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Next, Imperial Brands and AG Barr in line for coming week, UK GDP and US non-farms dominate macro diary

Monday next week will also see another easing of the UK's lockdown restrictions, allowing groups of six people or two households to meet outdoors

Imperial Brands - Next, Imperial Brands and AG Barr in line for coming week, UK GDP and US non-farms dominate macro diary

The coming week will be a shorter one for the UK as Good Friday kicks off the long Easter weekend.

With this in mind, the company diary is also a little quieter than it has been the last few weeks, although there will still be appearances from some big names including clothing retailer Next, cigarette maker Imperial Brands and Irn-Bru maker AG Barr.

On the macro front, while many in the UK will be celebrating the end of the UK’s stay at home order on Monday as lockdown restrictions ease again, the data experts will be poring over a number of key announcements including the UK’s GDP and the US non-farm payrolls data.

Imperial Brands strategy in focus

Tobacco firm Imperial Brands PLC (LON:IMB) is due to release a first-half trading update on Tuesday, where the firm is likely to look to build on its figures from last autumn where it met its previously lowered expectations for profits and dividends while improving cash flow.

The update will also be a chance for new boss Stefan Bomhard, who took over last July, to update investors on the company’s five-year strategy unveiled in January, which is focusing on improving the company’s next-generation products division as well as developing its business in Africa and improving operations in its core markets of the USA, Germany, the UK, Australia and Spain.

Another focus will be the company’s full-year guidance, which is currently set at low-to-mid single-digit growth in underlying, adjusted operating profit, as well as on ongoing reduction in net debt.

AG Barr looks to keep numbers fizzing

Irn-Bru maker AG Barr PLC (LON:BAG) started 2021 with a pop after upgrading its profit expectations for the current year, so the company’s final results on Tuesday are unlikely to contain any nasty surprises in the numbers beyond what has already been flagged.

In the year to January 24, 2020, the firm said its revenue is estimated to come in at £227mln, 11% below the prior year’s levels.

However, the company also noted that January’s lockdown measures had impacted its sales into 2021, so the outlook statement as well as how the firm plans to recover from the pandemic will be watched closely for how it sees the immediate post-COVID era panning out.

Pennon lets update flow

A trading statement from Pennon PLC (LON:PENN) on Tuesday, now describing itself as an environmental infrastructure group since the disposal of Viridor, is unlikely to get the pulses racing.

The water company said in its half-year results it had significant funds available of £2.7 billion and that it is working extensively to narrow down the potential opportunities.

Since then, nothing of consequence has been heard from the company but some companies have a propensity to announce acquisitions along with their results statement so acquisition news is not beyond the reals of possibility.

With that amount of cash on the balance sheet and the shares regarded as an income play, it was little surprise that the board elected at the interim stage not to join those companies suspending dividend payments during the pandemic.

The company’s policy is to increase the divi by two percentage points above the annual increase in the consumer price index with housing costs (CPIH).

Topps files

Topps Tiles PLC (LON:TPT) is expected to put out a half-year trading update on Wednesday, following up on a January statement where the retailer said sales in the first 13 weeks of its financial year had risen 20% year on year, with growth from both professional fitters and homeowners.

Management predicted sales would be hit during the latest lockdown, though, with trading margins under pressure due to the extra costs of delivering online orders.

While tiles and associated products are building materials so can continue to be sold under the building supplies exemption, customers can only access the trade counter or buy online.

The tiles retailer said that its commercial clients were seeing a slower recovery compared to the repair, maintenance & improvement market.

“The group is much better placed compared to last spring, helped by its high trade customer mix (who browse less), online strength, ‘COVID-ready’ operations and net cash position with around £60mln of liquidity headroom," said house broker Liberum.

The shares are down around 16% from where they were before last year’s coronavirus crisis sell-off.

Next up

Next PLC (LON:NXT) releases full-year results on Thursday looking to maintain its reputation for under-promising and over-delivering.

Pre-tax profit for the year to the end of January is expected to be £342mln, down from £728mln the year before but not a bad result at all considering the various lockdowns retailers endured.

Having raised guidance on more than one occasion last year analysts will be wondering if Next’s boss, Lord Wolfson, will repeat the trick again. Back in January, he was predicting minimal year-on-year change in sales but a recovery in profit to £670mln.

