Three things you need to know in the financial markets this morning from investment writer, Tony Cross
White goods retailer AO World published a Q3 trading update this morning, which again showed that at least some corners of retail are continuing to thrive. Group revenue rose 8.2% against the same period last year, the European operation is expanding apace and the company had its highest ever November sales figure. Clearly revenues are only half of the equation here and it’s important to understand profit margins too before getting too excited over the numbers, although the company states it is on track to meet full year targets.
Sticking with the same sector, Moss Bros has provided a trading update for the 23 weeks to January 5th this morning. Online sales growth is good, physical stores are suffering from lower overall footfall and total sales are up 0.6% on the same period a year ago. Hire sales are down around 10% and margins have fallen by 2.6%. There’s some smart thinking with average lease length being reduced and free cash of £10m forecast, although this is significantly lower than the position a year ago, too.
FlyBe has been bought out. The struggling regional airline put itself up for sale last year and a consortium lead by Virgin Atlantic and listed Stobart Group has bought the entity for just £2.2 million. That values FlyBe’s shares at just 1p each, a 94% discount to last night’s closing price and presumably significantly below the level where Stobart Group had tabled an undisclosed offer last February, as shares neared 45p each.