(Alliance News) - Kitchenware retailer ProCook Group on Friday said trading has been hurt by increasingly challenging market conditions, with customers affected by "exceptional pressures" on discretionary spending.
For the fourth quarter, ended April 3, ProCook said it was trading against "exceptionally strong comparatives" from the prior year, when it benefited from pent-up demand following the lifting of Covid-19 restrictions and the reopening of retail stores.
The retailer, which listed on the London Main Market back in November, said like-for-like sales have weakened across all channels, in line with the wider kitchenware market, though revenue remains "significantly higher" than the comparative pre-Covid period in 2019.
ProCook assumes the kitchenware market will remain highly challenging for the remainder of financial 2023. As such, it now anticipates that revenue for financial 2023 will be broadly in line with GBP69.2 million seen in financial 2022.
It also expects gross margins to remain broadly consistent year-on-year, and will continue to manage costs carefully.
Still, ProCook now expects to deliver adjusted pretax profit of between GBP4 million to GBP6 million for financial 2023. It didn't provide its adjusted pretax profit figure for financial 2022. In the first half of financial 2022, the six months that ended October 21 last year, underlying pretax profit was GBP3.6 million.
ProCook expects to release its financial 2022 results in late June.
"There are clear and numerous pressures on consumers at present which are impacting discretionary spend across retail as a whole and kitchenware is no exception. Whilst we are still seeing lots of new customers discovering the ProCook brand and buying our products, it is clear that many are tightening their belts. This creates a difficult short-term trading environment, but does not distract us from our strategic priorities, as we work towards our mission of becoming the first choice for kitchenware," said Chief Executive Officer Daniel O'Neill.
Procook shares dropped 46% early Friday to 42.00 pence. The stock listed at an IPO price of 145p so is down nearly 70% in six months.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.8% at 7,419.25
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Hang Seng: up 0.1% at 21,883.26
Nikkei 225: closed down 1.5% at 27,824.29
S&P/ASX 200: closed down 1.3% at 6,932.00
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DJIA: closed down 638.11 points, or 1.9%, at 32,272.79
S&P 500: closed down 2.4% at 4,017.82
Nasdaq Composite: closed down 2.8% at 11,754.23
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EUR: down at USD1.0630 (USD1.0657)
GBP: down at USD1.2490 (USD1.2536)
USD: down at JPY133.95 (JPY134.16)
Gold: up at USD1,845.11 per ounce (USD1,842.36)
Oil (Brent): down at USD122.75 a barrel (USD123.37)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's key economic events still to come
0930 BST UK Bank of England-Ipsos quarterly inflation attitudes survey
0830 EDT US real earnings
0830 EDT US consumer price index
1000 EDT US University of Michigan survey of consumer sentiment
1400 EDT US monthly Treasury statement of receipts and outlays
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Friday's key market event is the US CPI report for May at 1330 BST. Economists at Lloyds Bank said they expect the headline annual inflation rate to continue to slow, to 8.2% in May from 8.3% in April and 8.5% in March. The core rate of inflation is seen falling to 5.9% from 6.2% in April and 6.5% in March. They said risks for the headline figure are skewed to the upside, due to the recent rise in energy prices. "Core inflation seems more likely to have declined but there will be considerable interest in whether services inflation is continuing to accelerate. That would be an indication that inflationary pressures are broadening out," Lloyds said. "Overall, the report is not expected to ease the pressure on the Federal Reserve to continue to raise interest rates."
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The Bank of Japan said the prices of corporate goods remained mostly flat in Japan in May in its monthly report on the corporate goods price index. Preliminary figures for May showed that the producer price index was unchanged in the month compared to April, slowed from the 1.3% rise the previous month. Market consensus, according to FXStreet, had predicted a 0.5% rise for May. On an annual basis, the PPI rose 9.1% in May, slowing from the 9.8% rise in April.
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BROKER RATING CHANGES
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Berenberg cuts Travis Perkins to 'hold' (buy) - price target 1,380 (1,800) pence
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JPMorgan reinitiates Workspace with 'neutral' - price target 870 pence
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JPMorgan raises Countryside Partnerships to 'neutral' (underweight) - price target 295 (240) pence
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COMPANIES - FTSE 100
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Drugmaker GSK unveiled positive pivotal phase three data for its respiratory syncytial virus vaccine candidate AReSVi 006 for adults. RSV is a common contagious virus affecting the lungs and breathing passages. The RSV vaccine candidate showed statistically "significant and clinically meaningful efficacy" in adults aged 60 years and above, GSK explained. GSK said interim analysis was reviewed by an Independent Data Monitoring Committee, and the primary endpoint was exceeded with no unexpected safety concerns observed. Chief Scientific Officer Hal Barron said: "These data suggest our RSV vaccine candidate offers exceptional protection for older adults from the serious consequences of RSV infection. RSV remains one of the few major infectious diseases without a vaccine, and these data have the potential to meaningfully impact the treatment of RSV and may reduce the 360,000 hospitalisations and more than 24,000 deaths worldwide each year. Given the importance of these data, we plan to engage with regulators immediately and anticipate regulatory submissions in the second half of 2022."
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COMPANIES - SMALL CAP
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Genel Energy said that at its recent annual general meeting, Bill Higgs did not receive the required 50% majority of votes in favour of re-election as a director. At the May 12 AGM, 55% of the votes cast were against him. As such, Higgs has agreed to step down as chief executive of the company with immediate effect. Genel said Higgs will take up a role as a special advisor to the chair until September 1, to support an orderly transition, after which he will remain as a consultant to the company. Chief Operating Officer Paul Weir has been promoted to interim CEO with immediate effect. A search for a suitable replacement is underway and an announcement will be made in due course, it added.
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COMPANIES - GLOBAL
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Comair has announced that it will go into liquidation after abortive attempts to secure funding to keep the South African airline afloat. The airline owns low-cost airline kulula.com and operates domestic flights in South Africa for British Airways, which is part of International Consolidated Airlines Group. Its business rescue practitioners on Thursday lodged a court application to liquidate the embattled air carrier. The group had grounded all flights on Tuesday last week after running out of cash. Comair went into business rescue in 2020 as airlines worldwide took a hit from lockdown restrictions aimed at controlling Covid-19. Richard Ferguson, one of the business rescue practitioners, said on Thursday said that, despite their best efforts, they had been unable to secure the capital required for the airline to resume operations.
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Friday's shareholder meetings
Chariot Ltd - AGM
Ergomed PLC - AGM
MP Evans Group PLC - AGM
THG PLC - AGM
Ultra Electronics Holdings PLC - AGM
XLMedia PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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