Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Diageo
There’s a slew of company updates out this morning to the extent we’re spoilt for choice, but starting with Diageo LON:DGE, the drinks maker has published interims for the six months to December 31st. Organic sales were up despite the impact of COVID, but unfavourable exchange rate movements have won out here. The company is also expecting the current six month period to be rather more impressive as it will be against a weak comparative so whilst guidance remains suspended, there’s sufficient confidence to increase the interim dividend by 2%.
easyJet
Q1 numbers from easyJet LON:EZJ are out today which notes that performance was in line with management expectations. These numbers cover the three months to December 31st where passenger numbers were down 87% and the load factor slipped from 92% to 66%. Perhaps most critically, cash burn is identified as being around £40m per week, although to maintain that, more redundancies are needed. The company also notes that it has unrestricted access to £2.5bn worth of liquidity, so even in the current torrid environment has a one year runway. A return to normality can’t come fast enough for the sector, but this news may be sufficient to reassure investors.
FeverTree Drinks
There’s a trading update out from FeverTree Drinks LON:FEVR for the full year to December 31st. The unstoppable juggernaut of a company has seen growth disrupted by COVID, with a saturated UK market proving to be the laggard. A drying-up of sales in the on-trade couldn’t however be offset by gains for at home consumption, even though the business gained ground, finishing the year as the clear market leader. In other territories, performance remained robust leaving global full year revenues off by just 3%. The on-trade will resume at some point and the company will be working against weak comparatives, but overseas growth will remain critical.
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