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(Alliance News) - Knock-down prices and spacious stores are proving a winning combination for recently promoted FTSE 100 constituent B&M European Value Retail, which said Tuesday it performed well in the first half of its financial year.
B&M European Value Retail said it has seen strong momentum for the period March 29 to September 26, with its easily accessible out-of-town locations continuing to prove attractive to customers during the pandemic.
B&M reported revenue growth in the first half of 25%, with B&M UK stores generating revenue growth of 30% including like-for-like growth of 23%.
The retailer - which joined the FTSE 100 index of London blue-chips on Monday last week - expects to open new stores in this financial year as a result of a pick-up in leasing activity, in a range of 40 to 45 B&M UK gross openings, most of which scheduled to open in the fourth quarter.
"Our group has performed well in the first half. Our business model is proving well-attuned to the evolving needs of customers, given our combination of everyday value across a broad range of product categories being sold at convenient out-of-town locations," said Chief Executive Simon Arora.
The stock was up 4.0% early Tuesday and is up 25% so far in 2020, bucking the opposite trend among other retailers.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.3% at 5,911.72
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Hang Seng: down 0.7% at 23,312.90
Nikkei 225: closed up 0.1% at 23,539.10
DJIA: closed up 410.10 points, 1.5%, at 27,584.06
S&P 500: closed up 1.6% at 3,351.60
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GBP: flat at USD1.2850 (USD1.2855)
EUR: up at USD1.1670 (USD1.1653)
Gold: up at USD1,878.86 per ounce (USD1,871.99)
Oil (Brent): firm at USD42.22 a barrel (USD42.10)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
0930 BST UK lending to individuals and businesses, broad Money and credit
1100 BST Ireland monthly unemployment
1500 BST UK BoE Governor Bailey speaks at Queen's University Belfast
1000 CEST EU eurozone economic outlook
1100 CEST EU business & consumer surveys
1400 CEST Germany provisional consumer price index
0830 EDT US advance economic indicators report
0855 EDT US Johnson Redbook retail sales index
0900 EDT US S&P CoreLogic Case-Shiller indices
1000 EDT US consumer confidence index
1630 EDT US API weekly statistical bulletin
2100 EDT US presidential debate between Trump and Biden
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The ninth round of trade talks between London and Brussels is set to get underway as the two sides continue to clash over the controversial UK Internal Market Bill. At talks in Brussels on Monday, European Commission Vice President Maros Sefcovic reiterated calls for British ministers to scrap provisions in the legislation which could see the UK unilaterally tear up elements of the Brexit divorce deal. At a news conference following the meeting of the joint committee on the implementation of the agreement, Sefcovic said the EU "will not be shy" in taking legal action if the UK does not withdraw measures from the draft Bill by the end of the month. However Cabinet Office Minister Michael Gove, who co-chairs the committee with Sefcovic, said the UK government intended to continue with passage of the bill, which is due to go through its report stage in the Commons on Tuesday.
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Leaders in Liverpool, Leeds and Manchester have warned the UK government their hospitality sectors are at risk of collapse unless coronavirus restrictions are reviewed. In a letter to Health Secretary Matt Hancock and Business Secretary Alok Sharma, the leaders and chief executives of the three city councils said restrictions in place in the regions were threatening a "huge, disproportionate" economic impact. The city bosses said hotel occupancy was down to 30% and footfall had dropped by up to 70%. Guidance in place in the cities advises people not to mix with other households but the council leaders said it was "unenforceable" as well as being "contradictory and confusing".
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BROKER RATING CHANGES
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BERENBERG CUTS NEXT TO 'SELL' ('HOLD') - TARGET 4,500 (4,300) PENCE
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JPMORGAN RAISES STANDARD LIFE ABERDEEN TO 'OVERWEIGHT' ('NEUTRAL') - TARGET 270 (255) PENCE
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RBC INITIATES SCHRODERS WITH 'UNDERPERFORM' - TARGET 2,300 PENCE
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COMPANIES - FTSE 100
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Plumbing and heating products supplier Ferguson restarted dividend payments despite annual earnings being held back by the coronavirus outbreak. Bakery chain Greggs said it was experiencing a recovery in sales in September. IG futures indicate the FTSE 100 index is to open 20.17 points higher at 5,948.10. The blue-chip index closed up 85.26 points, or 1.5%, at 5,927.93 Monday. Ferguson said it delivered a strong performance in financial 2020, which in light of the coronavirus outbreak, highlighted the "resilience of its business model". For the financial year ended July 31, revenue slipped 0.9% to USD21.82 billion from USD22.01 billion in financial 2019; however, the figure was higher than the company-compiled consensus forecast of USD21.76 billion. Pretax profit was down 4.8% to USD1.26 billion from USD1.32 billion, while trading profit, which excludes exceptional items and amortisation of acquired intangible assets, was USD1.67 billion, up 8.6% from USD1.54 billion. The trading profit figure beat the consensus forecast of USD1.59 billion. Ferguson proposed a final dividend for the year of 208.2 cents which it said "effectively reinstates" the previously withdrawn interim dividend, and was in line with last year's payout. However, its USD500 million share buyback program remains suspended.
