British Land (BLND), SSP (SSPG), Residential Secure Income (RESI), mortgage rates, Nanoco (NANO) and VP (VP.)
British Land (BLND) announced yesterday that it was joining the equity capital raise party, and proposed a £300mn placing to partly finance the £441mn acquisition of a portfolio of seven retail parks from Canadian investor Brookfield.
The addition takes retail parks to 32 per cent of British Land’s portfolio. Andrew Saunders, analyst at Shore Capital, described the deal as “a nice add-on but not exactly transformational” adding that adjusted earnings would remain largely unchanged but that there could be some dilution of EPRA net tangible assets from 577p to 559p next year.
The placing price of 422p represented a discount of 3.6 per cent to British Land’s closing price on 2 October. NV
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SSP’s strong trading dulled by FX headwinds
SSP (SSPG) grew revenue by a sturdy 12 per cent in its fourth quarter on the back of net contract gains and acquisitions as like-for-like growth slowed against tough comparatives, but the travel caterer’s profits have been held back by foreign exchange fluctuations and weakness at its Continental Europe business.
For the year to 30 September, management expects revenue of £3.4bn and cash profits of £335mn-£345mn. The company’s planning assumption was for profits of £330mn-£359mn.
Operating profits are guided to rise from £164mn to £200mn-£210mn year-on-year. All geographies are expected to report growth other than Continental Europe, which has been hit by softer-than-expected demand during the Olympics alongside “industrial action and weak trading in the motorway services business”. CA
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Home buyers return to the market
Falling mortgage rates are starting to work their magic as buyer demand in September rose by 26 per cent year-on-year, according to Zoopla.
The number of sales agreed also rose by 25 per cent over the year, with the East Midlands up 32 per cent and the North East up 30 per cent. However, this is not necessarily translating into higher prices as over a third of sales are being agreed at over 5 per cent below the initial asking price.
Supply has also increased, with the number of homes available rising by 12 per cent due to concerns about tax changes from second home owners. NV
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VP warns on profit
Equipment hire company VP (VP.) warned that full-year profit would come in below expectations, citing sluggish demand in construction and housebuilding plus a slower start to the latest rail network maintenance cycle.
Adjusted pre-tax profit for the year will now come in at around £37mn, compared with a consensus forecast of £41.3mn. The shares fell 8 per cent.
VP also announced it is buying Charleville Hire and Platform, a competitor based in Ireland, for up to €33.8mn (£28.4mn). It is paying €12.1mn upfront, with the rest dependent on the company hitting earn-out targets. Charleville last year made a pre-tax profit of €2.3mn on revenue of €9.5mn. MF