Companies announcing their results next week

Graham Spooner, investment research analyst at The Share Centre, gives his thoughts on what to expect from companies announcing their results next week, the week commencing 11 December 2017.

Companies announcing their results next week

Monday

Photo-Me International (Q2 results)

This company is famous for its well-positioned photo booths along with a comparatively new venture into laundry machines. Trading so far this year has been in-line with expectations. It is likely therefore that from this update, investors will be concentrating on costs and new technology, along with its cash position and dividends. There may also be an update on forms of ID in Japan and the UK.

Tuesday

Ashtead (Q2 results)

It has been a stellar year for equipment hire group Ashtead with the shares comfortably outperforming the market. Last year’s strong trading carried on into the first quarter of the current financial year with rental revenue and profits both well up and boosted by the weakness of sterling. The market will be interested in how the main US business is performing, whether the capital expenditure on new equipment has carried on in the second quarter and what the management is now forecasting for the full-year figures. Expectations have been raised by a very positive trading update in October from rival United Rentals in the US.

Thursday

Bunzl (trading update)

The growth strategy at this support services company is based around acquisitions and updates of this kind are often accompanied with news of the latest. The group has a global presence so investors will be keen to hear about performance in individual regions and hopefully continued signs of resilience in its main markets. 

TUI (final results)

In September the company reiterated its previous guidance for a rise in full year earnings of at least 10% and said it now expected full-year sales to rise well above 3%. That was reassuring in the wake of the hurricanes and earthquakes which afflicted Mexico and the Caribbean in August. The market will be looking to see if the cruises and hotels operations are still performing strongly and whether the trend for holidaymakers to move away from Turkey and North Africa and towards the Western Mediterranean and Caribbean has continued. Demand in the UK has so far remained resilient but signs of weaker consumer sentiment will lead the market to focus on TUI’s performance in this country.

Economic Diary

Announcements for the w/c 11 December 2017:

12 December, UK consumer price inflation, November – Office for National Statistics

The UK inflation rate, looking at consumer prices, was unmoved in October, at 3.0%, against expectations of a modest rise. The falls in the pound seen after the EU referendum in 2016 have created one-off inflationary pressure. Sooner or later this effect will begin to ease, and indeed we may have seen inflation peak, with it set to fall back.  However, the pound also fell after the 2017 election, and this effect has yet to show up in the inflation data. After falling back either in November or soon after, inflation may see another modest rise later next year.

13 and 14 December, FOMC Two-day meeting, (December 12–13) – FED, Monetary Policy Committee meeting and minutes (14 December) – Bank of England and Governing Council of the ECB: monetary policy meeting in Frankfurt, (14 December) – European Central Bank

Of the three central banks covering the US, UK and Euro area, the Fed is the most likely to announce an increase in interest rates. After increasing them the last time it met, the Bank of England is unlikely to announce any change, although the minutes may hint at the likelihood of an increase in rates early next yet. However, the press conference accompanying the meeting of the ECB may be especially interesting. Recent purchasing managers’ indexes have pointed to the strongest growth in the euro area in many years, but also pointed to rising cost pressures.  The ECB may well choose to focus on cutting back on its quantitative easing programme.

14 December, retail sales in Great Britain, November – Office for National Statistics

Last month, the data revealed a 0.3% month on month increase in retail sales, but a worrisome 0.3% year on year contraction. Not that falling retail sales are surprising in an environment of falling real wages. But did Black Friday help boost sales? The latest data on retail sales from the BRC revealed a 0.6% year on year rise in sales, suggesting that Black Friday only had a modest effect.

Further announcements include:

12 December

  • UK house price index, November – Office for National Statistics
  • UK producer price index, November – Office for National Statistics

13 December

  • UK Labour market – Office for National Statistics
  • US consumer price index, November – U.S. Bureau of Labor Statistics
  • Residential market survey – Royal Institution of Chartered Surveyors

Past performance is not a reliable guide to future returns and tax rules can change over time. Please remember, no news or research item is a recommendation or advice to buy. Every Investor is not responsible for accuracy and may not share the author’s views. If you are unsure of the suitability of any investment for your circumstances please contact an adviser. All investments can fall as well as rise in value so you could get back less than you invest. 

 

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