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Burberry and Thomas Cook in the spotlight; ex-divs to take 26 points off the FTSE 100

Numbers from Countryside Properties, National Grid, and Wincanton will also be among Thursday's highlights.
Burberry store
Burberry has guided to broadly stable revenue and adjusted operating margins along with cost savings of £100mln

There are a number of fairly high profile announcements due on Thursday, though the FTSE 100 will need a bit more if it is to overcome the lumpy 23.6 point ex-div dent that’s due to come into effect as trading begins.

Tisci’s collection to steal the show in Burberry finals

Burberry Group plc (LON:BRBY) has been trying to take the brand more upmarket, having brought in former Givenchy designer Riccardo Tisci as its new chief creative officer to lead the change.

The fashion group released Tisci’s debut runway collection to stores in February. By May, all product deliveries will be his designs.

However, any sales uplift from the collection will fall outside results for the year to March 31.

Ahead of the results on Thursday, the company has guided to broadly stable revenue and adjusted operating margins along with cost savings of £100mln.

“With the new collection from Riccardo Tisci hitting the shelves only at the end of fiscal Q4, we expect another relatively muted set of results,” UBS said.

The investment bank predicts fourth quarter organic sales growth of 3%, comprising a 1% like-for-like rise, flat underlying space and a +1% positive impact from retail calendar adjustments.

For the second half of 2019 it assumes flat underlying total sales of £1.5bn, EBIT of £262mln, a 175 basis points drop in the margin to 17.4% and earnings per share of 48.8p.

“The market will likely be closely watching out for any commentary on the performance of Tisci's collection in store and any further signs of the turnaround being successful,” UBS said.

Thomas Cook to update on sale of airline, funding plans

In the travel sector, the market will likely compare the first half results of Thomas Cook Group PLC (LON:TCG), TUI AG PLC (LON:TUI) and On The Beach Group PLC (LON:OTB).

Analysts expect Thomas Cook to have racked up a hefty loss when the struggling travel group reports its results on Thursday. UBS expects to see an underlying loss of around £167mln for the first six months of its financial year, wider than the £127mln loss it posted this time last year.

Declining profitability in the Nordics and continental Europe is forecast to be the main issues, while the later timing of Easter, currency headwinds and higher fuel prices will also likely weigh on the bottom line.

The numbers are likely to play second fiddle though. Investors will be more interested in an update on the proposed sale of the airline, which Lufthansa is looking at.

Reports last week suggested that a £400mln funding from lenders might also be announced alongside the results, and bosses recently confirmed they were in talks with their banks.

Another point of interest will be the latest trends in bookings and pricing for the key summer period.

Countryside Properties investors hope for more of the same

Having reassured investors that it would full-year guidance after a recovery in its second quarter, Countryside Properties will be hoping to avoid any more changes at its interims on Thursday.

In March, the housebuilder’s modular timber frame factory in Warrington started full production and is set to deliver about 500 homes in the current financial year, so shareholders may be eyeing any possible upgrades that could come from the expanded production.

Some may also be on the lookout for news on the search for a new chief operating officer after incumbent Rebecca Worthington stepped down in April after four years at the firm.

Significant events expected on Thursday May 16:

Finals: Burberry Group PLC (LON:BRBY), National Grid PLC (LON:NG.), Wincanton PLC (LON:WIN)

Interims: Thomas Cook Group PLC (LON:TCG), Countryside Properties PLC (LON:CSP), Euromoney Institutional Investor PLC (LON:ERM), Grainger PLC (LON:GRI)

AGMs:  Lloyds Banking Group PLC (LON:LLOY), Belvoir Lettings PLC (LON:BLV), Next PLC (LON:NXT), Premier Oil (LON:PMO), Prudential PLC (LON:PRU), G4S PLC (LON:GFS)

Ex-dividends to knock 23.6 points off FTSE 100 index: GlaxoSmithKline PLC (LON:GSK), HSBC PLC (LON:HSBA), Intertek Group PLC (LON:ITRK), Tesco PLC (LON:TSCO), Royal Dutch Shell PLC (LON:RDSA)

Economic data: US weekly jobless claims; US housing starts; US Philly Fed manufacturing index


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