What to expect in the week ahead – company results

Remgro (Full Year Results): According to Bloomberg estimates, headline earnings per share (HEPS) are expected to increase by 15.6% for the full year. The company reported a drop in HEPS of 10.4% during the first half as Mediclinic’s contribution to earnings fell 50.5%. Other investments’ contributions declined 25.6%. Banking, consumer products and insurance are expected to contribute positively to the result.

Grand Parade Investments (Full Year Results): In its interim results, the group reported a 281% rise in HEPS off a very weak base due to start-up costs related to new restaurant launches. The improvement in Burger King and continued strong performance from GPI Slots contributed positively to the result.

Group Five (Full Year Results): In a recent trading update, the company cautioned that the headline loss per share is expected to deteriorate by between 52.4% and 70%. Consensus was expecting losses to narrow by 18.1% for the full year. Despite benefits being realised following the restructuring and rationalisation programmes implemented in FY18, further losses were incurred in the 2H18 due to additional losses on the independent gas and oil-fired combined cycle power engineer, procure and construct (EPC) contract in Kpone, Ghana (Kpone). Difficulty in the construction sector as some contract awards did not materialise whilst some secured contracts materialised later than anticipated also weighed on the result.

From a local corporate actions perspective, Tuesday marks the last day to trade in Richemont, Exxaro Resources, KAP Industrial Holdings, AdaptIT, Fortress REIT, BidCorp, NEPI Rockcastle, Old Mutual Limited, Bidvest, Santam, Cashbuild and Growthpoint Properties to receive their latest distributions. These counters will trade ex-dividend on Wednesday. Datatec and Omnia will host AGMs over the week, while EOH will host a GM in relation to the proposed strategic partnership and BEE transaction to be concluded between EOH and Lebashe.

American multinational computer technology corporation, Oracle, and the largest retailer of aftermarket automotive parts and accessories, AutoZone, are scheduled to release quarterly results on Monday and Tuesday respectively. Bloomberg estimates are guiding for positive top and bottom-line growth from both companies. According to Bloomberg Intelligence, Oracle isn’t expected to report any major surprises in its upcoming results, due to its seasonally muted quarter. The adoption of Oracle’s new autonomous database and bring-your-own-license offerings, introduced late last year, will likely have a positive impact during the second half as clients have more time to test them. Revenue growth is expected to be steady as improving IT-spend within the industry continues to boost sales of both cloud and on-premise products.

Information supplied by FNB Securities



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