Engineer reverses 24pc as cost rises hurt profit

RENOLD’S share price crunched into reverse at high speed after it issued a profit warning.

In a trading update, the FTSE Small Cap gear maker revealed it had been knocked off balance by rising materials costs, particularly in its industrial chain business.

A weaker dollar delivered a second blow to Renold, which sells its chains, gears and clutches in more than 20 countries.

The double-whammy will hit full- year profits, which are expected to be lower than in the past two years, it said.

Broker Finn Cap didn’t like what it was hearing and decided to slash the firm’s target price from 50p to 40p.

Robert Purcell, Renold’s chief executive, said: ‘ The increase in raw material prices has been significant, both in scale and speed, and has challenged our ability to pass these costs through to customers at the same pace.’

The company’s shares slid 23.8pc, or 10.6p, to 34p.

The FTSE 100 gained 0.3pc or 21.27 points to end the day at 7224.51, while the FTSE 250 finished up 0.59pc, or 117.06 points, at 20,085.07.

Meanwhile, you can be forgiven for thinking there was a closing down sale on the markets yesterday, given the number of directors buying and selling shares in their own firms.

Three top- men at troubled estate agent Countrywide reached deep into their pockets to stave off fears about its future.

The embattled home-flogger this week announced plans to scrap its dividend and shed a third of its workforce to balance the books after suffering a painful £200m loss last year.

In a bid to calm investors’ nerves, Countrywide chairman Peter Long splashed out £160,000 on company shares.

He was joined by operations director Paul Creffield and finance boss Himanshu Raja who bought £ 83,431 and £ 88,050- worth of shares respectively.

In a statement, Countrywide said: ‘This underpins their belief in the business and further demonstrates their commitment to leading the recovery.’

Investors, on the other hand, took their money elsewhere. Countrywide’s shares slid by 5pc, or 4.4p, to 83.1p.

Conviviality, the owner of Bargain Booze, suffered the dreaded next-day hangover after announcing on Thursday that it had accidentally overstated its earnings forecasts by 20pc. Easily done.

The debacle had knocked more than 59pc off the value of its AIMlisted shares.

Yesterday, chief executive Diana Hunter and finance boss Mark Moran hoovered up £50,360 and £130,800 of shares respectively, presumably to reassure investors. But the whole episode has gone down worse than a creamy White Russian on a hot summer’s day. Conviviality’s shares tanked another 12.2pc, or 15p, to 108p.

Rolls-Royce has dished out nearly £5m in shares to two senior directors. North America chief Thomas Bell received more than £4.8mworth as part of the company’s long-term incentive plan, while defence boss Christopher Cholerton received nearly £144,000.

This week Rolls reported a 25pc surge in profits as it continues its recovery under chief executive Warren East. Its shares nudged up 0.4pc, or 4p, to 925.8p.

A director of audio equipment supplier Focusrite sold more than £3.2m of shares after it revealed a stonking forecast. In a trading update, Focusrite said revenue in the six months to February 28 was likely to be up 25pc.

Within hours, operations director Tim Dingley cashed in 90,000 at 362.5p each, pocketing more than £3.2m in total.

Focusrite’s shares shot up 10.8pc, or 38.5p, to 393.5p.