LONDON MARKET PRE-OPEN: Strong Profit Growth For Primark And boohoo

LONDON (Alliance News) - Stock prices in London are seen Wednesday backing off from the previous session's oil-driven gains, after equities in Asia failed to capitalise on Wall Street's rally.In early company news, Associated British Foods saw a strong interim performance at discount clothing chain Primark though reported a fall in group profit due to its sugar division. Online fashion retailer boohoo posted double-digit rises in annual revenue and profit. Copper miner Antofagasta reported first-quarter production in line with expectations.IG says futures indicate the FTSE 100 index of large-caps to open 15.47 points lower at 7,507.60 on Wednesday. The FTSE 100 index closed up 63.19 points, or 0.9%, at 7,523.07 on Tuesday.Gains in London on Tuesday had been driven by a rally in the price of oil over Iranian supply fears. However, Brent prices eased overnight. Brent oil was quoted at USD74.25 a barrel early Tuesday in London, marginally down from USD74.46 late Wednesday, though still well up from last week.In the US on Tuesday, Wall Street ended firmly in the green, with the Dow Jones Industrial Average ending up 0.6%, the S&P 500 up 0.9% and the Nasdaq Composite climbing 1.3%."Earnings season has was major driver of the bullish sentiment on Wall Street yesterday," said David Madden at CMC Markets. "Solid quarterly updates from Twitter, Coca Cola, United Technologies and Lockheed Martin helped the S&P 500 to post a record close."However, he continued: "Asian markets had a hot and cold session, as gains were made in the first-half of the trading day, on the back of the bullish sentiment in the US, but the rally ran out of steam, and markets are now in the red."In Asia on Wednesday, the Japanese Nikkei 225 index ended down 0.3%. In China, the Shanghai Composite is 0.1% higher, while the Hang Seng index in Hong Kong is down 0.4%.In early London company news, AB Foods said it delivered a "robust" set of interim results, though profit did dip.Revenue for the 24 weeks to March 2 rose 1% to GBP7.53 billion, though pretax profit slipped to GBP515 million from GBP603 million a year ago. Pretax profit was hindered by a GBP79 million in exceptional items, with AB Foods having booked no such charges a year ago. On an adjusted basis, profit was largely in line with a year prior at GBP627 million.Sales at Primark were 4.4% ahead of a year ago, said AB Foods, driven by increased retail selling space partially offset by a 1.5% decline in like-for-like sales. With a "much higher margin", profit was 25% ahead of last year, and the company described the early customer reaction to the spring/summer range as "encouraging".The firm declared an interim dividend of 12.05p, up 3% on last year. AB Sugar adjusted operating profit amounted to just GBP1 million in the half, versus GBP106 million a year before, amid a 13% decline in revenue. Grocery profit rose 5% to GBP167 million."This is a robust set of results," said Chief Executive George Weston "Profit at AB Sugar was substantially reduced but, from this period, we expect our sugar profitability to improve.""The strong underlying growth in Grocery profits demonstrates good momentum. Primark delivered excellent profit growth, driven by further development of our customer experience and selling space expansion," he added.Online clothing retailer boohoo said it performed "exceptionally well" in its recently ended financial year, though expects the pace of revenue growth to ease in the coming year.Revenue for the year to February 28 rose 48% to GBP856.9 million, and pretax profit jumped 38% to GBP59.9 million. The retailer achieved an adjusted earnings before interest, tax, depreciation and amortisation margin of 9.9%, strengthened slightly from 9.8% the year before.Adding to the double-digit growth just achieved, boohoo said trading in the first few weeks of its new financial year has been "encouraging". boohoo expects revenue to grow between 25% to 30% in the year ahead, slower than the rate of growth achieved in its recently ended financial year, with an adjusted Ebitda margin of around 10% and capital expenditure in the region of GBP50 million to GBP60 million.Chilean miner Antofagasta reaffirmed 2019 guidance after reporting a first-quarter performance in line with expectations.In the three months to March, Antofagasta's copper production rose 23% on the year before to 188,600 tonnes, but was down 14% on the last quarter of 2018.This met expectations, with the year-on-year rise due to higher ore throughput and expected higher grades. However, quarter-on-quarter fall was caused by maintenance at the Los Pelambres and Centinela mines and lower grades.Chief Executive Ivan Arriagada said Antofagasta's "high level" of performance achieved in the second half of 2018 has continued, and it is on track for guidance of between 750,000 tonnes and 790,000 tonnes of copper in 2019. Insurer Aviva said Andy Briggs is to step down as the boss of UK insurance following the recent appointment of Maurice Tulloch as the new group chief executive. Aviva said Tulloch will be conducting a review of the UK businesses to ensure "the appropriate management structure to build on that success for the future" in the wake of Briggs's departure. Briggs will remain with Aviva until October 23 to ensure a smooth handover. Angela Darlington, currently Aviva's chief risk officer, will become interim CEO of UK Insurance.Legal & General said it has agreed its first pension risk transfer transaction in Canada for more than CAD200 million, or GBP114 million. Including this transaction, Legal & General has now written GBP2.5 billion in international pension risk transfers since its first transaction in 2015."I am delighted to announce our first PRT transaction in Canada, where the market is growing strongly. The transaction provides further evidence of our appetite and capability to grow our PRT business internationally," said Chief Executive Nigel Wilson.In the UK, senior members of the Conservative party are expected to hold further discussions on whether to change the party rules to enable an early leadership challenge to UK Prime Minister Theresa May.Officers of the Tory backbench 1922 Committee met in Westminster on Tuesday amid growing pressure for the prime minister to name the date of her departure. Afterwards there was no formal statement from the meeting, which was said have been inconclusive.Ahead of Tuesday's talks, the committee chair Graham Brady met privately with May, when he is reported to have told her MPs want her to announce when she is going. Under current party rules, MPs cannot mount a fresh leadership challenge until 12 months after last December's failed attempt.However, amid growing frustration over the latest delays to Brexit, some MPs now want to the rules to be rewritten to allow another challenge as early as June.Sterling was quoted at USD1.2922 early Wednesday, soft compared to USD1.2932 at the London equities close on Tuesday."The overriding concern for currency traders right now is if Theresa May is ousted, who will replace her? And how far will they be willing to go to achieve Brexit. Suddenly, the no deal Brexit option could be back on the table," commented Jasper Lawler, head of research at London Capital Group.In the economic calendar, the Ifo German business climate survey at 0900 BST and UK public sector borrowing at 0930 BST. In the afternoon, there is the Bank of Canada's latest interest rate decision at 1500 BST and US MBA mortgage applications at 1200 BST.