Europe Movers: British American Tobacco, Mining Stocks, TUI

Inga Muller
06 Dec, 2023
Frankfurt

European stocks extended their gains of the week on top of significant increases in the previous session. 

The DAX index increased 0.06% to 16,543.33, the CAC-40 index rose 0.1% to 7,393.55, and the FTSE 100 index advanced 0.3% to 7,513.13.

The yield on 10-year German bonds decreased to 2.25%; French bonds traded lower to 2.81%; the UK gilts declined to 4.05%; and Italian bonds inched lower to 4.00%.

TUI AG soared 10.5% to €6.57 after the tour operator reported operating profit that more than doubled in 2023.

Operating profit in the fiscal year 2023 ending in September surged 139% to €977 million from €568 million a year ago.

Revenue in the fourth quarter increased 11% to €8.5 billion, and operating profit jumped by €164 million to €1.203 billion.

For the full year 2023, the company swung to a profit of €306 million from a loss of €277 million a year ago.

The tour operator also lowered its debt to €1.3 billion from €3.4 billion, following strong operating cash flow and a successful €1.8 billion rights offering in April.

The tour operator forecasted revenue in fiscal 2024 to increase by "at least 10%" and underlying operating profit by "at least 25%."

British American Tobacco dropped 7.8% to 2,291.50 pence after the company reiterated its full-year 2023 earnings per share outlook.

The maker of cigarette and smokeless tobacco products generates strong cash flow, and the company said it is making progress in lowering its debt.

"BAT is a highly cash-generative business, and we expect to deliver close to 100% operating cash flow conversion in 2023.

We are making progress towards reaching the middle of our guided 2-3x adjusted net debt/adjusted EBITDA leverage range and expect to be around 2.7x by year end," said the company in an update to investors.

The company said it plans to generate more than 50% of its revenue from non-combustibles by 2035.

Mining companies were among the leading gainers after metal prices advanced in London trading.

Glencore increased 1.8% to 446.20 pence, Antofagasta gained 1.5% to 1,439.50 pence, and Anglo American advanced 2.1% to 2,199.50 pence.