Tomorrow28 Aug 2014 21:43
FRIDAY PREVIEW: BWIN AND PERFORM ISSUING HALF-TIME SCORES
Continuing a sporting week of Champions League and League Cup football and England-India cricket, a pair of FTSE 250 sport-related companies are due to run in their half-time numbers on Friday: Perform and Bwin.Party.
As well as interims from textiles group Berendsen and the Restaurant Group in the company arena there are also some interesting reports due out for the more macro minded.
In particular, Friday's preliminary estimate of euro area wide inflation pressures at the consumer level holds the potential to leave its imprint on trading. Some of the most recent estimates from economists point to inflation dropping to as low as 0.2% year-on-year come September.
Eurozone unemployment numbers are also due out, with expectations that this will remain flat at 11.5%.
US personal consumption expenditure figures are expected to remain at a year-on-year rate of 1.5% and to rise 0.1% month-on-month.
Bwin needs to avoid another own goal
There has been plenty of trading volume in both Perform and Bwin in the last few days in anticipation of their numbers, with the interims showcasing two companies at different stages of recovery.
Embattled Bwin is expected, according to the analysts consensus, to deliver earnings before interest, tax, depreciation and amortisation of €46m on revenues of €307m.
Its share price has collapsed since May, reflecting a decline in investor confidence in management's ability to turn the business around.
"As is the norm with underperforming companies, particularly those in the gaming sector, there is likely to be lots of positive narrative but against a backdrop of underwhelming numbers," according analyst Nick Batram at Peel Hunt.
He expects sports to be the one bright spot in the first half but foresees continued weakness in poker dragging down casino, and is slightly more optimistic than the consensus.
"In order to hit full-year consensus of circa €114m EBITDA, the group cannot afford anymore setbacks," he warns, adding that the group looks vulnerable from a trading perspective and as a potential takeover target.
At Numis, analyst Ivor Jones also expects a strong set of results from sports betting, with Bwin's focus on Germany, but is much less optimistic than the consensus with his EBITDA forecast of €42m.
He adds: "We expect management to discuss prospects for the second half which include the benefits of cost savings and the final stages of bringing the business onto one technology platform. We believe that investor attention will focus on the potential for corporate restructuring including new financial leverage and business disposals. There is the possibility that a further payments-related deal is announced which could bring closer the spin-off of Kalixa."
Perform is back on track
Jones' colleague Paul Richards believes digital sport rights business Perform will
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