easyjet in Slipstream of Ryanair

Tuesday, 31 October: The FTSE 100 was nudged slightly higher by a clutch of companies reporting third quarter results, though investors remained cautious given political developments on the continent over the weekend.

Croda(+4.36%) lead the FTSE 100 higher, as it reported a rise in sales for the third quarter of 2017 and reiterated full year guidance. The speciality chemicals company said sales increased 6% to £334.6m in the three months ended Sept. 30, as the 3Q profit margin also increased slightly over the prior year, reflecting improved product mix and pricing. Sales on a constant currency basis were 4% higher overall, as personal care and performance technologies segments grew by 7% and 8% on the same basis respectively. Expectations for 2017 were reaffirmed, with management noting that improving sales and margin should allow them to meet consensus estimates.

Weir Group(-6.82%) was the largest faller in the FTSE 250, as the engineering company announced that third quarter orders had grown 21%, but operating profit would be lower than previously indicated. Orders in its oil & gas division increased 59%, whilst order in its minerals division rose 12%. CEO Jon Stanton noted profits would be lower due to project phasing in its minerals division, as well as investment in growth, and one-off plant reconfiguration costs. This phasing is expected to yield benefit in the coming year, as group revenue and profit is expected to demonstrate strong growth on a constant currency basis.

easyjet(+3.18%) was buoyed for a second consecutive day, this came about due to a positive read-across from Ryanair’s 3Q results and the announcement of a further leasing agreement. Ryanair(+4.33%) reported increases in pretax profit and operating revenue for the half-year to September 30, a best performance since April 2014. Avation PLC announced it has signed a conditional letter of intent with easyjet PLC, for a new lease of an Airbus A320-200. The aircraft was previously on lease to the now defunct Air Berlin, and it is now dependent on the formal completion of easyjet’s partial purchase of Air Berlin.

Across Europe, indices were up at the close with the FTSE 100 +0.07%, the DAX 30 +0.09% and the CAC 40 +0.18%.

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