LONDON MARKET PRE-OPEN: Sunbelt Helps Ashtead's Annual Earnings Rise

(Alliance News) - Stock prices in London are seen opening cautiously higher on Tuesday as the US Federal Reserve's highly anticipated two-day monetary policy meeting begins.In company news, Ashtead Group and Telecom Plus reported higher earnings, and Meggitt won a contract in the US. IG futures indicate the FTSE 100 index is to open 7.29 points higher at 7,364.60. The blue chip index ended up 11.53 points, or 0.2%, at 7,357.31 on Monday. The Fed, which is scheduled to meet later on Tuesday and Wednesday, is widely expected to hold interest rates unchanged this month, although it is very likely to signal a rate cut sometime in the near term.Equipment rentals firm Ashtead Group reported a strong set of annual results for financial 2019.For the financial year ended April 30, revenue rose 19% to GBP4.49 billion from GBP3.71 billion the year before, and pretax profit rose 20% to GBP1.06 billion from GBP862.1 million. The company said it continued to enjoy strong end-markets in North America and was executing well on its strategy of organic growth supported by targeted bolt-on acquisitions.Its Sunbelt unit saw US total revenue, including new and used equipment, merchandise and consumable sales, increase 20% to USD4.98 billion from USD4.15 billion. Ashtead proposed a final dividend of 33.5 pence, bringing a total payout 40.0 pence, up 21% from 33.0p in financial 2018."Our business continues to perform well in supportive end-markets. Looking forward, we anticipate a similar level of capital expenditure in 2019-20, consistent with our strategic plan. So, with our business performing well and a strong balance sheet to support our plans, the Board continues to look to the medium term with confidence," said Chief Executive Brendan Horgan.Multi utility services provider Telecom Plus said it delivered annual results for financial 2019 in line with expectations.For the year ended March 31, revenue rose 1.5% to GBP804.4 million from GBP792.9 million the year before, and pretax profit increased 4.9% to GBP43.0 million from GBP41.0 million. Adjusted pretax profit increased by 3.7% to GBP56.3 million from GBP54.3 million in 2018. The company said that in the absence of "unforeseen circumstances" it expect adjusted pretax profit for financial 2020 to be between GBP60 million and GBP65 million. Telecom Plus raised its annual dividend 4.0% to 52.0p from 50.0p last year and expects to raise its payout another 10% to 57p in financial 2020. "We anticipate the momentum that has been building within our business over the last 12 months will continue, with growth in customer and service numbers for the current year reaching 5% and 10% respectively. Whilst it is inevitably more expensive to add multi-service customers, we are hugely encouraged by the record proportion of new members choosing to switch all their services to us (which has recently been running at over 58%), with the higher investment made in acquiring them being more than offset by the length of time they are likely to remain with us, and correspondingly higher expected lifetime value," said Chair Charles Wigoder. Aerospace and defence components engineer Meggitt has signed a contract with US aircraft company Textron for the supply of fire protection systems on the Cessna Denali and Skycourier platforms. Deliveries are set to commence later this year.Chris Allen, president of Airframe Systems at Meggitt, said: "Meggitt has a longstanding relationship with Textron and we value the trust they have placed in us to deliver world-class fire protection systems."Woodford Investment cut its stake In Oakley Capital Investment to 7.35% From 19.39%. The 12% stake sold is worth about GBP55 million. Separately, Oakley Capital Investment said Non-Executive Director Peter Dubens bought 5.3 million shares at 220.0p each, worth almost GBP12 million. In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average and S&P 500 up 0.1%, while the Nasdaq Composite closed up 0.6%.The Japanese Nikkei 225 index closed down 0.9%. In China, the Shanghai Composite is down 0.1%, while the Hang Seng index in Hong Kong is up 0.7%.The pound was quoted at USD1.2534 early Tuesday, lower than USD1.2559 at the London equities close Monday.The battle for the Conservative party crown in the UK is revving up with a fresh round of voting in the leadership stakes as Boris Johnson is due to break cover and take part in television debates.Tory MPs will vote in the second bout of the contest to select the UK's next prime minister on Tuesday ahead of a live TV debate that will feature the front-runner and former foreign secretary, Johnson.Candidates need to gain at least 33 votes from MPs to remain in the race to reach the final run-off, which will see some 160,000 Tory members select the next prime minister.If all candidates pass the 33-vote threshold, the one with the lowest total will be eliminated and by the end of the week, four of the six current riders will be forced out, leaving the final two to go head-to-head for votes from the Tory grassroots.The economic events calendar on Tuesday has eurozone inflation readings at 1000 BST and US housing starts at 1330 BST. In addition, European Central Bank President Mario Draghi and Bank of England Governor Mark Carney will speak on the second day of the ECB's annual three-day forum in Sintra, Portugal at 0900 BST and 1500 BST respectively.