44 Wednesday January 19 2022 | the times
BusinessMarkets
news in brief
Gambler’s winnings fall
Punter-friendly sporting results
and regulatory headwinds dented
fourth-quarter revenues at 888
Holdings. The gambling operator,
which shortly will complete its
£2.2 billion acquisition of William
Hill, suffered a 16 per cent fall in
revenues to $214 million in the
fourth quarter. For the year as a
whole, revenues grew by 14 per
cent to $972 million driven by
strong performances in Britain,
Italy, Romania and Portugal. By
product, casino grew 24 per cent,
while market exits and tough
comparables restricted sports
betting growth to 4 per cent.Elementis beats target
Elementis expects full-year
operating profit to be “modestly”
ahead of forecasts after a strong
final quarter. Adjusted operating
profit for 2021 would be
$105 milion to $107 million, ahead
of City forecasts of $104 million.
The London-based chemicals
company, which launched more
than 20 new products during the
course of the year, won
$35 million in new business and
reduced its costs by $10 million.
The shares closed up 3p, or
2.2 per cent, at 137¾p.Energean sets record
Energean had a record year, with
annual revenue up by 47 per cent
to $495 million. The hydrocarbon
exploration and production
company said in a trading update
that earnings before interest, tax
and other charges had almost
doubled to $202.9 million, from
$107.7 million the previous year.
In 2021 capital expenditure was
$359.3 million, against the revised
full-year guidance of $415 million
to $485 million. Shares in
Energean rose 33½p, or 3.7 per
cent, to 949½p.IntegraFin’s inflows up
Record first-quarter net inflows
have propelled IntegraFin
Holdings to a positive start to its
financial year. The investment
platform said that funds under
management had risen to
£54.5 billion by the end of
December, up 4.7 per cent from
£52.1 billion at the end of its
financial year on September 30.
Gross inflows amounted to
almost £2 billion in the first three
months of the financial first
quarter. Its shares closed down
2½p, or 0.5 per cent, at 524½p.Commodities
ICIS pricing (London 7.30pm)Crude Oils ($/barrel FOB)
Brent Physical +0.96
BFOE(Mar) 87.56 +1.02
BFOE(Apr) 86.89
WTI(Mar) 84.83 +1.68
WTI(Apr) 83.86 +1.05Products ($/MT)Spot CIF NW Europe (prompt delivery)
Premium Unld 780.00 782.00 +2.00
Gasoil EEC 767.25 769.25 +3.00
3.5 Fuel Oil 466.25 469.5 +6.00
Naphtha 767.00 769.00 -2.00ICE Futures
Gas Oil
Feb 770.75-770.50 May 736.50-735.00
Mar 758.00-757.75 Jun 728.75-728.50
Apr 745.50-745.25 Volume: 783709Brent (9.00pm)
Mar 87.94-87.93 Jun 85.40-85.38
Apr 87.19-87.17 July 85.00-84.15
May 86.30-86.27 Volume: 2026096LIFFE
Cocoa
Mar 1771-1769 May 1765-1747
May 1811-1810 Jul 1758-1686
Jul 1811-1800 Sep 1805-1787
Sep 1805-1787
Dec 1800-1756
Mar 1773-1764 Volume: 76015RobustaCoffee
Jan 2382-2300 Nov 2250-2135
May 2169-2165 Jan 2159-2095
Jul 2163-2151
Sep 2163-2138 Volume: 7273White Sugar (FOB)
Reuters Oct 482.90-477.40
Dec 484.00-471.30
Mar 507.20-507.00 Mar 479.70-477.90
May 498.30-485.40 May 472.60-470.00
Aug 491.70-489.00 Volume: 58720PRICES
Major indices
New York
Dow Jones 35368.47 (-543.34)
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Tokyo
Nikkei 225 28257.25 (-76.27)
Hong Kong
Hang Seng 24112.78 (-105.25)
Amsterdam
AEX Index 769.70 (-11.62)
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AO 7735.80 (-3.50)
Frankfurt
DAX 15772.56 (-161.16)
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Straits 3280.04 (-7.91)
Brussels
BEL20 4219.86 (-29.77)
