1st Sep 2021 08:11
(Alliance News) - WH Smith on Wednesday lifted its outlook for its recently ended financial year, but cautioned on the year ahead amid an "uncertain" travel rebound path.
The books and stationery retailer, which has outposts in train stations and airports as well as the high street, said second half group revenue was 65% of the same period two years ago. This marked an improvement from the first half figure of 60%. For the eight weeks to August 28, revenue showed a further improvement, standing at 71% of the levels reported two years ago.
For its travel unit, second half revenue stood at 38% of 2019's levels. UK travel passenger numbers remain "significantly" down on 2019 levels, the company said, but it is seeing a gradual recovery.
"Outside of the UK, our North America business has performed well in July and August, with sales at 93% compared to 2019 levels. We remain confident in the strength of our North American business and in winning further stores in this market," said WH Smith.
WH Smith said it expects the outcome for the financial year ended August 31 to be slightly ahead of expectations.
However, it warned on the financial year ahead.
WH Smith said: "As previously stated, we remain confident in revenues returning to pre-Covid levels in the next two to three years. While there will be a return to good levels of profitability in the year ending August 2022, the trajectory of the recovery in travel remains uncertain. This combined with the previously announced accounting finance charges relating to the successful convertible bond issue on April 29, means that we currently anticipate the levels of profitability for the year ending August 2022 will be at the lower end of market expectations."
Shares in WH Smith were down 5.3% in early trade in London, making it the worst performer in the FTSE 250 index on Wednesday morning.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.7% at 7,169.07
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Hang Seng: up 0.5% at 26,009.73
Nikkei 225: closed up 1.3% at 28,451.02
DJIA: closed down 39.11 points, 0.1%, at 35,360.73
S&P 500: closed down 0.1% at 4,522.68
Nasdaq Composite: closed down slightly at 15,259.24
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EUR: up at USD1.1813 (USD1.1802)
GBP: firm at USD1.3757 (USD1.3753)
USD: up at JPY110.22 (JPY110.01)
Gold: up at USD1,816.01 per ounce (USD1,805.13)
Oil (Brent): soft at USD72.03 a barrel (USD72.12)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Wednesday's Key Economic Events still to come
09:30 EDT Canada manufacturing PMI
10:00 CEST EU manufacturing PMI
11:00 CEST EU unemployment
09:50 CEST France manufacturing PMI
09:55 CEST Germany manufacturing PMI
11:00 BST Ireland unemployment
09:45 CET Italy manufacturing PMI
10:00 CEST Italy unemployment
09:15 CEST Spain manufacturing PMI
09:30 CEST Switzerland procure.ch PMI
07:00 BST UK Nationwide house price index
09:30 BST UK manufacturing PMI
08:15 EDT US ADP national employment report
09:45 EDT US manufacturing PMI
10:00 EDT US ISM manufacturing PMI
10:30 EDT US EIA weekly petroleum status report
20th OPEC and non-OPEC Ministerial Meeting
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Chinese manufacturers signalled a slight deterioration in business conditions in August, driven by a drop in output and new work, data from Caixin and IHS Markit showed. The headline seasonally adjusted purchasing managers' index posted below the neutral 50.0 level, at 49.2 points in August, down from 50.3 points in July, to signal a deterioration in the health of the sector. Though only marginal, it was the first time that business conditions had worsened since April 2020, with the index dipping to its lowest level for a year-and-a-half. "The reappearance of Covid-19 clusters in several regions beginning in late July has dealt a blow to manufacturing activity," explained Wang Zhe, senior economist at Caixin Insight Group.
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The decline in UK shop prices eased in August, numbers released on Wednesday showed, as consumers face the prospect mark-ups as retailers juggle shipping costs and Brexit red tape. According to the latest British Retail Consortium-NielsenIQ tracker, shop price deflation eased to 0.8% annually in August, slowed from July's 1.2% decline. Non-food prices slipped 1.2% in August, following's July's 1.8% fall. Food deflation eased to 0.2% from 0.4% in July. Fresh food deflation also eased, slipping to 0.6% from 1.0%. It was the ninth successive month that fresh food prices have fallen. BRC Chief Executive Helen Dickinson commented: "While it is good news that overall retail prices fell year-on-year, there was a slight rise in prices on the previous month. There are some modest indications that rising costs are starting to filter through into product prices."
