Berkeley Group Holdings PLC (LSE:BKG) has had a good run over the last few years but having come through Covid relatively unscathed a few more headwinds are starting to blow.
The London and south-east builder will have to deal with a rising interest rate environment for the first time in years, cladding remediation remains an unknown while material and staffing costs are rising.
Berkeley raised its annual guidance by 5% with its interims and brokers are pencilling in £544mln against £518mln for the full year, something likely to be reiterated at this third-quarter update.
In December, the group also reaffirmed its commitment to returning £282mln per year to shareholders up to 30 September 2025 and that any surplus cash would also be handed back and it would be a major shock if that too is not underlined.
There will also be plenty of macro data on Friday, including the UK gross domestic product (GDP) estimate for January from the Office for National Statistics.
The IMF decreased its UK 2022 GDP growth forecast to 4.7% from 5.0% in its most recent January forecast, while the Office for Budgetary Responsibility predicts 6% GDP growth this year.
Last year GDP rebounded by an estimated 7.5% following the 9.4% fall in 2020 when the pandemic sent shockwaves across the global economy.
“The UK economy is expected to have shown signs of a bounce back from the Omicron effect when the latest growth numbers are released, but there are concerns that the conflict in Ukraine could weigh on the economy going forward,” said Susannah Streeter, senior investment and market analyst Hargreaves Lansdown.
“The indications are that the invasion and sanction repercussions are more likely to add to inflationary pressures by more than it reduces growth, so the Bank of England is still expected to raise rates at the next policy meeting.
“These latest numbers will shine a light on just how robust the UK economy is to survive a fresh period of uncertainty and price pressures,” Streeter added.
Significant announcements expected
Finals: Sig PLC
Trading announcements: Berkeley Group Holdings PLC (LSE:BKG)
AGMs: Hardide PLC (AIM:HDD), Myanmar Investments (AIM:MIL) International Ltd
Economic data: University. of Michigan Confidence Prelim (US)