Indivior takes a battering as market loses patience with lack of ambition
THE City’s feelings towards Reckitt Benckiser’s $17 billion (£13.7 billion) bid for US baby-food group Mead Johnson might be mixed, but investors made their views about one of the firm’s spin-offs known today.
Shares in Indivior, the heroin addiction control company that split from the consumer goods giant in 2014, took a hammering, plunging 59.8p, or 16%, to 309.8p. Investors were happy enough with its annual results, but it was the unambitious guidance for this year which sparked the rush for the exit.
Net revenues last year were up 4% at $1.06 billion, just shy of guidance which had been raised in November, with adjusted net income up a bit at $254 million. It set aside $220 million to cover antitrust litigation
What frustrated the market most, though, was that net income, or profit, after exceptional charges is expected to be between $200 million and $220 million this year as it unveiled plans to spend between $40 million and $60 million on “driving future organic growth priorities”.
Strong corporate results from Lloyds Banking Group and housebuilder Barratt Developments, which upped its dividend, helped the FTSE 100 index put on 11.51 points to 7286.34.
Big falls from Indivior and outsourcer Serco prevented the rise being mirrored by the FTSE 250, which was off 41.25 points at 18,730.96.
Superdry clothes-maker SuperGroup, up 31p or 2.1% to 1511p, proved a smart bet after Panmure Gordon analysts claimed it was “one of the most undervalued global brand roll-out stories within the UK retail sector”.
Investors planning to attend today’s investor day for NCC were instead left nursing burnt fingers as the dust settled on the cybersecurity firm’s latest profit warning. NCC committed the Stock Exchange’s cardinal sin of issuing a profit warning just before the market shut last night — its third in four months — as it scrapped its planned capital markets day and initiated a strategic review.
Analysts at Canaccord were concerned the late reporting before the investor day “suggests this is not merely a trading issue but a financial reporting issue”, adding: “Our concern is that it may affect revenue recognition or cost allocation.”
The shares dived 29% in the last few minutes of trading yesterday and slumped by the same margin again today, down 37.18p to 89.32p.
Investors in Weir took profits after the oil-pump maker’s solid annual results: shares sank 53p to 1969p. Oil services firm Petrofac rose 24.11p to 898.61p as it showed signs of improvement in its annual results. Cancer therapy firm Advanced Oncotherapy fell 6p to 62p after announcing a £26 million loan with a Dubai firm. @jamienimmo63