blunder
1006 GMT - Barclays faces reputation issues following a bond blunder, says Hargreaves Lansdown. The British bank said it issued more securities than it had registered for sale in the U.S., meaning it will have to repurchase the affected bonds at their original price, taking a loss of GBP450 million. "This is a highly embarrassing turn of events for Barclays," HL says, adding that stock investors are clearly irked about the mismanagement of the structured product sales and the quick fire purchase, which sees the bank nursing a heavy loss. The blunder has also delayed the bumper GBP1 billion share buy back, adding toshareholders' angst, HL says. Still, underlying performance of the business is positive, and the bank is well capitalised, with a CET1 radio higher than the regulatory minimum, it adds. Barclays' shares fall 3.3%.
Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com
(END) Dow Jones Newswires
03-29-22 0831ET