Paris
CAC-40 7133.83 (-67.81)
Zurich
SMI Index 12529.56 (-103.65)
DJ Euro Stoxx 50 4257.82 (-44.32)
London
FTSE 100 7563.55 (-47.68)
FTSE 250 22652.71 (-218.93)
FTSE 350 4287.22 (-29.42)
FTSE Eurotop 100 3564.03 (-25.49)
FTSE All-Shares 4263.04 (-29.54)
FTSE Non Financials 5141.17 n/a
techMARK 100 6669.79 (-73.38)
Bargains n/a
US$ 1.3578 (-0.0069)
Euro 1.1994 (+0.0035)
£:SDR 0.98 (+0.00)
Exchange Index 83.03 (-0.08)
Bank of England official close (4pm)
CPI 114.48 Nov (2015 = 100)
RPI 314.30 Nov (Jan 1987 = 100)
RPIX 290.10 Jun (Jan 1987 = 100)
Morningstar Long Commodity 677.16 (+5.72)
Morningstar Long/Short Commod4703.45 (+27.75)London Financial Futures
Period Open High Low Sett Vol Open Int
Long Gilt Mar 22 122.92 123.04 122.42 122.77 242247 782980
Jun 22 125.77 125.77 125.77 125.28 1 4
3-Mth Sterling Mar 22 99.320 99.320 99.285 99.301 3457 269264
Jun 22 99.025 99.045 99.015 99.026 10377 232459
Sep 22 98.885 98.890 98.860 98.866 3885 301735
Dec 22 98.820 98.825 98.790 98.806 7310 347378
Mar 23 98.785 98.795 98.755 98.771 8310 229855
3-Mth Euribor Mar 22 100.54 100.54 100.53 100.54 34140 385972
Jun 22 100.47 100.48 100.46 100.47 83948 438505
Sep 22 100.38 100.39 100.37 100.39 98908 497593
Dec 22 100.28 100.29 100.26 100.29 96652 522105
Mar 23 100.11 100.14 100.09 100.13 98160 418246
3-Mth Euroswiss Mar 22 100.73 100.73 100.73 100.73 677 31949
Jun 22 100.71 100.72 100.70 100.71 925 29152
Sep 22 100.68 100.68 100.67 100.68 710 31355
Dec 22 100.61 100.62 100.59 100.62 488 22748
FTSE100 Mar 22 7559.5 7569.5 7472.5 7515.0 93356 603574
Jun 22 7449.0 7449.5 7449.0 7454.0 10 203
FTSEurofirst 80 Mar 22 5900.5
Jun 22 5883.5© 2022 Tradeweb Markets LLC. All rights reserved.
The Tradeweb FTSE Gilt Closing Prices information contained
herein is proprietary to Tradeweb; may not be copied or
re-distributed; is not warranted to be accurate, complete or timely; and does not constitute
investment advice. Tradeweb is not responsible for any loss or damage that might result
from the use of this information.6.3p this time. So a historic 114 price-
to-earnings ratio probably will fall
only to a stratospheric 81 or so when
the 2021-22 results are published in
the autumn. And there’s no
suggestion of a dividend.
On similar grounds, this column
advised avoiding the shares two
years ago because they seemed too
expensive. They were 330p then, so
may be one of those cases that defy
gravity and the usual financial
yardsticks, for a while at least.
Much of the recent growth
stemmed from online spending as
lockdowns restricted other
opportunities, which will not
continue indefinitely. However, the
company has sound expansion planstraded up to bigger boxes of more
luxury chocs. Half-year sales were
ahead by 40 per cent and 56 per
cent, respectively.
“All our growth drivers are behind
the acceleration in sales,” Thirlwell
said, pointing to its Velvetiser in-
home drinks system, VIP Loyalty
rewards and digital, while also name-
checking the United States, global
wholesale and the company’s joint
venture in Japan.
By any normal yardstick, the
shares are ridiculously expensive.
The 515p share price is supported by
earnings per share of a tiny 4.5p for
the financial year to last June and
the first half of the present year
suggests that may grow to only aboutM
aple and pecan, raspberry
and pistachio — no wonder
Hotel Chocolat’s mission is
“making people happy through
chocolate”. Angus Thirlwell, the
company’s co-founder and guiding
light, is ringing the changes on
flavours, to tasty effect.
