Go-Ahead Group was the UK’s largest rail operator. Its shares were rescinded after admitting to making’serious mistakes’ in the management of the Southeastern railroad.
As the Department for Transport (DfT), predicted, the stock would fall 14.9 percent to 600p. The penalty’s size was not easy to determine.
Go-Ahead was stripped of the Southeastern contract by the DfT in September after failing to repay £25million in taxpayer cash.
Off the rails: Go-Ahead stock tumbled 14.9%, or 105p, to 600p as the company predicted that it would be slapped with a fine by the Department for Transport
Keolis is the partner of the company in the management and operation Southeastern, which is French-backed firm SNCF. He is set to also be subject to a heavy penalty.
Go-Ahead cannot file accounts prior to January 3rd due to the consequences from the scandal. This will result in Go-Ahead’s shares being ‘temporarily suspended’ from trading that day.
This puts the company at high risk of defaulting upon its loans. It’s currently working to negotiate a waiver for its debt repayments so that it can publish its annual results.
Stock Watch – Cloudcall
Cloudcall is a company that provides messaging and telephone services for businesses. It was acquired by a tech investor.
Venture capital company Xplorer offers 81.5p per share of cash. That’s a 72 per cent increase on the closing price for the company Wednesday.
The offer, which values the entire business at nearly £40million, has been unanimously recommended by Cloudcall’s board.
These shares rose 66.3 percentage points, or 31.5p each, to 79p.
The international misery continued, as Go-Ahead’s Norwegian subsidiary suffered severe losses from a Norwegian rail contract. This is unless Go-Ahead can reach a funding agreement with the government of Norway.
Meanwhile, its German arm is dealing with mounting financial pressure including nearly £26million in losses from contracts in Bavaria. Another £10million is expected to be set aside for losses in its results.
The FTSE 100 fell 0.2%, or 15.79, to 7321.26, while the FTSE 250 lost 0.4%, or 82.39, to 23148.
Market confidence was impacted by tighter UK pandemic regulations, which led to leisure stocks falling due to concerns that rules regarding mask-wearing might put customers off.
Shares in Cineworld slipped 3.5 per cent, or 1.78p, to 49.86p while Restaurant Group, the owner of Wagamama and Frankie & Benny’s, sank 4.8 per cent, or 4.4p, to 86.5p and Revolution Bars fell 6.1 per cent, or 1.25p, to 19.25p.
Discount retailer B&M bounced 2.3 per cent, or 14.2p, to 644p after unveiling plans to return £250million to shareholders.
After the pandemic, business boomed and the company paid a 25p special dividend per share in January 14.
Volution ventilation specialist Volution FTSE 250 rose 4.9 Percent, or 25p at 539p. As it brushed off rising costs and supply chain issues, Volution posted a bullish trade update.
Revenues for the four months to the end of November were up 14.6 per cent year-on-year, boosted by several acquisitions and the company increasing prices to combat inflation.
AstraZeneca, a pharmaceutical giant, saw its Evusheld anti-Covid-19 treatment receive an emergency US approval. This resulted in a jump of 0.9 percent, or 78p to 8362p.
It is for teens and adults who have compromised immune systems, but are not able or unable to get vaccines.
Avast bought Evernym, an American-based supplier of identity verification technology, from an antivirus software company for an undisclosed price.
Avast hopes to use the proceeds of this purchase to create ‘breakthrough identities products’. Shares rose 0.1% or 0.6p to 616.6p.
Balfour Beatty, a mid-cap construction company, increased its share by 5.6p to 252.8p. It predicted that profits would return to pre-pandemic levels.
The group expects a profit for 2021 ‘in line’ with the £172million it delivered in 2019.
Peer Renew Holdings jumped 5.4 percentage points, 43p, up to 845p following record-setting results. For the year to the end of September, pre-tax profits jumped 27 per cent to £40.8million while revenues surged 28 per cent to £791million.