Good morning!

I did another big session of writing last night. So yesterday's report was greatly expanded, and now covers results/TUs from: Xaar, James Cropper, Eckoh, SoftCat, Quixant, Cello, CloudBuy, and Van Elle. Please click here to see the full report.


Today I intend reporting on the following results & trading updates:

Sopheon, Tracsis, Science In Sport, Safestyle, The Mission Marketing.



Firstly though, a quick mention of results out from Next (LON:NXT) . As retailing is my sector specialism, I always read Next's figures with great interest, as there's so much information that has wider significance. A couple of things struck me.

As always, its results just reinforced what a fantastic business Next really is. It generates such a high operating profit margin, that most retailers can only dream of. Also, even in a bad year, it throws off huge amounts of cashflow.

Most retailers have a tail of loss-making shops. Next doesn't. 97% of its store turnover is generating at least a 10% profit margin! 74% of its store turnover is generating over 20% profit margin. Truly remarkable figures, this is such a great business.

Selling price inflation - seems to be around 4-5%, driven mainly by the depreciation of sterling. That doesn't seem too bad to me.

Living wage & other cost pressures - look like they're going to be largely absorbed through efficiency & cost-cutting elsewhere. That includes reducing staff incentives - so clawing back by reducing bonuses, etc, presumably.

Guidance on EPS - quite a wide range. The low end is -12.4% drop in EPS this year versus last year. The upper end is a rise of 0.5%. So a fairly gloomy outlook, although isn't it always with Next? They seem to like starting the year with depressing guidance, then usually perform better.

Rents - this is the most interesting bit, a section called "retail space expansion". Next is still opening new stores, and crucially is now being offered excellent deals by landlords. A table is provided showing that rent/sales in existing stores is 6.6% (that is extremely low!). However, on new sites opening in 2017/18, rent/sales drops to only 5%.

The broader point is that any retailers or leisure operators that are currently expanding, are obtaining superb deals for new sites. This counteracts other problems, such as living wage, apprenticeship levy, business rates rises, etc.

The same factor is happening with

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