Market Prognosis

A concise summary of the major macro events of the past 24 hours, and selected UK company-specific news.

<< Back to Market PROGnosis archive

June 5, 2024

Workspace London’s office bellwether

Macro

The prospect for slower US growth, following fewer than expected job openings, leads to expectations of earlier moves on US rate cuts and a weaker USD $.

Energy and commodity prices continue to weaken.

UK Comapnies

Argo Blockchain mined 45 Bitcoin in May, or 1.5 BTC per day, a 55% decrease compared to April 2024 due to the reduced hash price resulting from the Bitcoin halving.

Pawnbroker Ramsden‘s H1 revenue increased by 12% to £43.8m. The loan book increased by 12% to £10.8m, and profit from purchasing precious metals increased by 25% to £5.0m. To date, trading is in line with the Board’s expectations.

STV‘s H1 Total Ad Revenue is expected to be up around 10-12% and up by 15-20% in Q2, driven by Euro 24. Its order book of secured future revenues in its studios is £86m. Its cost savings plan is on track to deliver £1.5m this year.

Watches of Switzerland is cautiously optimistic about trading in  FY25. Given market volatility, the industry is being more conservative on production, which it believes is a responsible approach to the long-term stability of the luxury watch market.

WH Smith is on track to deliver the FY in line with expectations.

Workspace CEO said its “valuation was down in the year by 9.5%, although the reduction was significantly lower in the second half. I expect this valuation to be the low point of the current cycle given the forecast of interest rate reductions combined with our ability to continue to deliver pricing growth and value-add asset management activity.”

Workspace is a major owner of attractively positioned and flexible London working environments. A recent study has shown that the UK has performed better than most other major economies in international services trade over the last decade, something Brexit had no discernable impact on. London has retained its position as a global hub for financial services, communications, and legal services. Workspace has an efficient operating platform to serve London’s dynamic small SME sector with c £bn worth of well-located sites which over the last year have been devalued by 13% to an appraised £8 NAV per share. WKP is not heavily geared and has several ongoing development projects. As the WFH trend dissipates office workers from somewhere will likely grow at the expense of office workers from nowhere.   

This communication is provided for information purposes only, and is not a solicitation or inducement to buy, sell, subscribe, or underwrite securities or units. Investors should seek advice from an Independent Financial Adviser or regulated stockbroker before making any investment decisions. Progressive Equity Research Ltd (“PERL”) does not make investment recommendations.

Opinions contained in this communication represent those of PERL and/or our affiliates at the time of publication and PERL does not undertake to provide updates to any opinions or views expressed. PERL does not hold any positions in the securities mentioned in this communication, however, PERL’s directors, officers, employees, contractors and affiliates may hold a position,  and/or may perform services or solicit business from, any of the companies or related securities mentioned.

Any prices quoted in our research are as at the previous day’s close.