As the company behind the steel structures that went into the London Olympic stadium, Severfield recognises what solid support looks like. As it reported record new orders, investors rushed to give it their backing.
In an upbeat trading statement, Severfield said it expected to report full-year results slightly ahead of its previous guidance. Shares in the steel manufacturer rose 10½p, or 19.3 per cent, to 64½p.
The Aim-quoted business said it has secured £511 million of new orders in Europe, a record high. The company has also grown its order book across Europe with one third of its orders to be delivered outside of the UK.
In a move to return cash to investors, Severfield announced that it would begin a £10 million share buyback programme. The business also said it had appointed Charlie Cornish to take over as chair. Cornish, the former chief executive of Manchester Airports Group, head Severfield’s board from the end of July.
Revenues at Severfield are set to benefit from a growing number of net-zero projects to mitigate against the impact of climate change which require steel structures. These include the construction of battery plants and energy efficient buildings.
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Analysts at Liberum said that Severfield was in a good position to gain market share in the UK’s structural steel market. They added that the company’s division in India was also likely to benefit from a strong pipeline of projects alongside the country’s growing economy.
It was a more upbeat day for investors following Tuesday’s broad-based sell off. The FTSE 100 rose 27.63 points, or 0.4 per cent, to 7,847.99, with the rise driven by positive updates from the miners.
Antofagasta added 61p, or 2.8 per cent, to close at £22.69, after the Chilean miner said it would meet annual profit guidance despite reporting a drop in copper production. Fellow miner Anglo American reported provisional diamond sales of $445 million during its third sales cycle for 2024. The shares rose 73½p, or 3.5 per cent, to £21.69.
British-Australian mining behemoth Rio Tinto reiterated its annual production guidance, its shares advancing 134p, or 2.6 per cent, to £53.88.
In an altogether different sector, Burberry shares rose 11p, or 1 per cent, to £11.46, in a read-across from LVMH, after the French luxury retailer reported a rise in first-quarter sales and met forecasts.
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Another riser on the blue-chip index was JD Sports. Investors took a punt on the retailer after it signed a franchise agreement with Foschini Retail Group to launch in South Africa. The group said it plans to open 50 JD Sports stores in the country over the next five years. Shares in the retailer advanced 2¼p, or 1.8 per cent, to 119p.
Shares in Mondi were under pressure following reports that DS Smith had formally agreed a merger with US based International Paper. Mondi shed 13p, or 0.9 per cent, to £13.64, while DS Smith advanced 3¾p, or 1 per cent, to 397¼p.
Paddy Power owner Flutter took a hit, falling 240p, or 1.6 per cent, to £147.60, following a quarterly update from competitor Entain that showed UK revenues had fallen due to tougher legislation.
The FTSE 250 closed flat today falling just 4.4 points to 19,340.14. The biggest riser on London’s mid-cap index was International Distributions Services which rose 61¾p, or 28.9 per cent, to end the day at 276p. Shares in the Royal Mail parent company rose after it was reported that Daniel Kretinsky, the largest shareholder in International Distributions Services, is exploring a possible takeover bid for the group.
Ukrainian miner Ferrexpo was boosted by strong iron ore prices which reached their highest level in five weeks. Shares in the iron ore miner gained 2p, or 4.8 per cent, to 46¼p.
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Over on the main market, online fashion retailer Asos received a boost after it appointed a new chief financial officer and reaffirmed its full-year forecast for adjusted profit. Its shares climbed 16¼p, or 4.9 per cent, to end the day at 349½p.
Investors steered clear of Deliveroo as they awaited tomorrow’s trading update. Shares in the takeaway delivery business shed 4p, or 3.1 per cent, to end the day at 121¼p after a read-across from Just Eat.
In another blow to London’s junior market, Scirocco Energy announced it would ask shareholders for permission to delist from Aim. Shares in the energy company fell 0.05p, or 18.2 per cent, to 0.23p.
Inspecs focuses on bright side
Eyewear manufacturer Inspecs seems to have the right vision as the group swung into profit in 2023.
Inspecs, which designs, makes and distributes eyewear, climbed 3½p, or 7.5 per cent, to end the day at 50½p, after the group announced upbeat annual results.
The Bath-based company reversed a £7.7 million loss in 2022 to report a £200,000 profit for the year to December 2023. Revenue rose 1.1 per cent to £203.3 million, up from £201 million the previous year.
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The group announced it had achieved record sales during 2023, driven by increased demand for their frames. The results marked a turnaround for the AIM-quoted business which had reported two years of losses.
The eyewear business has recently completed a new manufacturing facility which it believes will lead to increased production in the second half of the year. It also plans to launch new products.
Inspecs said that efficiency had been enhanced through adjustments to its global supply chain
The group, founded in 1998 by its chief executive Robert Totterman, said it had made a slow start to the year but was confident of meeting market expectations.
Wall Street report
Indices ended lower as the quarterly company earnings season is only just getting under way and concerns persist over the extent and timing of interest rate cuts this year. The Dow Jones industrial average fell 45.66 points, or 0.1 per cent, to 37,753.31.
