It will be a busy day for the company diary on Wednesday, with several blue-chip firms slated to report before the US heads off for Thanksgiving on Thursday.
Companies range from DIY retailers all the way to utilities firms, although there will also be a showing from the FTSE 250 with TalkTalk reporting its interims.
In the economic calendar, there will be a trans-Atlantic shipment in the form of US consumer sentiment, home sales, and goods orders data while in the UK there will be the latest set of figures for public sector finances.
Some cheer needed for Kingfisher
Interim results from blue-chip DIY retailer Kingfisher in September provided little cheer and investors will be hoping for some positive comments from a third-quarter trading update from owner of the B&Q and Screwfix chains ahead of the all-important Christmas trading period.
The performance of the FTSE 100-listed firm’s troubled French DIY chain Castorama will again be a focus for the market, as will any update on the progress of the group’s long-term unification strategy.
There have been increasing calls for Kingfisher to split itself up with the French operations and Screwfix being separated out but so far under pressure CEO Véronique Laury has resisted.
Johnson Matthey to maintain growth expectations
Like many other industrial names, precious metals processor Johnson Matthey PLC’s (LON:JMAT) share price has been disappointing lately and investors will hope that the group’s interim results will see it maintain revenue growth expectations in the mid to high single digits.
In a preview, Graham Spooner, investment research analyst at The Share Centre said: “While the business is a leader in emissions technologies, for which it has been a beneficiary of increased regulations on emissions, it has a need to focus on the development of materials and chemicals for the revolution towards electric vehicles; this though will have a significant impact on research and development costs.”
New Sage boss should know his onions
One of the key focus for investors in FTSE 100-listed financial software provider Sage Group PLC (LON:SGE) when it reports full-year results will be that fact the performance of Steve Hare, the firm’s current interim COO and CFO who has been appointed as successor to departed CEO Stephen Kelly.
However, given that fact that Hare is an insider of the business and has been involved in the group's strategic direction, then investors should not expect too much of a deviation from Sage’s current strategies.
Investors will expect to see the group’s transition to subscription-based revenues continue to drive sales forward and become an ever more dominant part of Sage’s business model.
However, there has already been a slowdown in parts of the business this year, especially in Northern Europe and the MENA region.
Back with its interims in May, Sage downgraded its full-year organic growth rates to 7%-8%, while keeping its operating margin intact at 27.5%, although whether this can actually be maintained was met with doubt by analysts a short while ago.
Regulatory terms key for United Utilities
With the heavily structured and regulated marketplace for UK utilities it is quite rare for financial results in the sector, so when blue chip United Utilities Group (LON:UU.) reports on its third quarter the attention will be on the terms for the upcoming new regulatory business period.
UU gave the detail of its plan, which included a proposed £1bn cut to spending alongside a 10.5% reduction in the cost of the average bills for customers.
Share Centre analyst Graham Spooner, in a preview note, looked more closely at the quarter, and, said: “The warm summer resulted in additional costs in order to safeguard supplies and resources.
“Investors will be hoping that the concerns regarding regulators and politicians may be receding and that trading will be in line with expectations, leading to the share price and sector becoming less volatile.”
Can TalkTalk keep up the momentum in net adds?
Further away from the blue chips, FTSE 250-listed TalkTalk Telecom PLC (LON:TALK) has recorded six consecutive quarters of growth in its customer base since changing its strategy to focus on providing low-cost broadband.
In the first quarter, the group added 80,000 broadband customers on strong demand for its fixed low-price plans and said it remained “firmly on track to deliver at least 150,000 net adds this financial year”.
Investors will be hoping for more of the same when it reports its second-quarter results.
They will also be looking to see whether TalkTalk can improve customer churn and average revenue per user (APRU). Customer churn – the proportion of customers leaving the company – rose to 1.28% in the first quarter from an average of 1.22% last year. APRU fell to £24.65 from £25.10 but TalkTalk said it would stabilise in the first half.
Following the last quarterly update, analysts at Barclays said: “TalkTalk has suffered market share losses in the past few years, negative earnings momentum, and rising leverage; however, 12 months on from its strategy ‘reset’, we see a return to top-line growth with our/consensus earnings estimates seeming to have bottomed.”
Significant announcements expected:
Wednesday November 21:
Trading updates: Kingfisher PLC (Q3) (LON:KGF), Breedon Group PLC (LON:BREE)
Interims: Johnson Matthey PLC (Q2) (LON:JMAT), Talktalk Telecom Group PLC (LON:TALK), United Utilities PLC (LON:UU.), Babcock International Group PLC (LON:BAB), Biffa PLC (LON:BIFF), Creightons PLC (LON:CRL), Helical PLC (LON:HLCL), Liontrust Asset Management PLC (LON:LIO), Alpha Financial Markets Consulting PLC (LON:AFM), NewRiver REIT plc (LON:NRR), Syncona Limited (SYNC)
Finals: Sage Group PLC (LON:SGE), Marston’s plc (LON:MARS), Countryside Properties PLC (LON:CSP), Paragon Banking Group PLC (LON:PAG), SSP Group PLC (LON:SSPG), Cambria Automobiles PLC (LON:CAMB), C4X Discovery Holdings plc (LON:C4XD)
Economic data: UK public sector finances; US durable goods orders; US existing home sales; University of Michigan final consumer sentiment index