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Rio Tinto is facing accusations it "side-stepped" responsibility to clean up poisonous waste from a closed mine on Papua New Guinea's Bougainville island in a complaint filed Tuesday in Australia. The complaint, lodged with Australian authorities by the Melbourne-based Human Rights Law Centre on behalf of more than 150 Bougainvilleans, heaps more pressure on the mining giant already under public attack for blowing up sacred Aboriginal sites. It alleges the former Panguna copper and gold mine, which was at the centre of a decade-long civil war in PNG, continues to leak waste into rivers more than three decades after it was shuttered. "Our rivers are poisoned with copper, our homes get filled with dust from the tailings mounds, our kids get sick from the pollution," a traditional landowner and member of local parliament, Theonila Roka Matbob, said in a statement.
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COMPANIES - FTSE 250
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Baked goods retailer Greggs said it was experiencing a recovery in sales in September as coronavirus lockdown measures eased and customers returned to stores. Greggs said September company-managed shop like-for-like sales improved to 76% of the same time in 2019 in the four weeks to September 26, with higher levels of activity following a slower August. The Newcastle-based firm said that due to its seating option being closed, it was not in a position to participate in the UK government's 'Eat Out to Help Out' scheme and this, along with high temperatures made August a "difficult month" for baked goods. "The outlook for trading remains uncertain, with rising Covid-19 infection rates leading to increasing risks of supply chain interruption and further restrictions on customer activities out of the home. In these challenging conditions our teams continue to work hard and have proven our ability to operate with social distancing and adapt to new digital channels," the company said.
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COMPANIES - GLOBAL
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A consortium headed up by private equity firm TDR Capital and retailer EG Group has nudged ahead in the race to buy Walmart's UK grocery unit Asda, Sky News reported on Monday. The deal could value Asda at GBP6.5 billion, according to Sky. EG Group operates the Euro Garages petrol station operator. Sky News added that although Walmart's preferred bid is TDR and EG's, Apollo Global Management also remains in the race to buy Asda. The TDR and EG bid also has the backing of a syndicate of lenders including Barclays, Lloyds Banking Group, Morgan Stanley and ING Group, it said. Quoting insiders, Sky News added that a deal could be anywhere between days or weeks away.
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US investment bank Goldman Sachs is expected to reshuffle the top management of its consumer banking unit, with current Chief Executive Harit Talwar handing over management duties to his deputy Omer Ismail, Bloomberg News reported on Monday citing people familiar with the matter. According to the news agency, Talwar will remain at the company as a partner for now and as chair of the consumer division, known as Marcus. Goldman Sachs declined to comment on the leadership shuffle at Marcus.
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Toyota Motor said global sales in August recovered at a faster pace than previously expected, noting that year-on-year sales are now at around 90% of the year prior. The car manufacturer said worldwide sales were down 11% at 720,765 units in August, with sales in China up 27% year-on-year at 164,354 units, while sales in Japan were down 11% to 104,535 units. Toyota said China sales were aided by local motor shows, as well as reinforced measures to secure orders, adding that sales of the Levin, ES, and other models were strong. Japanese sales were hurt by the Covid-19 pandemic. Total worldwide sales for Toyota from January to August was down 19% to 5.2 million units.
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Tuesday's Shareholder Meetings
PV Crystalox Solar - GM re tender offer
Raven Property Group - GM re tender offer
Novacyt
Gama Aviation
Ince Group
IMImobile
Brickability Group
DCD Media
Jaywing
Carclo
Arcontech Group
Amigo Holdings - GM re Richmond Group resolutions
Rockfire Resources - GM re articles of association amendment
Appreciate Group
Augmentum Fintech
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By Tom Waite; thomaslwaite@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
