Here are three things you need to know in the financial markets this morning from investment writer, Tony Cross.
#1. Loungers optimistic and continues growth
Bar and restaurant operator Loungers [LON:LGRS] has published full year results today for the 12 months to April 18th. Revenues are down by slightly more than 50% but the company notes it has significantly outperformed the market since the reopening of indoor dining in mid-May. The nine week period to July 18th saw sales almost 24% up on the 2019 comparable, with flexible office working seen as being one factor in helping drive traffic to the high street. In his usual and refreshingly pragmatic tone, the CEO notes that whilst there’s uncertainty as to what happens next, the business is looking ahead with confidence and is opening new premises at a rate of 25 per year.
#2. Next Plc raises profit forecast, repays rates relief
Next Plc [LON:NXT] has issued a trading statement noting that performance over the last 11 weeks has been materially ahead of expectations, leading the company to increase profit guidance for the full year. Full price sales for the period were up by 18.6% on 2019’s figure, whereas previous guidance had put this at just 3%. There’s an interesting CSR point here, too, with the company electing to repay business rates relief for the period shops were closed, which comes in at £29m. However a cash surplus of some £240m has now been accrued, which will be returned to shareholders via a special dividend. Moves like this can only strengthen calls for a different taxation model, namely one which proportionately hits online sellers – and that’s ultimately something which wouldn’t be of net benefit to Next.
#3. Wickes Group sales leap up
Hardware store group Wickes [LON:WIX] has published a trading update for the 26 weeks to June 26th this morning. This certainly paints an interesting picture, perhaps most notably in the do-it-for-me market of bathroom and kitchen fit-outs. In line with the reopening of non-essential retail, Q2 sales jumped a staggering 187.5% percent against the number seen a year earlier, underlining that pent-up consumer demand. First half guidance of £45m pre-tax profits remains unchanged.
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