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Beer mats at the ready for JD Wetherspoon update

Wednesday is also due to see results from British Land, SSE and Talktalk and updates from Taylor Wimpey and Spirax-Sarco

JD Wetherspoon -

Shareholders at pub chain JD Wetherspoon PLC (LON:JDW) will be hoping for a cup half-full when it releases a trading statement on Wednesday, amid politically-charged times for the group.

In September, the firm said that profits dipped 4.5% to £102.5mln due to costs rising in the first half of the year, despite like-for-like sales rising almost 7% in the period.

The firm is facing a backlash at the moment from influential shareholder advisory group Pirc, which urged investors yesterday to oppose JD Wetherspoon’s financial report over its failure to get shareholder approval for pro-Brexit spending.

The referendum campaign spending included £94,856 on almost 2mln pro-leave beer mats ahead of the 2016 vote.

‘Spoons has also previously cited costs rising with staff wages on the increase as it looks to recruit and retain workers amid an increasingly tight jobs market.

How will British Land follow rival

Real estate investment trust British Land’s half-year results were foreshadowed by those from FTSE 100 rival Land Securities a day earlier.

While REITS have been hit by retail woe and Brexit worries in recent years, they have been even more jittery this season after a profit warning from shopping centre owner Intu, which said like-for-like rents are falling this year due to high street shops going bust.

The sort of company voluntary arrangements (CVAs), the measure employed by troubled companies to redraw contracts in a bid to stay afloat, that hit Intu also have the potential to hit profits at British Land.

Swiss bank UBS says both big REITS are looking to sell out of retail with disposals set to continue, noting that British Land will be particularly squeezed by a possible £10mln hit to rents from CVAs, and steep 11-13% declines in its retail assets.

A day earlier LAND boss Rob Noel said: “We expect the retail market to remain challenging as it continues to be impacted by structural change,” adding that the “storm” in retail had become “voracious”.

Investors eye Ovo deal updates from SSE

In its half-year figures on Wednesday, investors in SSE PLC (LON:SSE) will eye updates around the energy firm's planned sale of its retail arm to the UK’s largest independent supplier, Ovo Group, in a £500mln deal that was announced in September.

The acquisition is expected to complete late this year or early next year, so any further clarity on the timing will be watched closely, as well as by how much SSE’s net debt will be reduced by the proceeds from the sale.

Another important factor will be the group’s full-year dividend, which was indicated to be held at 80p per share in a July trading update despite what SSE said were “short-term challenges” in the early months of its current year.

Full-year expectations were also reiterated in July despite lower output from renewable energy in the first quarter, but with SSE planning to shutter its last coal-fired power station, Fiddler’s Ferry, next March, investors will be hoping green energy output will be able to make up the difference.

Will Taylor Wimpey whimper over UK politics?

Taylor Wimpey PLC (LON:TW.) will issue a trading update for Wednesday, with all eyes peeled for any comments from the housebuilder referring to political uncertainty affecting recent trading, pricing and cancellation rates.

Another interesting point will be cost inflation, which the company set at 5% earlier in the year, higher than its peers ranging between 3% and 4%.

The builder reported in its July interim results a strong sales rate and healthy forward order book, with 87% of sales secured for 2019, although it expected a slightly higher weighting to profits in the second half.

All Talk?

Talktalk Telecom Group PLC (LON:TALK) is due to report first-half results a few months after reporting strong demand for fibre broadband in the first few months of its financial year.

The company, which operates in a highly competitive market up against larger rivals BT Group, Virgin Media and Sky, said in July that revenue rose 1.3% in the first quarter with on-net revenue up 2.6%, as 70% of new customers took fibre in the three months to the end of June.

Management reiterated full-year guidance of strong underlying earnings (EBITDA) growth, underpinned by “accelerated fibre penetration” and cost reduction plans.

The analyst consensus is expecting underlying revenues of £389mln in the second quarter, implying flat growth.

First-half EBITDA is expected to be up 9% to £110mln including costs from the FibreNation joint venture that was set up a year ago, with the City number crunchers pencilling in £258mln for the full year.

Analysts at UBS noted that these figures are on an IAS17 accounting basis and TalkTalk is switching to IFRS16, for which there was not yet a consensus estimate.

“There will be no commentary on net adds, but we think TalkTalk is seeing continued moderate losses in its broadband base in a competitive UK market,” the UBS analysts added, expecting a confirmation of guidance.

Significant announcements on Wednesday 13 November:

Interims: British Land PLC (LON:BLND), SSE PLC (LON:SSE), Talktalk Telecom Group PLC (LON:TALK), Renold PLC (LON:RNO), Speedy Hire PLC (LON:SDY), Biffa PLC (LON:BIFF), Wincanton PLC (LON:WIN), Wizz Air Holdings PLC (LON:WIZZ), Workspace Group (LON:WKP)

Finals: Avon Rubber PLC (LON:AVON), BBA Aviation PLC (LON:BBA),

Trading statements: Taylor Wimpey PLC (LON:TW.), Tullow Oil plc (LON:TLW), JD Wetherspoon PLC (LON:JDW), Smiths Group PLC (LON:SMIN), Spirax-Sarco Engineering PLC (LON:SPX), OneSavings Bank PLC (LON:OSB), Valeura Energy PLC (LON:VLU)

AGMs: Hays PLC (LON:HAS)

Economic announcements: UK and US inflation

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