22nd May 2024. 8.55am

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Regency View:


Airtel Africa’s signal strength

Airtel Africa (AAF), in its results for the year ended 31 March 2024, showed its strength despite facing a volatile macro-economic environment.

The company reported a total customer base growth of 9%, reaching 152.7 million customers. Data customers saw a significant increase of 17.8% to 64.4 million, coupled with a 20.8% rise in data usage per customer, demonstrating the company’s efforts in bridging the digital divide.

Airtel also saw substantial growth in its mobile money subscriber base, which jumped 20.7%, reflecting the company’s investment in distribution to drive financial inclusion across its markets.

Despite currency headwinds and inflationary pressures, Airtel maintained resilient earnings (EBITDA) margins at 48.8%. The company’s revenue in constant currency grew by 20.9%, accelerating to 23.1% in Q4 24. Nigeria, a key market, experienced accelerated constant currency revenue growth of 34.2% in Q4 24, reflecting the company’s ability to navigate challenging environments.

Looking ahead, Olusegun Ogunsanya, CEO of Airtel Africa, expressed optimism about the growth opportunities across its markets. The company aims to continue focusing on margin improvement while prioritizing its purpose of transforming lives across Africa.

AAF Daily Candle Chart

AAF Daily Candle Chart

Clarkson sets sail on profitable waters

In a recent AGM trading statement, Clarkson (CKN) said it is on a positive trajectory, emphasising its role in facilitating global trade amidst complexities.

The Broking division demonstrated resilience, aligning spot business with previous year’s levels and showcasing promising forward order book invoicing. Despite challenges in the Suez Canal region, Clarkson’s maintained profitability, supported by strong activity across port agency and supplies.

The Research division continued its upward trajectory, providing market-leading data and insights to a diverse subscriber base. Meanwhile, the Support division showcased good performance, although impacted by lower Suez Canal transit volumes.

The company remains optimistic about the future, with expectations unchanged for the remainder of the year. Laurence Hollingworth, Chair of Clarksons, expressed confidence in the positive outlook, driven by the company’s strong order book and recent contract wins.

CKN Daily Candle Chart

CKN Daily Candle Chart

Costain constructs a bright future

Costain (COST) announced that its year-to-date trading performance has been consistent with internal expectations. The company reported that its average weekly net cash position from January 1 to April 30 stood at £168.8 million, marking a significant increase from the previous year’s figure of £122.9 million during the same period.

The construction company emphasised its commitment to delivering on its margin targets, aiming for an adjusted operating margin run-rate of 3.5% in 2024 and further increasing to 4.5% by 2025.

Costain also highlighted significant contract wins since the beginning of the year, including projects with notable clients such as BP, Northumbrian Water, Thames Water, Transport for London, and two new framework contracts in the nuclear energy sector.

Despite acknowledging the macro-economic backdrop, Costain’s Board expressed confidence in the company’s strategy and medium to long-term prospects. This confidence is reflected in the share price which has carved out a strong uptrend this year. We remain more than happy to hold the stock within our list of FTSE Investor open positions.

COST Daily Candle Chart

COST Daily Candle Chart

Experian’s data dominance continues

Experian’s (EXPN) data dominance continued to reign supreme as the company reported strong financial results and outlined a promising outlook for the future. The credit checking agency’s latest fiscal year ended on a high note, with impressive growth figures exceeding analyst expectations and propelling its shares to new heights.

In the fiscal year ending 31 March, Experian showed its formidable position in the market, with organic growth reaching an impressive 8% in the fourth quarter and a solid 6% for the full year. This performance beat analyst expectations and took the shares to new trend highs.

Total revenue from ongoing activities surged to $7.06 billion, reflecting an 8% increase from the previous year or 7% growth at constant exchange rates. Meanwhile, underlying profit (EBIT) witnessed a notable uptick, rising 7% to $1.93 billion, further solidifying Experian’s financial standing.

CEO Brian Cassin expressed confidence in the company’s trajectory, noting that the results were at the top end of expectations. Looking ahead, the board anticipated “further strategic progress” in the new financial year, with organic revenue growth projected in the range of 6-8% alongside expansions in profit margins.

