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Three Quick Facts: Boohoo, DS Smith and Capita

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Here are three things you need to know in the financial markets this morning from investment writer, Tony Cross.

#1. Boohoo two year sales continue to impress

There’s a trading update out from fast fashion retailer Boohoo LON:BOO group this morning, noting net sales growth in the final quarter of 7%, which translates to a 48% improvement from pre-pandemic levels. Performance in the UK remains strong and although overseas operations have been hit by longer shipping times, the company has now seen a return to growth in these markets as a result of the positive contribution from wholesale. Adjusted EBITDA for the full year is set to be in line with market expectations, but the note is light on detail, swerving the potential impact of the squeeze on living costs.

#2. DS Smith customers happy to swallow rising prices

DS Smith LON:SMDS also issued a trading statement, covering the November – January Q3 period. This is a solid update that shows input inflation being more than offset by increased prices being charged to customers, whilst also clearly laying out the company’s exposure to both Russia and Ukraine. The outlook for the full year remains unchanged.

#3. Capita offers limited scope for cheer

Capita LON:CPI has published full year results, but these present something of a mixed bag. The narrative certainly looks positive with contract wins up by a third and low attrition, but headline reported revenues are off by 4% and the operating loss has ballooned from £32m to £86m. Adjusted figures paint a more positive picture, whilst a growing pipeline of new business and a continued recovery post COVID-19 are likely to provide support going forward, however a number of factors are flagged as likely to squeeze margins in the year ahead.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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