FTSE 250 movers: Trainline on track; Hipgnosis hits sour note

by | Sep 14, 2023

(Sharecast News) – Online travel platform Trainline on Thursday launched a £50m share buyback as ticket sales grew by almost a quarter in the first six months of its financial year.
Group net ticket sales grew 23% year-on-year to £2.6bn in the six months to August 31, driving growth in group revenue of 19% to £197m.

UK Consumer net ticket sales were £1.7bn, up 19% as more people switched to digital ticketing and passenger numbers continued to recover after the Covid pandemic.

“Growth was tempered somewhat by ongoing industrial action in the UK, with 11 strike days in the first half – estimated gross ticket sales impact of £5-6m per strike day,” Trainline said.

International consumer net ticket sales rose 24% to £559m, led by Spain and Italy. Web sales growth slowed during the half given a normalising of demand year-on-year and increased competition in keyword auctions, following a more benign period last year coming out of Covid, plus some impact from changes to the presentation of search engine results.

Trainline said it expected annual net ticket sales growth of between +13% and +22%, revenue growth of between +13% and +22% and adjusted core earnings of between 2.15% and 2.25% of net ticket sales.

Food packaging business Hilton Foods is to expand into the North American market after entering a long-term supply agreement with Walmart Canada.

The company, which currently operates across 13 European markets through partnerships with retailers like Tesco, Costco and Rimi, is opening a new manufacturing facility in Eastern Canada to supply Walmart’s supermarkets with a range of protein products.

These will initial start with beef, lamb, pork, seafood, before moving into some added-value products, the company said in a statement on Thursday.

“This agreement further extends our global footprint and will be our first manufacturing facility in North America,” said Hilton Food’s chief executive Steven Murrells.

“It is another sign of the strength of our customer offer, as well as growing consumer demand for high quality, affordable, protein products, which we can deliver through our scale, international experience, and supply chain expertise.”

Newly formed division Hilton Foods Canada will finance the new facilities, and is expected to start production in 2026. The investment in plant and equipment will be debt funded with spending to kick off in 2024, however the group said its leverage is expected to remain at “comfortable levels during this investment phase”.

Hipgnosis Songs Fund said on Thursday that it has agreed to sell some catalogues to a partnership between its investment adviser and funds advised by Blackstone for $465m in order to fund a share buyback programme and reduce debt.

The group will sell a portfolio of 29 music catalogues for $440m and a portfolio of non-core songs for around $25m.

Hipgnosis will use the proceeds to establish a share buyback programme of up to $180m, to repay $250m of drawings under its revolving credit facility and to enhance financial flexibility.

Merck Mercuriadis, chief executive and founder of Hipgnosis Song Management and founder of Hipgnosis Songs Fund, said: “Earlier this year we initiated consultations with shareholders, in contemplation of the continuation vote and our concerns that the true value of our iconic songs was not being reflected in our share price.

“It was clear that shareholders shared our belief in the continuing long-term opportunity of Hipgnosis Songs Fund and wished to see a significant share buyback programme and reduction of our leverage in order to deliver a re-rating in the share price.

“The transactions announced today allow us to execute on that strategy and reflect our determination to deliver immediate shareholder value and enhance the company’s position to deliver long-term exceptional returns and capital growth through our investment strategy of ‘buying, holding and actively managing’ a major portfolio of iconic songs as they benefit from the continued growth of streaming.”

Market Movers

FTSE 250 (MCX) 18,761.07 1.08%
FTSE 250 – Risers

Trainline (TRN) 273.60p 10.59%
Pennon Group (PNN) 642.00p 7.09%
Hilton Food Group (HFG) 772.00p 6.34%
Carnival (CCL) 1,131.00p 4.97%
Synthomer (SYNT) 48.12p 4.38%
NCC Group (NCC) 96.00p 4.23%
Virgin Money UK (VMUK) 170.10p 3.78%
Future (FUTR) 779.50p 3.73%
Harbour Energy (HBR) 255.00p 3.41%
TBC Bank Group (TBCG) 2,820.00p 3.30%

FTSE 250 – Fallers

Hipgnosis Songs Fund Limited NPV (SONG) 89.20p -4.09%
Bakkavor Group (BAKK) 95.80p -4.01%
easyJet (EZJ) 443.10p -2.42%
Apax Global Alpha Limited (APAX) 163.80p -1.80%
International Public Partnerships Ltd. (INPP) 127.80p -1.69%
Games Workshop Group (GAW) 10,330.00p -1.62%
LXI Reit (LXI) 92.10p -1.60%
Aston Martin Lagonda Global Holdings (AML) 329.20p -1.50%
Ferrexpo (FXPO) 76.85p -1.47%
Genus (GNS) 2,148.00p -1.47%

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