Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Hammerson
Full year results are out from Hammerson LON:HMSO this morning, with the company keen to emphasise it is executing a strategic shift. Disposals are ahead of targets and debt is being paid down. Many tenants are operating under CVAs which impacts rent increases but footfall is slightly ahead. Rental income is down 11%, although with the portfolio value some 16% lower, there’s the scope to make some argument over yield here. The dividend is being maintained and arguably the picture could be somewhat worse.
Tesco
Tesco LON:TSCO has announced the disposal of its 20% stake in its Chinese joint venture, Gain Land. The deal will result in proceeds of £275m for Tesco, which will be used for general corporate purposes. The JV had been loss making so the move helps with the retailer’s ambition of simplifying its core operation.
Meggitt
Aircraft engineering firm Meggitt LON:MGGT has published its full year results today. Revenues are up 10% whilst underlying pre-tax profits have risen by 11% and margins have been maintained at 17.7%. The company notes a number of headwinds including supply chain disruption and the grounding of the 737 MAX fleet, but a 5% dividend increase is recommended, too. Debt has nudged higher however and the outlook is set to be constrained by those existing headwinds plus the macroeconomic impact of the COVID19 (Coronavirus) outbreak. The company’s exposure to the defence sector does however provide a degree of stability even if commercial dealflow starts to wane.
