UBS Reports Strong Results, Cautious Outlook; Fresenius Sells Stake to Summit

Sarla Buch
23 Apr, 2018
New York City

Capita plans to raise

[R]4:00 PM Frankfurt – Capita plans to raise £701 million through a rights issue. Fresenius Medical Care declined after the company lowered fiscal outlook. Philips Electronics profit tumbled. UBS reported strong financial results.[/R]

In London trading, FTSE 100 index rose 26.66 or 0.4% to 7,395.36 and in Frankfurt the DAX index edged up 8.63 to 12,546.55.

In Paris, CAC 40 index increased 11.95 or 0.2% to 5,424.92.

Capita Plc surged 11.3% to 177.95 pence after the outsourcing services provider said its plans to raise £701 million through a rights issue after issuing of 1 billion new shares at an issue price of 70 pence per share to pay down debt.

In 2018, Capita expects to generate proceeds from non-core disposals of £300 million.

Separately, Capita today said revenues in the year ending in December dropped 4% from a year ago to £4.2 billion.

Net loss in the year widened to £862.8 million from £51.7 million in a year ago period and diluted loss per share increased to 118.93 pence from 14.27 pence.

The outsourcing services provider said wider loss was driven by £551.6 million goodwill impairment and number of other asset impairments and provisions.

Fresenius Medical Care AG & Co. KGaA declined 4.2% to €81.34 after Germany-based dialysis and health care services provider reported revenues in the first-quarter ending in March plunged 10% from a year ago to €3.9 billion.

Net profit in the quarter slumped 9.4% to €279 million from €308 million in a year ago period.

Fresenius lowered revenue forecast to between 5% and 7% from the earlier estimate of 8% but net income growth in the range of 13% to 15%.

In addition, the dialysis products provider said the company has sold its controlling stake in Sound Inpatient Physicians Holdings to a consortium led by Summit Partners for about €1.76 billion or $2.15 billion.

The transaction is expected to close in late 2018.

Philips Electronics NV soared 5.2% to €34.64 after the Netherlands-based health service provider said sales in the first-quarter ending in March fell 2.5% from a year ago to €3.9 billion.

Net profit in the quarter tumbled 52% to €124 million from €259 million in a year ago period and diluted earnings per share dropped to €0.13 from €0.25.

UBS Group AG dropped 3.2% to 16.65 Swiss francs after Switzerland-based investment banking and financial services provider reported total revenues in the first-quarter ending in March rose 2.3% from a year ago to 7.7 billion francs.

Net income in the quarter surged 18.9% to 1.5 billion francs from 1.2 billion francs and diluted earnings per share jumped to 0.39 francs from 0.33 francs.

UBS said in the second-quarter, funding costs related to long-term debt and capital instruments issued to comply with regulatory funding and liquidity requirements will be higher than in fiscal 2017.