European Markets Advance; Sodexo, ThyssenKrupp Net Soar

Lucy Stoeva
19 Nov, 2015
New York City

European bourses recorded gains on the back of Sodexo stock buyback program and improving jobs market in the U.S. Royal Dutch Shell received Australian regulatory approval to acquire BG Group. Sodexo net soared 32%.

[R]4:00 PM Frankfurt – European bourses recorded gains on the back of Sodexo stock buyback program and improving jobs market in the U.S.Royal Dutch Shell received Australian regulatory approval to acquire BG Group. Sodexo net soared 32%.[/R]

Stock markets in Europe gained ground, backed by positive economic indications for the U.S. economy and Sodexo soared 10% after the catering services provider announced a stock buyback program and lifted its dividend.

In economic news, the volume of UK retail sales fell in October due to a slump in food retail, department stores and clothing.

The Office for National Statistics said sales volumes fell 0.6% in October after recording a 1.7% increase in September.

Compared to the same period a year ago, retail sales volumes rose 3.8%, while average shop prices were 3.3% lower than a year earlier.

Online sales are growing stronger, however, recording an increase of 11.2% compared with the same period in the previous year.

In London trading, FTSE 100 index jumped 61.63 or 0.9% to 6,339.35 and in Frankfurt the DAX index increased 144.04 or 1.3% to 11,103.29.

In Paris, CAC 40 index gained 24.47 or 0.5% to 4,931.39.

Helical Bar Plc gained 0.6% to 442.65 pence after the U.K. property developer acquired two office buildings in central London valued at approximately £250 million and are located at the tech district.

The deal involves buying the stake of Crosstree Real Estate Partners LLP in the Bower project. As part of the deal, Crosstree will acquire stores from the venture valued at £23 million.

Royal Dutch Shell Plc gained 2.6% to 1,682 pence after the oil and gas explorer received clearance from the Australian Competition and Consumer Commission for its proposed $70 billion takeover of rival BG Group PLC.

Johnson Matthey Plc soared 9.6% to 2,682 pence after the U.K.-based specialty chemicals maker announced it will pay shareholders a special dividend of £305 million after selling two businesses.

The special dividend of 150 pence a share comes on top of a regular dividend, which increased 5% to 19.5 pence.

The company stated revenues in the first-half ending in September advanced 20% from a year ago to £5.76 billion.

Underlying pretax profit in the period declined 4% to £208.3 million due to poor performance in its precious metal line of business, caused by low prices.

Sodexo SA surged 11.4% to €89.44 after the France-based catering and on-site services provider said revenues in the year ending in August jumped 2.6% from a year ago to €19.82 billion.

Net profit in the period soared 32.4% from a year ago to €700 million compared to €490 million and earnings per share advanced €4.60 from €3.23.

The company forecast higher revenues and profit for fiscal 2016.

Its restructuring and cost cutting program is expected to reduce costs by €200 million by 2018.

More importantly, Sodexo announced a share buyback program of €300 million and a dividend of €2.2 a share, up from €1.8 a share last year.

ThyssenKrupp AG jumped 2.8% to €19.70 after the Germany-based carbon steel products maker reported sales in the year ending in September increased 4% from a year ago to €42.78 billion.

Net profit in the period surged 45.7% from a year ago to €309 million compared to €212 million and diluted earnings per share increased €0.55 from €0.38.

The company forecasted operating profit for the fiscal 2016 of about €850 million.