Ken Murphy, Tesco’s chief executive, will reveal on Wednesday how the supermarket thrived in one of the toughest times for the country. It led the way in bowing to public pressure and said in December that it would repay £585 million of business rates relief. The move, which acknowledged that supermarkets had fared well in comparison to retailers who were forced to shut, jolted most of its rivals into following suit, although Co-op, Waitrose, Marks & Spencer and Iceland are still refusing to repay the taxpayer support.
If Tesco had kept its relief, its profits would largely be the same as last year despite the heavy costs of sick pay for thousands of staff and making its shops secure. As it stands, analysts’ consensus is for Tesco to report £58.4 billion of group sales, a 0.7 per cent increase on last year, and a pre-tax profit of £891 million, compared with £1.31 billion in the previous year.
Tesco says that its online business is now profitable and with capacity for 1.5 million deliveries a week Murphy is expected to emphasise the strength of its market-leading position at a time when experts believe the shift online is a permanent one. However, investors will be keen for a sense of how much Tesco’s sales will drop once people are allowed to go to pubs, bars and restaurants again.
Tomorrow
A surge in demand for comfy hoodies and exercise clothes during the pandemic has meant that JD Sports has fared well despite store closures. In January it delivered a boost to profit guidance on the back of strong online sales, with the market now expecting £400 million of annual pre-tax profit. Peter Cowgill, JD Sports’s boss, has got the taste for acquisitions in the past year and analysts will want to know if it will continue with its overseas dealmaking.
Interims Plus500, Revolution Bars
Finals SourceBio International, JD Sports Fashion,
Next Fifteen Communications, Good Energy, JTC, Northbridge Industrial Services, French Connection, SigmaRoc
Trading update Electrocomponents, XP Power
Wednesday
Robert Walters can be expected to follow its peers in reporting improved fee income and profit for the first quarter after a tough 2020.
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The London-listed recruitment group, which operates in more than 30 countries, suffered a 75 per cent drop in annual pre-tax profit last year as the pandemic hit hiring globally. However, profit was ahead of market expectations after it cut costs and benefited from its exposure to Asia Pacific, the group’s largest region, where pandemic restrictions have been lifted faster than elsewhere.
The company had previously said that it had seen pockets of strong demand from the technology, cybersecurity and healthcare sectors. Last month Robert Walters, the chief executive, said that early 2021 trading was “in line with current market expectations for the full year” and “signs of improvement” in Asia Pacific provided “a degree of cautious optimism for a longer-term economic recovery”. Page Group, another recruiter, reported fee income and profit ahead of expectations last week after a recovery in hiring in March.
Finals Tesco, Destiny Pharma, Mission Group, Futura Medical
Trading update Audioboom, Robert Walters Group, Watkin Jones
Thursday
A first-quarter trading update would not normally carry huge significance, especially one little more than a month after full-year results. But Deliveroo is not a normal company. The loss-making food delivery outfit floated on the London Stock Exchange at a bottom-of-the-range value of £7.6 billion and fell by 30 per cent on the first morning of trading. Most analysts expect it to report trading in line with its previous comments.
Finals THG Holdings, PureTech Health, Oxford Biomedica, Intelligent Ultrasound, Epwin
Trading update Hays, Naked Wines, Norcros, Travis Perkins, Deliveroo, Entain, Polar Capital, Nucleus Financial
Friday
Ashmore, an investment manager focused on emerging markets, had $93 billion of assets at the end of last year. Yet unhelpful movements in markets since then are likely to have taken their toll, Stuart Duncan, an analyst at Peel Hunt, the broker, said before Ashmore’s latest trading update. “EM debt markets have . . . moved lower since the start of the year, and AUM [assets under management] are likely to show modest declines,” he said. Ashmore has its origins in an emerging markets funds business run by ANZ, the Australian banking group, before becoming a separate company in a 1999 management buyout.
Trading update Ashmore, Kainos, Man Group, Mediclinic International