Panini World Cup stickers have been selling like hot cakes – but they are not enough to keep an entire distribution business ticking over. Strong demand for the collectibles was the highlight of an otherwise tough trading update from distributor Connect Group, formerly Smiths News.
Stripping out acquisitions, new openings and new products, revenue at all three of its main divisions – news and media, books and education – declined in the 44 weeks to 5 July. Analysts highlighted the books division, where like-for-like revenues fell 3.2 per cent, as particularly worrying. Despite it saying it was still on track to hit full-year targets, Connect’s shares fell 18.75p to 171p.
The video marketing and distribution group Rightster climbed 2.5p to 59p after it announced two acquisitions. It paid £50m for Base79, an online video business run by the son of a former Sun newspaper editor, and spent £4m on Viral Spiral. The deals were financed by a £42m shares placing, with the YouTube co-founder Chad Hurley taking part, as well as joining Rightster’s advisory committee. Guy Feld, a fund manager at Hargreave Hale, called the moves “transformational”.
Airlines dragged the FTSE 100 lower after a profits warning from Air France. The British Airways owner IAG was worst hit, falling 25.3p to 335.9p, while EasyJet also suffered a 77p fall to 1,248p.
Apart from aviation stocks, the blue-chip index was quiet, falling 85.06 points to 6,738.45. Investors continued to take the red pen to growth stocks on the mid-cap FTSE 250 index, with Just Eat tumbling 18.2p to 239.6p and Ocado 27.4p lower at 390.7p.
Despite a strong trading update, the insulation and roofing group SIG slipped 18p to 175p after blaming a strong pound for hitting earnings, adding that its French business was still struggling.
A second profits warning this year from Monitise sent the mobile payments company’s shares tumbling by 4.25p to 45p on the Alternative Investment Market. It admitted revenues would be lower than expected, while annual losses would be greater than forecast. Barclays said the business now had “a credibility problem”.