Thursday will see trading updates from two housebuilders with a bit of reputational damage to repair: Bovis Homes and Persimmon.
For Bovis, the challenge is to grow margins while addressing the issues that saw it get a reputation for shoddy standards.
Feedback from the May 24 capital markets day for investment analysts indicated that management is now more confident on the margin improvement it is expecting from a new range of house types.
The day after the capital markets day a report from Liberum said “the visit yesterday gives confidence that planned benefits will be delivered and even hints at outperformance against published targets,” so the update may contain some good news for Bovis shareholders.
Bovis's erstwhile chief executive (CEO) David Ritchie walked the plank at the beginning of last year following a profit warning and for a while, it looked like Persimmon's extravagantly remunerated CEO, Jeff Fairburn, might also head for the exit this year at the height of the outrage over his record-breaking bonus scheme.
In the end, it was chairman of the board Nicholas Wrigley and Jonathan Davie, chairman of the remuneration committee, who took the hint when a metaphorical loaded revolver was passed around with the port and brandy.
Persimmon said in April it had seen robust trading this year, with forward sales revenue, including completions, up by about 8% to £2.76bn in the year to date.
Average selling prices for its homes rose to £236,500, up from £229,500 a year earlier, as the company said that pricing conditions remain firm across its regional markets.
“There has been a notable fall in activity in the London market and investors will want to hear if this is impacting on the rest of the country. By looking at their peers, one would say no, but a more cautious stance to land and plot acquisition strategies could be taken by management given the number of macro-economic uncertainties,” suggested Graham Spooner, an investment research analyst at The Share Centre.
Purplebricks and the good ol' red, white & blue
Investors in online estate agent Purplebricks will be hoping for good news from the firm following its recent announcement that it is expanding its US presence into Las Vegas and Phoenix after previous launches in New York and California.
The firm received a boost to its US expansion plans in late March when German digital publisher Axel Springer purchased an 11.5% stake in the company for £125mln.
However, there will also be caution around a slowdown in the UK property market and if it has impacted the company’s balance sheet, particularly following the adverse weather in February and March of this year.
Primark’s US progress eyed at AB Foods
Another UK company increasingly looking across the Atlantic is Associated British Food.
Despite the name, Primark stores are the group's star assets, and the discount fashion chain will be the focus again in Thursday’s third-quarter trading update.
Even without an online presence, Primark’s low prices and wide offering mean sales are holding up pretty well during a difficult time for many bricks-and-mortar retailers.
UBS analysts reckon like-for-like sales will dip by 1%, albeit against some strong comparatives while the recent good weather could see that figure improve.
Investors will be looking for any commentary surrounding Primark’s roll-out in the US. It currently only has eight stores across the pond but the potential is massive, so any signs that the brand is gaining traction there is likely to be cheered.
Away from Primark, sugar is the only other division likely to move the dial. Prices are falling though, which is likely to pressurise the bottom line once again.
SuperDry unlikely to provide surprises
Appealing to a different demographic to Primark is UK fashion retailer SuperDry, which will deliver its full-year results on Thursday with analysts saying it is unlikely to provide any surprises since the company has already provided guidance.
The group expects a pre-tax profit of £96.5mln to £97.5mln, up 11% year-on-year.
Analysts believe the focus will be on any comments about current trading, brand performance and the balance sheet.
Significant announcements expected
Trading updates: Associated British Foods plc (Q3) (LON:ABF), Bovis Homes Group PLC (Q2) (LON:BVS), Persimmon PLC (H1) (LON:PSN), Empiric Student Property PLC (LON:ESP)
Finals: SuperDry PLC (LON:SDRY), Purplebricks PLC (LON:PURP)
Ex-dividends: To clip 0.55 points off FTSE 100 index - Next Plc (LON:NXT)
Economic data: Halifax UK house price index; US weekly jobless claims; US Challenger job cuts;; US ADP employment; US ISM non-manufacturing; US services PMI; US composite PMI; FOMC meeting minutes