Three things you need to know in the financial markets today from investment writer, Tony Cross.
#1. Dunelm Q1 numbers impress with 9% sales uptick
There are Q1 numbers out from Dunelm LON:DNLM this morning showing total sales up 9% with the digital channel accounting for 35% of that. The majority of the uptick is reported as being driven by volume, whilst currency tailwinds and falling freight rates have also served to boost gross margins by 120bps, in line with longer term expectations. Given the economic backdrop these numbers seem encouraging and management are confident that there’s further market share to be obtained.
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#2. Rentokil acquisitions boost revenue growth
There’s a Q3 update out from Rentokil Initial LON:RTO, highlight a material uptick in revenues. Using constant currency metrics the gains are close on 60%, bolstered by acquisitions, whilst organic growth was rather more modest. The group expects momentum to continue into the year end although notes some weakness emerging in select North American markets. However this is a well diversified play enabling any isolated headwinds to be quickly absorbed.
#3. Hollywood Bowl customer demand remains strong despite economic headwinds
Hollywood Bowl LON:BOWL has issued a trading update for the year to 30th September noting excellent financial and operating performance in both the UK and Canada with customer demand remaining strong. Favourable weather conditions in the UK school holidays were seen as supportive although it’s worth noting that country revenues only rose by 4%, so lagging inflation significantly. Whilst that certainly helps with the value proposition, it will impact margin. Plans are to declare a dividend of at least 7p per share, with FY results due in December.
