Three things you need to know in the financial markets this morning from investment writer, Tony Cross.
Taylor Wimpey
Full year results are out from the housebuilder Taylor Wimpey [LON:TW] this morning, covering the period to the end of December. The company notes that completions were down 40%, but this was in line with expectations and the recovery in the latter part of the year has seen capacity return to near normal levels. The average selling price rose to £288,000 and the company has proposed to resume dividend payments at a rate of 7.5% of net assets – something that is likely to be flagged in the media as the sector stands to receive yet more taxpayer funded support in tomorrow’s budget. The company also notes that it plans to build a smaller proportion of affordable homes this year although expects that number to normalise in 2022, targets an operating margin of 21-22% and is set to finish the year with £500m worth of cash.
Flutter Entertainment
Some bumper full year results out from Flutter Entertainment LON:FLTR, the gambling group. The numbers were bolstered by a merger which saw revenues more than double, but even on a pro-forma basis, the 28% increase in sales isn’t to be overlooked. Online gambling channels fared well through lockdown, but the company notes closed high streets in the UK & Ireland are hitting EBITDA by £9m a month, proposed tax changes in Germany could cost up to £25m and the global economic outlook remains uncertain. However there’s strong momentum in the underlying business and in recent weeks the business notes “favourable sports results” making it, rather than its customers, the clear winner.
PPHE Hotel Group
Hotel owner and operator PPHE LON:PPH – the name behind brands ranging from Park Plaza to Arena Campsites – have published full year results today. Revenues for the full year to December 31st were down by 70% and although occupancy levels have been decimated by COVID, it’s interesting to see average room sale prices off by less than 20%. The group is counting on a rebound in the year ahead with a belief that its city centre hotels will benefit from resurgent demand and the company remains committed to its CapEx plans. There are a lot of unknowns here, but PPHE notes it has a proven track record in navigating economic cycles. The real challenge is that this latest shock is fundamentally different to anything we’ve seen before.
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