Footsie threat to Inchcape
Sunday 26 November 1995
The mauling leaves Inchcape worth just pounds 1.3bn, and makes it the most likely candidate to step aside for the National Grid, the UK power transmission company that will go straight into the FT-SE 100 index when official dealings start on 11 December.
A regular meeting of the Stock Exchange's UK committee on 6 December will almost certainly seal Inchcape's fate as the main criterion for FT-SE 100 membership is market worth. Inchcape's removal from the Footsie would mean the withdrawal of some index-tracking funds from the share, which could prompt further share-price weakness in the run-up to Christmas.
"I'm absolutely certain Inchcape will drop out of the Footsie in two weeks' time," says Nyren Scott-Malden, analyst at broker BZW.
He is one of many to slash results forecasts recently, after profit warnings this month from motor dealer Evans Halshaw and car-hire specialist Eurodollar, plus poor trading conditions in France and Hong Kong.
Worse, Inchcape is particularly vulnerable to a strong Japanese yen; every 5 per cent movement in the currency is estimated to hit the bottom line to the tune of pounds 13m, though the blow can be softened by hedging.
Brokers now expect pre-tax profits of around pounds 140m before exceptional charges for 1995, versus pounds 231m in 1994. Inchcape itself admits the omens are poor. "The situation isn't very promising," said a spokesman. "We will have to go some in the next few weeks to stay in the index."
- 1 If I were Prime Minister: I'd give tax cuts to the rich, keep Trident, and get my football team wrong
- 2 Top Gear: Jodie Kidd, Philip Glenister and Guy Martin 'in advanced talks' to join show
- 3 General Election 2015: 14-year-old boy asks Nick Clegg – 'can you kill Katie Hopkins?'
- 4 University student in court for allegedly covering housemates' food in window cleaner and spit
- 5 Garland shooting: Isis claims attack on Prophet Mohamed cartoon contest in Texas as its first action on US soil
Italian police 'reveal' what Jesus looked like as a young boy
Mysterious 'X-Files' sounds heard miles above the Earth
University student in court for allegedly covering housemates' food in window cleaner and spit
Garland shooting: Isis claims attack on Prophet Mohamed cartoon contest in Texas as its first action on US soil
Met Gala 2015: Beyoncé manages to out-skimp Rihanna, Miley and Kim Kardashian combined with near-naked ensemble
In defence of liberal democracy
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
Andy McSmith's Sketch: Feisty audience is the real star of an enlightening show
iJobs Money & Business
£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...
£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...
£215 per day: Ashdown Group: Junior Project Manager (website, web application ...
£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...