Global sell-off sends Pru shares deep into the red
Insurance giant Prudential insisted its links to collapsed silicon Valley Bank (SVB) were minimal but its shares were hammered as it was caught in the global stock market rout.
The asia- focused business revealed it has around £800,000 of exposure to SVB against a total debt book of £19bn.
‘Our exposure to SVB is de minimis, ’ said the Pru’s chief financial officer James Turner. ‘We are very conservative in the positioning of our balance sheet.’
But shares tumbled 12.4pc, or 147p, to 1036p on another brutal day on financial markets.
The slump came despite the Pru reporting an 8pc rise in profits for 2022 to £2.8bn.
It also said business in the first two months of 2023 was buoyed by the lifting of covid restrictions in china, allowing mainland visitors to go to Hong Kong and buy insurance again.
Prudential is listed in London but now focuses solely on asia and africa, having sold off its us and UK arms. Its entire senior management team has moved from London to Hong Kong.
However, chief executive anil Wadhwani said that the insurer has no immediate plan to change its uK domicile.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said it was a ‘sturdy’ first set of results under the new chief executive but added that Prudential ‘ hasn’t done enough to offset wider market concerns’.
Those concerns, which centred on the banking sector in the wake of the collapse of sVB and in particular the health of credit suisse, saw the FTSE 100 index tumble 3.8pc, or 292.66 points, to 7344.45, while the FTSE 250 fell 2.6pc, or 503.81 points, to 18,625.85.
Just six blue- chip stocks were up in London.
But it was not all doom and gloom. Bloomsbury cheered after its revenue and profits soared on the back of bumper sales of its fantasy novels and academic digital resources.
The Harry Potter publisher said it should have made more than £260m of revenue and around £30m of profit for the year to February 28.
This would be above the £242.6m of revenue and £26.9m profit analysts had expected. shares soared 6.4pc, or 27p, to 447p.
Bloomsbury chief executive nigel newton said: ‘Throughout a year which has been characterised by rising inflation and cost of living pressure, it is notable that reading remains hugely popular throughout the world with books regarded by many readers as an affordable pastime.’
Iron ore pellet producer Ferrexpo, which has more than 95pc of its 10,000 workforce in central Ukraine, said access to the Black sea remained crucial after its revenue halved in 2022 and pellet production slumped almost 50pc.
The shares plunged 7.1pc, or 9.3p, to 122p.
The mood was hardly brighter at IG Group after the stock trading firm saw its active client numbers fall 5pc to 335,400 in the three months to February 28 compared to the same period a year ago.
It said the market was quieter particularly in December.
The company’s shares slipped 9.9pc, or 76.5p, to 695.5p.
Burberry has poached a replacement for outgoing finance boss Julie Brown from supercar manufacturer McLaren.
The luxury fashion house said that Kate Ferry will be taking over from Brown as chief financial officer in september.
The 50-year- old former retail analyst held senior posts at Dixons carphone and Talk Talk before joining the McLaren Group as cFO two years ago.
Burberry’s stock fell 3.6pc, or 84p, to 2249p.