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BROKER RATING CHANGES
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MORGAN STANLEY RAISES LONDONMETRIC PROPERTY TO 'OVERWEIGHT' ('EQUAL-WEIGHT')
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MORGAN STANLEY RAISES BRITISH LAND TO 'EQUAL-WEIGHT' ('UNDERWEIGHT')
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BERENBERG RAISES TYMAN TO 'BUY' ('HOLD') - TARGET 500 (375) PENCE
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COMPANIES - FTSE 100
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Anglo American's strategy director Duncan Wanblad is the leading candidate to succeed Mark Cutifani as chief executive, Sky News reported on Tuesday. Sky News noted the FTSE 100-listed miner is considering a small number of external hopefuls for the role. A decision on Cutifani's successor could be announced as soon as the end of October. Wanblad took on the role of strategy and business development director in 2016. He was CEO of Anglo's base metals unit between 2013 to 2019. Cutifani meanwhile, was appointed as CEO of the company back in 2013. Sky News noted Cutifani does not plan on stepping down from the post until the Quellaveco copper mine project in Peru has been completed. This is expected to happen next spring.
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The UK Competition & Markets Authority has decided not to refer National Grid's purchase of PPL WPD Investments - the holding company of Western Power Distribution, the UK's largest electricity distribution business - to a phase two investigation. The GBP7.8 billion deal for Western Power from US energy firm PPL was agreed in March.
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COMPANIES - FTSE 250
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888 Holdings said it delivered a record first half revenue and profit, made strong strategic progress, and increased its full year expectations. For the six months ended June 30, revenue was up 39% to USD528.4 million from USD379.1 million last year and pretax profit up 14% to USD57.9 million from USD50.9 million. 888 declared an interim dividend of 4.5 US cents, up from 3.2 cents paid out at the same time last year. For the remainder of the year, 888 said it remained mindful of the tougher comparables in the fourth quarter, a period that enjoyed an exceptionally strong performance in both betting and gaming revenues during 2020. However, it is confident that revenue and adjusted earnings before interest, tax, depreciation, and amortisation in the full year will be slightly ahead of its prior expectations.
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Kainos Group said trading from April 1 to date continued to be resilient across the business as organisations continue to increase their investment in digital solutions. Kainos said its performance was further enhanced by its long-term customer relationships and the expansion of revenue across customers, markets and geographic regions. As a result, for the full year ending March 31, 2022, Kainos expects revenue to be ahead of current consensus forecasts and adjusted profit to be in line with consensus forecasts. It posted revenue and adjusted pretax profit of GBP234.7 million and GBP57.1 million respectively in financial 2021. Separately, Kainos said it has expanded its Americas Workday operations by acquiring UNE Consulting for an undisclosed sum. The acquisition is Kainos's fifth in the Workday partner ecosystem and the second in the Americas, after the acquisition of IntuitiveTEK, based in Denver, Colorado, in 2020, it added.
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COMPANIES - GLOBAL
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Moderna's Covid-19 vaccine produces more antibodies than Pfizer's, according to findings from a study posted on Monday. Findings from the probe, which measured immune responses in healthcare workers in Belgium, were posted by the Journal of the American Medical Association. The level of antibodies found in those vaccinated with two doses of Moderna's vaccine was 3,836 units per millilitre. This was more than double the 1,444 u/ml from the jab developed by Pfizer alongside BioNTech. "This study demonstrated a significantly higher humoral immunogenicity of the SARS-CoV-2 mRNA-1273 vaccine (Moderna) compared with the BNT162b2 vaccine (Pfizer-BioNTech), in infected as well as uninfected participants, and across age categories," the JAMA said.
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Wednesday's Shareholder Meetings
Block Energy PLC - GM re investigation into affairs
Aberdeen New Dawn Investment Trust PLC - AGM
Eckoh PLC - AGM
Jupiter Green Investment Trust PLC - AGM
Kinovo PLC - AGM
McColl's Retail Group PLC - GM re equity raise approval
Prime People PLC - AGM
Severfield PLC - AGM
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By Lucy Heming;Â [email protected]
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