Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Soft drinks producer Fever Tree [LON:FEVR] has published a trading update this morning, showing that the business continues to see expansion across the board. However, sales growth in the UK market is reported to be slower than anticipated, with tough comparatives and a slow down in retail spending combining to weigh on the outlook a little. Growth elsewhere remains impressive, with US revenues up by a third and continental Europe up by almost 20%. Profit forecasts have been refined but still represent a 12-13% year on year increase with margins unchanged.
Full year numbers from accounting software providers Sage [LON:SGE] are out this morning, showing revenues are up but profits are down. This margin squeeze may be a cause for concern amongst investors, although there’s a sweetener with £250m being returned to shareholders following the sale of Sage Pay. The continued move to Software as a Service (Saas) is set to continue proving capital intensive and this is expected to keep margins in check for the year ahead.
Mitchells & Butlers
There’s a strong set of full year numbers from pub operator Mitchells & Butlers [LON:MAB] out today, with profits up by around 20%, whilst earnings per share have increased by more than a third. In the first few weeks of the new trading period, the company continues to outperform the wider market, although it acknowledges the risks faced by the high level of macroeconomic uncertainty. The share price has been a strong performer since before the summer – these numbers arguably justify the performance.