EXPN Daily Candle Chart

EXPN Daily Candle Chart

easyJet faces headwinds amidst mixed performance in FY24

Investing in easyJet (EZJ) is starting to feel as frustrating as queuing for one of their planes. Just when you think the shares about to take off, they stutter and we’re left waiting once again in the departure lounge!

In its recent financial report, easyJet’s results reflected this narrative of uncertainty. While the company reported a positive summer demand outlook, the actual financial performance fell short of expectations.

The airline reported a headline loss before tax of £350 million, a slight improvement from the previous year’s £347 million loss, but still falling short of profitability.

Despite registering a 42% year-over-year growth in its Holidays division, the overall financial performance remained subdued, reflecting ongoing uncertainties in the aviation industry. Factors such as fuel price volatility and economic fluctuations added to the complexity of the landscape.

While easyJet pursued strategic initiatives like ‘upgauging’ and expanding into new markets, including successful launches in Birmingham and Alicante, the company faced headwinds stemming from subdued demand and heightened competition.

CEO Johan Lundgren emphasized the importance of enhancing customer experience and driving operational efficiencies in navigating through the challenges. However, uncertainties surrounding travel restrictions and consumer confidence persist in the wake of the global pandemic, posing continued obstacles for the airline.

EZJ Daily Candle Chart

EZJ Daily Candle Chart

Keller’s strong start paves the way for a promising year ahead

Geotechnical specialist, Keller (KLR) reported a strong start to the year in its recent trading update…

The company’s performance in the first four months of the year exceeded expectations, with overall results significantly ahead of the previous year. This strong momentum, coupled with a healthy order book and recent contract wins, has bolstered confidence in Keller’s performance for the remainder of the year.

In North America, strong trading continued, supported by ongoing infrastructure investment and improved operational performance. In Europe and the Middle East, while demand remained weak in residential and commercial sectors, the infrastructure segment exhibited resilience. Meanwhile, the APAC region saw profitable trading in some areas despite continued market softness in others.

Keller’s strong cash performance persisted during the period, positioning the company favourably with a net debt/EBITDA leverage ratio expected to be at the lower end of the target range.

Looking ahead, Keller remains optimistic about its prospects for the remainder of the year. With a robust order book and continued momentum in key markets, the company is well-positioned to maintain its momentum.

KLR Daily Candle Chart

KLR Daily Candle Chart

Morgan Advanced Materials announces solid Q1 trading update

Morgan Advanced Materials (MGAM) released its Q1 trading update ahead of its Annual General Meeting. The company reported a 12% increase in sales for the first three months of the year compared to the same period last year, driven by strong organic growth.

Despite facing weaker economic conditions, MGAM maintained its outlook for full-year constant currency revenue growth. The company expressed confidence in its ability to deliver solid performance for the remainder of the year, with additional capacity from recent investments expected to contribute to growth.

CEO Pete Raby emphasised the company’s solid performance and its strategic investments in new capacity and technologies to support growth in Faster Growing Markets.

The shares have started to trend higher with strong momentum, and recent price action has taken out the 2023 highs – opening the door for further gains.

MGAM Daily Candle Chart

MGAM Daily Candle Chart

Vodafone celebrates turnaround milestone as Germany resumes growth

Vodafone (VOD) hailed the progress of its turnaround plan, noting Germany’s return to growth following the divestment of its Spanish and Italian operations. Under the leadership of CEO Margherita Della Valle, the telecoms giant embarked on a transformation journey, streamlining its operations and addressing underperforming markets.

Despite a 74% decline in FY24 operating profits, primarily due to exceptional gains in the previous year, Vodafone remained focused on cost-cutting measures. The company had already reduced its workforce by 5,000 roles, with plans to cut an additional 2,000 positions as part of a €1 billion cost reduction target.

Della Valle emphasised the company’s commitment to improving underlying performance in Germany, aiming to restore it as a significant growth engine by 2026. Meanwhile, discussions with the UK’s Competition and Markets Authority (CMA) regarding the proposed merger with Three were ongoing. The CMA had expressed concerns about potential negative impacts on mobile customers, such as higher prices and reduced quality.

Looking ahead, Vodafone planned to increase investment in customer experience, enhance performance in Germany, and accelerate momentum in its business segment. The company also intended to rebase its dividend and initiate share buybacks, utilizing proceeds from the sale of its Spanish and Italian businesses in the coming years.

VOD Daily Candle Chart

VOD Daily Candle Chart


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