London open: Footsie makes sluggish start
London's blue chips have made a sluggish start in early dealings with most attention focused on a string of announcements from FTSE 250 firms.
Music and games retailer HMV reported a 10.1% rise in like-for-like sales in the 16 weeks ended 26 April and said it expects full-year profits before tax and exceptional costs to be towards the upper end of market expectations. Total group sales rose 11.9% in the 16 weeks period, while gross margins were in line with previous guidance.
Electronic component group Laird reports a strong start to 2008. In the three months to March, revenue from continuing operations grew by 35% compared with the same period in 2007. "Organic revenue growth in the quarter was towards the top end of expectations of 15% to 20% growth in the medium term, at constant currency, with particularly strong growth in antennae modules and actuation devices," it says.
Sub-prime lender Cattles also says it has seen a strong start to the year. "Trading conditions for our business have been favourable. The Group is achieving higher margins on its new lending volumes and has tightened its lending criteria. Ongoing investment in systems and arrears management infrastructure has ensured arrears and the loan loss ratio have remained stable." Cattles launched a £200m cash call last month.
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Magners cider group C&C's operating profits fell by 37% last year to February on sales down to €679m from €738m. This year so far, the group says its performance in both Ireland and Great Britain reflects weak market conditions related to the combination of low consumer confidence and poor spring weather. For the full year C&C expects modest overall revenue growth and some improvement in operating margins.
Engineer IMI says its end markets generally remain firm with no discernible change in order momentum in recent months. Prospects for the oil and gas and power markets look positive for its Severe Service business. "Providing end markets remain supportive and notwithstanding some inflationary pressures on input costs, the combination of growth from new products, strong emerging markets growth and the benefits from our restructuring programme gives its confidence for good progress in 2008," it said.
British Energy will be busy as the latest deadline for potential bidders looms. French power giant EDF is today expected to table a takeover offer but German group RWE is not interested any more according to German paper reports.
Private equity firm Vitruvian Partners has launched a recommended 45p a share cash offer for AIM listed TV production company Tinopolis worth £44.7m. Vitruvian, whose bid represents a 32% premium to last night's closing price, has received irrevocable undertakings to back the offer representing 55.6% of the shares.
