MARKET REPORT: National Express sinks after profit warning
Shares in the company behind National Express plummeted to a record low after it issued a profit warning and canceled its dividend.
Mobico Group boss Ignacio Garat said the FTSE 250 company’s profit recovery will take longer than expected amid rising costs in the UK and North America. He now expects to make at least £175m to £185m in profits by 2023, up from a previous forecast of £200m to £215m.
Shares in Mobico, as the parent company is now known, plunged 27.5 per cent, or 23.4p, to 61.6p.
As part of efforts to cut costs, the group eliminated its final dividend. It is also preparing its North American school bus business for possible elimination.
Higher costs associated with recruiting and training drivers mean profits in this part of the business are expected to be between £5m and £10m lower than previously thought.
In a bind: Ignacio Garat, head of the Mobico Group, says that the recovery of the FTSE 250 company’s profits will take longer than expected
In the UK, the coach business enjoyed a strong increase in revenue and passengers. But slow passenger growth and inflation pressures in the bus division have weighed on the British and German division, where profits are likely to be £15m to £20m below expectations.
Mobico wasn’t the only one to issue a profit warning. Revenue at building materials company SIG fell 2 per cent to £681m in the three months to September 30 as it warned market conditions were challenging amid weaker demand.
It expects to make between £50m and £55m of profits this year, much less than the £65.3m to £84m range set by analysts. The shares sank 8.8 per cent, or 3p, to 31p.
The update came a day after Travis Perkins cut its profit forecast by up to £65m amid pressures in the property market. The FTSE 100 rose 0.32 per cent, or 24.75 points, to 7,644.78, while the FTSE 250 fell 0.23 per cent, or 40.55 points, to 17,835.69.
Official figures showed the UK economy recovered in August with growth of 0.2 per cent after a sharp decline in July. Inflation in the United States remained unchanged at 3.7 percent due to rising oil prices.
Back in London, commodity stocks were on the move: BP rose 3 percent, or 15.8 pence, to 536.1 pence, while Rio Tinto added 0.5 percent, or 23 pence, to 5,078 pence and Endeavor Mining rose 0.6 per cent, or 10 pence, to 1,587 pence. .
Gold producer Centamin turned a profit after revealing a plan for a mine in Egypt that aims to increase production, reduce costs and reduce carbon emissions. It rose 0.6 per cent, or 0.45p, to 82.8p.
Hays was the latest recruiter to report a drop in a new sign of pressures in the hiring market. Rates fell 7 percent in the three months to the end of September. The shares fell 0.8 per cent, or 0.8 pence, to 102.1 pence.
It’s turning out to be a week to forget for ITV. Days after its star presenter Holly Willoughby quit This Morning after 14 years, she said she was among several organizations being investigated by the competition watchdog for alleged breaches relating to the purchasing of freelance services and the hiring of staff. . The shares fell 1 per cent, or 0.66p, to 67.56p.
Safestyle has come under increased pressure as the double glazing giant explores a possible sale.
The shares, which are down 94 per cent so far this year, plummeted 25.3 per cent, or 0.59p, to 1.76p yesterday.
Another company affected was N Brown, as the clothing retailer’s revenue fell 10.4 per cent to £297m in the six months to September 2 due to bad weather.
The group behind brands such as Simply Be and JD Williams also suffered a half-year loss of £4.1m, having made a profit of £7.2m in the same period the previous year. It fell 1.1 per cent, or 0.22p, to 19.77p.
Payments company Wise rose 0.6 per cent, or 4.4p, to 724.6p after revenue soared 51 per cent to £345m in the three months to the end of September.