Capita
More woes for the outsourcing sector with Capita announcing a rights issue to the market this morning. The news was reported in the weekend press first, so this is unlikely to impress investors, even if the announcement leads with a structural overhaul which “aims to simplify and strengthen the business in order to deliver future success. Its objective is to become a more focused and predictable, client-centric company, generating sustainable free cash flow.” The company wants to raise £700m through the offer and is promising cost savings of £175m a year by 2020.
Chapel Down
Full year results from Chapel Down, the UK-based winemaker & brewer, are out this morning. Turnover is increasing and although margins are being hit – gross profits have fallen from 39% a year ago to 38% today – the metrics look encouraging. Wine sales are up 20%, beer sales up 33% and the company’s new foray into spirits is being heralded as a success, too. This may be a small cap company, but it’s an inspirational one.
Clarkson
There’s a brief trading update out from Clarkson, the provider of ship broking services, this morning. Whilst it’s light on detail, it comes with a dark undercurrent and the business is experiencing something of a perfect storm. “Challenging environment”, “lower freight rates” and the fall in the US dollar are all colluding. The expectation is that profits for the full year are expected to be materially below those of last year – this is a profit warning and the shares will likely feel the brunt once the market opens.
