Tullow Oil sinks in otherwise-flat London markets as election waits begins

By Barbara Kollmeyer, MarketWatch

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Tullow Oil shares lost more than half their value on Monday, after the oil and gas company cut guidance and its chief executive resigned, in otherwise-sluggish London markets.

The FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX -0.49%  slipped 0.2% to 7,225.56, weighed down as the British pound continued to rise. The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.1115%  gained 0.2% to $1.3169, as a weekend poll from the Financial Times showed a 10 percentage-point lead for the ruling Conservative Party over the Labour Party ahead of the Dec. 12 general election.

A strong pound tends to be negative for U.K.-based multinationals — many of which are listed on the FTSE 100 — that generate most of their revenue outside the country.

Tullow /zigman2/quotes/205079109/delayed UK:TLW -0.08%  shares slid 60% after the company said 2019 output fell significantly below expectations, suspended its dividend and said Chief Executive Paul McDade had resigned with immediate effect.

“The news represents a continuation of the problems which have dogged the company ever since its share price peaked more than seven years ago,” said Russ Mould, investment director at broker AJ Bell, in a note to clients.

“The appetite for risk which served it well when exploring for oil and gas arguably left it in a perilous position when it had too much debt heading into the oil-price crash in 2014. Despite efforts to reduce borrowings, this remains an issue for the company, with net debt totaling nearly $3 billion,” he added.

Leading the gainers were shares in grocer Tesco /zigman2/quotes/203761082/delayed UK:TSCO -0.04% , which confirmed speculation that it had begun a review of the strategic options for its businesses in Thailand and Malaysia, including an evaluation of a possible sale of these businesses. Shares rose nearly 5%.

Just Eat shares  rose 0.6% after Prosus, a spinoff of South African consumer internet group Naspers /zigman2/quotes/205954517/delayed ZA:NPN -0.09% , lifted its offer for the U.K. online food-delivery company to £5.1 billion pounds ($6.70 billion), stepping up a bidding fight for Just Eat with Takeaway.com /zigman2/quotes/201653805/delayed NL:TKWY +1.67% .

/zigman2/quotes/210598409/delayed

Add to watchlist UK:UKX

FTSE 100 Index

UK : FTSE UK

7,562.36

-37.38 -0.49%

Volume: 433,875

June 9, 2023 4:59p

/zigman2/quotes/210561263/realtime/sampled

Add to watchlist GBPUSD

British Pound

US : Tullett Prebon

1.2574

+0.0014 +0.1115%

Volume: 0.0000

June 9, 2023 4:59p

/zigman2/quotes/205079109/delayed

Add to watchlist UK:TLW

Tullow Oil PLC

UK : U.K.: London

25.72 p

-0.02 -0.08%

Volume: 2.31M

June 9, 2023 4:35p

P/E Ratio

24.73

Dividend Yield

0.00%

Market Cap

£372.32 million

Rev. per Employee

£4.47M

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Add to watchlist UK:TSCO

Tesco PLC

UK : U.K.: London

261.90 p

-0.10 -0.04%

Volume: 11.36M

June 9, 2023 4:35p

P/E Ratio

26.37

Dividend Yield

4.16%

Market Cap

£18.72 billion

Rev. per Employee

£190,062

/zigman2/quotes/205954517/delayed

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Naspers Ltd. N

ZA : South Africa

310,970

-272.00 -0.09%

Volume: 357,122

June 9, 2023 5:03p

P/E Ratio

11.66

Dividend Yield

0.21%

Market Cap

636.67 billion

Rev. per Employee

3.40M

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Add to watchlist NL:TKWY

Just Eat Takeaway.com N.V.

NL : Netherlands: Euronext Amsterdam

€ 12.92

+0.21 +1.67%

Volume: 2.21M

June 9, 2023 5:55p

P/E Ratio

N/A

Dividend Yield

N/A

Market Cap

€2.84 billion

Rev. per Employee

N/A