Three things you need to know as the UK financial markets open, from Tony Cross.
#1. Ashtead revenues up, but profits dip
Plant hire specialists Ashtead LON:AHT published Q1 earnings this morning, noting a 7% increase in rental revenues, but a 2% decline in operating profits. Management note that involvement in a growing number of mega projects in the US is offsetting lower levels of activity in local construction markets. As expected, lower used equipment sales and higher interest costs are also impacting profitability. Will investors buy this, or will the fact that the CFO intends to stand down next year overshadow sentiment at the open?
#2. Watches of Switzerland sees demand outstripping supply
Watches of Switzerland Group LON:WOSG has issued a trading statement for the first 18 weeks of the financial year, noting performance in line with expectations and the company being on track to deliver against FY25 guidance. Demand continues to outstrip supply in the UK and US markets, arguably telegraphing a message of confidence regarding the luxury goods sector, although management do concede that US growth is likely to be second-half weighted.
#3. Ryanair posts bumper passenger figures for August
Ryanair [LON:0RYA] has issued a brief note regarding traffic figures for August, stating that a new record has been achieved with some 20.5 million guests being carried during the month. This is just a traffic update however so won’t provide any real context against the profit warning the budget airline issued at the end of July. This was driven by fare-cutting in a bid to fill planes, but is clearly damaging to margins. Any bump here needs to be treated with caution.