Mon, 5th Jun 2017
The latest FTSE reshuffle means that Hikma Pharmaceuticals and Intu properties will be demoted from the FTSE 100. The details of the reshuffle have been confirmed by FTSE Russell as the index provider calculated the market capitalisation of the companies in the index.
Hikma Pharmaceuticals is the smallest pharmaceuticals company in the index, and shares have been slipping in recent months, as the news surfaced that the company was unlikely to receive US regulatory approval for its new generic asthma drug. Further data submissions will be required before the FDA approve the drug. This stumbling block, combined with the reduced value of the Egyptian pound, has put the group in a difficult position.
Intu properties has seen its shares perform poorly in the last few months, with concerns about how the Brexit could impact the UK economy hitting the company hard. The group has beaten market expectations, with better than expected full-year results being published in February, and it says that it is confident that it will see an increase in net rental income over the course of the year, despite the challenging conditions. However, consensus forecasts for earnings and dividend growth remain uninspiring.
These relegations open the way for G4S and Segro to join the index. The security solutions company is rejoining the index after a demotion, while Segro, a warehouse management company, is enjoying a promotion after benefiting from the recent surge in online retailing and the associated increase in demand for warehouse spaces.