Carphone and ITV in danger of FTSE relegation
Broadband provider Carphone Warehouse and broadcaster ITV were today among the blue-chip firms facing possible relegation from the FTSE 100 Index.
The UK’s second biggest pubs group, Enterprise Inns is also in the frame for demotion to the FTSE 250 Index, along with Ukrainian miner Ferrexpo.
The quarterly reshuffle of the blue-chip index will be announced on Wednesday evening, based on closing prices on Tuesday night. Any changes will be implemented from the end of trading on Friday September 19.
Based on yesterday’s close, top tier firms Carphone Warehouse, ITV, Enterprise Inns and Ferrexpo lay outside the UK’s top 100 companies ranked by market capitalisation and could be subject to ejection.
On the flip-side, FTSE 250 companies Inmarsat, which operates satellite equipment, software firm Autonomy and bus and trains group Stagecoach were inside the top 100 are therefore in line for promotion.
Fresnillo, which is the owner of the world’s largest silver mine in Mexico and listed in London in June, was also a top 100 firm and could be subject to promotion.
ITV’s demotion would be a blow for boss Michael Grade, who returned to the broadcaster at the end of 2006 to lead a turnaround.
While ratings have crept up during his tenure, the worsening economy has taken its toll on the group’s all-important advertising revenue.
The firm, which has been a FTSE 100 member since being created from the merger of Granada and Carlton in 2004, recently said it expected market revenues to be 8% down during the second half of this year compared to 2007. ITV’s share price has more than halved over the past year.
Carphone Warehouse, which is the UK’s third largest broadband provider behind BT and Virgin Media, has seen broadband business slow in tandem with the housing market. The firm’s share price has nearly halved since it entered the top flight in September last year.
And pubs group Enterprise Inns has suffered a series of blows along with other members of the industry, including from a consumer spending slowdown, alcohol duty hikes and a smoking ban. Its share price has also more than halved over the past year.
