Market Prognosis

A concise summary of the major macro events of the past 24 hours, and selected UK company-specific news.

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February 8, 2024

James Fisher on slow road to recovery, Sanderson and Watches of Switzerland in-line

UK Company News 

Astra Zeneca guided that its revenue and EPS are expected to increase by a low double-digit to low teens percentage in the coming year.   

James Fisher updated that trading in the second half was resilient and aligned with market expectations. The energy market remained largely supportive, albeit North Sea IRM (inspection, repair and maintenance) and decommissioning conditions continued to be challenging. Fendercare benefitted from increased operations in Brazil, and high tanker utilisation and stable day rates are ongoing. However, more closure and reorganisation costs mean debt is taking time to come down, giving a mixed picture.  

The recovery path for James Fisher was always going to be a long one. There is growing evidence of underlying progress, but the lingering debt is an issue. 

Revolution Beauty updated that FY24 adjusted EBITDA is expected to be between £11 million and £12 million (previous guidance for low double digits) and revenue growth in the low single digits. It has accelerated the rationalisation of lower-margin SKUs, successfully driving margin improvement. 

Given the exceptional performance of fellow make-up supplier Warpaint, RevB has been sidelined by internal issues and management changes. With settlements of some of the legacy disputes now progressing and a more stable management team in place, there might be a recovery play here.   

Sanderson Design traded in line with management expectations with the strong growth reported in the half-year from the Group’s licensing activities and North America continuing in the second half, mitigating the challenging conditions in the UK. FY revenue outlook remains unchanged. Specific cost pressures are expected, including the increase in the Real Living Wage and property-related costs, such that profitability in the current financial year is expected to be similar to that of the year ended 31 January 2024. Note. 

Watches of Switzerland reconfirmed guidance from its 18 January 2024 Trading Update. It is encouraged by the UK Office for Budget Responsibility’s review of VAT-free shopping for tourists; it has not included its reintroduction into our guidance. 

An in-line statement so soon after its recent warnings is welcome news in the luxury sector currently. 

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