FTSE 250 movers: Computacenter climbs, SIG slides
London's mid-cap stocks trotted back higher on Thursday, led by Computacenter and Capita.
Computacenter, a provider of IT infrastructure services, released a trading update for the second quarter saying that, while there is still much to do, full year results are likely to be "comfortably in excess" of the expectations it set out a few months ago. The said it has seen continued momentum within the supply chain business across all geographies, but particularly in Germany.
The six months of trading to 30 June 2018 shows “considerable progress” for Computacenter in adjusted profitability, and even further progress in adjusted earnings per share following the buyback completed in February.
Shares in outsourcer Capita were given a double boost as it was awarded a contract by the UK Department for Education's testing arm to manage all primary school national curriculum assessment tests in England, and separately sold its parking management business for £235m. Management expect the company to raise more than £400m from non-core asset disposals this year, £100m ahead of its previous target.
Drugmaker Indivior was picked up by Bank of America Merrill Lynch, where analysts upgraded the stock to ‘buy’ following recent share price weakness after its profit warning a day earlier.
On the downside, SIG was looking rocky amid some comments on the building materials sector from Deutsche Bank and UBS. Deutsche analysts said UK distributors such as Travis Perkins and SIG have "greater exposure to more uncertain construction activities such as RMI and commercial" and may be forced into cost-cutting this year to prevent downgrades if the trading environment weakens further. SIG shares were down 4.5% and Travis 0.8%.
UBS downgraded Kingspan to 'sell', sending its shares falling 2.8%, and Travis Perkins to 'neutral'.
Homewares retailer Dunelm was a big faller in early trading but erased most of its losses after a mixed fourth quarter update. Like-for-like revenues were flat in the quarter and profit margins were squeezed as management took a £3m charge for unsold stock, meaning full year underlying profit is now expected to fall almost 7% to £102m.
Broker Peel Hunt said Q4 trading proved to be broadly in line with May's profit warning, though forecasts for this year and next year will need to be downgraded, with 2018's cut to £102m from £107m meaning EPS will be 39.4p. For 2019 the PBT forecast is cut to £111m from £120.7m, producing an EPS of 42.9p.
"The scale of downgrades remain disappointing, although much of this is a function of external conditions and unfavourable weather in Q4 rather than Dunelm specific concerns."
Market Movers
FTSE 100 (UKX) 7,651.28 0.78%
FTSE 250 (MCX) 20,771.63 0.63%
FTSE 250 - Risers
Computacenter (CCC) 1,480.00p 7.71%
IP Group (IPO) 138.46p 5.70%
TP ICAP (TCAP) 273.36p 5.26%
Capita (CPI) 169.40p 5.12%
Alfa Financial Software Holdings (ALFA) 165.80p 4.67%
Sophos Group (SOPH) 508.50p 3.78%
Inmarsat (ISAT) 547.80p 3.63%
Card Factory (CARD) 206.01p 3.42%
Provident Financial (PFG) 643.80p 3.07%
Indivior (INDV) 274.50p 3.00%
FTSE 250 - Fallers
SIG (SHI) 126.00p -4.47%
Intu Properties (INTU) 176.60p -4.36%
Telecom Plus (TEP) 1,108.00p -3.32%
Entertainment One Limited (ETO) 368.40p -3.05%
Equiniti Group (EQN) 211.75p -2.87%
Petrofac Ltd. (PFC) 554.00p -2.64%
Superdry (SDRY) 1,318.00p -2.37%
Ferrexpo (FXPO) 160.25p -1.75%
Grafton Group Units (GFTU) 795.00p -1.49%
Premier Oil (PMO) 129.37p -1.25%