Three things you need to know in the financial markets today from investment writer, Tony Cross.
#1. M&S profits jump but Ocado drags
Full year results from Marks & Spencer LON:MKS are out today. The headline is of strong results as the company reshapes for growth, but that feels like a somewhat perpetual theme. On a statutory basis however pre-tax profits are up by just over 20%, and perhaps the stand out point is that the company’s investment into Ocado has been responsible for £29.5m worth of losses, reversing a £13.9m profit contribution a year ago. Whilst no dividend has been declared, the company indicates that this will be resorted from November.
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#2. Kingfisher: modest decline in Q1 sales, FY targets intact
Kingfisher LON:KGF has a Q1 trading update out, with like for like sales down 3.3% but the company reporting improved trading conditions since the start of April. Full year guidance has been reiterated and management remain comfortable with consensus market expectations of pre-tax profits of £634m for the full year, adding that they are controlling costs well and are on track to reduce inventory levels across the year.
#3. SSE: despite record CapEx, bumper dividend payments
Full year results from the utility provider SSE LON:SSE are out today, leading with record levels of capital expenditure. Buoyant energy prices have however been incredibly flattering to the numbers with adjusted pre-tax profits as close as doubling to £2.2 billion and shareholders benefitting from a 12.9% increase in dividends to reflect inflation – presumably the most management felt they could reasonably defend given the economic backdrop. However, the fact that the windfall tax applicable to the business is a mere £43.8m – admittedly covering only a quarter of the year – is again likely to be the headline grabber.
