Today’s Markets: Crypto slumps, US inflation ahead

Companies

Power plays: National Grid ups profits, Centrica announces buybacks

As Europe remains concerned about keeping the lights on over winter, National Grid (NG.) has announced an upgrade in its five-year earnings growth expectations, and British Gas owner Centrica (CNA) has brought in a buyback scheme that will cover 5 per cent of its issued share capital. At its current market capitalisation, this will take around £250mn. 

National Grid has less exposure to power prices than retailer British Gas, as it owns and services infrastructure like interconnectors and the high voltage transmission network rather than generating assets, but reported a 50 per cent higher underlying operating profit of £2.2bn for the six months to 30 September. It also upped its forecast for annual earnings per share growth from 5-7 per cent a year (on a compound basis) to 6-8 per cent a year. AH

Domino’s to make more buybacks

Domino’s Pizza (DOM) shares rose by over 2 per cent after the dough-roller announced a further £20mn of share buybacks and said full-year cash profits should be in line with market expectations of £125mn-£135mn. The company also said it expects £40mn-£50mn of profits on the disposal of its German joint venture.

In the third quarter, total system sales were up by a fifth against pre-pandemic though total orders fell by 2 per cent. Collection orders rose by 28 per cent, with delivery orders down by 13 per cent.

Peel Hunt analysts said that “the resilience and cash flow of the model warrants a much higher valuation”. CA

Rolls-Royce eyes potential sites for reactors

A Rolls-Royce (RR)-led consortium has identified four sites as potential locations for new small modular reactors (SMRs).

All four are on or near older nuclear sites – two at Trawsfynydd in North Wales and Sellafield in Cumbria are directly controlled by the Nuclear Decommissioning Authority (NDA) and two are on land currently leased by the authority to third parties at Wylfa and Oldbury.

The sites have been identified following a review supported by the NDA but any formal commitment of its land for SMRs would still need government approval.

Rolls-Royce’s consortium, which includes BNF Resources, Constellation (US:CEG) and the Qatar Investment Authority, is also carrying out studies at other sites at Berkeley, Bradwell, Hartlepool and Heysham.

Rolls-Royce SMR chief executive Tom Samson said the sooner that sites can be identified, the sooner it can deliver “secure supplies of low-carbon nuclear power from SMRs designed and built in the UK”.

The company is also assessing six locations as the potential site for a factory that would build reactor parts. MF

AstraZeneca reports strong Q3 thanks to cancer, diabetes franchises

AstraZeneca (AZN) has upped its profit forecast for the year after a better-than-expected performance in the third quarter. Management now expects core EPS to increase by a high twenties to low thirties percentage (versus previous guidance in the mid-to-high twenties).

Its best-selling drug, with some $1.4bn in quarterly sales, was the cancer drug Tagrisso. Its diabetes therapy Farxiga also made more than $1bn in the three months to the end of September, and its rare disease franchise came in 1 per cent ahead of expectations with $1.7bn in revenue.

Chief executive Pascal Soriot said the company “continues to see the benefit of our sustained investment in R&D, with 19 major regulatory approvals since our last earnings call”. Shares were up 2.4 per cent by mid-morning. JJ

SolGold boss out 

Just a few days after copper and gold mining hopeful SolGold (SOLG) signed away more of its future production to raise cash, chief executive Darryl Cuzzubbo is out the door. He was in the top job for only a year. This follows the rapid departure of the company’s CFO earlier in the year.

The company is developing the Alpala mine in Ecuador but last month said it only had cash to last it until December. Earlier this week, it raised $50mn (£44mn) by selling off a 0.6 per cent royalty on the potential mine to industry investor Osisko Gold Royalties. Key shareholders BHP (BHP) and Newcrest (AU:NCM) were once again critical of the deal, with BHP boss Mike Henry telling newspaper The Australian it was “disappointing high-cost finance”. 

It is currently running a strategic review after revealing a merger with Cornerstone Capital Resources (CA:CGP) last month. Director Scott Caldwell will serve as interim boss.  

SolGold did not give a reason for Cuzzubbo’s immediate departure. AH