Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s a note from J Sainsbury [LON:SBRY] this morning, following Tesco’s lead yesterday in terms of also agreeing to forego the business rates relief it had been granted. However the note contains some interesting facts regarding the size and shape of the business going forward. Having waived the rates relief of £410m, underlying pre tax profits for the year are expected to be at least £270m. The company expects to generate average retail free cash flow of £500m per year over the next three years so in a sweetener to shareholders over handing back that cash, management have committed that dividend payments will be prioritised over paying down debt. Good news all round.
A stunning set of full year results from AJ Bell [LON:AJB] this morning. Revenues up 21%, pre-tax profits up 29% and assets under administration up 8% against a 19% fall in the FTSE all share over the same period. Shareholders will be rewarded with a 28% dividend hike and the company sees the uncertainty of the past nine months as a catalyst for yet more people to want to look at investing in their own future, although notes the economic uncertainty that lies ahead both from COVID and Brexit.
There’s a full year trading update from RM [LON:RM], the suppliers of technology to the education sector. Full year results are expected to come in ahead of expectations, with the company having benefitted from increased spending on remote learning solutions during the pandemic. Debt has been paid down too, although the company notes that uncertainty remains over the future. Education spending may have been accelerated from the forthcoming years, although if this marks a longer term shift to the use of digital, the company notes it is well placed to benefit.
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