Updates from Wetherspoon, Afren and Diploma

Adrian Holliday
savings, tax, stockmarket, pensions, cash, investment FTSE 100 afren, Diploma, Wetherspooon
savings, tax, stockmarket, pensions, cash, investment FTSE 100 afren, Diploma, Wetherspooon


There was almost a 40-point hike for the FTSE 100 on Thursday, rising to 6,761. AstraZeneca and CRH were the main beneficiaries, up 4% and 3.7% respectively (to 4479p and 1807p). Shire was also up strongly, up 2.7%. However there were steep falls for StandardChartered, down 4.4% and (again) TullowOil, down 3.2% to 308p. DirectLine was down 2.7% to 321p.

More positive news for the Dow Jones, up almost 1.5% to 17,895.2 and a rise of nearly 260 points, helped by fresh dollar falls against the euro, boosting profits hope for many US companies.

Let's start with an early-morning beverage from Wetherspoons. Revenues rise 9% to £744.4m (2014: £683.2m) for the 26 weeks to 25 January. Like-for-like sales climb 4.5% while operating profits dip 1.1% to £55.1m.

The Wetherspoon dividend is maintained at 4p. Chairman Tim Martin says his operation remains under pressure from increased competition from supermarkets plus increased pay and bonuses for pub staff.

"The second half," he says, "of the last financial year was strong, which will make it difficult to improve on that performance in the current year, although we expect a reasonable outcome for the full financial year, even so."

Next, oil operator Afren. The small-cap FTSE 250 player says its reached a deal with its lenders to address its short and longer-term borrowing pressures and recapitalise its capital structure.

That means a debt-for-equity swap, meaning its creditors will take shares in the operation while continuing to financially support Afren. It's thought the total controlling stake will be around 11%.

At the start of March Afren defaulted on a $15m loan interest payment. The impact on the company's share price in the last six months has been huge, falling from 110p to 6.5p (currently).

Lastly, technical services player Diploma says it has bought 100% of Rutin AG, the Swiss non-trading holding company of the Kubo Group companies based in Switzerland and Austria.

The Kubo business specialises in high value products that address harsh environments or complex applications says Diploma. Kubo also retains exclusive distribution rights in Switzerland and Austria for some large international manufacturers of sealing products.

"The acquisition," says Diploma chief exec Bruce Thompson, "will [also] open up opportunities for cross selling of products with Diploma's other Seals businesses, including access to Kubo's high precision, manufactured parts."

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