A breakdown in talks to secure a new buyer, and a profit warning have wiped nearly £75million off the value of betting firm Sportech.
The former owner of the football pools put itself up for sale in October following a strategic review.
But despite talks with a number of interested parties, there are unlikely to be any bids.
In a grim update, Sportech warned earnings would be lower at around £6.5million because of accounting issues that will result in write-downs.
Sportech put itself up for sale in October following a strategic review of the business. But despite holding talks with a number of interested parties, there are unlikely to be any bids
And its results are expected to contain £8m of exceptional items, including £4.3million relating to former board members.
Chairman Richard McGuire remained upbeat, adding: ‘I am confident that the company has the potential to deliver significant long-term value to shareholders, especially if the US sports betting market is liberalised.’
However, analysts at Peel Hunt said they were reviewing the firm’s ‘Buy’ rating following the announcement, and shares plunged 51.8 per cent, or 40.3p, to 37.5p.
The FTSE 100 ended pretty much where it started, down 0.09 per cent, or 6.09 points, at 7132.69.
Meanwhile, a glowing report from Goldman Sachs boosted London-listed miners.
The investment bank confirmed that the miners were ‘on their strongest footing for many years’, on the back of a boom in demand for commodities.
STOCK WATCH – BURFORD CAPITAL
Burford Capital’s shares went through the roof after the company more than doubled its profits.
The financier to the legal market reported a 132 per cent increase in operating profits to £207million in 2017.
And its income was up 109 per cent to £244.4million.
Christopher Bogart, chief executive, said: ‘The past year saw an explosion of demand for Burford’s capital from clients around the world.’
Shares shot up 31 per cent, or 338p, to 1428p.
It says the sector is attractive to investors as it upgraded Anglo American from ‘Neutral’ to ‘Buy’ and BHP Billiton and Antofagasta from ‘Sell’ to ‘Neutral’.
Investors sat up and listened. Antofagasta rose 3.5 per cent, or 31.6p, to 946.2p, while Anglo rose 3.3 per cent, or 57.8p, to 1789.4p. BHP was up 0.6 per cent, or 8p, at 1444.6p,
Glencore, which maintained its ‘Buy’ rating, saw its shares rise 1.8 per cent, or 6.85p, to 383.55p.
Shares in FTSE 250-listed Hikma Pharmaceuticals rocketed despite the firm posting big losses.
In its full-year results for 2017, Hikma revealed a pre-tax loss of £528.7million, mainly because of a £715million writedown to its West-Ward Columbus acquisition.
However, revenues were ahead of brokers’ forecasts, which had a positive effect on its share price.
Said Darwazah, Hikma’s chairman, said: ‘To be more competitive and achieve our ambitious goals, we are making transformational changes.’ Shares jumped 6.5 per cent, or 56.6p, to 929p.
A new collaboration with crisis-ridden cycling outfit Team Sky caused shares in engineering firm Versarien to slide.
Team Sky, which is at the centre of a scandal in professional cycling, wants Aim-listed Versarien to investigate how miracle-material graphene can boost its performance. It is the world’s thinnest substance – very lightweight, but harder than diamonds.
It is thought it could be used to make bike frames lighter and more durable and riders’ helmets safer. It might also be used in clothing and tyres.
Versarien said the tie-up was the ‘ideal showcase’ for its graphene technology. However, all it did was send investors running. Shares slipped 2.3 per cent, or 2p, to 83.5p.
Elsewhere, shares in Cathedral City cheesemaker Dairy Crest dived after broker Peel Hunt cut its 2019 earnings forecast from £74million to £68.5million as it expected additional marketing spend to drive growth in a ‘tough consumer environment’. Shares fell 7.6 per cent, or 41.5p, to 507p.
An upgrade from ‘Sell’ to ‘Hold’ from Societe Generale sent shares in satellite operator Inmarsat to the stars.
However, it also cut the firm’s target price from 455p to 410p. Shares hopped up 3.4 per cent, or 13p, to 399.7p.