MARKET REPORT: Shares in Moonpig crash to earth even as online card-seller reports record annual turnover – but sales slow as Covid restrictions go
Shares in Moonpig came crashing to earth even as the online card-seller reported record annual turnover.
The company had its worst day since joining the stock market in February after it warned roaring sales have slowed as Covid restrictions have loosened.
Moonpig was a pandemic ‘winner’ when its services were suddenly in hot demand because lockdowns shut shops and kept people at home.
Out of orbit: Moonpig was a pandemic ‘winner’ when its services were suddenly in hot demand because lockdowns shut shops and kept people at home
People unable to buy cards in shops turned to Moonpig, which lets customers upload handwritten messages to online versions of cards and send gifts from the likes of Lego and Cath Kidston.
It delivered 50.9m orders in the 12 months to the end of April, including 139,000 on Mothering Sunday.
But the reopening of the economy has normalised trade. It expects turnover to reach between £250m and £260m this financial year, which would be a fall of 32 per cent compared with the previous year.
Although it said it had not seen an exodus of customers, it will be scrabbling to keep new users. Peel Hunt analysts downgraded Moonpig from ‘buy’ to ‘hold’ on the back of the muted outlook.
The numbers for the year to April 30 had been strong, with revenues up 113pc to £368m and profits of £32.9m, up from £31.8m.
Shares fell 9.3 per cent, or 39.6p, to 385p, leaving it valued at £1.3billion.
Investors cheered a host of other firms who reported that business was picking up now that life is returning to normal.
A jump in sales of takeaway sandwiches and other ‘food to go’ meals has boosted Greencore – up by 50 per cent on last year to £360m in the 13 weeks to June 25. It is also only around 3 per cent lower than the same period of 2019. Shares rose 3.3 per cent, or 4.3p, to 133.2p, as the Dublin firm reported it is testing recyclable sandwich packaging.
Croda was the top riser on the FTSE 100 – up 5.6 per cent, or 440p, to 8266p – after it said full-year results will smash expectations.
The chemicals group, which makes ingredients used by the cosmetics, construction and oil industries and Omega 3 fish oil concentrates, reported a 41 per cent half-year rise in profits as sales rose 39 per cent to £934m. Business will be boosted by a contract to work on Covid vaccines.
Big gains for some of the results reporters failed to lift the wider market, however. The Footsie closed 0.4 per cent lower, down 29.35 points, to 6996.08 and the FTSE 250 fell 0.2 per cent, or 56.18 points, to 22877.01, snapping a five-day winning streak.
China-focused funds tumbled after Beijing launched another attack on businesses there. The Chinese government has targeted education technology companies by banning firms that teach the school curriculum from making a profit or floating on the stock market. After crackdowns on cryptocurrencies, Jack Ma’s Alibaba and ride-hailing app Didi, the education intervention has traders bracing for more to come.
Fidelity China Special Situations, which is a major investor in Chinese tech firms, and Scottish Mortgage Investment Trust, both sank as their biggest holding, Tencent, was caught in the sell-off.
Fidelity fell 4.3 per cent, or 15.5p, to 342p, while Scottish Mortgage tumbled 4.3 per cent, or 57.5p, to 1278p.
Over on AIM, Northcoders made modest gains on its first day on the market. The Manchester group offers training in software coding, which has become a hot skill for young people in particular as they enter the job market.
Its shares went public at 180p and closed at 182.5p. It provides a mix of Government-funded apprenticeships, corporate ‘boot-camp’ training courses and one-to-one tuition in Manchester and Leeds. Clients include Jaguar Land Rover, Barclays (down 0.04 per cent, or 0.06p, to 169.38p) and the Department for Education.