Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Kingfisher
There’s a Q4 trading update out from B&Q owner Kingfisher LON:KGF this morning, covering the period to January 9th. Demand has been brisk over the Christmas period, extending the upbeat performance seen in Q3 and the company believes it is on target to post full year results in line with upper end of market forecasts. Ongoing uncertainty over the impact of COVID continues to drag, but there’s optimism that the company’s repositioning in recent months – including strong growth in online sales -leaves them well placed to benefit in the longer term.
Games Workshop
Another niche retailer that has benefitted from lockdown is Games Workshop LON:GAW, who have published interims for the period to November 29th today. Another set of record sales means revenues are up by 25% whilst operating profits have advanced by closer to 50%. Staff have been sharing in the upside with an additional £5m bonus pool split equally across the team, whilst shareholders are being offered a further 80p dividend on top of the additional 60p declared last month. Looking at the outlook statement, the biggest concern appears to be retaining the right staff and the bonuses, plus across the board 3% pay rises, suggest that this is something they are taking very seriously.
Nichols
Finally, a short note from soft drinks company Nichols LON:NICL, owners of the Vimto brand, covering the 12 months to December 31st. The Out of Home market continues to struggle as a result of rolling lockdowns and reduced demand. The slump cannot be overstated either, with Q4 sales to this market down by 84% from 2019. As previously guided the company expects full year sales to be almost 20% lower, although the company notes that its cash position was better at the end of 2020 than it had been a year earlier. A diversified business model and robust balance sheet should leave the company well placed for the future.
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