FTSE 250 movers: Diverging success for retailers JD Sports and Dunelm

London's mid cap stock index remained in positive territory on Tuesday, outperforming its larger sibling thanks to gains from the likes of JD Sports and Savills.

Sports and fashion retailer JD said it expects pre-tax profit for the year to 3 February to hit around £300m versus market expectations of £270-295m as good trading continued through the second half and the Christmas period. Management highlighted the “material growth in online and continuing overseas space expansion”, with broker Shore Capital hailing UK online sales growth of circa 30%, with international online growing at a faster growth rate but from a much lower revenue base.

Shares in estate agent Savills was in the black after saying it had a stronger-than-expected finish to 2017 and now sees underlying results for the year to the end of December ahead of its previous expectations. A strong performance in the UK and
Asia more than offset a decline in profits from the US from additional investment in building the business.

Analysts at Numis upgraded their pre-tax profit forecasts for Savills by 5% and noted that company also announced chief executive Jeremy Helsby is retiring at the end of 2018, after 39 years with the company, and will be succeeded by European CEO Mark Ridley, who has been at Savills for two decades.

Hunting gained after being double-upgraded by Morgan Stanley to 'overweight' and being picked as one of broker Canaccord Genuity's top picks in the oilfield services sector. The former saw self-help initiatives as leading to "new peaks" for the Titan perforating-gun business, while the Canadians said the downhole specialist "should continue to benefit from US onshore and progressively see international and offshore recover".

UBM was higher ahead of its trading update next month and after a year when it underperformed the market and peer Informa by around 5%. The rise came the day after analysts at Liberum reiterated their 'hold' rating on the events group and 760p target price.

Provident Financial led the fallers after its mixed final quarter of the year, where there were 20% fewer new customer bookings for its Vanquis Bank arm and expects losses from the doorstep lending business were expected at the larger end of expectations. Provident's struggles to "reconnect" with many customers of its doorstep credit arm after changing the business model last year saw even fewer lost customers and agents coming back on board in the fourth quarter and resulted in a higher impairment charge.

However, analysts at Canaccord and Numis were largely positive, with the former noting that home credit receivables and active customers were ahead of its estimates of £300m and 0.4-0.5m respectively. "Combined with plans to right-size the business's centralised support functions, we would argue Home Credit's prospects are much improved. While the business may never return to its former glory, we believe it should start to accrete value to the wider investment case rather than detract from it."

Shares in Capita were hit after it lost out to a rival in its bid to retain the contract for administration of Prudential's life and pensions business. The Pru will transfer the contract from Capita to Tata Consultancy Services in July as part of a wider customer and technology transformation programme, which Capita said were expected to have contributed around £80m in revenue in the full year to December 2017.

Hochschild Mining was down a day ahead of its production report, while Ashmore gave up its early gains and ended in the red, down 1.5%, despite the emerging markets asset manager posting a jump in assets under management for the three months to the end of December amid strong net inflows.

Homewares retailer Dunelm was in the dumps for investors despite keeping up good sales growth in the three months to 30 December. News that margins were dented slightly and the first half will see profits fall was a bit of a disappointment, though.

Market Movers

FTSE 100 (UKX) 7,747.18 -0.28%
FTSE 250 (MCX) 20,850.53 0.09%
techMARK (TASX) 3,541.90 0.03%

FTSE 250 - Risers

JD Sports Fashion (JD.) 388.90p 6.40%
UBM (UBM) 787.50p 5.35%
Savills (SVS) 999.00p 3.47%
Hunting (HTG) 631.50p 3.44%
Mitie Group (MTO) 195.30p 3.28%
Shaftesbury (SHB) 1,014.00p 2.84%
Dignity (DTY) 1,932.00p 2.77%
TI Fluid Systems (TIFS) 252.00p 2.69%
CLS Holdings (CLI) 233.50p 2.64%
Renishaw (RSW) 5,485.00p 2.62%

FTSE 250 - Fallers

Provident Financial (PFG) 811.00p -11.85%
Capita (CPI) 395.10p -6.15%
Hochschild Mining (HOC) 246.40p -5.08%
Dunelm Group (DNLM) 670.00p -4.42%
RPC Group (RPC) 798.40p -4.38%
Serco Group (SRP) 101.56p -3.64%
Vedanta Resources (VED) 921.90p -3.36%
Kaz Minerals (KAZ) 938.80p -2.80%
Polymetal International (POLY) 896.40p -2.71%
Saga (SAGA) 122.60p -2.70%