Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s a trading statement out from AO World [LON:AO] this morning covering the third quarter to 31st December. As we saw reported in the interims, lockdown has driven significant growth at the company and this shows no signs of relenting in the last reporting period. UK sales were up 67% year-on-year whilst the smaller German operation saw sales jump 77%. The note cautions however that costs are rising owing to operational challenges, but with the company having recruited 1500 staff during 2020, the outlook appears upbeat.
Retail has been very much a game of two halves through the COVID pandemic and Superdry’s [LON:SDRY] latest results show that they remain one of the strugglers. Interim results for the 26 week period to 24th October show revenues off by almost a quarter, whilst gross margins are also being squeezed as a result of promotional activity. The company has moved more sales into online channels, but with the headline numbers falling, ground is being lost. The picture is little changed in Q3 either and the outlook remains tough. The note points out that liquidity remains strong and loan covenants have been reprofiled through to April 2022.
Hotel Chocolat [LON:HOTC] has published an update for both the 13 and 26 week trading periods to 27th December this morning. Sales for the periods are up 19% and 11% respectively, showing that despite disruption to its own store network, the multi-channel offering has served it well. Despite increased investment in digital and international growth, trading remains in line with management expectations. Six month numbers will be published on March 2nd but despite the headwinds and consumer belt-tightening – at least figuratively – the company seems to have found a sweet spot with its approach.
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