easyJet PLC results will offer opportunity to outline omicron-related outlook

Other results and statements on Tuesday’s agenda include publisher Future, water company Pennon and fintech newcomer Wise

Who’d be the owner of an airline in the current environment? At the moment their shares are almost as volatile as cryptocurrencies.

But for backers and bosses of easyJet plc (LSE:EZJ) at least the company has £1.2bn in its back-pocket that it raised in September.

The budget airline has already revealed the headline loss before tax for the year to the end of September is expected to be between £1.135bn and £1.175bn in Tuesday’s results.

At the time it issued that guidance, the consensus forecast among analysts was for losses of £1.175bn; that has subsided to £1.153bn.

Cash burn on a fixed-costs-plus-capital-expenditure basis for the final quarter of the financial year – the third of the calendar year – was around £36mln a year, which was below the company’s guidance of £40mln.

Analysts and investors will be most interested in the company’s views of the likelihood of further travel restrictions being introduced in the wake of the discovery of the new ‘omicron’ strain of the coronavirus.

Wise up

Wise PLC (LSE:WISE), the international transfers and payments fintech that floated in the summer, a quarterly update in October revealed transaction volumes were continuing to grow, leading it to say that annual revenue will be up 20-25%.

However, the ‘take rate’ – defined as revenue as a percentage of volume – is expected to be slightly lower in the second half due to price reductions. Full-year gross margin is expected to come in at 65-67% from 62% last year.

The focus on Tuesday’s half-year numbers will therefore be on how trading has gone in the second half so far and if the full-year outlook has changed.  

Polluter Pennon

Pennon Group PLC (LSE:PNN, OTC:PEGRY) will take its turn with half-year results that follow its listed water company peers United Utilities, which reported better profits as business consumption returned to pre-pandemic levels, and Severn Trent, which brought forward plans to improve the quality of rivers in its region by five years.

Pennon investors might expect a little from column A and a little from column B, as the company’s South West Water arm was cited this summer by the UK Environmental Agency for being one of the worst polluters performers in the sector, after allowing raw sewage to spill into rivers and the sea and performing “significantly below target” for pollution for the 10th year in a row.

In July the FTSE 250 group unveiled plans to achieve net-zero carbon emissions by 2030, and has since identified renewable energy generation investment opportunities of £60mln, in addition to £20mln associated with projects related to regulatory allowances.

And in September it said there had seen record demand for water as more people have moved to the regions it serves during the pandemic, with water usage and revenue increasing after businesses reopened following the end of lockdowns.

Seeing into Future

Future PLC (LSE:FUTR) reports full-year results on Tuesday, where analysts and investors are likely to be most interested in how the media group’s recent acquisitions are bedding in.

“Every year is a transformational year for Future. The company will report on a year that started with the purchase of Cinemablend, then GoCo, Marie Claire, and finally Dennis. If that was not enough, the company is still digesting and renovating TI Media,” observed Peel Hunt.

“Underlying all this M&A activity is a playbook that delivers strong organic growth – the company’s comments on black Friday should be very telling this year – but for once we believe it is the M&A progress that will be of particular note,” the broker added.

Analysts are expecting underlying earnings (EBITDA) of £206mln on turnover of £601mln. A full-year dividend of 2.34p is in prospect.

Significant announcement on Tuesday 30 November

Trading announcements: DiscoverIE Group PLC, DP Eurasia NV

Interims: GB Group plc, Pennon Group PLC (LSE:PNN, OTC:PEGRY), System1 Group, Vp plc, Wise PLC (LSE:WISE)

Finals: Contango Holdings, Countryside Properties, easyJet plc, Future PLC (LSE:FUTR), Gooch & Housego PLC, Greencore Group PLC, Marstons PLC, Topps Tiles PLC, Shaftesbury PLC, Treatt PLC

AGMs: Advance Energy plc, Alternative Income REIT, Castillo Copper Ltd, Europa Metals Ltd, Nanoco Group PLC

Economic data: Nationwide House Price index (UK), M4 Money Supply (UK)