Week Ahead

Airlines and Abrdn deliver updates on trading

EasyJet holidaymakers
Easyjet: returned to profit

Investors will be keen to hear about the impact of geo-political events and post-pandemic recovery when budget airlines  EasyJet and Wizz Air update on trading conditions.

Both airlines have expressed concern over conflict in the Middle East, with this week’s updates set to cover the period since the Israel-Hamas conflict began in early October.

The update from easyJet will also offer investors a glimpse of the airline’s progress since a return to pre-tax profit last year.

Bank of America last week gave the airline a double upgrade on the back of stable fuel costs and more people going on holiday.

Shares in Wizz Air have underperformed rivals as it is seen as more exposed to being hit by geopolitical tensions and engine issues from a key supplier. 

Wizz Air’s update will come less than a week after the airline agreed to pay passengers £1.2 million in compensation, following a reassessment of rejected refunds by regulators.

The carrier will be hoping to divert attention to improved passenger statistics for the winter period though, with October, November and December all bringing year-on-year increases in the number of people carried by the airline.

Abrdn will update on flows and trading during H2 in an update on Wednesday. Year on year revenue at the Edinburgh-based asset manager fell 8.72% from £1.69bn to £1.54bn. This along with an increase in selling, general and administrative costs has contributed to a reduction in net income from a gain of £994m to a loss of £550m.

Shareholders in Smart Metering Systems, currently subject to a £1.3 billion offer from UG investor Kohlberg Kravis Roberts, have been told not to attend the meeting on Tuesday to vote on the deal after last week’s decision to switch from a scheme of arrangement to a straight takeover offer. SMS says documents should be sent out this week.

Primark‘s owner, Associated British Foods, is likely to give an update on store opening plans in Europe and America as it targets 530 by 2026 from the current 432. There will be interest in its online roll-out, as well as comments on input cost inflation and pricing across all of its operations.

ABF also owns British Sugar, Ovaltine and Twinings and its share are up by a quarter in the past 12 months. AJ Bell anaysts say this has been helped by improved earnings momentum at Primark, an easing in input cost pressures and improved consumer confidence, which have combined to provide upgrades to earnings expectations and fund share buybacks.

City diary

Monday 22 January

  • Trading updates from Baillie Gifford US Growth Trust, City of London Investment Group, Edinburgh Worldwide Investment Trust, Polar Capital Global Financials Trust

Tuesday 23 January

  • Full-year results from Crest Nicholson, Watkin Jones
  • Trading updates from Premier Foods, ABF (Primark), Henry Boot, Marston’s, Quiz
  • UK government borrowing
  • EU consumer confidence

Wednesday 24 January

  • Trading updates from abrdn, Computacenter, easyjet, TI Fluid Systems, Tullow Oil, Quilter, Wetherspoon

Thursday 25 January

  • Trading updates from Wizz Air, Fuller Smith & Turner, Britvic, CVS, Mitie, Dr Martens, FeverTree Drinks, Halfords, Foxtons and Workspace

Friday 26 January

  • Trading update and AGM: WH smith


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