Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Smith and Nephew
Smith and Nephew [LON:SN] has published Q4 and full year results this morning, which show the group’s performance remains constrained by deferral of elective surgeries. Full year revenues were off by 12% on an underlying basis, whilst margins also slipped. The company notes that COVID-19 is likely to continue to hamper sales in the first half of the current financial year and there’s uncertainty as to the pace of any recovery. However on a more positive note, there’s confidence that year on year revenues and margins will increase, although admittedly this will be against a weak comparative.
Recruiter Hays [LON:HAS] has published half year numbers today, covering the six months to December 31st. COVID has again rattled performance, although the company notes a trend of improvement through the reporting period. Fee income is down by a quarter whilst operating profits have fallen by 75%. The downturn has been balanced across the company’s geographical footprint and although dividends remain suspended the board have said it is their intention to resume payments when full year results are announced in August. That may be sufficient to lend some support at the open.
Full year numbers are out from Barclays [LON:BARC] this morning and as would be expected, this makes for a weighty document to wade through. Pre-tax profits of £3.065bn were more than 50% ahead of analyst expectations and despite the year of turmoil that 2020 was, total fee income also managed to edge a little higher. Bad debt remains a cause for concern, but the bank notes that impairment charges for Q4 were down by 19% from Q3. It’s far from universal good news however as the statutory RoTE fell from 5.3% to 3.2%, moving further away from the bank’s 10% target. Dividend payments are however being resumed following last year’s suspension at the request of the Bank of England.
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