Three developing stories at the UK stock market open.
1. Shift in strategy fails to buoy HSS for now
It’s a useful barometer of the wider economic health of the country, so a full year trading update from HSS LON:HSS this morning is worth covering as the company pivots its structure and also shifts its financial year by three months. Headline revenues on a like for like basis fell by 2% whilst margins were also squeezed, attributed to a change in the sales mix and more re-hire business. Net operating costs were also higher and although this all points towards a more focused entity, the headline numbers may make for a tough amongst investors.
2. Dividends hiked for a 32nd consecutive year at Bunzl
Distribution and services group Bunzl LON:BNZL served up full year numbers this morning with revenues flat, adjusted operating profits up 3.4% and an 8.2% increase in the dividend – the 32nd consecutive year the shareholder return has been upped. Slight volume growth and easing inflationary pressures were noted, whilst operating margin improvements were also seen. Despite economic uncertainty, forecasts are for further revenue growth in FY 25, with operating margins stable and holding well ahead of pre-pandemic levels.
3. Management look to narrow discount to NAV at HICL
HICL Infrastructure [LON:HICL] published an interim update and capital allocation update today with headlines including a further £100m share buyback and a divestment target of more than £200m for the coming year as management attempt to tackle the fact that the stock continues to trade at a significant discount to NAV. Target dividends remain on track.
