Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s a trading update out from fashion retailer Next [LON:NXT] this morning, covering the six months to December 26th. The company’s online channel continues to serve it well, compensating for almost all the sales lost in physical stores, with the update adding – unsurprisingly – that party and work clothes sold poorly, whilst kids clothing, loungewear and home furnishings performed rather better. Returns rates – a significant cost to the business – also fell. Active customer numbers are up by almost a quarter, but it’s far from being universally good news. The company notes that the overperformance in the last two months of 2020 will be almost entirely offset by lost full price sales during the lockdown – a situation which has arguably deteriorated further since the note was signed off – and the additional costs of clearing end-of-season stock online. That said, the conclusion is that in the worst-case scenario, full year sales will be 3.5% lower than seen in 2019 and pre-tax profits will still be £600m.
Sticking with retail and WM Morrison [LON:MRW] are providing a trading update today, too. Group sales excluding fuel were up 9.3% over the Christmas period, with the company continuing to see a strong performance with a range of innovations across online channels, too. The company notes that market share has also grown and that customers are benefitting from deflationary pressures, too. Despite the uncertainty, full year pre-tax profits are still expected to be in line with previous forecasts of £420-£440m.
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Remote Monitored Systems
There’s a short update from Remote Monitored Systems [LON:RMS] who we flagged in last night’s AIM roundup. The company has advised the market that its new face mask machine was loaded and dispatched from the Spanish manufacturer yesterday and should be in the UK by the end of the week. A further update has been promised once the equipment has been commissioned.
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