UK fashion retailer Next (NXT) has lifted its full year profit forecast by £10m to £727m after it saying that trading in August was better than expected.

Shares in the FTSE 100 high street operator shot to the top of the FTSE 100 leader board in early trade on Tuesday after the company revealed ‘we did not experience any material loss of sales in August or early September.’

The shares rally 8.5% to £55.58.

Next reported interim pre-tax profits of £311.1m, just below expectations for £316m, but bumper online growth. The company saw internet revenue jump 16.8% to £892.3m and profit jumped 21.2% to £163.3m.

CHALLENGED HIGH STREET

But news from elsewhere across the high street is less encouraging with Card Factory (CARD) buckling under the pressure of tough trading.

While reporting a 17.2% jump in headline pre-tax profit for the six months to 30 June to £27.7m, the company’s underlying performance declined sharply in some areas. This was due to an assortment of factors including foreign exchange, rising national living wage, card payment charges, and ‘our investment in strengthening our competitive position by maintaining our low price points.’

The greetings card business opened a net 25 new stores in the period, to bring its total branch network to 940.

Cared Factory shares are trading around 6.5% lower in early trade at 174.2p.

Online spreadbetting firm CMC Markets (CMC) is also under the cosh after posting a stark warning on its 2019 net operating income on Tuesday.

Shares in the trading platform business have slumped close on 13% to 144.4p, valuing the company at about £416m. They blame low market volatility and regulatory constraints for curbing client trading activity, much like rival IG Group (IGG) last week.

Also warning is building materials supplier Low & Bonar (LWB) as input costs spark a complete profits rethink. Shares in the company have crashed by around 25% in early trade to 38.4p.

NEW BROOM AT IMPERIAL

UK tobacco company Imperial Brands (IMB) said that its divestment plan is on track and progressing well, and it expects full year results in line with expectations as it ramps up the release of vaping products.

That sends shares in the FTSE 100 firm running 1.7% higher to £26.53.

Commodities trader and miner Glencore (GLEN) said on Tuesday it would buy back additional shares worth up to $1bn, increasing the size of its existing buyback programme which is approaching completion. Investors like the sound of that, pushing the share price 2% higher to 336.5p, although still well down on the 415p levels on January.

INVESTORS SWEET ON HOTEL CHOCOLATE

Pre-tax profit climbed by 13% to £12.7m for the year to 1 July at retailer Hotel Chocolate (HOTC:AIM), results that reassure investors. Shares in the firm are up about 3% at 347.5p in early deals, valuing the business at around £392m.

The company opened 15 new stores in the period as well as launching new international ventures in Scandinavia, Japan and opening its first US store.

Irn-Bru maker AG Barr (BAG) shrugged off the new sugar tax, the March cold snap and the CO2 shortage to increase half year pre-tax profits 4% to £18.2m.

The company reported revenue up 5.5% to £136.9m in the six months to 28 July although there was some downward pressure on profit margins, slipping from 13.9% to 13.4%. AG Barr shares drift about 1% lower to 722p, although the stock is up around 50% since late 2016.

ELSEWHERE ON THE MARKETS

British American Tobacco (BATS) has named Jack Bowles as chief executive officer to succeed Nicandro Durante. Bowles has been with BAT since 2004 and will become chief executive designate on 1 November and will join the board on 1 January.

BAT shares drift 1.6% lower to £34.87.

UK power company SSE (SSE) has reiterated its full year adjusted operating profit forecast and said it would buy the remaining 50% stake in Seagreen Wind Energy Limited, continuing its push into offshore wind energy projects. The shares slip 4p to £11.26.

Oil prices on Tuesday were within reach of four-year highs hit in the previous session, as looming U.S. sanctions against Iran and unwillingness by the Organization of the Petroleum Exporting Countries (OPEC) to raise output supported the market.

Gold held steady on Tuesday as the dollar stood firm ahead of the two-day US Federal Reserve meeting beginning later in the day, while simmering US/China trade tensions kept investors nervous about risks to global growth.


Issue Date: 25 Sep 2018