Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
City Pub Group
The City Pub Group [LON:CPC] has published a note this morning, advising that it is seeking to raise £22m. There are two cited purposes here, strengthening the balance sheet and ensuring the business is in a position to expand the estate as and when acquisition prices become depressed. Whilst this looks like sound thinking, the pub industry in particular seems well placed in terms of government support over staff salaries and business rate holidays. City Pubs seems to think however that there will be opportunities to sniff out.
Online sales may have been seen as the salvation of man retailers during the COVID19 crisis but there’s a short note out from Next [LON:NXT] this morning advising that it has temporarily closed its warehouse and distribution centre as of last night. This is in response to staff feeling that their role is non-essential at this time. There are no further details, but the shares, which had posted an impressive recovery of almost 30% this week, are likely to take a beating at the open.
Domino’s Pizza [LON:DPZ] has published a trading update this morning, highlighting some interesting trends in the market as consumers react to current events. The business has taken the decision to stop in-store collections and work on a delivery only model, but the uptick in demand seen so far is delivering overall growth. However, the picture in the company’s struggling (now classed as discontinued) overseas operations has been less prosperous with temporary store closures and double digit declines in sales. There may be an uptick now, but the length of the shut down plus the resilience of the company’s UK operations pose longer term threats. The dividend declared in full year results at the start of the month has been suspended and there’s no guidance being made available for the full year.
Sign up for three quick facts and more with our Free Daily Digest newsletter, every weekday morning.