The FTSE 100 index closed up Wednesday with the market focussed
on decent company results despite the risks of rising inflation.
Companies reported solid numbers for the most part, with rising
costs failing to significantly impact sales growth, Michael Hewson
at CMC Markets said. Still, the travel sector faced considerably
higher fuel and airport charges, with TUI dropping to its lowest
level in 2021. "Financials have also slipped back, with U.K. gilt
yields slipping back in the wake of this morning's CPI numbers,
which came in slightly below expectations and in turn is
translating into some underperformance from the likes of Barclays
and Lloyds Banking Group," Hewson noted.
Companies News:
Segro Third-Quarter Rental Income Rose
Segro PLC said Wednesday that the rental income it contracted
during the third quarter of 2021 rose 63%, and its vacancy rate
declined further on the back of strong demand for space.
---
Antofagasta Expects Copper Production to Fall in 2022
Antofagasta PLC on Wednesday forecast lower copper production
for 2022, reflecting a lack of rainfall and lower grades at its
Centinela Concentrates operation.
---
Avast 3Q Revenue, Adjusted Ebitda Rose; Reaffirms FY Outlook
Avast PLC said Wednesday that its adjusted Ebitda and revenue
for the third quarter of 2021 increased when compared with the
year-earlier period, and reiterated its full-year outlook.
---
Deliveroo 3Q Orders, Gross Transaction Value Rose; Raises
Full-Year Transaction Value Guidance
Deliveroo PLC said Wednesday that it saw a rise in orders and
gross transaction value in the third quarter of 2021, and raised
its guidance for gross transaction value for the year.
---
Burberry Appoints Versace's Jonathan Akeroyd as New CEO
Burberry Group PLC said Wednesday that it has appointed Jonathan
Akeroyd, currently Gianni Versace SpA's chief executive, as its new
CEO.
---
Real Good Food Sees Positive 1H Ebitda as Revenue Returns to
Pre-Pandemic Levels
Real Good Food PLC said Wednesday that it achieved profitability
at the Ebitda level in the first half of the fiscal year, as
revenue returned to pre-pandemic levels.
---
Anglo American Says De Beers' Rough-Diamond Sales Fell
Anglo American PLC said Wednesday that rough-diamond sales by
its majority-owned De Beers Group fell 6.1% in the eight sales
cycle of 2021 compared with the previous cycle, but said sales were
higher compared with the same cycle last year.
Market Talk:
Antofagasta Faces Unfavorable Weather Conditions, Political
Risk
0925 GMT - Antofagasta has released an iffy production report
which has put the miner on the back foot, AJ Bell analyst Danni
Hewson says. The company's copper operations in Chile, which
require plenty of water to function, are facing epic drought
conditions, she says. Moreover, there are concerns about looming
changes to Chilean mining royalties which could see Antofagasta get
a smaller share of production revenues, Hewson says. "In the wake
of Covid and amid elevated commodity prices, countries may well be
tempted to increase their take as they look to rebuild broken
public finances and the mining sector may have to prepare itself
for a wave of resource nationalism," the analyst warns.
(jaime.llinares@wsj.com)
Antofagasta 3Q Production Was in Line With Expectations
0917 GMT - Antofagasta reported third-quarter copper production
of 181,100 metric tons, which was in line with expectations, Peel
Hunt says. Gold output was slightly higher than forecast, which
helped keep net cash costs low at $1.16 a pound, below Peel Hunt's
projection of $1.22. In addition, the brokerage says forecasts of
lower copper production for 2022 should have been expected:
"Guidance of 660-690kt for 2022 comes as no surprise given the
heavy warnings made earlier in the year about the drought situation
at Los Pelambres--our estimates are already in line with the
newly-issued guidance." Shares fall 4.1%.
(jaime.llinares@wsj.com)
Antofagasta Expected to Increase Dividends as Expansion Projects
Are Completed
0910 GMT - The end of the current capital expenditure cycle,
combined with strong copper pricing, will allow Antofagasta to
deliver strong dividend payments in 2022 and 2023, Peel Hunt says.
The brokerage forecasts a dividend of 166 cents a share for next
year and 132 cents in 2023, which would be up from the 2021
estimate of 89 cents. The mining company's expansion projects
remain on schedule and budget for completion through 2022, Peel
Hunt says. The desalination plant at Los Pelambres will remove
water as a constraint for the copper mine, allowing Antofagasta to
increase production to full capacity ahead of expansion completion,
it says. (jaime.llinares@wsj.com)
UK Inflation Slips But Increase Is Expected
0848 GMT - U.K. inflation dropped in September as the positive
'Eat Out to Help Out' program base effect ended, but a sharp
increase is expected for October, driven by utility price rises and
a partial VAT increase, HSBC says. Utility prices are set for
another jump in April, petrol prices are rising and supply
shortages haven't gone away, HSBC's senior economist Chris Hare
says. "So despite a calmer month in the inflation data, the worst
of the inflation squeeze is yet to come," he says. The extent of
U.K. rate increases priced in by markets isn't warranted by
fundamentals, Hare says. While HSBC's expectation is for the first
rate rise in February, continuing inflation fears mean risks are
tilted toward an earlier increase. (maria.martinez@wsj.com)
No Rain in Chile Means No Gain for Antofagasta
0838 GMT - Antofagasta should be a huge beneficiary of the
commodities boom, but its copper mines are being affected by a
decade-long drought in Chile that has gone from bad to brutal,
Freetrade analyst Gemma Boothroyd says. The company needs water to
separate the mineral from the ore, so as water supplies run dry,
the risk Antofagasta's profits start to shrivel does too, she says.
The company expects production to fall next year, and in August
pulled down guidance for 2021. "The question for copper-hungry
investors now is whether they have a better choice. The metal
continues to smash record prices, but is water-starved Antofagasta
their best bet?," Boothroyd says. (jaime.llinares@wsj.com)
Crest Nicholson Shares Look Cheap, Says Peel Hunt
0835 GMT - Shares in Crest Nicholson Holdings rise 1.3% to 378
pence after the U.K. house-builder said financial and operational
progress meant it plans to expand into new geographical areas, with
new medium-term targets. The group is targeting more rapid volume
increases in the longer term, supported by an extra three or more
divisions, Peel Hunt says, adding that the shares look cheap. "We
reiterate our add recommendation and 460p target price," Peel
analysts say. (philip.waller@wsj.com)
Contact: London NewsPlus, Dow Jones Newswires; Dow Jones
Newswires; paul.larkins@wsj.com
(END) Dow Jones Newswires
October 20, 2021 12:40 ET (16:40 GMT)
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