Here are three things you need to know in the financial markets this morning from investment writer, Tony Cross.
#1. Rentokil Initial profits likely to be ahead of consensus
Interim results are out from Rentokil Initial [LON:RTO] this morning and the company continues to fare well despite the risk it was working against some tough comparatives. Headline revenues are up by 18%, pre tax profits have risen by 60% and EPS is up by an eye-catching 161%. The worldwide return to work is bolstering the vast majority of units within the business, although revenues from disinfection services are now tapering quickly. However the company is confident that excepting the risk of new COVID-19 variants emerging, a strong second half of the year will follow and profits are likely to be £10-£15m ahead of consensus.
#2. Diageo optimistic about growth prospects
Full year numbers from Diageo [LON:DGE] show strong net sales growth, particularly out of North America. Reported group sales rose by 8.3%, with restocking proving particularly supportive in a number of territories. EPS has close on doubled to 113.8p from the same point a year ago when it stood at 60.1p and net sales are critically up on the 2019 comparative, too. Management do anticipate some volatility in the near term but are optimistic about broader growth prospects. Investors are set to be rewarded with a 4% increase in dividends.
#3. Smith & Nephew confident that its guidance can be delivered
Smith & Nephew [LON:SN] likewise has H1 and Q1 numbers up today, showing a marked increase in revenues as elective surgeries came back on stream and indeed returned close to near normal levels in many markets. That growth was particularly marked in the second quarter where sales were up by close on 50% and the company is confident that its guidance of 10%-13% revenue growth and 18%-19% increase in margins can be delivered so long as there are no further COVID related constraints.
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