Date: Wednesday 13 Jun 2012
It was an up and down day for the Footsie although the top-share index rarely strayed far from the previous day's closing value.
The so-called "shareholder spring" of protest votes against bumper pay packages for executives continued with perhaps the biggest slap in the face so far, as 60% of votes at WPP's annual general meeting were cast against the remuneration package.
The verdict of the shareholders is only advisory and the board of the advertising conglomerate can ignore it if they wish, but the company's Chairman, Philip Lader, said: “We take the remuneration report vote seriously. We’ll consult with many share owners and we’ll then move forward in the best interest of our share owners and our business.”
WPP chief executive Sir Martin Sorrell, the second highest paid boss among FTSE 100 companies behind "Diamond Bob" Diamond at Barclays, is set to get a 60% earnings increase to £6.8m a year.
Sorrell has described his increase as a reward for success, not failure, and his case was backed up by a trading update at the AGM which highlighted a 7% increase in reported revenues to £3.2bn in the first four months of the year, with like-for-like revenues up 4%.
Supermarket group Sainsbury's keenly awaited trading update proved a bit anti-climactic with like-for-like (LFL) sales growth below expectations. LFL sales in the 12 weeks to June 9th were up 1.4% on the corresponding period of last year, below market expectations of growth of between 1.6% and 2.0%. Total sales for what is the first quarter of the supermarket chain's first quarter were up 3.6% year-on-year, or 3.8% excluding fuel.
Competition in the supermarket sector remains as fierce as ever, with Tesco boss Philip Clarke recently describing as "unhelpful" the "coupon war" being waged by some of the major players - including Tesco. Now reports are emerging that Morrisons might be joining the battle, having previously eschewed coupons. The chain disclosed on Tuesday that it is giving a voucher scheme a trial run on ten stores in the north-east of England.
Tesco, meanwhile, was upgraded to "overweight" from "neutral" by HSBC.
Elsewhere in the retail sector, JD Sports was wanted after reporting a pick-up in LFL sales growth. The designer label sportswear retailer said LFL sales in the 19 weeks to June 9th were up 1.5% on the corresponding period of the previous year, which represents an improvement in the growth rate of 1.2% previously reported for the nine weeks to the end of March.
Scottish oil and gas giant Cairn Energy is to make an agreed takeover of North Sea oil producer Nautical Petroleum. Cairn is offering 450p per share in a deal which values Nautical at around £414m. The terms represent a 51.1% premium to the closing price of Nautical on the trading day prior to the announcement of the bid.
In other bid news, pharmaceuticals firm Proximagen has shot up after succumbing to a takeover offer from US firm Upsher-Smith Laboratories (USL). USL is offering 320p in cash per Proximagen plus either a further 192p in cash or an equivalent amount in loan notes. The terms value Proximagen at around £357m.
The bid is good news for intellectual property development firm IP Group, which has a 7.6% stake in Proximagen.
Supply chain software company Kewill has received a last-minute bid from Symphony, a US private equity firm, beating off rival bidder Francisco Partners. Symphony is offering 106p per Kewill share.
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Antofagasta (ANTO) 1,070.00p +1.61%
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Royal Dutch Shell 'A' (RDSA) 2,090.50p +1.48%
Shire Plc (SHP) 1,904.00p +1.44%
FTSE 100 - Fallers
Xstrata (XTA) 920.00p -5.15%
Man Group (EMG) 72.00p -3.36%
Glencore International (GLEN) 355.00p -3.23%
IMI (IMI) 844.50p -2.88%
Sainsbury (J) (SBRY) 283.50p -2.61%
Vedanta Resources (VED) 915.50p -2.55%
Aggreko (AGK) 2,177.00p -2.33%
Evraz (EVR) 260.50p -2.32%
Burberry Group (BRBY) 1,341.00p -2.12%
Wolseley (WOS) 2,190.00p -2.01%
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Howden Joinery Group (HWDN) 118.40p +2.87%
Cranswick (CWK) 800.00p +2.56%
RPC Group (RPC) 374.60p +2.52%
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FTSE 250 - Fallers
Ferrexpo (FXPO) 179.40p -6.56%
Imagination Technologies Group (IMG) 443.00p -6.30%
Aquarius Platinum Ltd. (AQP) 60.70p -5.30%
Kesa Electricals (KESA) 46.28p -4.77%
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Spectris (SXS) 1,467.00p -3.80%
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Fenner (FENR) 339.00p -3.50%
FTSE TechMARK - Risers
Asterand (ATD) 1.38p +22.22%
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RM (RM.) 78.50p +7.53%
Emblaze Ltd. (BLZ) 48.00p +6.08%
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