Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s an interesting trading update from Hotel Chocolat [LON:HOTC] out this morning, covering the full year to June 30th. It has absolutely been a tale of two halves for the confectioner, with sales in H1 up by 14% on a year on year basis, with a 14% fall seen in H2. That shows the importance of Mother’s Day and Easter to the retailer, and perhaps also flags a gap in the digital distribution channel. That said, online sales are now performing well and with the vast majority of stores open, it’s the high street ones rather than those reliant on commuters which are seeing the best performance. The company notes it has £60m available liquidity headroom and believes the brand is resilient for the future.
Global educational publisher Pearson [LON:PSON] has issued half year results to June 30th this morning. Despite the company’s pivot towards online learning, that wasn’t sufficient to support the business, with underlying revenues down 17% for the period. It hasn’t been all one way however – applications for the virtual schools run by the business are up by 61% for the 2020/21 academic year and retention rates have been lifted too. Expectations are for something of a rebound to be seen as pent up demand is realised as physical assessment centres reopen and the company notes that a trend of improvement had already been seen in June.
There’s a Q1 update out from Vodafone [LON:VOD] this morning, which notes a 1.3% decline in organic revenue, largely as a result of COVID-19 impacts. Churn is down again, but unlike others who have credited a lack of competitive activity during lockdown, that makes for the 7th successive quarter of improved loyalty for the brand. The plan to spin out Vantage Towers, the European network of mobile phone masts, remains on track for next year and the company’s EBITDA outlook remains unchanged at flat to slightly lower.
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