MARKET REPORT: JD Wetherspoons leads the way with shares fizzing up 3 per cent, as pub chains cheer

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Investors in JD Wetherspoon were getting the drinks in yesterday as they cheered a rise in sales at the pub chain.

Shares fizzed up 3 per cent, or 20.5p, to 700p, after the company reported that like-for-like sales had increased 3.8 per cent in its third quarter.

Its operating margin had fallen by one percentage point to 6.4 per cent though, a reflection of wage increases for its hourly-paid staff, the company said.

Boom brewing: JD Wetherspoon shares fizzed up 3 per cent, or 20.5p, to 700p, after the company reported that like-for-like sales had increased 3.8 per cent in its third quarter

Wetherspoons also set the scene for its biggest ever share buyback. It is planning to buy anything from zero to £60million worth of shares in the year to July 2017.

Riding the wave of its rival’s success was Mitchells & Butlers.

The group, which operates popular pub chains including O’Neill’s and All Bar One, frothed up 2.5 per cent, or 6.6p, to 270p.

Rising confidence among consumers means more spending, and that means more borrowing.

Little wonder then that International Personal Finance reported that customer numbers were up 3 per cent year-on-year.

The firm offers small, short-term, unsecured loans in emerging markets including Slovakia, Romania, Mexico and Bulgaria. It also revealed that the amount of credit issued was up 6 per cent on last year.

The group has been focusing on reducing costs and restructuring the business.

It said growth was particularly strong in southern Europe, but that intense competition from digital and payday loan operators in Poland and the Czech Republic had impacted on business in those regions, while growth in Mexico was below expectations at 4 per cent.

In Poland and Lithuania there have been new regulations on consumer lending to contend with.

In the Czech Republic, legislation is expected to come into force in July to require lenders that are not banks to obtain a licence to trade from the Czech National Bank. 

All the new red tape might be designed to protect the consumer, but there are some concerns that it will force those with poorer credit ratings to seek loans on the black market instead. Shares fell by 6.3 per cent, or 16.4p, to 244.5p.

Avon Rubber shares bounced up after the firm announced an interim dividend of 3.16p per share, an increase of 30 per cent on last’s year payout. Investors will receive the payment on September 5.

In its half-year report the business announced that operating profit had increased 6pc to £9m in the six months to the end of March. 

Analysts were particularly impressed by the headway the group made in the dairy sector – Avon makes lining and tubing for the industry.

Sales churned up 18 per cent to £20.6million, helped along by the firm’s acquisition of milking equipment manufacturer InterPuls last year. Panmure, Investec, and N+1 Singer all raised their target price on the stock, the latter with the highest target of 975p. The share price sprang up 16.7 per cent, or 120p, to 838p.

According to whispers in the City, Premier Veterinary Group is set to announce plans to expand into the US imminently. 

In December the Bristol-based pet care group announced that it had sold its veterinary practice business for £6.5million to focus on its Premier Vets Alliance arm, a network of 740 member vet branches across Europe.

The Alliance provides services to branches, including its pet care plan healthcare programme, to which it currently has 117,000 pets signed up across the UK, Ireland, Denmark and the Netherlands.

If Premier expands to the US it could be an opportunity to tap into a much larger market. Shares were in the doghouse yesterday though, down 3.7 per cent, or 4.25p, to 120.75p.

The biggest faller in the FTSE 100 (down 1.19 per cent, or 73.57 points, to 6,112.02) was Randgold Resources.

The miner warned that production had dropped 11pc from its previous record quarter when 291,912 ounces of gold had been produced. The business has also been hit by technical issues at two of its sites.

Yet Randgold said its increased focus on the profitability of its mines meant profits were up anyway at £44million.

With the gold price still a long way from its peak at $1,290, shares were far from sparkling yesterday. They fell 11.7 per cent, or 775p, to 5,830p.

Avingtrans makes equipment for the aerospace, energy and medical sectors.

Yesterday is announced it will sell its aerospace division, Sigma Components, to private equity firm Silverfleet Capital for £47million. The division reported an operating profit of £3.3million in the last financial year.

Avingtrans will return a ‘substantial proportion’ of the cash to shareholders as well as investing in its energy and medical businesses, Metalcraft and Maloney Metalcraft, and repaying some debt. Shares soared by 13.1 per cent, or 21.5p, to 185.5p.