Homeserve flags forecast-busting profits, Inchcape cancels final dividend
By Josh White
Date: Tuesday 07 Apr 2020
(Sharecast News) - London open
The FTSE 100 is expected to open 88 points higher on Tuesday, having closed up 3.08% at 5,582.39 on Monday.
Stocks to watch
Home repair company Homeserve said it expected to deliver profits ahead of expectations as it maintained a full workforce during the coronavirus crisis. The company, which provides emergency repairs and heating services, said full year adjusted profit before tax was expected to be ahead of consensus expectations at ?181m, up 12%. It has not furloughed or fired any staff, with its 6,000 office-based staff working from home. "HomeServe is continuing to respond to emergency repair requests from customers in all the countries where it operates, and is completing an average 150 jobs every hour," the company said.
Inchcape updated the market on the ongoing impact of the Covid-19 coronavirus pandemic on Tuesday, reporting that trading in a "large number" of its markets had been affected by closures, or significantly lower business activity, leading to the cancellation of its final dividend. The FTSE 250 automotive distributor and retailer described its balance sheet as "strong", reporting current liquidity of ?600m, including ?140m in cash and revolving credit facility headroom of ?460m. Its board said that, to preserve cash, it was no longer recommending the payment of the final dividend of 17.9p per ordinary share, and reiterated its hold on any forward guidance.
Cineworld has deferred dividends and directors' pay to conserve cash after closing all its cinemas during the Covid-19 crisis. The international cinema chain suspended payment of the 2019 fourth quarter dividend of 4.25 cents a share and upcoming 2020 payouts. After being forced to close all 787 cinemas in 10 countries, executive and non-executive directors agreed to defer their pay until there is greater clarity about the effects of the crisis.
Newspaper round-up
Mark Barnett, the protege of fallen investment star Neil Woodford, has been sacked as manager of a ?400m investment trust for poor performance. Barnett has been handed six months' notice by Invesco Perpetual Income and Growth Investment Trust after more than 20 years as its manager. - Guardian
On Tuesday afternoon the eurozone's 19 finance ministers will dial into a conference call that could define the region for years to come. Solidarity in the currency union has been in short supply in recent weeks even as the fragile eurozone became the epicentre of the coronavirus outbreak. Weeks of talks over a joint response to the economic carnage caused by Covid-19 have been largely fruitless. - Telegraph
Lloyds staff have claimed they are struggling with unclean office space and ultra-long hours as the banking industry scrambles to cope with surging demand. Workers told trade union BTU that they are putting in 18-hour days amid an onslaught from small business customers afraid of going bust during the lockdown. - Telegraph
High street banks have blamed the government-owned body responsible for overseeing the coronavirus loans scheme for delays preventing thousands of small businesses from accessing urgently needed funds. The criticism of the British Business Bank comes as Rishi Sunak, the chancellor, prepares to meet bank bosses this week to discuss how they are implementing the scheme. - The Times
Saudi Arabia's sovereign wealth fund has built an 8.2 per cent stake in Carnival, the struggling cruise operator, worth about $430 million on the company's current share price. The move by the Public Investment Fund, which has previously taken stakes in Uber and Tesla, is seen as a vote of confidence in the beleaguered cruise industry. - The Times
US close
US stocks closed well into the green on Monday, after an overall more optimistic tone around the Covid-19 pandemic from the White House at a press conference a day earlier.
The Dow Jones Industrial Average ended the day up 7.73% at 22,679.99, the S&P 500 added 7.02% to 2,663.68, and the Nasdaq Composite was 7.33% firmer at 7,913.24.
It was a positive session throughout, with the Dow opening 934.68 points higher following a red session on Friday, after data revealed that non-farm payrolls collapsed in March, although another sharp rally in crude oil futures helped to stem losses.
Optimism about a marked slowdown in the increase of death rates and new infections in the hardest-hit countries like Italy and Spain saw indices rise on Monday, and had many investors hopeful that current restrictions could be shorter-lived than many had previously speculated.
New York state reported 594 new deaths related to Covid-19 on Sunday, fewer than the 630 reported on Saturday and marking the first daily decline.
But Donald Trump was still cautious, warning that there would be "a lot of death" in what looked set to be the US' "toughest week".
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN