McBride raises full-year earnings outlook on higher demand for cleaning products
- McBride raises earnings outlook as COVID-19 fuels demand for cleaning products.
- The British manufacturer expects robust trading in November and December.
- Primark estimates £430 million hit to sales this autumn due to the COVID-19 crisis.
McBride plc (LON: MCB) raised its guidance for annual earnings on Friday as the ongoing Coronavirus pandemic fuelled demand for cleaning products in recent months. The COVID-19 crisis has so far infected more than 1.6 million people in the United Kingdom and caused over 60 thousand deaths.
The current market consensus for McBride’s pre-tax profit in the year to conclude on 30th June 2021 stands at £25.2 million. The British manufacturer, however, expects its full-year pre-tax profit to come in at least 10% higher than estimates.
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McBride’s performance in the stock market
McBride opened roughly 8% up in the stock market on Friday. On a year to date basis, it is 20% down in the stock market despite a 25% recovery since the first week of April. In comparison, McBride had performed fairly downbeat in the stock market with an annual decline of roughly 30%.
At the time of writing, McBride is valued at £129 million and has a price to earnings ratio of 19.35.
The owner of prominent brands like Hospec, Clean N Fresh, Ovenpride, and Surcare, said on Friday that trading in November and December was expected to be better than in the same months last year. In November and December of 2019, McBride’s performance had remained under pressure.
According to the London-based company:
“This improved revenue performance combined with continued factory efficiencies, limited operational impact from COVID-19, lower than expected operating costs and input costs for certain raw material year on year improvement in first-half earnings.”
In the previous fiscal year, McBride had seen a 33% decline in annual earnings attributed to weaker demand for the company’s laundry products.
Primark estimates £430 million hit to sales this autumn
In separate news from the United Kingdom, Associated British Foods (LON: ABF) estimated an upwardly revised £430 million hit to sales at its fashion subsidiary, Primark, this autumn due to the ongoing Coronavirus pandemic.
The company, however, expressed confidence that phenomenal trading in the period before Christmas will help offset the COVID-19 related hit to sales. AB Foods said last month that its full-year earnings were 40% lower due to the COVID-19 disruptions.
On a year to date basis, Associated British Foods is currently 8% down year to date in the stock market. At the time of writing, the British multinational is valued at £18.76 billion and has a price to earnings ratio of 41.15.