Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
There’s a confident trading statement out from Ocado [LON:OCDO] this morning, noting sales for the last quarter are up by 10.3%. Current concerns over COVID19 are giving the retailer a significant boost, with news yesterday that it had suspended its website until the weekend as it attempted to maximise output. The company is maintaining its revenue guidance growth for the year at 10-15% although acknowledges that heavy forward buying of non-perishable items could skew performance.
Full year numbers from Next [LON:NXT] have been published today, with the fashion retailer continuing to paint a picture of growth with online sales remaining as the key driver. Profits from financing – a lucrative part of the business – are also higher, accounting for around 20% of the pre-tax figure. The outlook however is overshadowed by COVID19 and extrapolations of this week’s sales suggest revenues down 30% from a year earlier. The company lays out various mitigation possibilities and perhaps most bluntly, if sales fall by more than 20% then dividend payments in the summer are likely to be delayed.
Brewers Shepherd Neame have also published a COVID19 update this morning, just over a week after the release of interim results. Clearly the underlying situation has changed rapidly and, in a bid to account for this, the company lays out a series of steps it is taking to mitigate the crisis. Rent receipts are being suspended, with directors taking a 20% pay cut and shareholders being advised that the planned dividend to be paid at the start of next month has been cancelled. The fact that directors and investors – rather than employees and tenants – are bearing the brunt here is to be applauded.
Sign up for three quick facts and more with our Free Daily Digest newsletter, every weekday morning.