Future results at top end of expectations but finance boss to leave

“There may still be 27 days to go until Halloween, but the fear factors are out in force and investors are not in the mood to be spooked,” says Russ Mould, investment director at AJ Bell.

“Inflation, the energy crisis, supply chain issues, economic growth stuttering, concern that interest rates could go up sooner rather than later and China’s ongoing Evergrande debt problem remain at the forefront, clouding investment decisions and muddying the waters for anyone trying to make money on the market.

“The FTSE 100 fell 0.2% to 7,012, dragged down by weakness in banks and BT, the latter following media reports that it is set to face growing competition from Virgin Media which is reported to be in talks to receive investment from Sky for its full-fibre broadband rollout.

“In Asia, Hong Kong’s Hang Seng index dropped 2.4%, with healthcare stocks firmly out of favour with investors.

“Trading was suspended in Evergrande and its property management business Evergrande Property Services. While no details were given, speculation points to rival developer Hopson preparing to buy a stake in Evergrande Property Services. One would have thought Hopson sees this as an opportunity to strike a bargain deal, given how Evergrande is in a desperate situation.

“On the UK market, among the stocks managing to push ahead was Sainsbury’s as investors speculated that it would be the next takeover target in the supermarket sector following CD&R’s successful bid over the weekend for Morrisons. Fortress, which was unlucky in the Morrisons bid, is seen to be eager to make a large transaction, so one must wonder if Sainsbury’s is the next logical business to tick all the right boxes for the US dealmaker.

“Flutter Entertainment seems to be getting its ducks in a row to float its subsidiary FanDuel on the US stock market. The appointment of a permanent CEO for FanDuel is a logical next step towards floating the business, which could command a higher valuation as a standalone entity. Flutter is expected to keep a decent sized stake in FanDuel should it be listed in the US.”

Future

“When you set the bar high it can be hard to clear. That’s the lesson Future learned after an ostensibly positive update got a modest shrug-off from the markets.

“It seems guiding for results at the top but within the parameters of current guidance wasn’t enough for some investors.

“A reference to a hard act to follow on audience growth, even if the context of this being superseded by digital advertising growth, may also have led to a bit of nervousness.

“The departure of Future’s finance chief Rachel Addison after a little more than a year may have raised some eyebrows.

“Addison became part of the team following the acquisition of TI Media, at which time numbers chief Penny Ladkin-Brand moved to chief strategy officer to accommodate.

“Perhaps the temptation to get the old team together was too much for Future CEO Zillah Byng-Thorne to resist as Ladkin-Brand gets set to resume her position as finance director.

“Future’s growth trajectory, built on buying magazine titles on the cheap and then monetising the specialist content through a central e-commerce and online advertising platform, has been nothing short of remarkable.

“The company lauds the merits of its latest acquisition of Dennis Publishing in this latest statement, a transaction which added titles like The Week and Minecraft World, but there will be some concern that eventually it runs out of deals which can really move the dial.”

These articles are for information purposes only and are not a personal recommendation or advice.