Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Numbers have been released by Kingfisher [LON:KGF] covering the first six months of its trading year to 31st July. Despite the lockdown, sales fared well with only a modest 1.3% year-on-year dip being recorded. Margins were only off by 10 basis points and earnings per share close on doubled. The company noted that sales were weighted towards the second quarter – which would be expected given the timing of lockdown easing – and that trends remain encouraging as Q3 gets underway. Despite that however, the interim dividend is suspended given the ongoing economic uncertainty.
There’s a pre-close trading update out from TUI [LON:TUI] this morning. The note contains quite a number of data points but highlights include the fact Q4 capacity has been trimmed from a planned 30% to around 25%. Since restarting operations in mid-June, the tour operator’s planes have been 84% full and the plan remains to operate 80% of previously planned holidays in summer 2020. The company continues to benefit from significant German government support, so assuming the 2021 program takes off as planned may be sufficient to navigate the turbulence.
Sticking with travel, there’s half year post-close numbers out from Whitbread [LON:WTB] this morning. The company notes that occupancy rates in August averaged 51% – albeit with heavy discounts – whilst restaurant performance was boosted by the Eat Out To Help Out scheme, leaving sales for August down 38.5%. However with demand likely to remain depressed, the company has announced plans to lay off 6000 staff – almost one fifth of the workforce. Demand is expected to remain subdued in the medium term and although the September/October period usually sees a pickup in bookings, the company notes it’s too early to assess the impact of COVID-19 here. The next update is due at the end of October.
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