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Babcock directors buy on dip


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Shares in Babcock International have suffered lately. A mid-July trading statement warned of continued delays to defence spending, exacerbated by the restructuring of the government’s Defence Equipment & Support (DE&S) organisation. A subsequent spending review has prompted analysts to lower full-year forecast revenue growth at Babcock from 4 per cent to 2 per cent.

The group’s shares have been on shaky ground since last year, when concerns over the wider outsourcing sector and weak cash flows dented confidence. Clearly, investors are still nervous. This announcement caused another drop in the share price, erasing almost all of the re-rating seen since the start of the year.

The company directors, however, don’t seem as worried. Shortly after the statement’s release, four non-executives increased their stakes. Restrictions on share dealings were in place before the announcement, which could explain the purchases’ quick succession.

Dart Group has been quick to snap up some of the excess capacity left over in the European air travel market by the now-collapsed Monarch airlines. It increased seat capacity by 45 per cent to 11.3m during the year to March. So far the load factor, or the proportion of seats filled, has managed to keep up, increasing from 91.5 per cent in full-year 2017 to 92.2 per cent. But the European market is a tricky one, and “very competitive pricing” meant average airline ticket yields fell 15 per cent to £73.65.

Still, the market was encouraged by the full-year results, sending the shares up to near record highs of around 1,030p. Executive chairman Philip Meeson sold 500,000 ordinary shares at 912p apiece. Dart said the £4.56m transaction was completed to meet “personal financial commitments”, while Mr Meeson still owns just over 55.7m shares, around 37.5 per cent of issued share capital.

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Directors’ Deals, July 30, 2018
Company Director No of shares Price (p)
BUY
3i♥ Simon Thompson (ch) 7,382 941.14
3i Peter Grosch 1,581 941.14
3i David Hutchison  1,581 941.14
3i Jonathan Asquith 1,581 941.14
3i Stephen Daintith 1,581 941.14
3i Caroline Banszky 1,581 941.14
Ascential  Duncan Painter (ceo) 41,538 428.2602
Babcock International Victoire De Margerie 1,800 711.49
Babcock International Kjersti Wiklund 2,100 717.178
Babcock International Myles Lee 2,500 728.21
Babcock International Michael Turner (ch) 15,000 736.49
Barratt Developments  Richard Akers 10,000 525.12
Beazley  Robert Stuchbery 9,500 528.1
Better Capital PCC  Jonathan Moulton 500,000 30.125
BTG  Anne Thorburn 15,000 499.81
Cloudcall Gary Browning 15,000 140
Dunelm Nick Wilkinson (ceo) 48,876 508.95
ECSC David Mathewson (ch) 5,000 88
ECSC David Mathewson (ch) 3,589 95
Future  Alan Newman 5,000 494.9
Hansard Global  Leonard Polonsky  100,000 60.8
Hansard Global  Leonard Polonsky  100,000 62.1
Hansard Global  Leonard Polonsky  100,000 62.7
Helical  Michael O’Donnell 33,500 348.5
Henderson European Focus Trust  Alain Dromer 2,300 1,249
Infrastrata  Graham Lyon (ch) 1,889,345 0.535
JPMorgan Japan Smaller Companies Trust  Robert White 10,000 438.19
Maistro  Ian Cleverly  250,000 4
Maistro  Laurence Cook  250,000 4
New Century AIM VCT  Michael Barnard 3,000 77
NewRiver REIT  Kay Chaldecott 35,671 279
Nostrum Oil & Gas♥ Simon Byrne 20,000 182.2861
Oxford BioMedica  Lorenzo Tallarigo (ch) 306 867
PCF Timothy Franklin 7,363 33.95
Plastics Capital♥ Keith Butler-Wheelhouse 25,000 114
Proteome Sciences  Martin Diggle 171,000 2.85
Safestyle UK  Alan Lovell 100,000 35.7
Smart Metering Systems  Miriam Greenwood 483 674.83
Staffline John Crabtree (ch) 2,375 1054
Urban Logistics REIT  Bruce Anderson 8,163 122.5
Victrex  Jakob Sigurdsson 3,250 3,072.50
SELL
Dart Philip Meeson (ch) 500,000 912.1638
Independent Investment Trust (The)  Douglas McDougall (ch) 25,000 770
Obtala  Miles Pelham (ch) 1,200,000 7.85
Polar Capital Technology Trust  Peter Hames 4,000 1,306
Record  James Wood-Collins (ceo) 250,000 40.7
Severfield  Derek Randall 141,736 82.2
* placing/tender/open offer ♥ spouse/connected party; Trades from July 19-25; Source: Morningstar/Investors Chronicle
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