FTSE 250 movers: Thomas Cook flies low, Greggs forecasts hot profits
London's FTSE 250 was down 0.2% at 18,675.86 late on Tuesday, as Thomas Cook's shares dropped by over 20%.
Tour operator Thomas Cook was in freefall after it withdrew its dividend and cut its annual profits guidance for the third time this year. The company, having only just issued a second profit warning in September, said its final result was expected to be around £30m lower than previously guided due to a number of legacy and non-recurring charges.
Trading is still not back to full strength either, with bookings for the coming winter down 3% on last year and a "mixed start" to for summer 2019, with the UK source market appearing solid but Northern and Continental Europe more mixed.
Budget airline Wizz Air also dropped at the news, with investors clearly worried about the travel industry at large after a long hot summer kept would-be holidaymakers at home in the UK.
Healthcare services provider UDG Healthcare posted a jump in full-year profit after its two global platforms, Ashfield and Sharp, continued to drive earnings. The shares fell however, with Jamie Constable at broker N+1Singer noting: "Comments that investments are likely to constrain growth are likely to be focused in on by the market with investors focused on the organic growth outlook."
The wider sector was having a tough time on Tuesday, with pharmaceutical and healthcare outfits Indivior, Mediclinic and Convatec also on the decline.
Ibstock fell as Numis cut its projected earnings per share for 2019 following the sale of the clay and concrete building products manufacturer's US business. Analysts reiterated their 'add' rating and target price of 270p for the stock, though.
Amid a weaker gold price, Hochschild Mining dipped lower due to fresh concerns of an escalating trade war between Beijing and Washington, after President Trump said it was "highly unlikely" he would accept an offer by China that could avert higher tariffs next year on more than $200bn of Chinese goods.
As China is a key buyer of industrial and precious metals this placed miners under pressure.
Meanwhile on the upswing, bakery chain Greggs surged as it said total sales in the eight weeks to 24 November were up 9% and lifted its 2018 profit forecast to at least £86m, up from previous guidance of £81.8m.
"This stronger trading in October and November is particularly encouraging as it builds on good comparative sales in the same period last year," the Greggs board said in its statement.
Consequently, Peel Hunt upgraded Greggs to 'hold' and upped its target price from 900p to 1,300p as it praised staff training, a strong Christmas product range and effective cost cutting measures.
"The patchy late Spring is now a distant memory and we’d own up to over-reacting to it; this is clearly a very consistent performer and with a decent upgrade today it’s clear that our negative stance is wrong," said a note from the broker.
Market Movers
FTSE 250 (MCX) 18,641.94 -0.41%
FTSE 250 - Risers
Greggs (GRG) 1,379.00p 11.48%
TalkTalk Telecom Group (TALK) 125.70p 3.80%
Sophos Group (SOPH) 364.00p 3.00%
Equiniti Group (EQN) 233.00p 2.19%
Keller Group (KLR) 634.00p 2.09%
Hill & Smith Holdings (HILS) 1,186.00p 2.07%
Millennium & Copthorne Hotels (MLC) 472.50p 2.05%
Renishaw (RSW) 4,018.00p 1.98%
Vietnam Enterprise Investments (DI) (VEIL) 464.00p 1.98%
Spirent Communications (SPT) 131.40p 1.86%
FTSE 250 - Fallers
Thomas Cook Group (TCG) 37.15p -23.46%
UDG Healthcare Public Limited Company (UDG) 573.00p -7.66%
Indivior (INDV) 96.00p -4.86%
Victrex plc (VCT) 2,558.00p -4.41%
Ultra Electronics Holdings (ULE) 1,459.00p -4.39%
Wizz Air Holdings (WIZZ) 2,938.00p -4.17%
Ibstock (IBST) 225.00p -3.76%
Hochschild Mining (HOC) 156.10p -3.46%
Mediclinic International (MDC) 343.40p -3.46%
Convatec Group (CTEC) 156.50p -3.31%