MaxMarioni
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MaxMarioni's Insights

Insights for February 2016

Topics: beverages, Food
Other Insights on Related Shares: DGE.L
Related Shares: Diageo Share Price

Diageo, the drinks manufacturing and distribution giant, has posted interim first-half results which has underwhelmed commentators. The volume of sales has slipped by 3%, from 134 million to 130 million reported sales worldwide, while net sales have decreased by 5% from £5,900 million to £5,606 million. This has resulted in a 7% drop in reported profits before exceptional items from £1,839 million to £1,717 million, and in a parallel decrease of 3% of operating profits from £1,668 million to £1,613 million. The company has reported 1.8% organic net sales growth, a 2.4% organic (before earnings and tax) operating profit growth: the impact to bottom line figures is mostly due to adverse exchange rates and the impact of the disposal of non core assets. Free cash flow has grown by £0.8 billion, reaching £140 million. Earnings per share have risen by 7% to 56.1. The interim dividend has also been increased by 5% and now stands at22.6 pence per share. (Read more)

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Other Insights on Related Shares: RIO.L
Related Shares: Rio Tinto Share Price

Rio Tinto, the second biggest mining company in the world by market share, has reported a loss in profits in its 2015 annual results. Underlying net earnings came in at US $4,540 million, a considerable drop of US$4765 from the total 2014 figures, with net losses totalling US $866 million. The Anglo-Australian company conceded that reduced prices on the raw materials it provides played a major effect on the results, reducing earnings by over 80%. This was partially offset, however, by US$ 2,007 millions gains due to favourable foreign exchange conditions. (Read more)

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Topics: Airline
Other Insights on Related Shares: WIZZ.L
Related Shares: Wizz Air Share Price

Not all the effects of cheap oil are bad for companies. Wizz Air (WIZZ.LN), the ultra-low cost airline focusing on flights to central and Eastern Europe, can testify to this. The Budapest-based carrier, which is traded on the LSE, posted a 17% increase in revenue for the third quarter compared with Q3 last year, up to €310 million, and a 23% rise of almost a million in passenger numbers for the same period, for a total of 4.7 million passengers. Although profit suffered quite a large fall of 20.9% from a year earlier, what the company calls underlying net profit – reported net profit minus foreign exchange losses and exceptional items – was instead almost 4 times what it was for the third quarter in 2014, jumping from 3.6 to 17.2 million. This has permitted the company to raise its underlying net profit guidance for the year to a range between €200 and €210 million. This hike in profitability was partly at least due to the fall in oil prices: first, Wizz Air had to pay less in fuel costs – the average fuel price paid by Wizz Air declined by 27.2% compared to Q3 2014 – and second, it was fed through to passengers with lower air fares, boosting ticket sales. (Read more)

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