Market Prognosis

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

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June 20, 2024

YouGov caught off guard

Macro

Bank of England expected to keep interest rates unchanged later today.

UK news headlines are full of polling predictions of a Conservative wipeout on July 4th.

Oil, commodity and precious metals prices generally firmed up overnight.

UK Companies

Alfa Financial Markets agrees to a £626m PE cash offer.

Angling Direct reported a resilient trading performance despite an uncertain consumer landscape and sub-optimal weather conditions. It continues to trade in line with the Board’s expectations.

CMC is confident in the business’s ability to generate robust income on a leaner cost base, resulting in improved profit margins.

Concurrent has won a $4.46M order to supply computer plug-in cards to a US Defence and Aerospace prime contractor to upgrade specific sensing equipment used in different aircraft types across multiple fleets.

Energean is selling non-core assets to Carlyle for up to $945m, a potentially financially transformative transaction.  

Filtronic said it had a transformational year after entering into a Strategic Partnership with SpaceX.

Franchise Brands’ business continues to perform well and grow. However, the US used oil price that impacted profits in 2023 continues to soften, which will also impact 2024. A change in the accounting treatment of the sale of franchise territories’ income from taking revenue upfront to spreading it over the life of the franchise agreement may also impact profit in 2024. FB does not expect to make further scale acquisitions until the debt is substantially repaid.

YouGov warned that it has seen lower sales bookings than anticipated and now expects full-year adjusted operating profit to be £41-44 million, some 30% below prior expectations. It said it would focus on optimising its cost base and prioritising investment in key growth areas such as upgrading its Data Products.

YouGov is best known for its political polling but generates the bulk of its revenue and profits from its data products, which are used mainly by consumer brands for understanding changing consumer attitudes. This area of the market has become more competitive and has seemingly caught the new management of YouGov off guard. The latest YouGov UK political opinion poll predicts a central projection for the Labour Party at 425 seats, up by 125 from their 2019 total. Rishi Sunak must be hoping they are also caught off-guard by this expectation. However, the more competitive environment in YouGov’s core business needs better explanation and understanding for the business to regain its historically high valuation. 

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