Three things you need to know in the financial markets today from investment writer, Tony Cross.
#1. Ocado: losses mount for online retailer
Full year results from online grocer Ocado LON:OCDO are out today, noting solid expansion of the company’s footprint in the last 12 months with 12 new partner sites having been opened. However, retail revenues are down 3.8% with the company facing a challenging set of geopolitical and macroeconomic headwinds. Management note that the UK JV with Marks & Spencer has been resilient to higher costs and smaller basket sizes, although headline losses have jumped from £177m to £500m year-on-year.
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#2. Serco shareholders set for 19% divi uplift
Outsourcing specialists Serco LON:SRP also have full year numbers out, with revenues some 2% higher. However, that also accounts for some £480m worth of COVID related work so stripping this out pushes revenues some 11% higher on a constant currency basis. The order book is up by 8% and shareholders are set to receive a 19% uplift in dividends, despite management conceding that they had to increase salaries faster than planned to account for rising living costs. A £90m share buy-back is underway and guidance for 2023 is unchanged.
#3. AO’s full year profit forecast upgraded
There’s a trading update out from the white goods distributor AO World LON:AO. today. The company notes that initiatives to reduce costs and improve margins are playing out, leading management to revise EBITDA for the full year to come in higher than previously forecast at between £37.5m and £45m. Last estimates had this figure at £30m to £40m. A full year post close statement should be issued at the end of April.
