Tightening health measures depressed Elior’s Q1 performance and these are likely to intensify during the second quarter. The more than 15% decline in the share price reflects the market’s worry about the catering sector’s short-term future.

Elior Group SA

• 28 Jan 21
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REACT Group plc (REACT), the specialists in deep cleaning services for customers in the public and private sectors, has announced encouraging full year results, marginally ahead of our increased forecasts and a significant turnaround from the losses reported in previous years. Cash balances at the year-end were also substantially higher than forecast at £1.8m. The new management team has delivered on its promises in what has been a challenging year and we continue to remain very positive on the prospects for the Group. We have introduced forecasts for FY2021 but at this stage, with so much uncertainty we have set our expectations prudently. Nevertheless, the year has started strongly and our projections, supported by a high level of recurring revenue and margin improvement, still anticipates a more than doubling of EBITDA and could be raised as REACT progresses through the year.

REACT Group Plc

• 26 Jan 21
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Following the transformational acquisition of rival Dominium we are formally initiating on DP Poland. The combination has broadened and strengthened the business model, creating a top 3 market player with a proven new CEO at the helm. Significantly, the enlarged entity will be profitable and self-funding, something the market has been long waiting for. The deal creates a platform to accelerate growth and to become the dominant pizza player in Poland. We identify three main drivers – cost synergies, organic growth and a resumption of the rollout strategy. DP Poland has proven that the Domino’s formula works as well in Poland as it does elsewhere in the world; its mature stores are substantially profitable. The share price will be driven by confidence in delivery of EBITDA growth and cost synergies.

DP Poland PLC

• 25 Jan 21
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Entain reported strong Q4/FY 20 sales with 7%/1% cc growth respectively (ahead of estimates). The performance was driven by the strong broad-based momentum in online (Q4 20: +41%, FY 20: +28%), which more than offset the decline in retail. The US stood out with 131% growth, pushing FY 20 revenue expectations higher to $175-180m. We will be upgrading our estimates to factor in the stronger than expected performance. In other developments, Jette Nygaard-Andersen was appointed CEO with immediate effect.

Entain PLC

• 22 Jan 21
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Escape Hunt (ESC) has conditionally agreed to acquire its French master franchise partner, BGP Escape (BGP). Together with UK sites currently in build, ESC expects BGP to add enough scale for the group to reach positive EBITDA when conditions normalise and new sites have matured. The acquisition is attractively priced at only 1x EBITDA before earnout payments.

Escape Hunt Plc

• 22 Jan 21
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Technicolor has announced the disposal of the post-production house of Production Services for €30m, for completion in H121. This leaves the segment focused on VFX (visual special effects) and animation, where growth and margin prospects are higher. FY21 has a good project pipeline, with around two-thirds of the year’s expected film and episodic VFX sales in place. No group level update was given, although Connected Home recently passed the milestone of shipping 20m DOCSIS 3.1 boxes. We have made a precautionary trim of 3% to our FY21e revenue to reflect the continuing COVID impact, reducing EBITA by €7m to €97m. CEO Richard Moat purchased €1.1m of shares in December, as agreed at the restructure.

Technicolor (TCH:EPA)Technicolor SA (TCH:PAR)

• 21 Jan 21
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JDW has raised fresh equity capital (worth £93.7m; equals c.6% of the market cap) as the third national lockdown has dried up operational cash flow. The net proceeds will be used to strengthen further the company’s balance sheet, working capital and acquire any cheaply available properties. Investors have cheered this development as the stock price surged 5% on Wednesday.

J D Wetherspoon plc

• 20 Jan 21
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Taking into account the adverse impact of the pandemic, the Air Europa acquisition price has been halved to €500m with payment deferred until the sixth anniversary of the acquisition’s completion, which is now scheduled for H2 21.

International Consolidated Airlines Group SA

• 20 Jan 21
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M&B’s poor trading performance in Q1 FY20/21 was not a surprise. Lfl revenue in the current quarter is also likely to remain deep in the red. Management is exploring an equity issuance to remain afloat / meet the fixed cost and debt service obligations. After all, the cash coffers are fast depleting and the choice on the table is limited.

Mitchells & Butlers plc

• 20 Jan 21
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