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September 11: Corporate news in the UK today is led by Primark, the discount retailer owned by Associated British Foods. Growth has stalled. ABF’s second-half trading update shows like-for-like sales growth at Primark unchanged at 3 per cent, which is bad news when you consider that this has been the group’s main source of growth recently. The rest of the business, in the words of Andrew Wood at Sanford Bernstein, was “generally weak or, at best, mixed”. Some brands are doing well, such as Ovaltine and Twinings, but baking looks dreadful, as does sugar. Lex nevertheless thinks ABF is a good bet in the long term.
Trading in Sportingbet shares resumed this morning, having been suspended last week when the chairman, Peter Dicks, was arrested at JFK. The stock promptly fell 40 per cent. There is some very well-informed and interesting discussion taking place on casinoaffiliateprograms.com. One blogger points out the industry is watching the Sportingbet case even more closely than BetonSports because it is a much more straightforward case: “If Sportingbet wins this one, it seems to set a clear path for the rest of the industry (the one’s who operate on the up-and-up that is).”
Genting has announced the terms of its £639m takeover of Stanley Leisure. However, the market is expecting a counterbid – the stock is up 2 per cent at 875p, above Genting’s offer price of 860p. Incidentally, the chairman of London Clubs International, Michael Beckett, told today’s annual meeting that his company has only one suitor, Harrah’s Entertainment. Genting already owns 29 per cent of LCI.
Dreadful news from Psion: its first half adjusted operating profit fell 72 per cent as competition and currency movements hit margins.
Intriguing: Robert Bonnier, the founder of Scoot.com, has stepped down as chief executive of Future Internet Technologies. This comes at the same time as the group announces the sale of some of its assets to a company ultimately controlled by Bonnier. In fact, this is just one of several very interesting stories in the Aim market today, as you’ll see in tomorrow’s paper.
Among the larger stocks, we have a series of results: Bovis Homes (in line), Hiscox (disappointing), Forth Ports (disappointing outlook statement), Regus (pretty good), and Group 4 Securicor (selling a loss-making German business).
Lastly, Financial Dynamics, the City PR firm, has been bought by FTI Consulting of the US for $260m (I haven’t had time to look properly but you can bet that is just the headline number).
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