Pubs and properties on the menu for Friday

By Tom Howard / January 11, 2018 / www.proactiveinvestors.co.uk / Article Link

It's all about a City boy's two favourite (legal) things on Friday: pubs and properties.

Housebuilder Bovis Homes Group PLC (LON:BVS) will come to the market with a trading statement, hot on the heels of several of its peers which have all updated investors this week.

Traders became a little tetchy over margins when Barratt Developments PLC (LON:BDEV) gave its first half update on Thursday, so Bovis will need to ease any similar concerns from its shareholders.

Barratt's update also suggested the market might be slowing down a little bit, with the builder reporting a flat sales rate in the final six months of 2017.

Liberum expects Bovis to have competed 3,600 units in the year at an average selling price of ?272,000 to give sales of roughly ?1bn - 5% down year-on-year.

On the whole, analysts are looking for a margin of 12.8% and a profit before tax of ?122mln.

Pubs popular over Christmas?

The issues facing all pub chains are well-known and the market will be looking for more guidance on things such as costs, staffing and the trading environment from Mitchells & Butlers PLC (LON:MAB) when it updates investors on Friday.

The FTSE 250 group saw full-year profits drop back in November as the Brexit-hit pound pushed import costs higher, while it also blamed weaker consumer confidence and a shortage of workers on Britain's exit from the European Union.

Like-for-like sales edged higher back then though, so investors will be keen for that positive trajectory to have been maintained over Christmas.

Given that the deluge of retailers this week have pretty much all warned on consumer spending, it will be interesting to see if the pub industry is also still suffering from people cutting back on 'luxuries'.

Labour costs are also likely to be in focus - especially with the firm's "above average exposure" to wages.

 

Significant events expected on Friday January 12:

Trading updates: Bovis Homes Group PLC (LON:BVS), Mitchells & Butlers PLC (LON:MAB), Tarsus Group PLC (LON:TRS), XP Power Ltd. (LON:XPP)

Interims: Artemis Alpha Trust PLC (LON:ATS)

Economic data: US CPI; US retail sales

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