US airstrikes on Iran has left equity investors edgy in opening trade as Iran promises aggressive response.
IC TIP UPDATES:
Despite the uncertain UK backdrop, a trading update from Johnson Service (JSG) indicates trading has remained strong with “consistent” organic growth achieved during 2019. The textile services provider is guiding that full year results will be slightly ahead of market expectations. The £10m high volume linen plant in Leeds remains on course to be opened in the spring. The group has acquired Fresh Linen Limited for a cash consideration of £12.5m, extending its presence in South East of England, an area in which it has previously been underrepresented in the high volume linen market. Buy.
Next (NXT) is often treated as a bellwether for the UK retail sector and, if this is the case, things are looking positive. The group grew full-price sales 5.2 per cent in the period from 27 October to 28 December, 1.1 per cent ahead of its internal forecast. As a result, management has edged its full-year profit guidance up £2m to £727m. EPS guidance points to an increase of 5.4 per cent over the coming year. Buy.
OTHER COMPANY NEWS:
Three companies have agreed to pay £10.5m to regulator Ofgem’s redress fund following the major power cut in August last year. RWE (ETR:RWE), which operates the Little Barford power station, and Hornsea One Ltd, which runs the offshore wind farm co-owned by Orsted (CPH:ORSTED), will each pay £4.5m after failing to remain connected to the grid following the lightning strike. Distributor UK Power Networks will also pay £1.5m. Ofgem concluded National Grid’s (NG.) electricity systems operator (ESO) “performed well” during the incident but identified a number of issues it believes must be addressed to reduce the risk of similar events occurring. The regulator says it will accelerate its previously announced review of the ESO’s structure and governance.