He delivered a bullish trading
update yesterday, saying that second-
quarter revenue was 37 per cent
higher than the year before and
62 per cent up on the pre-Covid
quarter two years ago as customersWilliam Kay Tempus
Buy, sell or hold: today’s best share tipsIt’s time to look past the Covid shock
N
atWest is back in the
spotlight in the run-up to
its 2021 results on
February 18, not least
because the government
is on the verge of cutting its stake in
the bank, a legacy of the 2008
financial crisis, from a peak of 79 per
cent to below the psychologically
important 50 per cent. The steady
trickle of NatWest shares from the
Treasury on to the stock market has
dampened the price, but glasses will
be raised in the boardroom when the
government’s stake falls below the
level of automatic control.
With that box ticked, the annual
results will cleanse the balance sheet
of a few nasty one-off charges. The
bank will have released about
£1 billion set aside for Covid loan
losses that did not materialise. And
last month it learnt that its fine and
costs for breaching money-
laundering regulations over Fowler
Oldfield, the Bradford-based jeweller,
totalled £270 million, rather than the
£340 million that had been feared.
Alison Rose, the chief executive,
has had a turbulent tenure so far. Her
first results announcement in
February 2020 was fractionally too
early to merit any mention of Covid.
Instead, attention was drawn to her
decision to scrap the tarnished Royal
Bank of Scotland name in favour of
NatWest. Her agenda then wasfocused on social and environmental
change and the bank was prominent
in last November’s Cop26 climate
change conference by pledging the
end of loans to coal firms. However,
as Britain’s biggest lender to
companies, deriving more than
90 per cent of its income from thiscountry in 2020, it has had its hands
full with more basic priorities. By
October of that year Rose was forced
to admit that “the full impact of
Covid remains very unclear”.
The forthcoming results season
will be a chance to reassess UK-
quoted banks. All are cash-heavy
after pandemic roadblocks and the
Bank of England ban on dividends in
2020, but, with the help of growth in
lockdown-swollen customer deposits,
NatWest has more spare money than
most, about £80 billion over the
minimum requirement. Excluding
UK government support schemes,
personal lending has been muted,
except for mortgages.
That leaves NatWest nicely primedHeading north
Source: RefinitivShare price 2021 2020050100150200250pApr2020 2021 2022
Jul Oct Jan Apr Jul Oct JanTotal incomeOperating expensesProfit before impairment releasesOperating profit before taxProfit attributable to ordinary
shareholders£8.093bn
£8.621bn-£5.463bn
-£5.564bn£2.630bn
£2.697bn£3.579bn
-£415m£2.516bn
-£644m
Nine months ended 30 Septemberfor an economic pick-up and the
associated increases in the Bank of
England’s base rate expected this
year. After December’s much-delayed
move from 0.1 per cent to 0.25 per
cent, analysts are looking for another
rise to 0.5 per cent this spring and a
possible 1 per cent by the end of 2022.
That would attract more savings,
creating capacity for more loans at
rates already routinely around 8 per
cent for individuals.
Eyes will be peeled to see if
NatWest has begun this year with an
improved net interest margin, the key
difference between the interest it
pays on deposits and what it charges
on loans and the like. At the end of
September its 1.54 per cent margin
was the sector laggard. If it has
hauled that back to the 2.06 per cent
of a year ago, it will be better-placed
to make the most of higher interest
rates and revived post-Covid activity.
Deutsche Bank sees NatWest as
the most rate-sensitive UK bank
because of its £80 billion excess
capital, which therefore offers the
highest potential return. Its
12.45 price-to-earnings ratio is at the
top end, but so is its 2.4 per cent
dividend yield. The bank is
committed to paying an average
£1 billion a year, 3.27 per cent of the
present market capitalisation, in
ordinary and special dividends for the
next three years. The shares have
more than doubled to 254p since the
March 2020 Covid shock, but four
years ago they were above 300p,
Deutsche Bank’s target for them.
They should have further to go.ADVICE Buy
WHY After surviving difficult
trading conditions, NatWest
looks best placed to take
advantage of the post-
pandemic outlookin its main British, American and
Japanese markets, with the long-
term prospect of spreading to new
territories. However, with such
success come threats: one day
competitors will nibble on its recipe.
Much hangs on the half-year
numbers that are due on March 2.
The share price has fluctuated either
side of 500p since October. However,
Peel Hunt analysts think that 600p is
a fair prospect.ADVICE Hold
WHY The expansion plans
have further to gonatwest group
Market cap
£30.5bnTotal assets
£778bnhotel chocolat
Market cap
£679mTotal assets
£156m