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(Alliance News) - Consumer electronics and mobile phone seller Currys on Friday broke a string of positive Christmas trading updates by UK retailers, saying the technology market was challenging over Christmas, with uneven customer demand and supply disruption.
For the 10 weeks that ended January 8, group like-for-like revenue fell 5% compared to growth of 4% two year before.
Looking ahead, Currys expects to deliver full-year adjusted pretax profit of around GBP155 million. This would be flat on the year before. It posted adjusted pretax profit of GBP156 million in financial 2021.
More positive for shareholders, the company launched a share buyback programme of GBP75 million running to the end of October. Morgan Stanley will conduct a first phase, worth GBP32 million and running until April 29.
"The technology market was challenging this Christmas, with uneven customer demand and supply disruption. Against this backdrop, Currys' colleagues showed their resilience and the stronger business we've built. We gained market share, improved customer satisfaction, traded profitably, and can look ahead with confidence," Chief Executive Officer Alex Baldock said.
"Customer demand for some tech was strong. This was a gamers' Christmas, the year that virtual reality broke into the mainstream, and when consoles flew off the shelves. Oculus Quest 2 and PS5 were stars. Appliances large and small also enjoyed strong sales, as consumers continued to kit out their homes. Still, the overall UK tech market was down 10% compared to last year's peak period," he added.
Currys shares were down 5.5% early Friday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.2% at 7,548.86
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Hang Seng: down 0.2% at 24,383.32
Nikkei 225: closed down 1.3% at 28,124.28
S&P/ASX 200: closed down 1.1% at 7,393.90
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DJIA: closed down 176.70 points, 0.5%, at 36,113.62.
S&P 500: closed down 1.4% at 4,659.03
Nasdaq Composite: closed down 2.5% at 14,806.81
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EUR: soft at USD1.1465 (USD1.1471)
GBP: soft at USD1.3723 (USD1.3738)
USD: down at JPY113.72 (JPY114.05)
Gold: up at USD1,827.45 per ounce (USD1,817.65)
Oil (Brent): flat at USD84.85 a barrel (USD84.80)
(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
1000 CET Germany annual gross domestic product
1100 CET EU foreign trade
1100 GMT Ireland live register
0830 EST US advance monthly sales for retail & food services
0915 EST US industrial production & capacity utilization
1000 EST US manufacturing & trade: inventories & sales
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UK economic growth picked up in November, with gross domestic product exceeding its pre-pandemic size for the first time, according to the Office for National Statistics. However, the figures represented the state of the UK economy prior to the impact of the Omicron variant of Covid-19. UK gross domestic product advanced 0.9% in November from October, accelerating from month-on-month growth of 0.2% in October. The November print beat the market estimate, cited by FXStreet, of 0.4% growth. The ONS said the monthly figure for GDP is estimated to be above its pre-coronavirus pandemic level of February 2020 for the first time. "The economy grew strongly in the month before Omicron struck with architect, retailers, couriers and accountants having a bumper month. Construction also recovered from several weak months as raw materials became easier to get hold of," commented ONS economist Grant Fitzner.
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BROKER RATING CHANGES
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Goldman Sachs reinitiates Smiths Group with 'Buy' - price target 1,840 pence
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Goldman Sachs raises Renishaw to 'Conviction Buy List' (Buy) - price target 6,550 (6,450) pence
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RBC cuts Warehouse REIT to 'Sector Perform' (Outperform) - price target 180 (175) pence
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COMPANIES - FTSE 100
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Experian expects full-year organic revenue growth of 12% to 13% and total revenue growth expected in the range of 16% to 17% at constant exchange rates. Experian expects strong full-year earnings before interest and tax margin accretion at constant currency.
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SSA Investments confirmed that it sold a 4% stake in B&M European Value Retail. Goldman Sachs International was sole bookrunner for the placing of 40 million shares at 585 pence each, raising gross sales proceeds of GBP234 million. SSA owned 109.9 million shares in Luxembourg-based B&M, or an 11% stake. Following the sale, SSA will now own about 7% of B&M. SSA is the investment vehicle of the Arora family. Simon Arora is B&M's chief executive. The intention to sell the shares was first announced after the London market close on Thursday.
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COMPANIES - FTSE 250
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Vivo Energy, which sells fuels and lubricants under Shell and Engen brands in 23 African countries, said on Friday that Chief Financial Officer Doug Lafferty has resigned to be CFO at Aston Martin Lagonda Group Holdings. Lafferty will remain a director of Vivo Energy until he leaves, which will be no later than July 13. Lafferty will remain focused on the delivery of the company's full-year results, due March 2, and on ensuring the effective transition of his responsibilities, Vivo said. The search for a new CFO is underway and a further update will be announced in due course, the company said. At Aston Martin, Lafferty replaces Ken Gregor. The luxury automaker noted that, before Vivo, Lafferty had been CFO of Williams Grand Prix Holdings and also worked for 16 years at British American Tobacco.
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Bellway said John Tutte will join the board as non-executive chair designate on March 1. He will succeed Paul Hampden Smith, who will retire from the board as chair on April 1. Tutte was previously CEO and chair at housebuilding peer Redrow.
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COMPANIES - GLOBAL
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Itochu confirmed that it, along with Japan Industrial Partners, will take half of Hitachi's stake in Hitachi Construction Machinery for JPY182.5 billion, or around USD1.6 billion. Hitachi currently holds a 51.5% stake in the business. After this deal, Hitachi will be left with 25.4% of Hitachi Construction and the Itochu-JIP joint venture will hold 26%, split equally between the two consortium parties. Itochu-JIP is buying Hitachi Construction shares for JPY3,300 each. The stock closed down 17% at JPY2,976 in Tokyo on Friday. Itochu noted that Hitachi had been looking for a new partner to aid Hitachi Construction's growth, and began mulling a deal at the end of 2020. Itochu believes it can drive synergies with its existing businesses.
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Citigroup revealed plans to sell its consumer banking franchises in Indonesia, Malaysia, Thailand and Vietnam to Singaporean bank UOB. The deal includes Citi's retail banking and credit card businesses but excludes the bank's institutional businesses in all four countries. UOB will pay the New York-based bank cash for the net assets of the acquired businesses, plus a premium of SGD915 million, around USD690 million.
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Friday's shareholder meetings
ThinkSmart Ltd - GM re sale of Clearpay stake
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By Tom Waite; thomaslwaite@alliancenews.com
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