£500m fundraising sinks Provident’s stock again

THERE was more woe for Neil Woodford yesterday as shares in doorstep lender Provident Financial plunged further. The high-profile fund manager is the second-largest shareholder in the business with a 23pc stake, only beaten by his previous firm, Invesco Asset Management, which owns 24.9pc.

Provident shares fell to a 22-year low on talk it may look to raise £500m from investors in order to repair its balance sheet. It has also been reported that finance chief Phillip McLelland has left, just weeks after a new chief executive arrived.

The firm is due to report its fullyear earnings today and investors are braced for a loss of £120m from the consumer credit division.

It is the latest in a series of blows for investors, which started with a profit warning last summer.

Provident’s shares are worth just a fifth of their price this time last year, when they sat at 2922p. Yesterday they lost a further 10.4pc, or 68.6p, to close at 588p.

The FTSE 100 finished the day up 0.6pc, or 45.17 points, at 7289.58. Top riser on the index was Anglo

American after it announced the sale of the Drayton coal mine in Australia, in which it has an 88pc stake. The mining giant, which ceased work at the site in 2016, has not disclosed the amount the project was sold for. Shares leapt 3.1pc, or 55.2p, to 1843.6p.

The AA stumbled further as analysts at Credit Suisse cut their target price for the ailing motor group. Stockbroker Berenberg slapped on a ‘sell’ rating as it concluded the firm’s plan to reverse falling membership numbers and cut costs ‘has failed’.

The broker said that as the AA’s new management team planned to increase spending to drive growth, their efforts to reduce debt ‘looks more uncertain and further away’. Shares dropped 12.2pc, or 10.52p, to 75.52p.

A positive appraisal from Barclays pushed publisher Pearson higher. It reported lower debt than the broker had anticipated, prompting it to increase its target price. Shares advanced 2pc, or 14p, to 714p.

Shares in outsourcer Bunzl slipped 1.8pc, or 36p, to 1975p. The company, which sells everything from cake stands to disposable gloves and earplugs, has seen its share price dented since Amazon threatened last summer to increase its focus on business-tobusiness distribution.

Investors failed to be convinced that Bunzl has the power to hold its own against the Silicon Valley titan, despite profits growing 13pc to £409.3m last year.

Investors flocked to Ascential, formerly known as Emap, as the publisher said it had put its exhibitions business up for sale to focus on its digital operations and raised its dividend 19pc. Shares surged 5.9pc, or 22.4p, to 400.6p on the news. Ascential reported a 25pc boost to its sales last year, reaching £375.8m.

Secure payments provider Eckoh revealed it has signed a four-year contract worth £1.3m with a major US retailer. The firm will provide its Call Guard secure payments system, which is used in call centres to stop employees seeing or hearing customers’ sensitive card data. It is the firm’s 11th contract win in the current financial year – two more than the year before. Shares jumped 4pc, or 1.5p, to 38.75p. Record revenue could not keep

Keller in the black on the day. The engineering firm saw revenue rise 16pc to £2.1bn in 2017 and said underlying pre-tax profit was up 16pc to £98.7m.

But profit in the US dropped by 14pc as demand dipped and storms at the end of the year impacted business.

It also said that two loss-making contracts in Asia had masked ‘good progress’ there. Shares were off 1.1pc, or 10p, at 930p.