personal finance

Avon insiders buy on temporary setback


Shares in Avon Rubber slumped in the run-up to Christmas after the Wiltshire-based group announced a delay to a contract to make body armour plates for the US Army and the Defense Logistics Agency.

The group has been engaged in a product approval process for small arms protective inserts and body-armour plates, but these have dragged on longer than anticipated, with the result that first deliveries under the contracts are expected to commence in the first half of the group’s 2022 financial year, which will have a material impact on results for its September year-end.

Avon also revealed that a protest has been lodged against the US Army Next Generation Integrated Head Protection System contract announced in September.

It does not currently foresee any material impact on expectations for full-year 2021, but the contract updates represent a negative beat on near- to medium-term prospects, something of a rarity where Avon is concerned.

Group chairman Bruce Thompson and non-executive board member Victor Chavez clearly viewed the consequent double-digit markdown in the share price as an open goal and promptly snapped up about £123,000 of stock between them, garnering a paper profit of £7,000 in the intervening period.

Avon has continued to derive some benefit from the pandemic, specifically increased demand for its respiratory protection range for use by first responders, while order intake for its Ceradyne ballistic helmet range provides encouragement following its launch in North America in July 2020.

But given the highly competitive nature of its end markets, the group will be desperate to avoid a repeat of the contract delays and risk imperilling its reputation for reliability in terms of delivery. Still, a separate announcement detailing a $33m (£24.2m) order for respiratory equipment from Nato’s support and procurement agency suggests that industry take-up of the group’s protection technologies is not slowing down.


On December 30 — with AJ Bell shares up for 2020 after a wild year for financial markets — chief executive Andy Bell and Investcentre managing director Fergus Lyons cashed in stock worth £16.7m and £8.1m, respectively.

The transactions mark the latest of several rounds of insider selling since the DIY investment platform went public in 2018. Both Mr Bell and Mr Lyons participated in the sale of almost £50m-worth of shares by directors and senior executives in December 2019, which was followed by a £5.6m share sale by Mr Lyons last May and a £7.8m disposal by the chief executive last August.

Viewed against their remaining holdings, the latest sales are slight: Mr Bell continues to hold more than 93m shares, worth £411m at the current price, while Mr Lyons’ residual interest stands at a still-chunky £69.5m.

But on a longer time horizon, both men have reduced their exposure to AJ Bell shares, even as the group’s market valuation has climbed. Including stock sold at the group’s initial public offering, Mr Bell’s and Mr Lyons’s shareholdings have fallen by a fifth and almost a third, respectively, in just over two years.

Investors tempted to view this as a bearish sign should consider whether they would take some money off the table after building up a successful business over decades. We expect they might. That, after all, is one of the benefits of a public listing — amid all the scrutiny this brings.

Our view of the shares is unchanged. Though AJ Bell trades at an eye-watering 49 times forward earnings, this reflects long-term secular trends and growth plans it would be unwise to bet against.



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