London’s FTSE was flat at the open on Tuesday, edging a mere 0.03% higher to 6,800.19, as concerns over the economic impact of a third nationwide lockdown were offset by a flurry of earnings upgrades.

KINGFISHER CLIMBS

Home improvement retailer Kingfisher (KGF) climbed 2.7% to 287p as the B&Q-to-Screwfix owner assured it is ‘comfortable’ with the top end of current market expectations for annual pre-tax profit as ‘strong’ demand continues.

Group like-for-like sales for the fourth quarter to date (9 Jan) are up 16.9%, supported by the lockdown-induced DIY boom and rapid ecommerce growth, although Kingfisher cautioned that ‘uncertainty over Covid-19 and the impact of lockdown restrictions in most of our markets continue to limit our visibility’.

Fantasy miniatures maker Games Workshop (GAW) cheapened 6.5% to £108.7, despite marching in with exceptionally strong first half results, as investors took some profits off the table following a phenomenal share price run.

Games Workshop generated record sales, profit levels and cash generation in the half to 29 November, driven by ‘a step change’ in sales of its Warhammer 40,000 miniatures across the world, though management remains ‘mindful’ of the uncertainty created by Covid-19 and Brexit.

THE HUT UPGRADES GUIDANCE AGAIN

Online retailer THG (THG) ticked up another 2.7% to 811p after it reported a surge in annual revenue and upgraded sales guidance for 2021.

Sales for the year to December 2020 jumped 41% to £1.61 billion, bolstered by a 51% improvement in the fourth quarter and revenue for 2021 is now expected to grow by 30%-to-35%, up from previous medium-term guidance of 20%-to-25%, with an anticipated boost from recent acquisition Dermstore.

Housebuilder Vistry (VTY) rallied 3.6% to 984.5p, having guided for a full year profit at the upper end of forecasts and a resumption of dividends with a ‘modest’ final payout.

Building materials distributor Grafton (GFTU) firmed 2.6% to 964.5p as it too raised its annual profit guidance, citing a strong-than-expected performance in November and December.

Elsewhere, Gamesys (GYS) gained 3% to £12.94 after the online gaming company said it expected to report annual revenue and adjusted core earnings at the upper end of current market expectations following a ‘strong’ fourth quarter performance.

Gambling company Playtech (PTEC) perked up 3.4% to 464.4p as it forecast a better than expected drop in 2020 earnings, completed the sale of YoYo Games for around $10 million and said it remains in talks over the possible sale of financials division Finalto.

MENZIES MARKED HIGHER

Aviation services group John Menzies (MNZS) jumped 4.3% to 244.5p despite flagging a 37% drop in 2020 revenue after the pandemic hurt the airline sector. Investors focused on news the company generated an underlying operating profit in the second half, driven by increased volume, government support programs and cost cutting.

Agriculture and engineering group Carr’s (CARR) rallied 5.4% to 131p as it said its agriculture business was performing ahead of expectations, although the engineering business was behind amid a backdrop of lower oil and gas investment following a fall in oil prices.

The company said it had made a positive start to the year with trading overall in line with the board’s expectations.

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Issue Date: 12 Jan 2021