Next and SSP Group to update investors mid-week


Wednesday is coming with two representatives from the FTSE 100 and FTSE 250 updating on current trading.

Next’s investors will be seeking reassurance on dividend payment plans, while SSP Group will have to comfort shareholders that things are improving after a tough year and a half in the travel industry.

In terms of macro releases, the mid-week comes with UK and US housing figures in terms of mortgage lending and approvals.

Thank u, Next

Alongside July’s second-quarter trading statement, Next announced a plan to return GBP240mln of “excess cash” to shareholders.

It paid out GBP140mln on 3 September and said it would pay out the rest, amounting to GBP100mln, following the Christmas trading update in January 2022, assuming all was going to plan.

The FTSE 100 retail powerhouse also noted that it would then look to resume ordinary dividend payments in the year to January 2023, when analysts and shareholders may also ponder the resumption of share buybacks as well.

Analysts and shareholders will also look out for Lord Wolfson’s take on pressing strategic and macroeconomic issues, notably the value of High Street stores, the ongoing addition of third-party brands to the website and issues surrounding input costs, the availability of raw materials and freight capacity and pricing.

“It should be particularly informative to hear Next’s views on pricing, given how the firm benchmarks itself on the basis of full-price sales,” analysts at AJ Bell said.

SSP: Seeing Some Progress?

Year-end numbers from SSP Group comes with the travel sector lately flying into brighter skies after the Biden administration re-opened the gates on flights into the US.

SSP, which operates food concessions in 180 airports as well as railway stations, was among those lifted by the news, having said it will start to reopen units when they can make a positive contribution to underlying profits.

In the previous quarter, the company reported a 73% decline in sales versus 2019, with flights down 41% globally and UK rail passenger volumes 57% lower.

With 1,150 out of 2,750 units open at the end of May, with 1,200-1,500 expected to be open in Q4, management guided to fourth-quarter sales being down 60%.

Analysts at Peel Hunt said it should be doable given that global flight numbers were down 32% and UK rail passenger numbers were down 43%.

“We estimate having about half the estate open would be consistent with total revenues being down 60%.”

Peel analysts do not expect 2022 to be upgraded at this stage, given the trend in business travel and the risk of new Covid variants to international travel, though they predict in future that SSP “should benefit from enhanced expansion opportunities and the long-term retention of recent cost savings”.

Significant announcements expected for Wednesday 29 September:

Interims: Next PLC (LSE:NXT)

Trading announcements: SSP PLC

Economic data: UK mortgage lending/approvals


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