We give our thoughts on what to expect from companies announcing results week commencing 1 March 2021.
Companies reporting w/c 1 March
Bunzl Plc: Q4 2020 Earnings Release
The share price has eased back recently, probably on the recent strength of the pound. The company provides a variety of everyday products ranging from disposable cups, safety equipment, napkins, cleaning & hygiene supplies to food packaging. It operates in over thirty countries and the majority of revenue comes from outside the UK, with the US contributing around 56% of revenue. The group continues to benefit from increased demand for Covid related products such as masks, hand sanitisers and gloves.
Ashtead Group Plc: Q3 2021 Earnings Release
Shares in equipment hire group Ashtead have been among the strongest in the FTSE 100 over the past year, rising 55% in that time. The last trading update, a second quarter statement in December, impressed the market as it showed results ahead of expectations. Revenues and profits still fell back slightly in the first half, but the company maintained its dividend and has clearly benefited from being designated as an essential business in its key markets. In December Ashtead said full-year figures would be better than it had previously forecast and investors will want to hear if that remains the case along with what prospects the company sees as restrictions are gradually lifted over the next 12 months.
Intertek Group Plc: Q4 2020 Earnings Release
The slowing down of global trade flows due to Covid-19 is likely to be the explanation for the group's expected decline in sales and profits – however, this is only expected to be a marginal fall. Ultimately its business is defensive in nature while increased needs of safety and hygiene are likely to keep management bullish for the medium to long term. It is an acquisition focused company so investors will be keen to find out how businesses are being integrated and whether there is further potential for more.
Flutter Entertainment Plc: Q4 2020 Earnings Release
Flutter, previously created by the merger of Betfair and Paddy Power, have gone from strength to strength throughout the lockdown period as punters turned online to bet on live sport. In the Group's Q3 update back in November the Group announced an increase in revenues of around £300m compared to the previous year as a result of higher customer volumes across all segments. The Group are continuing to expand in the US too where the legal unwinding of online gambling is proving to be a big opportunity.
Taylor Wimpey Plc: Q4 2020 Earnings Release
Interesting times for the housebuilding sector as the good trading it is has seen in recent months is now facing a number of challenges. In January, Taylor Wimpey said it had returned to normal levels of production capacity towards the end of 2020 and forecast that these full-year figures would be in line with market expectations. Investors will be looking for any change in the outlook for dividends. The company said previously it would announce a final dividend, but this year’s special dividend will have to wait for consideration next year. If the recent rumours that the Chancellor is planning to announce a 3-month extension of the stamp duty holiday to the end of June in his upcoming Budget are true, that would provide a useful boost for the sector. Fellow housebuilder Persimmon reports full-year figures the following day.
Prudential Plc: Q4 2020 Earnings Release
2020 will have been the first full year in its new structure and being an Asian focused life and asset management company. The first half was impacted materially by the outbreak of the virus, but the second half should have been better as the Asian countries emerged out of the crisis earlier. Investors will hope for some good news on the dividend which were cut back due to the pandemic, but they should not get their hopes too high since Prudential is keen in invest further in Asia for growth. Updates on the Jackson life IPO will be anticipated.
Persimmon Plc: Q4 2020 Earnings Release
After what has been a difficult year Persimmon have displayed resilience throughout with strong H2 completions and supportive demand following favourable government cuts which resulted in top-line revenue for the Group's last update exceeding estimates. Should the economy recover in an orderly fashion, Persimmon should continue to see demand as uyers return to the market with confidence, combined with the fact that low interest rates provide an attractive mortgage market which overall supports the general upbeat view on the housebuilder.
Avast Plc: Q4 2020 Earnings Release
The Czech group is one of the few major tech companies listed in the UK and it did relatively well from the vast numbers of people now working from home and needing additional security on their computers. However the shares have stalled since the summer on
questions of how well it is monetising its freemium business model. The return of people potentially back into places of work also takes away some of its attraction. Investors will hope to see the debt come down in this update.
Rentokil Initial Plc: Q4 2020 Earnings Release
The company operates in over 80 countries, with the largest revenue coming from North America. The group intends to focus on its pest control business, which has been performing well and accounts for over two thirds of profits. It is also involved in washroom hygiene and interior landscaping. Increased demand for hygiene products and associated services have benefitted the group over the crisis.
Admiral Group Plc: Q4 2020 Earnings Release
A drop in the number of claims from drivers during lockdown and lower than expected costs from claims made in previous years helped Admiral to beat market expectations with its interim figures last August. The market will be interested to see if the same factors have provided a similar boost to the second half. The company rather mistimed the relaunch of its travel insurance products last summer, but investors will be hoping they benefit once restrictions are eased later this year. Any comments on the position of arrears in its loans business will also be worth noting, and investors will be looking for further details of the return of capital resulting from the sale of the company’s price comparison businesses to Zoopla in December.
CRH Plc: Q4 2020 Earnings Release
Building materials group profitability is strongly linked to the health of the global economy, in particular the US and European housing and construction activity. The group has a strong balance sheet with good cash generation. As a result of the crisis governments may decide on a further fiscal push which could see a boost to infrastructure spending for which CRH is well positioned to benefit. Any comment on the outlook for the year ahead will be worth noting.
All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.