Diageo (DGE), Redrow's (RDW) and Chemring (CHG)
Diageo (DGE) shares plunged by 10 per cent in early trading after the spirits giant warned in a surprise trading update that organic net sales growth and operating profit growth in the first half of the year would be slower than in the second six months of its 2023 financial year. The change in outlook is down to “a materially weaker performance outlook in Latin America and the Caribbean”, where net sales are expected to fall by more than a fifth year-on-year, and factors such as consumer downtrading and lower operating leverage.
Management also cut medium-term guidance. While the company still expects organic net sales growth of 5-7 per cent a year, it now forecasts that operating profit “will grow broadly in line with organic net sales growth”. It had previously guided for annual operating profit growth of 6-9 per cent. CA
Read more: Three figures that show why Diageo is a great investment
Redrow's shares slump after 'lower than anticipated' sales
Redrow's (RDW) shares sank 6 per cent in early trading after the housebuilder blamed its "lower than anticipated sales rate" on a gloomy Autumn market.
Net private reservations for the 18 weeks to 3 November sank by a quarter year-on-year as net cancellations ticking up by three percentage points, also to 25 per cent. Redrow said its older and wealthier buyers are typically more able to buy in cash, but mortgage difficulties further down their sales chains were causing more deals to fall through.
It expects revenue and pre-tax profit to be at the "lower end" of guidance, meaning sales of around £1.65bn and nearer £180m than £200mn in pre-tax profit. ML
