1965: Life at the Top – Kotcheff
The FTSE 100 index had its quarterly review on Wednesday and saw three companies dropped from the index (Investec, Lonmin and Inmarsat) replaced by CRH, Evraz and Polymetal International. The index is reviewed every quarter (every day would simply create an unnecessary administrative burden as companies towards the bottom of the top 100 list would alter far too often). The FTSE100 is based on the largest UK listed companies, by value. It includes well known names and companies that most people would not have heard of.
Lonmin, is the worlds third largest platinum mining company, based in South Africa. The latest results for the company revealed improvements in profit and debt reduction against 2010 figures. However its share price has gradually collapsed to about half value over the last 12 months.
Inmarsat are a satellite company – the space technology type. The company was promoted to the FTSE100 in September 2008 but has now been “relegated” though this information does not appear on their website. The third quarter 2011 figures show improving revenue, up nearly 18% to $364m, however the share price has fallen around 40% over the year.
Investec are an investment company originally from South Africa. They provide financial products here in the UK and of course globally. You might have seen their adverts which tend to include a zebra. They would describe themselves as a specialist bank and asset manager. In the UK and Europe they manage around £45bn where operating profits increased by 8% in their last financial year. However their share price has also fallen significantly this year – by around 30%.
As a result, these three companies have dropped out of the FTSE100, which means that anyone with a UK FTSE100 tracker fund will have minor adjustments being made. The replacements are Evraz, a steel company with significant production in Russia. A theme continued with the inclusion of Polymetal International, a precious metals mining company with significant production in Russia and Kazakhstan. CRH are a building materials company with its HQ in Ireland. It was originally formed as a merger between Cement Ltd and Roadstone Ltd in 1970.
Never forget the adage – where there’s muck there’s brass.
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