Equity Briefing: Babcock International and Inland Homes

Babcock International is expected to release its full-year results after having to delay their publication, while Inland Homes is scheduled to report interim results early this week. We explain what to expect.

Want the latest news to come to you?

You can get the latest market-moving news and incisive insight sent straight to your inbox every day, including the Equity Briefing, by subscribing to receive our market commentary updates.

Click here to subscribe.

Babcock International

Babcock International has had to delay the release of its results for the financial year to the end of March because of the pandemic. The engineering firm is expected to publish them soon, potentially as early as today.

The main revelation will be the impact of its current reviews that is seeing Babcock restructure itself for future growth, but at a hefty cost in the short-term. It has already revealed the review of its balance sheet has identified around £1.7 billion worth of impairments and revealed underlying operating profit will be down around £30 million each year.

This comes as it looks to offload around £400 million worth of assets and refocus on its aerospace, defence and security work in the UK, France, Canada, Australia and South Africa.

This makes the final results hard to gauge, but it did provide an insight into its performance last April, revealing underlying revenue dropped to around £4.69 billion in the year from £4.87 billion and that underlying operating profit dropped to £307 million from £524 million. Analysts are expecting revenue of £4.59 billion and profit of £289.8 million.

Babcock has said profitability will be impacted over the coming years as a result of the restructuring but will set it up for growth in the medium-term. It has said it should be able to return Babcock to growth without having to raise equity.

Inland Homes

Inland Homes is also expected to publish interim results covering the six months to the end of March before the end of June, so expect them to be released early this week.

The company specialises in maximising the value of land by securing planning permission and then deciding what to offload, what to develop itself, and what can be advanced with the help of external investors. It also has an asset management service and a portfolio of rental properties.

In March, the company revealed the level of work of its asset management division, rate of reservations and forward order book had all remained broadly steady from its last set of full-year results, which saw revenue and profits plunge as the pandemic disrupted the business.

Investors will therefore be hoping things have improved over the last few months to set it up for a stronger performance in the second half. The fact it has secured planning permission for three projects, including a new major development in Basildon, and sold-off a hotel in Bournemouth shows some progress has been made during the period.

How to trade top stocks

You can trade a variety of stocks with City Index by following these four steps:

  1. Open a City Index account, or log-in if you’re already a customer.
  2. Search for the company you want to trade in our award-winning platform
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade 

Build your confidence risk free

More from Equities

Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.