Directors’ Deals: Oxford Nanopore chair boosts holding

The mood music surrounding the London Stock Exchange seems more discordant by the day. After the likes of Ferguson and CRH decided to pursue primary listings in the US, and chip maker Arm ignored the UK government’s lobbying efforts, the LSE’s bosses will have been stung by criticism from Intercontinental Hotels Group chief executive Keith Barr. 

Dwindling liquidity meant the UK stock market is currently “not a very attractive place”, he told the FT last week.

The last big win for the LSE was convincing genomic sequencing company Oxford Nanopore to list on its home market rather than the Nasdaq exchange favoured by biotech peers. However, given the reception since its market debut around 18 months ago, it’s little wonder that its chief executive Gordon Sanghera also recently considered pursuing a listing elsewhere. After debuting at 425p, the shares initially soared to a high of 736p in December 2021, giving it a valuation of over £6bn. But they have been broadly heading downwards ever since, and closed last week 68 per cent off their peak, with a market cap of around £1.9bn.

It would be unfair to lay the blame for this solely at its listing venue. Lossmaking technology shares have been punished in most markets, with Nasdaq’s US small-cap biotechnology index falling in value by 32 per cent over the same period.

Although the company halved pre-tax losses to £83.4mn in 2022, it is still around three years away from breaking even at a cash profit level, according to analysts’ estimates. 

Its technology is highly rated, though, and the FactSet consensus target price of 347p is more than 50 per cent higher than current levels. Chair Duncan Tatton-Brown seems to think there’s value to be had — he recently bought over £215,000-worth at an average of 216p a share.

Hollywood Bowl HR boss knocks down stake

While leisure tastes and fads have come and gone in recent decades, tenpin bowling has hung around and is still a cost-effective option. This has ensured that Hollywood Bowl has continued to increase sales. It reported record first-half sales this month of £111mn (2022: £100mn). This improvement, equivalent to 11 per cent, or 3.5 per cent on a like-for-like basis, came despite a general reduction in discretionary spending. The company continues to grow, adding new centres as well as fixing up existing locations. 

Chief executive Stephen Burns said Hollywood Bowl would keep a growth focus while its “insulation from cost of goods and energy inflationary pressures” would keep profits from landing in the gutter. 

This was the backdrop against which chief officer Melanie Dickinson sold just over £300,000 in shares, at an average price of 248p. The company’s share price had run up before the unscheduled trading statement, and it has continued that move up as of publication time, sitting at 256p. Dickinson has got in before the closed period before results are released; Hollywood Bowl will publish its half-year figures next month. 

Peel Hunt upgraded its forecasts after last week’s trading update, lifting sales expectations by 3 per cent to £197mn and pre-tax profit estimates by 6 per cent to £42mn.