Companies Reporting: Associated British Foods, Vistry

Our regular look at the FTSE 350 and other companies reporting from 8 – 12 September.

• Associated British Foods banks on Primark momentum.
• Visty hopes to see profitability improve in the second half.

Associated British Foods, Trading Statement, Wednesday 10 September

Aarin Chiekrie, equity analyst, Hargreaves Lansdown: Associated British Foods LON:ABF has had a tough start to the year. First-half revenues remained flat, but some troubles in its Sugar divisions saw group operating profits fall faster than expected, down 10% to £835 million. With expectations now rebased lower, there’s cautious optimism that there won’t be any more disappointments when the group releases its second-half trading update next week.

• UK Stock Market News: Primark, Vistry, Wickes
• Associated British Foods makes its move on Hovis

Performance at the all-important Primark business is set to improve as a record-breaking warm summer is likely to have boosted footfall and encouraged UK consumers to spend more. This positive momentum looks set to spill over to the group’s ingredients and grocery businesses and help sales trends pick up here too. But with the sugar market across Europe remaining weak, it looks likely to offset progress elsewhere in the business. As a result, markets are forecasting another half of double-digit operating profit declines to around £876 million.

Vistry, Half Year Results, Wednesday 10 September

Aarin Chiekrie: Vistry’s LON:VTY first-half results shouldn’t bring too many surprises next week. The housebuilder is already confirmed that revenue is set to fall from £2.0 billion to around £1.8 billion due to a pullback in partner-funded activity. Sales prices are holding firm for now, but that still means first-half underlying profits are expected to fall from £162 million to around £125 million.

• UK Stock Market News: Primark, Vistry, Wickes
• UK Stock Market News: PageGroup, Vistry, Hostelworld
• Companies Reporting: Vistry, Trade deals and UK GDP

Much more important than any first-half numbers will be the outlook for the second half. The UK government has pledged to invest an unprecedented £39 billion in affordable housing over the next decade, marking a significant step up in funding. This money is set to start flowing later this year, and Vistry looks better positioned to benefit than many of its peers.

Investors will be keen to hear just how much of a positive impact the group’s expecting, given that Vistry’s expecting second-half activity to rebound and deliver a full-year increase in profits. But with affordability issues continuing for buyers, nothing is guaranteed.

This article has been brought to you in association with Hargreaves Lansdown. All opinions expressed in this article are from the analysts and do not necessarily represent the opinions of The Armchair Trader.

FTSE 100, FTSE 250 and selected other companies scheduled to report