FTSE on track for strong week, looking beyond SIG’s headlines and GVC issues reassuring numbers
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“Although The FTSE 100 doesn’t seem to want to move on Friday morning, trading flat at 7,196, it is still on track to finish the week up nearly 2%. That would be its best weekly performance since early February,” says AJ Bell Investment Director Russ Mould..

SIG

“Results from specialist building products firm SIG are a lesson in not just focusing on the headlines. Underlying operating profit came in a touch ahead of analyst forecasts at £94m. However, this was boosted by the divestment of its Building Systems business and the sale of several properties.

“Underlying pre-tax profit actually fell 10% year-on-year and on a statutory basis the company posted a loss of £51.2m, reflecting several one-off items relating to a restructuring effort.

“Still, the company appears to be recovering from a difficult 2016 which saw a major profit warning and the departure of chief executive Stuart Mitchell.

“His successor Meinie Oldersma has made progress in repairing the balance sheet such that he can offer investors a slight uptick in the full year dividend. After a year of consolidation, which was rewarded by a handsome increase in the share price, Oldersma may have to serve up something more impressive to keep investors on side in 2018.

“Strong markets in mainland Europe and Ireland should be helpful but the outlook in the UK is less encouraging.”

GVC

“GVC has produced another set of impressive results with revenue before deducting VAT up 17% to €925.6m in 2017. The New Year has also started well. That’s helped to give a small boost to the share price which had previously stalled last October.

“All eyes are now on the imminent acquisition of Ladbrokes Coral and achieving its synergy targets. GVC has previously done a good job of surpassing expectations with synergies on acquisitions, so there are now high hopes that it will do the same with this deal.”

These articles are for information purposes only and are not a personal recommendation or advice.

The daily market update is written by Russ Mould, AJ Bell’s Investment Director and his team. The article highlights the movement in the main index, winners and losers on the day and any macro-economic announcements.