Finance Friday – a brief look at this week’s finance and investor news from around the UK
M&S has reported a 63.5% fall in pre-tax profits to £176.4 million in the current financial year. Much of the decline was due to one-off items, including the costs of store closures and shutting the company’s defined benefit pension scheme. Stripping out these items, adjusted profit still fell by 10.3%, to £613.8 million. Revenues in the ailing Clothing and Home division fell 2.8%, though M&S is now selling more of its stock at full price, rather than at a promotional discount. Food revenue grew by 4.2% thanks to new stores being opened.
Full year revenues of £1.1bn were up 7.2% at Halfords and 2.7% on a like-for-like basis. However, weaker sterling increased the cost of goods sold by £14m, hitting margins in the retail division and resulting in a 7.5% decline in profits before tax to £75.4m. The shares rose 0.9% following the announcement.
Shares in Revolution Bars are down a huge 36%, after the group announced that profits would be significantly behind expectations and in line with last year. The figures are being blamed on cost headwinds such as the living wage, minimum wage and apprenticeship levy that frankly the group should have seen coming a mile-off.
It was lift-off for Wizz Air, with the shares up 10.7% after the FTSE-250 listed budget airline delivered a record year. The outlook for next year is bright too, with profits set to be between €250-270m – higher than analysts had expected.
Shares in Petrofac are down 30%, after the group announced further details of the Serious Fraud Office investigation into its relationship with Monaco based company Unaoil. The group’s COO suspended and the group is devoting “significant resources” to the SFO investigation.
Pets at Home
For the 2016/17 financial year, Pets at Home revenues grew 7.2% to £834.2m. This was driven by a 1.5% increase in like-for-like sales and the opening of 15 superstores, 50 vet practices and 50 grooming salons. The results were broadly in line with analyst expectations and the shares were little moved on the news.
Kingfisher’s first quarter results caused a 6.7% drop in the share price, after it again detailed weak trading in France. There was further disappointment for investors, with the news that Chief Exec Véronique Laury’s transformation plan is facing difficulties. Savings of £500m have been targeted from simplifying stock across divisions, and reducing the number of suppliers to increase its buying clout.
Dixons Carphone has reported 9% growth in full year revenues, up 3% at local currency rates. Like-for-like sales rose 2% in the fourth quarter, despite the Easter weekend falling outside the period this year. The shares rose 3% on the news.
Pennon shares rose 1% following the announcement of full year results. Profits before tax of £250m are up 18.3% on the year before, with revenue broadly flat at £1.4bn.
Severn Trent has increased the 2016/17 full year dividend to 81.5p per share. The shares rose 2.1% on the news.