The retailer is one of those companies that has suspended dividend payments and the market will be keen to learn whether the board is ready to indicate when pay-outs might resume.

Analysts at RBC seem to be upbeat about the company’s prospects ahead of the results, upgrading their rating on the stock to ‘outperform’ from ‘sector perform’ on March 26 as well as upping their target price to 8,800p from 8,100p.

Macro matters

The coming week will see a further easing of restrictions in the UK, with England’s stay at home rule ending on Monday, with groups of up to six people or two households allowed to meet outdoors as well, as well as outdoor sports such as football and cricket.

In terms of macroeconomic data, the week starts off quietly but as it segues from March into April the giant wheel economic data turns again, bringing new PMI manufacturing surveys on Thursday and non-farm payroll (NFP) numbers on Friday, when the UK will be among the many countries enjoying the start of the Easter long weekend.

On Wednesday, the UK Office for Statistics will publish a revised estimate of the latest quarterly GDP data, looking back to the final quarter of last year.

“The pandemic will continue to remain in focus, amidst rising global case numbers in recent weeks, while the blockage in the Suez Canal will also receive much attention,” said analyst Jonathan Jayarajan at Deutsche Bank.

Rising coronavirus case numbers in recent weeks have led to increasing concern among investors, Jayarajan said, noting fresh restrictions in multiple countries, with Germany’s lockdown extended until mid-April 18 and France’s extended to further regions.

As for the US jobs data, Deutsche’s economists are expecting a 675k increase in NFPs in March, which would be the strongest monthly job growth since October, with the unemployment rate predicted to fall to a post-pandemic low of 6.0%.

The March PMIs flash data from mid-month was “incredibly strong”, says Jayarajan, with numbers for Germany and the euro area coming in at all-time highs and the US also decent.

“An interesting question will be whether the strength in the price gauges we saw in the flash PMIs will be reflected in other countries too, since that would add further support to the idea that inflationary pressures are building in multiple regions.”

Significant announcements expected for week ending 2 April:

Monday March 29:

Finals: Digitalbox Holdings PLC (LON:DBOX), Dev Clever Holdings PLC (LON:DEV), Globaltrans Investment PLC (LON:GLTR), Impact Healthcare REIT plc (LON:IHR), Quixant PLC (LON:QXT), Ten Entertainment Group PLC (LON:TEG)

Economic data: UK house prices, US Dallas manufacturing index

Tuesday March 30:

Trading announcements: Imperial Brands PLC (LON:IMB), Pennon Group PLC (LON:PNN), 3I Group PLC (LON:III)

Finals: AG Barr PLC (LON:BAG), Animalcare Group PLC (LON:ANCR), Central Asia Metals PLC (LON:CAML), Chesnara PLC (LON:CSN), Dialight PLC (LON:DIA), EKF Diagnostics Holdings PLC (LON:EKF), Michelmersh Brick Holdings Plc (LON:MBH), Real Estate Investors PLC (LON:RLE), S&U PLC (LON:SUS), Silence Therapeutics PLC (LON:SLN), Yu Group PLC (LON:YU.)

Interims: Nanoco Group PLC (LON:NANO)

Wednesday March 31:

Trading announcements: Topps Tiles PLC (LON:TPT)

Finals: Gulf Keystone Petroleum Ltd (LON:GKP), Tricorn Group PLC (LON:TCN), Inspired Energy PLC (LON:INSE)

Interims: Gattaca PLC (LON:GATC), James Halstead PLC (LON:JHD)

Economic data: UK GDP, US ADP jobs, US Chicago PMI

Thursday April 1:

Trading announcements: Renew Holdings PLC (LON:RNWH)

Finals: Next PLC (LON:NXT), Equiniti Group PLC (LON:EQT), Sportech PLC (LON:SPO)

FTSE 100 ex-dividends to knock 2.12 points off the index: Smith & Nephew PLC (LON:SN.), Taylor Wimpey PLC (LON:TW.), Melrose Industries PLC (LON:MRO), Phoenix Group Holdings PLC (LON:PHNX)

Economic data: UK manufacturing PMI, US jobless claims, US manufacturing PMI

Friday April 2:

Good Friday, UK market closed

Economic data: US non-farm payrolls

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