personal finance

Renishaw director sells down

Renishaw non-executive deputy chairman John Deer has sold £392,100 of shares in the measuring equipment specialist, a month after banking £39,000 from another disposal. Mr Deer’s children are the shares’ beneficial owners.

The share sales followed a trading update in which Renishaw revealed a turbulent nine months that have delivered a heavy hit to its profits. In May, the company said that its full-year 2020 pre-tax profits are expected to sit in the range of around £31m to £41m, compared with £109.9m last year.

While all of its manufacturing facilities are now open, most are operating at lower capacity. Renishaw registered a fall in Chinese demand during its third quarter that it attributed to the Beijing government’s coronavirus response. 

The company has also suffered from falling demand in the machine tool sector and has been caught in the crossfire between China and the US during their trade dispute. It did, however, observe growth for its optical and laser encoder products, citing a recovery in the semiconductor market.

In the nine months to 31 March 2020, Renishaw’s core metrology segment, which accounts for 94 per cent of its turnover, recorded a 9.5 per cent decline in revenue. Renishaw experienced a similar drop in its healthcare arm. The group saved £5.1m through scrapping its half-year dividend in March and has since announced the cancellation of its final dividend. 

Over three quarters, Renishaw’s pre-tax profits have slumped 76.8 per cent to £19.7m compared with last year. As a result of the pandemic, Renishaw has delayed the publication of its full-year results from 3 August into the middle of the month.

Renishaw declined to comment on Mr Deer’s disposals.

Investors in Ashmore Group may have drawn breath upon sight of chief executive Mark Coombs’ latest share disposal, particularly when set against the asset manager’s recent performance.

Ashmore, which specialises in emerging markets investment, recorded a 22 per cent decrease in its assets under management in its quarter ending March 31, with corporate debt and equities registering its highest drops. Ashmore attributed its performance to sharp market falls in February, with sell-offs in emerging markets’ fixed income and equities delivering “the most attractive valuations seen in more than a decade since the 2008 financial crisis”, it claimed.

Mr Coombs’ disposal of 10m shares, which earned him £43.5m, is, however, unconnected to Ashmore’s third quarter. It took place as part of a strategy set out in February last year to reduce the chief executive’s holding from its previous level of around 39 per cent, which he admitted “could restrict Ashmore’s future success,” adding that “it would be prudent to prevent the size of my shareholding becoming a more significant issue over time.”

According to the takeover code, any person with 30 per or more of a company’s voting rights must make an offer to acquire all of the company’s shares, although the company is able to apply for a waiver at its annual general meeting. Mr Coombs agreed to sell up to 4 per cent of his Ashmore stock every year, targeting bringing this below the 30 per cent threshold. Mr Coombs also sold shares in September 2019 and February 2020, and his latest disposal reduces his stake from 36 per cent to 34.6 per cent.

Berenberg analysts forecast full-year 2020 adjusted earnings per share of 25.9p, falling to 22.7p in 2021.


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