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Three Quick Facts: Stagecoach, Britvic and Kingfisher

By Tony Cross
22nd July 2020

Related topics: Kingfisher [LON:KGF], Britvic [LON:BVIC], Stagecoach [LON:SGC]

Three things you need to know in the financial markets this morning from investment writer, Tony Cross.

Stagecoach

Full year results are out from transport operator Stagecoach [LON:SGC] this morning, covering the period to May 2^nd. This obviously includes the worst of the COVID-19 pandemic, something which is reflected in a 25% decline in revenues, although profitability has been sustained. Again this took a hit but the fact pre-tax profits have only fallen by around 30% is worthy of note. The company notes that a return to more normal levels of public transport usage is some way off, although the format plays a critical role in delivering a greener economy. Whilst that may be true, many individuals have also been conditioned by recent events to accept they don’t need to travel at every opportunity, with remote working and online shopping often providing alternatives. This has been a solid performance given the backdrop but can it be sustained?

Britvic

There’s a Q3 trading update from Britvic LON:BVIC published today covering the period to June 30th, noting that the impact of the COVID-19 lockdown left revenues for the period down by 16.3%. There was some mitigation here as at-home sales filled part of the void left by the licensed trade. Even as the hospitality sector reopens, the toll on EBIT remains at something between £12m and £18m per month. Whilst management are said to be comfortable with the current situation, they acknowledge the high degree of uncertainty when it comes to the pace of recovery.

Kingfisher

Retailer Kingfisher LON:KGF has published a pre-close trading update today. Sales recovery has been seen in May and June as lockdowns have eased, although the 200%+ improvement in e-commerce channels is the real stand out here. There’s little else to add beyond that, but the note adds that sales for May, June and the first half of July are up 21.6% year on year, whilst group like for like sales for the year to July 18^th are off by a modest 3.7%. The economic uncertainty combined with people having more time at home arguably bodes well for the DIY industry, although with shares essentially flat on the year to date, the market may well have already accounted for this.