After a quiet Monday, things pick up a little bit on Tuesday with Bellway the first of two housebuilders releasing trading updates this week.
Bellway has already recently informed the market of some key metrics so there may not be many surprises.
The housebuilder said it completed the sale of 10,307 new residential dwellings – marking the first time it has ever topped 10,000 homes and a 6.9% increase on the 9,644 it completed last year.
Bellway estimated revenue growth of 16% to nearly £3.0bn after reporting £2.5bn the previous year. Brokers are tipping pre-tax profit of £641mln.
The operating margin is expected to dip to 22.0% from 22.3% as house price growth has eased.
Great news for residents living at Poplar's New Festival Quarter buildings. Developer Bellway has vowed not to pass on re-cladding costs to leaseholders. Warranty provider @NHBC has also agreed to contribute to costs. Full story @CNplus https://t.co/KtUcQXOUOp
— jack simpson (@CNJackSimpson) October 15, 2018
GDPR a challenge and an opportunity for dotdigital
Email marketing specialist dotdigital Group is now being styled as the operator of an “AI-driven omnichannel marketing automation platform”.
As with Bellway, much of the top-level stuff in dotdigital’s full-year results will already have been divulged in July’s trading update in which it reported £43.1mln in revenue plus adjusted underlying earnings in line with expectations.
Peel Hunt, which recently initiated coverage of the stock with a ‘buy’ recommendations, has pencilled in £9.9mln for adjusted profit before tax and adjusted earnings per share of 2.9p.
The broker is expecting dotdigital to provide more detail on performance in the fiscal year just ended.
“The big bear point between the last presentation and this one was GDPR [global data protection regulations], but once they said: ‘no material impact on either email volumes or recurring revenues from existing clients, following GDPR implementation to date’, the stock recovered; however, we would expect them to provide more details.”
Peel Hunt thinks GDPR may be a net benefactor for dotdigital, as its clients will need to ensure that their marketing communications are more relevant, targeted, and personalised, which would require them taking more of dotdigital’s products.
The broker also expects to receive more details about the Comapi integration and the new product launches it has made as a result of the acquisition.
It is also keen to learn more about progress with the relationship with Magento and other e-commerce platforms, plus the execution of its geographical expansion programme.
Jobs and wages
From a macroeconomic viewpoint, the UK unemployment figures and average earnings will be of interest.
"We’re likely to see another decent wage growth figure on Tuesday, confirming that skill shortages across the economy are pushing employers to raise pay to attract/retain talent. In fact, there’s a possibility that headline (ex. bonuses) wage growth nudges up to the symbolic 3% level," suggested Dutch finance house, ING.
Significant announcements expected
Trading update: Ixico PLC (LON:IXI), Merlin Entertainments PLC (LON:MERL)
Finals: Bellway PLC (LON:BWY), DotDigital Group PLC (LON:DOTD), Nanoco Group PLC (LON:NANO), Netcall PLC (LON:NET)
Interims: Gear4Music Holdings PLC (LON:G4M), BP Marsh & Partners PLC (LON:BPM)
Economic data: UK unemployment; UK average earnings; US industrial production; US JOLT jobs; US housing market index