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Halfords (HFD), Pets at Home (PETS), Wickes (WIX), SSP (SSP), Foxtons (FOXT), Harworth (HWG), SThree (STEM) and S4 Capital (SFOR)
Shares in Halfords (HFD) jumped by a fifth after the company upgraded profit forecasts on the back of healthy third-quarter trading.
The company reported a 13 per cent like-for-like increase in cycling sales, as more bikes were given as Christmas gifts.
The autocentres business also grew servicing, maintenance and repair revenue by 10 per cent, while the colder weather in recent weeks also helped to boost motoring product sales in January by 5.5 per cent.
The improved trading led the company to increase its underlying pre-tax profit to £32mn-£37mn, which is well ahead of the company-compiled consensus forecast of £28mn.
The outlook for next year is less certain, though. Although its direct labour cost increases are “relatively easy to quantify” at £23mn, the effect on demand and the health of the broader economy are harder to predict, the company said. MF
Pets at Home’s store sales dogged by cautious consumers
A slower Christmas in Pets at Home (PETS) stores was offset by a strong performance from its vets business.
Like-for-like revenue for the three months to 2 January was down 1 per cent across the group, and 2.8 per cent in stores. The company blamed “a more challenging UK consumer backdrop, with particularly weak footfall from October”. Vet group revenue grew by 20 per cent, though, supported by an increase in subscriptions, visits and average transaction values.
Full-year guidance was left unchanged, though, and the company still expects “modest growth” in underlying pre-tax profit. The shares rose by 3 per cent. MF
Wickes begins its own rebuild
Shares in Wickes (WIX) rallied after it reported a much stronger second half.
Like-for-like sales grew by 0.1 per cent in the second half, following a 3.9 per cent decline in the first, meaning a full-year decline of 2 per cent.
The improvement was due to a much stronger performance at its retail arm, where like-for-like sales grew by 2.6 per cent in the first half and 1.5 per cent over the course of the year. The design & installation arm, which fits big-ticket items such as kitchens and bathrooms, remains in decline, but its performance improved markedly, from an 18 per cent sales contraction in the first half to orders moving back into positive territory by the fourth quarter (although delivered sales were still down 3.1 per cent).
Wickes’ shares jumped by 9 per cent as the company said adjusted pre-tax profit would be “towards the upper end” of consensus forecasts, which range from £39.7mn to £44mn. MF
Read more: This retailer is on the up – and is a prime takeover target
SSP enjoys strong start
SSP (SSP) reported a 14 per cent increase in first-quarter revenue at constant currency rates, which it attributed to “continued structural growth across the travel industry”.
The operator of restaurants, bars and other concessions within travel hubs said like-for-like sales growth of 6 per cent was accompanied by a 5 per cent increase through net site gains and a further 5 per cent through acquisitions. There was also a 2 per cent reduction following its exit from 13 unprofitable motorway service sites in Germany. Full-year guidance (for revenue of £3.7bn-£3.8bn and earnings per share of 11.5p-13.5p) was left unchanged. The shares rose by 4 per cent. MF
Foxtons beats market expectations
Foxtons (FOXT) beat market expectations this morning after reporting adjusted profit growth of around 33 per cent and revenue growth of 11 per cent, sending the shares up 5 per cent.
Foxtons reported revenues of around £163mn and adjusted operating profit of £19mn in its full-year trading update this morning. The estate agent, which dominates in London, saw lettings revenue grow by 5 per cent. This segment makes up 65 per cent of group revenue.
The estate agent also reported that the sales under-offer pipeline was “significantly above” the prior year and was at the highest opening position since 2016. This is expected to underpin year-on-year revenue growth in the first quarter of 2025. NV
Harworth moves towards £1bn target
Shares in Harworth (HWG) rose by 2.9 per cent this morning after the group confirmed that EPRA net development value (NDV) for the full year would be in line with expectations as the group moves towards its £1bn target.
Harworth also completed a record number of residential sales, selling 2,835 plots at a headline price of £104mn, which was “in line with or ahead of 30 June 2024 book values.” Harworth’s residential land pipeline totals 31,264 plots, of which 15 per cent is now consented following the receipt of permission on a further 818 plots.
Net debt increased by 28 per cent to £46.7mn, representing a pro-forma loan to value based on June 2024 valuations of 6.1 per cent. NV
SThree shares drop on fees and profit slide
Shares at SThree (STEM) fell nearly 6 per cent this morning after the specialist recruiter reported a drop in full-year net fees and profits due to the ongoing hiring slowdown.
Group net fees fell 9 per cent on a like-for-like basis to £369.1mn in the year to 30 November, with declines across the Netherlands, Germany and the US, the firm’s three largest markets.
Contract net fees, which make up 84 per cent of the business, fell by 7 per cent, against a steeper 18 per cent decline in permanent positions. Fees for engineering roles were down 1 per cent, while technology recruitment fell by 10 per cent and life sciences by 17 per cent.
The net fees slide meant pre-tax profit declined by 9 per cent to £67.6mn. As disclosed in an unscheduled update in December, management expects pre-tax profit for the 2025 financial year to come in at around £25mn, including up to £7mn of one-off costs to deliver operational efficiencies. VM
S4 Capital expects 2024 results to beat consensus
S4 Capital (SFOR) shares surged by 14 per cent after the advertising and marketing firm said 2024 net revenues and operational Ebitda are likely to beat market expectations.
Net revenues are expected to come in at £746mn and operational Ebitda at £84mn. Like-for-like revenues are anticipated to be 11 per cent lower and the operational Ebitda margin to sit in the range of 11 to 12 per cent for the year.
Net debt is also expected to be below current consensus of £185mn and below the lower end of the previously guided range of £150mn-£190mn, with a 1.6 net debt to Ebitda ratio, compared with current consensus of 2.2x.
Management added that net revenue and operational Ebitda for 2025 is expected to be broadly similar to 2024. More detailed targets will be disclosed in its full-year results on 24 March. VM
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