Just Eat hit by slowing growth, and Smith & Nephew becomes latest FTSE 100 firm to see CEO depart

“The FTSE 100 trades higher on Monday morning despite the so-called ‘Super Saturday’ sitting of the House of Commons failing to provide the certainty on Brexit the markets are craving.

“There are now renewed hopes Prime Minister Boris Johnson can get his deal through today, although there are likely to be further twists in the Brexit saga no matter what happens in Westminster later,” says AJ Bell Investment Director Russ Mould.

Just Eat

“While its double-digit growth would be the envy of many companies, Just Eat hasn’t delivered enough to leave investors feeling satisfied.

“Ultimately today’s numbers show growth has slowed since the first half in the third quarter of the year.

“The market has been a bit grumpy with Just Eat since the summer when the group agreed its merger with Dutch firm Takeaway.com – with the 15% premium to the company’s previous close seen as a very miserly portion.

“The company still expects this deal to go through before the end of 2019, pending a shareholder vote in December, to create one of the largest food delivery firms in the world.

“However, bigger isn’t always better and some observers have pointed to the risks of indigestion thanks to pressure on consumer spending, the competitive nature of Just Eat’s core market and its historic underinvestment in delivery services.

“Ultimately shareholders will decide the fate of the deal and there is still some pretty healthy scepticism over whether the transaction will complete.”

Smith & Nephew

“Can anything stop the exodus of FTSE 100 chief executives in 2019? The numbers have now been bolstered to the point where these departing CEOs could almost cobble together an 11-a-side football match as Smith & Nephew’s Namal Nawana steps down.

“Australian Nawana has only been in post for 18 months but has already helped revive the share price with a new strategy.

“This culminated in re-organising the business into three global franchises: orthopaedics, sports medicine and advanced wound management.

“The market responded positively to this simplified structure, which reduced duplication of effort and made reporting responsibilities clearer with better accountability.

“There appears to be a pretty simple reason Nawana is leaving – pay. It became apparent over the summer that the company was looking for ways to increase its head honcho’s remuneration with apparent discussions about a move to a US listing to escape an increasing backlash in the UK towards excessive executive pay.

“The fear will be that this revamp of the business will be derailed by Nawana’s departure despite efforts to allay these concerns – with internal candidate Roland Diggelmann stepping up to the top job and Nawana staying to smooth the transition until the end of the year.

“Diggelmann faces a tricky task of balancing the need for continuity with a likely ambition to bring his own ideas to the role.”

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