Renold’s share price crunched into reverse at high speed after it issued a profit warning.
In a trading update, the FTSE Small Cap gear maker revealed it had been knocked off balance by rising materials costs, particularly in its industrial chain business.
A weaker dollar delivered a second blow to Renold, which sells its chains, gears and clutches in more than 20 countries.
A weaker dollar delivered a second blow to Renold, which sells its chains, gears and clutches in more than 20 countries
The double-whammy will hit full-year profits, which are expected to be lower than in the past two years, it said.
Broker Finn Cap didn’t like what it was hearing and decided to slash the firm’s target price from 50p to 40p.
Robert Purcell, Renold’s chief executive, said: ‘The increase in raw material prices has been significant, both in scale and speed, and has challenged our ability to pass these costs through to customers at the same pace.’
The company’s shares slid 23.8 per cent, or 10.6p, to 34p.
The FTSE 100 gained 0.3 per cent or 21.27 points to end the day at 7224.51, while the FTSE 250 finished up 0.59 per cent, or 117.06 points, at 20,085.07.
Meanwhile, you can be forgiven for thinking there was a closing down sale on the markets yesterday, given the number of directors buying and selling shares in their own firms.
Three top-men at troubled estate agent Countrywide reached deep into their pockets to stave off fears about its future.
The embattled home-flogger this week announced plans to scrap its dividend and shed a third of its workforce to balance the books after suffering a painful £200million loss last year.
STOCK WATCH – KATORO GOLD
Tough laws on miners proposed in Tanzania has cast doubt over Katoro Gold’s Imweru project.
The government wants to hike taxes on mineral exports, take a bigger stake in mining firms and force them to build local smelters.
Katoro says it is conducting further assessments to ‘determine the extent to which the new legislation and regulations may impact the viability of the Imweru gold project’.
Shares in the firm dived 36.7 per cent, or 0.7p, to 1.3p.
In a bid to calm investors’ nerves, Countrywide chairman Peter Long splashed out £160,000 on company shares.
He was joined by operations director Paul Creffield and finance boss Himanshu Raja who bought £83,431 and £88,050-worth of shares respectively.
In a statement, Countrywide said: ‘This underpins their belief in the business and further demonstrates their commitment to leading the recovery.’
Investors, on the other hand, took their money elsewhere. Countrywide’s shares slid by 5 per cent, or 4.4p, to 83.1p.
Conviviality, the owner of Bargain Booze, suffered the dreaded next-day hangover after announcing on Thursday that it had accidentally overstated its earnings forecasts by 20 per cent. Easily done.
The debacle had knocked more than 59 per cent off the value of its AIM-listed shares.
Yesterday, chief executive Diana Hunter and finance boss Mark Moran hoovered up £50,360 and £130,800 of shares respectively, presumably to reassure investors.
But the whole episode has gone down worse than a creamy White Russian on a hot summer’s day. Conviviality’s shares tanked another 12.2 per cent, or 15p, to 108p.
Rolls-Royce has dished out nearly £5million in shares to two senior directors. North America chief Thomas Bell received more than £4.8million-worth as part of the company’s long-term incentive plan, while defence boss Christopher Cholerton received nearly £144,000.
This week Rolls reported a 25 per cent surge in profits as it continues its recovery under chief executive Warren East. Its shares nudged up 0.4 per cent, or 4p, to 925.8p.
A director of audio equipment supplier Focusrite sold more than £3.2million of shares after it revealed a stonking forecast.
In a trading update, Focusrite said revenue in the six months to February 28 was likely to be up 25 per cent.
Within hours, operations director Tim Dingley cashed in 90,000 at 362.5p each, pocketing more than £3.2million in total.
Focusrite’s shares shot up 10.8 per cent, or 38.5p, to 393.5p.