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We have a third quarter trading update from broadcaster Sky out this morning. This could be considered something of a moot point given the business sits in the midst of takeover wrangling but the solid growth in earnings – up 14% from a year earlier – certainly underline that the business appears to be pointing in the right direction. Heavy investment in Germany and Austria is weighing on margins locally, but this is seen as part of a turn-around program for the territory – it’s unlikely to detract from the bigger buy-out conversation.


More bad news from the high street by all accounts with half year numbers in from Debenhams. The company is making headway in digital sales but a disappointing Christmas drove discounting, in turn amounting to a 30% drop in EBITDA. Underlying earnings per share came in at just 2.8p – the bottom end of analyst expectations (although there were only two analysts covering) and the dividend has been halved. This isn’t a pretty picture and today’s departure of the Finance Director will likely do little to reassure investors.


Unilever may have brushed off a takeover bid just over a year ago, committing to do better for investors as a result and this seems to have been played out in today’s first quarter update. Underlying sales growth is up 3.4% on the same period last year, the dividend has been hiked 8% and there’s a share buyback program underway with the proceeds of the “spreads” business (they sold off their margarine division as part of the deal to placate shareholders. As a company, Unilever is typically seen as having a positive social impact – this isn’t reported in the results, but the fact they can do that and still improve performance is probably worthy of note.

Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Tony Cross

Tony Cross

Tony Cross is a market commentator with over 15 years of experience, producing compelling, insightful copy for journalists and investors alike. Focusing on macroeconomics, UK blue chip equities and inter market analysis, Cross's commentary is well regarded for its clarity and ability to cut through the waffle. He has been quoted in publications as diverse as The Financial Times, The Times, The Guardian and The Sun. He has also been a regular guest on both Share Radio and TipTV.


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