14th Jun 2023. 8.58am

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Auto Trader accelerates ahead with impressive annual results

Auto Trader (AUTO) recently announced its impressive annual results, showcasing a strong performance in its core business.

The car dealer achieved a notable 9% increase in revenue and a solid 10% rise in operating profit, while maintaining an impressive operating profit margin of 70%.

Despite the challenges posed by limited vehicle supply, retailer revenue experienced significant growth of 10%. This growth was primarily driven by the widespread adoption of additional products and services, highlighting the positive response from customers.

Auto Trader expects this momentum to continue, supported by their annual pricing and product event and the increasing popularity of the Auto Trader Connect platform.

CEO Nathan Coe emphasized the promising outlook for Auto Trader’s marketplace, stating, “The prospects for our marketplace are stronger than ever, with a significant number of car buyers and retailers relying on Auto Trader. We have also made substantial progress in enhancing the new and used car buying experience by shifting more of the journey online, within the Auto Trader platform.”

Looking ahead, Auto Trader is confident in meeting its growth expectations for the new financial year. The company anticipates robust retailer revenue growth and aims to expand its share in the new car leasing market through the Autorama segment.

AUTO Daily Candle Chart

AUTO Daily Candle Chart

Glencore makes bold cash offer for Teck Resources’ coal business

Swiss mining giant Glencore (GLEN) has made a cash offer to acquire Teck Resources’ coal business, intensifying a major takeover battle in the mining industry.

Glencore plans to purchase Teck’s steelmaking coal business and later merge it with its own coal assets, creating a dominant force in the coal mining sector. The proposed merger would result in an annual production of over 100m tonnes of thermal coal and 30m tonnes of steelmaking coal.

Previously, Glencore had offered up to $8.2bn in cash to acquire Teck’s coal business as part of a larger $23 billion cash-and-share deal for the entire company. Teck Resources, however, has rejected multiple takeover offers. Glencore’s pursuit of Teck has been complicated by the Canadian company’s dual-class share structure and opposition from key stakeholders. Nevertheless, Glencore remains open to both acquiring the entire company and securing the coal business separately.

Teck Resources said it is engaging with Glencore to discuss the potential coal deal but is also considering other proposals. Despite the challenges, Glencore’s CEO is determined to pursue the acquisition and believes that acquiring the coal business alone would be a secondary option in terms of potential benefits.

GLEN Daily Candle Chart

GLEN Daily Candle Chart

Indivior share price surges as lawsuit settlement reached

Indivior’s (INDV) share price has rallied after it reached a settlement agreement to pay $102.5m to resolve a lawsuit filed by 41 US states and Washington, D.C.

The lawsuit alleged that Indivior engaged in unlawful practices to suppress competition for its opioid addiction treatment, Suboxone. This settlement brings an end to the legal dispute that began in 2016, although Indivior maintains its position of denying any wrongdoing throughout the process.

As part of the settlement, Indivior has committed to implementing additional transparency measures to prevent any potential anticompetitive behavior in the future.

The settlement agreement is still subject to approval by the federal judge overseeing the nationwide antitrust litigation involving Suboxone in Philadelphia. By reaching this settlement, the parties involved have avoided a trial that was originally scheduled for September 18.

Indivior CEO, Mark Crossley said:

“We take our role as a responsible steward of medications for addiction and rescue extremely seriously. Resolving these legacy matters at the right value allows us to further this mission for patients.”

With the uncertainty of the litigation now lifted, the shares have enjoyed a nice rally and we expect prices to retest their January highs.

INDV Daily Candle Chart

INDV Daily Candle Chart

Vodafone and CK Hutchison near merger of British operations

Vodafone (VOD) and CK Hutchison, based in Hong Kong, are on the verge of finalizing an agreement to merge their British operations.

Sources indicate that an announcement is imminent. The merger will result in Vodafone holding a 51% stake and Hutchison owning 49% of the combined entity, which is estimated to have a total value of approximately £15bn, including debt.

Rather than a cash exchange, the ownership stakes will be adjusted through debt reallocation, as previously outlined by the companies in October.

Vodafone’s new Chief Executive, Margherita Della Valle, is under pressure to complete strategic deals in key markets to enhance the performance of the telecom giant. The merger was initially identified by her predecessor, Nick Read, as a means to strengthen Vodafone’s position in the UK market.

The proposed merger is expected to face rigorous regulatory scrutiny. However, Vodafone and Hutchison argue that the combination would bring benefits to consumers by facilitating the rollout of full 5G technology and expanding broadband connectivity. Hutchison has faced limitations on its investment capacity in Britain due to its inability to cover the cost of its capital.

VOD Daily Candle Chart

VOD Daily Candle Chart


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