AO World expecting revenue rise, Mondi sees quarterly earnings slip
By Josh White
Date: Thursday 15 Oct 2020
(Sharecast News) - London open
The FTSE 100 is expected to open 43 points lower on Thursday, having closed down 0.58% on Wednesday, at 5,935.06.
Stocks to watch
Online electrical retailer AO World said it expected half-year revenue to rise by more than half driven by strong performances in the UK and Germany. The company said it expected group revenue to rise by 57% year on year for the six months to September 30. UK revenue increased by 54% and German sales rose 83% on a constant currency basis. "In our UK retail business, the sales momentum continued from Q1 throughout Q2 despite the reopening of competitor bricks and mortar stores. We believe we have seen a lasting step change in online penetration," AO World said on Thursday.
Mondi said on Thursday that third quarter underlying EBITDA fell 20% year-on-year to €306m (£276.55m), despite lower costs. The FTSE 100 packaging producer said compared to the second quarter, underlying EBITDA was 13% lower. It said good volume growth in uncoated fine paper and fibre-based packaging products, as well as ongoing strong cost control, was more-than-offset by the impact of planned maintenance shuts, negative currency effects and lower average selling prices.
Newspaper round-up
Shops will offer cashback without consumers needing to make a purchase, under Treasury proposals to protect people's access to cash. In 2019 consumers received £3.8bn in cash when paying for items at a till, making it the second most popular way of withdrawing money behind ATMs. - Guardian
Management consultants are being paid as much as £6,250 a day to work on the British government's struggling coronavirus testing system, sources have confirmed. Senior executives from Boston Consulting Group (BCG) are being paid fees equivalent to £1.5m a year to help speed up and reorganise the £12bn network that Boris Johnson said in May would be "world-beating". - Guardian
Ocado has lost the right to open a new depot in north London after the local council ruled that a planning application was misleading. The news emerged after Labour councillors in the area welcomed the move by the authorities in Islington. The decision could be a major setback for Ocado's ambitions to have depots closer to shoppers to cut delivery times. Other supermarkets, such as Tesco, have also begun building urban warehouses to dispatch online orders from. - Telegraph
Policymakers in Britain must do more to help people to find jobs in order to boost productivity and limit the long-term economic fallout from Covid-19, according to a report by the Organisation for Economic Development and Co-operation. In its latest forecasts for the UK economy, the body said that government interventions to protect jobs and incomes would lead to unemployment averaging 5.3 per cent this year. - The Times
Deloitte has resigned as auditor of EG Group, the British petrol stations company whose billionaire owners have agreed a £6.8 billion takeover of Asda, amid concerns about its governance and internal controls. EG Group, which owns nearly 6,000 petrol stations and reported more than €20billion of revenue last year, told its bondholders in a private notice this week that KPMG had been appointed as its auditor after Deloitte resigned with "immediate effect", according to the Financial Times. The firm had been auditing EG Group's accounts for four years. - The Times
US close
Wall Street stocks finished in negative territory on Wednesday, amid a flurry of corporate earnings.
At the close, the Dow Jones Industrial Average was down 0.58% at 28,514.00, the S&P 500 was off 0.66% at 3,488.67, and the Nasdaq Composite was 0.8% weaker at 11,768.73.
The Dow closed 165.81 points lower on Wednesday, after losses in the previous session, as market participants digested some key corporate earnings and news of a pause in multiple Covid-19 vaccine studies.
Stimulus talks were still drawing attention on Thursday, as was election polling, which currently has Joe Biden ahead by 17 points on a national basis.
On the macro front, mortgage applications fell 0.7% in the week ended 9 October, after increasing 4.6% in the previous week, according to the Mortgage Bankers Association.
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