News from FTSE 100 companies has tailed off a little as we’ve reached the and of August. But things should start to liven up a bit as we enter September, and we’ll have a number of our top firms bringing us important news, especially in the first half of the month.
Here are three key updates that might be important for your portfolio:
Associated British Foods, Monday 9 September
Associated British Foods (LSE: ABF) is set to end its financial year on 14 September, and on 9 September we should have a trading statement ahead of that — the results themselves are due on 5 November. The first-half stage, reported in April, saw revenue up 10% to £6.33bn with adjusted pre-tax profit up 25% to £452m. Adjusted earnings per share (EPS) climbed 22% to 41.9p, and the interim dividend got a 10% boost to 9.35p per share. An update in July indicated that things were steady, with overall year-on-year revenue for the 40 weeks to 22 June up 9% and Primark sales up 22%.
The firm’s share price has had a good time, climbing around 40% over the past 12 months to today’s 1,848p, despite dipping to 1,680p in June before recovering. Over two years, shareholders have enjoyed an 80% gain, and there’s been a steady dividend yielding around the 2% mark.
The rising share price has, of course, depressed the forecast dividend yield, and even though there’s a 10% payout increase to 31.5p per share currently forecast, that would only provide around 1.7%. The shares are also quite highly-rated on a forward P/E of 19, but quality companies with steadily-rising earnings don’t usually come cheap — after five straight years of EPS rises, we have further gains of around 10% expected this year and next.
Kingfisher, Wednesday 11 September
Kingfisher (LSE: KGF), the owner of the UK’s B&Q and Screwfix brands together with a number of European outlets, is set to reveal its first-half performance on 11 September. The firm had a tough first quarter, but a pre-close update ahead of next month’s results brought better news, with chief executive Ian Cheshire telling us that “…we have been able to capitalise on the better weather conditions in Q2, particularly in the UK, which has helped us to deliver growth“. Consumer confidence is still weak, but Kingfisher is predicting a first-half in line with expectations.
Earnings fell for the year to February 2013, after several years of double-digit rises, but the City is predicting a 6% rise in EPS this year followed by 13% next year. That, together with the firm’s upbeat outlook, has helped boost the share price by around 40% over the past 12 months to 387p, with all of the gain coming since the start of 2013. Shareholders also have a dividend yield of around 2.5% to look forward to.
NEXT, Thursday 12 September
NEXT (LSE: NXT), one of our high-street successes, is set to deliver half-time results on 12 September, with a 26-week trading statement released on 30 July telling us to expect an overall sales rise of 2.3%. The firm’s earlier guidance had suggest something in the 1-4% range, so that’s close to the mid-point.
Sales continue to be volatile, as also experience in the first quarter, with the firm saying that consumers are “becoming more spontaneous in their purchasing habits“. Short-term effects of things like the weather are apparently becoming more pronounced.
The NEXT share price has done well, with steady appreciation all year resulting in a 12-month gain of 35%, to 4,914p. After four years of double-digit EPS growth, a reasonably high P/E valuation might be expected, but NEXT shares trade on a multiple of only around 15. That does not seem excessive to me. Back in 2011, the P/E fell to under 10, so well done to those who identified the screaming bargain at the time.
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> Alan does not own any shares mentioned in this article.
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