Admiral up on premiums hike
BUYERS stepped on the gas and helped Admiral accelerate 65p to 1518p.
The GoCompare.com and Confused.com insurer was boosted by data from the AA’s Shoparound motor pricing survey that car insurance premiums rose 5pc in the secondquarter and are set to get even more expensive. Bad news for young drivers who already have been hit with increases of about 6pc in the three months to the end of June.
The AA warned that a rise in insurance premium tax from 6pc to 9.5pc would put upward pressure on premiums. Fully comprehensive car insurance premiums were on average £549.46 per year in the second quarter. AA insurance managing director Janet Connor said: ‘The days of cheap car insurance premiums are over – price rises are inevitable.’
Yet broker Canaccord Genuity retains its sell recommendation on Admiral. it sees the AA data as a small fundamental positive, which is already in the price. it forecasts a 5pc motor price increase for the full-year.
Demand yesterday also followed news that Admiral is taking on an extra 130 people in its Newport office as well as 50 additional jobs in Cardiff and 100 in Swansea. Always a sign that business must be thriving.
Chief executive, co-founder and major 11.7pc shareholder Henry Engelhardt has announced he will step down in May and hand over the reins to David Stevens, who co-founded the company with him in 1991. Admiral sold its first policy over the telephone in January 1993 and was floated on the LSE in 2004. RSA also responded to the AA survey with a gain of 9.3p at 440.2p.
The rest of the Footsie was either in neutral or reverse gear ahead of today’s Greek parliament vote on the second tranche of reforms specified by the country’s creditors, which is required before third ballot negotiations can proceed. Connor Campbell at spreadex.com said: ‘Greece is aiming to have a third bailout signed, sealed and delivered by August 20 at the latest, incidentally the date of the country’s next ECB repayment.’
The blue- chip index drifted 19.62 points lower to 6769.07 and the FTSE 250 25.53 points down to 17,755.89. Late sentiment was not helped by Wall Street’s hefty fall of 181 points. Already concerned about an early rise in uS interest rates, traders in New York were miffed to see united Technologies drop 6pc after cutting full-year earnings forecasts and warning about pressure in its aerospace systems and Otis elevators business. iBM fell 5pc after reporting a 13th consecutive decline in quarterly profits.
EasyJet, 55p off at 1666p, lost altitude on nervous selling ahead of today’s third-quar- ter trading update. Analysts lowered expectations for its second-half performance in May. The market will also want to hear if the recent terror attack in Tunisia and ongoing troubles in Greece have had any major impact on trading.
After a Charles Stanley upgrade to hold from reduce, following a solid first-half tradi ng performance, Croda International jumped 156p to 2951p. The broker upgraded in light of an improved performance in the second- quarter, driven by better- thanexpected sales of pharmaceutical grade Omega-3. it increases the chances of additional capital returns to shareholders.
ValiRx advanced 8p or 24pc to 41p following upbeat Phase i and ii trial updates for its lead compound, VAL201, which treats locally advanced or metastatic prostate cancer and other advanced solid tumours.
AiM-listed Blur Group, which has created an online platform for companies to buy and sell services, jumped 5p to 29.5p. it revealed that the number of active users at the end of the year had risen 31pc to 65,000, from around 50,000 at the end of 2014. Following news of the appointment of Mary Turner as chief executive from October, online fashion retailer Koovs rose 3.5p to 72.5p. Peel Hunt called it an eye-catching appointment and said the company had pulled off a coup. She brings vast experience of the consumer-facing tech world, gained with the likes of BT, Tiscali and as a non- executive at ASOS. Koovs remains a business with massive potential. The broker’s target price is 150p.
Specialist asset manager Gresham House closed rock steady at 267.5p after announcing its first investment advisory agreement, to be led by Graham Bird, Tony Dalwood and the Strategic Public Equity investment team. it has taken a 19.4pc stake in early stage venture capital company SPARK Ventures (0.25p easier at 4.75p) following a £10.1m share placing by SPARK, £3.8m worth of asset swaps and £3.1m open offer.
The purpose of the fundraising is to pursue a new investment strategy in partnership with Gresham House. GH will now be focusing on inefficient areas of the market, taking influential block stakes in smaller companies and then constructively engage to identify value creation catalysts. Watch this space.
÷ SCIENCE in Sport, the official sports nutrition supplier to several professional cycling teams and the GB Rowing team, rose 2.75p to 68.25p following a positive trading update. Sales increased 19pc to £5.24m at the half-way stage, driven by strong growth in e-commerce, from third-party e-tailers and its own website, and in international markets. The board is confident about the outlook for the full year.