Connect Group shares (LON: CNCT) jumped over 20% on Thursday’s opening as the group revealed a trading update.
The final quarter of the group’s fiscal year had been stronger than management had anticipated.
Underlying earnings for the fourth quarter ending August 29 came in at £10m. As a result, Connect Group now expects to deliver underlying earnings for the full year of between £38.5m and £39.0m. This is above the top-end of the previous guidance announced earlier this year.
Commenting on the latest trading update, Jonathan Bunting, Interim Chief Executive Officer, said:
“The Group has made good progress in the delivery of its core objectives in the period, continuing to drive efficiencies in Smiths News while completing the strategic review of the Tuffnells business and its subsequent disposal on 2 May 2020. The removal of the drag on profitability and cash, and the alignment to our core expertise, will strengthen and focus the Group going forward. The COVID-19 pandemic will clearly have a material impact on the Group’s performance in the second half of the year, the quantum of which remains unclear.
“However, our markets and business model are well placed to recover as lockdown restrictions ease. In the current environment, we are applying that same focus to our vital role in supplying our retailers and their communities across the UK. Colleagues across the Group have been steadfast in their commitment to these goals; their safety and wellbeing, together with that of our customers, remains our top priority at this time,” Bunting added.
Connect Group shares (LON: CNCT) are currently trading +21.34% at 22,60 (1045GMT).