Rising profits fail to paper over higher costs at Mondi
Investors binned shares in Mondi, the packaging and paper giant, after it became the latest heavyweight company to gripe about significant increases in input costs.
the shares fell 5pc, or 81p, to 1529p, after the company experienced higher energy, wood, resins, transport, chemical and paper costs in the first half of the year.
that news overshadowed a sharp increase in profit before tax to £933m from £354m the year before. the company’s profits statement now exclude its russian operations, which were put up for sale in May.
earnings of £406m were 7pc higher than investment analysts had expected, but the broker Jefferies suggested fund managers had pencilled in a figure of £421m and thus were disappointed.
the drugs aren’t working for Hikma Pharmaceuticals, which reported flat revenues for the first six months of 2022 as higher sales of its injectable and branded products were offset by weaker pricing in its generic drugs business. the company’s shares lost 6.3pc, or 111.5p, to 1650.5p as the group’s core operating profit dipped 4pc to £250m from £261m the previous year.
Hikma slashed its full-year revenue guidance range for its Generics business to £536m to £556m from previous guidance of £585m to £ 618m. on the plus side, branded revenue is now expected to show some modest growth having previously been expected to be in line with 2021’s outturn.
the FTSE 100 reacted phlegmatically to the Bank of england’s interest rate hike and recession warnings, rising 0.03pc, or 2.38 points, to 7448.06. the FTSE 250, meanwhile, climbed 0.7pc, or 136.92 points, to 20155.76. one of the mid-cap index’s star performers was Convatec Group, up 6.8pc,
or 15.6p, to 245.8p. the medical products company confirmed its full-year guidance, saying it is on track to deliver organic revenue growth of 4pc to 5.5pc and an adjusted operating margin (on a constant currency basis) of at least 18pc, notwithstanding the current inflationary environment.
Chief executive Karim Bitar said the first-half performance demonstrated the company is ‘continuing to pivot to sustainable and profitable growth’, although as pivots go, it is barely noticeable, with adjusted operating profit of $204.3m barely changed from $204.4m a year earlier.
Ocado shares rose 3.1pc, or 27.8p, to 940p and are up almost 20pc over the last week since the company announced changes to the executive responsibilities of board member Mark richardson.
richardson, the chief operating officer, will be chief executive of ocado’s new business, which will extend the warehouse technology pioneer’s offering into new market sectors alongside grocery.
the strategic shift has prompted some market commentators to speculate that the company would be open to selling its 50pc stake in its retail joint venture with Marks & Spencer (up 1.5pc, or 2p, to 139.3p) should M&s be interested in taking full control.
one of the world’s oldest shipping journals has fallen into foreign hands in a £385m deal.
London-based Lloyd’s List – which listed the insurance of the titanic only three months before it sunk in 1912 – has been sold by the publishing and exhibitions organiser Informa to the German private equity fund Montagu.
the 288-year-old shipping news provider was launched in 1734 by Lloyd’s Coffee house owner edward Lloyd. the announcement came as Informa enjoyed upbeat first-half results.
the firm said it remained on track to meet the top-end of its guidance for the year as revenues soared 59.1pc to £1bn. Profits climbed 226.6pc to £234.5m. shares in Informa fell 1pc, or 6p, to 595p.