It was a bloated week of financial reporting among London’s blue-chips - many performed well (or, at least, better than feared).
Naturally, we can see some clear themes - energy and oil and gas companies reap the benefits of soaring prices, for example, whilst consumer goods giants such as Reckitt Benckiser Group PLC (LSE:RKT, ETR:3RB), Unilever PLC (LSE:ULVR) and newbie spin-off Haleon PLC (LSE:HLN, NYSE:HLN) all seemingly able to pass on higher costs to consumers.
Miners were impacted by the falling prices of commodity goods, as well as global uncertainty and weather hitting production levels in some cases.
Across the pond, meanwhile, US tech firms like Meta and Alphabet, the Facebook and Google parents respectively, missed target.
Without further ado, here’s our rundown of the week's results.
Good: Unilever, Reckitt, Drax ...
Unilever, which is behind brands such as Dove and Knorr, beat underlying sales expectations, posting an 8.1% increase in the first six months of the year.
Previous targets were expected to be within 4.5%-6.5%.
As a result of its resilient performance, full-year sales growth is now expected to be above 6.5%, although the FTSE 100 company did not state the new forecasts.
Drax Group (LSE:DRX) boosted its underlying earnings by 21% to £225mln in the first half of the year, with the power station operator reiterating its expectations for full-year adjusted underlying earnings.
Analysts set expectations of £614mln earlier this month, with Drax forecasting EBITDA above this.
Coca Cola HBC AG (LSE:CCH) upgraded annual sales guidance thanks to robust demand for fizzy drinks despite rising costs.
The soft drink company beat expectations, with revenues climbing to US$11.3bn in the second quarter compared to the market consensus of US$10.5bn
Catering group Compass Group PLC (LSE:CPG) also posted a healthy set of results, raising its revenue forecast while maintaining its full-year profit margin target.
Revenues were expected to grow by 30%, but that forecast has now been raised to 35% following its third quarter results.
Reckitt, like Unilever, beat revenue expectations and also raised guidance for the year.
The consumer goods company successfully passed on costs to consumers, with the manufacturer of everything from Durex to Dettol upping revenue growth to somewhere between 5%-8%, up from 1%-4%.
Revenues grew 8.6% to £6.8bn in the six months to the end of June compared to the same period last year.
Lloyds Banking Group PLC (LSE:LLOY) lifted guidance after reporting income grew in the six months to June 30 by 12% to £8.4bn.
Analysts at Shore Capital now expect the high street bank to raise full-year profit before tax to £7bn from the current £6.82bn
GSK PLC (LSE:GSK, NYSE:GSK) previously expected full-year sales to increase by 5%-7%, but after a bumper second quarter, it now forecasts sales to increase by anywhere between 6%-8%.
Revenues in the second quarter were up 19% to £6.9bn, while adjusted operating profit grew by 22%.
Haleon, GSK’s health consumer goods spin-off, also reported strong numbers, and now expects the top line to grow between 6% and 8% this year, an increase in the range of 2%.
In its half-year trading statement, sales were up 13.4% to £5.2bn, although it did caution the impact of war in Ukraine would have a modest impact on margins.
Centrica PLC (LSE:CNA), the owner of British Gas, said the outlook for the full year “remains positive” as the group continues to reap the benefits of soaring energy bills.
Dividends, perhaps controversially given the cost-of-living crisis, were reinstated for the first time since the pandemic, as underlying earnings surged 143% in its half-year report.
However, the group did report an operating loss, largely due to remeasurements of derivative energy contracts and tax liabilities after the price of gas surged.
Shell PLC (LSE:SHEL, NYSE:SHEL), like Centrica, continued to benefit from soaring costs in oil and gas prices.
Income nearly tripled to US$18bn, with the company launching its share buyback programme, planning to give US$6bn back to investors before its third quarter results.
NatWest Group PLC (LSE:NWG) delivered a “strong” performance, according to chief executive Alison Rose, given the tough economic backdrop.
Profit remained steady in its interim results, with profit at £1.89bn, while overheads fell considerably in the six months to 30 June.
Income is expected to be around £12.5bn for the year, firming up on first quarter guidance which was above £11bn.
British Airways owner International Consolidated Airlines Group SA (LSE:IAG) returned to profit for the first time since the pandemic in the second quarter, although it still reported a pre-tax loss in the first half, although significantly reduced compared to last year.
Looking forward, it now expects to post a positive operating profit for the full year 2022, assuming there are no further COVID related setbacks.
Standard Chartered PLC (LSE:STAN) announced a US$500mln share buyback as the international bank announced pre-tax profits climbed by 8% in the first half of the year.
Second quarter profits surged 12% compared to the same period last year to US$1.3bn, exceeding analysts expectations of US$989mln.
The UK based lender said performance was buoyed by a growth in retail products, transaction banking and its financial markets business.
Although UK based, the bank operates largely in Asia, with COVID lockdowns in China weighing on performance.
Chief executive Bill Winters said markets in Asia were in the early stages of post pandemic recovery, with possible policy stimulus that could help revive its economy, a potential boost for Standard Chartered.
AstraZeneca PLC (LSE:AZN) wrapped up the week and followed industry performance of GSK and Haleon, upgrading guidance for the full year after a bumper first half which exceeded expectations.
The drugs giant expected revenues from its COVID jab to decline by 20% to 25% for the year, but it is now expected to remain flat.
As a result, the Anglo-Swedish company reckons top line growth for 2022 will be in the "low twenties" per cent, up from the "high teens.”
Bad: BATs, Rio, Barclays ...
British American Tobacco PLC (LSE:BATS) is one of a few firms which felt the full force of Russia’s invasion of Ukraine, with profits slumping because of its exit from the Kremlin.
Profits fell by 25%, with its exit from Russia costing the group £957mln, although it is making progress in the vaping and e-cigarettes sector.
Mining giant Rio Tinto PLC (LSE:RIO) was another which reported a slash in earnings in the first half, down 26% on the back of lower iron ore prices, higher energy prices and general inflationary pressures.
While it maintained full-year production guidance, it warned that iron ore shipments and bauxite output guidance largely depended on weather and market conditions.
Barclays PLC (LSE:BARC) was hit with litigation and conduct charges in the second quarter that forced it to raise operating costs charges for the year.
Previous guidance was set at £15bn, but the bank now expects costs to be around £16.7bn for the year.
Profits also took a hit in the first quarter, down 32% to £3.7bn, although income rose 10% year-on-year.
Anglo American PLC (LSE:AAL) followed the theme set by miners, reporting a sharp drop in earnings and shareholder pay-outs.
Much of the blame was placed on waning demand for commodities, as well as cost pressures hitting margins.
Duncan Wanblad, who took over as chief executive in April, also warned that higher borrowing costs and political instability would threaten investment in projects required to take the industry to global net zero targets.
Natural resources company Glencore PLC (LSE:GLEN) lowered guidance for copper production in 2022 by 5% for the year, with production in 2022 so far down 15% in the first half.
The mining conglomerate cited “ongoing geotechnical constraints” as its open pit in the Democratic Republic of Congo, as well as lower year-to-date run rate in Australia due to staff shortages as a result of COVID.
Meh: Vodfone, Smurfit, ITV ...
Vodafone Group PLC (LSE:VOD) got the week kicked off for FTSE 100 updates, as the mobile phone operator announced revenue growth of 1.6% to nearly €11.28bn in the first quarter of the year.
Further to that, the group said it is on track to deliver financial year 2023 guidance od underlying earnings between €15bn and €15.5bn and adjusted free cash flow of €5.3bn for the year.
Smurfit Kappa Group plc (LSE:SKG), the packaging giant, warned on outlook as demand for self-packing declined in a post-pandemic world, as well as inflation across Europe making consumers cautious.
This was despite posting a 50% jump in profits for the first half of the year, and a 33% climb in revenue to US$1.22bn.
Unite Group PLC (LSE:UTG), a relatively recent entry into London’s blue-chip index, said profits almost trebled thanks to an influx of foreign students, mainly from China and Inda.
Pre-tax profits were up to £344mln from £130mln for the first six months.
However, the student accommodations provider warned that rising interest rates could hit full-year earnings, and drew back on its earnings per share guidance, even though chief executive Richard Smith remained confident the costs could be passed on.
BAE Systems PLC (LSE:BA.), the aerospace company, said performance was in line with expectations as it posted its interim results.
Underlying earnings increased by 8.1%, though operating profit and net cash flows saw a 21% year-on-year decline.
Principal concerns for the weapons manufacturer include government contract risks, supply chain issues, competition in global markets and defence spending.
ITV PLC (LSE:ITV) was another that hit expectations, with total advertising revenues up 5%, in line with previous guidance.
However, the group did expect its ITV Studios business to exceed its 2019 performance, with its ITVX streaming service set to launch in the fourth quarter.
ITV Studios and Media and Entertainment were ahead of expectations, as statutory profit also climbed to £219mln from £133mln.
BT Group PLC (LSE:BT.A), whose workers are on strike, reported revenue growth for the first time in five years, successfully passing on price hikes above inflation to customers.
Sales increased by 1% to £5.13bn, ahead of analysts’ predictions, while adjusted EBITDA was up 2% to £1.9bn, in line with expectations.
Free cash flow targets of between £1.3bn and £1.5bn for the full fiscal year 2023 also remain unchanged.
Real estate portal Rightmove PLC (LSE:RMV) expects market activity to be “broadly stable” for the remainder of 2022 as the company posted a higher first-half profit.
Operating profit grew 6% to £121.3mln, while revenue was up 9% to £162.7mln as the property market remained healthy compared to 2019, the last pre-pandemic period.
However, the property market faces fresh challenges as the cost-of-living crisis and rising interest rates could dampen sentiment.