On Tuesday, EasyJet reported a record H2 pre-tax profit as soaring demand for holidays over the summer helped the company swing to a pre-tax profit for the full year.

EasyJet shares were up 3.36% and are trading at 418p at the time of writing on Tuesday.

In the fiscal year 2023, easyJet reported a headline profit before tax of £455 million, showing a substantial improvement of £633 million compared to the previous year.

EasyJet holidays experienced remarkable growth, expanding 221%, with the pre-tax profit being £122 million.

According to Sophie Lund-Yates from Hargreaves Lansdown, “easyJet has once again shown how its best-in-class operation has set it up for success. The group’s measured expansion at high-calibre airports has proved an especially shrewd move, as has the supercharged effort to push easyJet holidays. In a time when cost and convenience are the ultimate precursors to whether or not customers will splash on a trip, easyJet has been able to scoop up lots of existing demand in its net.”

She added that “investors are being rewarded for their patience following a bumpy few years with the reinstating of the dividend. The starting point means there’s plenty of room for growth, but it will allow EasyJet to dip its toe before diving in, which is the right move in such an uncertain

Looking into the future, EasyJet reports that the revenue per seat for Q2 to Q4 is expected to outperform YoY.

EasyJet holiday sales are anticipated to experience growth of over 35% in FY24, with the average selling price (ASP) increasing.

Investors will also be happy to learn the company is reinstating a dividend of 4.5p to be paid in early 2024.

EasyJet also reported a plan to increase the payout to 20% of the profit after tax for FY24.

Sophie Lund-Yates further stated, “easyJet is adamant that households will continue to prioritise travel in the new financial year. There are early indications that’s true, but that could change at short notice if the UK folds into recession.”

Lund-Yates also highlighted the conflict in the Middle East was hurting winter bookings.

“The conflict in the Middle East also has the potential to dent performance and will need monitoring closely. The good news for easyJet is that its problems are all outside of its control, which tells the market that its proposition is about as good as it can be and is waiting to take off once conditions allow,” Lund-Yates said.

Pets at Home published its half-year report on Tuesday, revealing that the pet retailer’s H1 consumer revenue 8.6% in the period, smashing their 7% growth target.

Pets at Home shares were up 2.57% to trade at 294p at the time of writing.

Total revenue increased to £774.2 million during the 28-week period ending 12th October, with comparable sales showing a growth of 6.2%.

The growth trend persisted into the initial weeks of the third quarter, recording a roughly 4% rise in comparable retail sales as the holiday season approached.

The underlying pre-tax profit of the group decreased by 19.3%, amounting to £47.8 million for the half-year, primarily attributed to the rise in digital investments.

The company’s CEO, Lyssa McGowan, said that, “our medium-term vision and strategy is to build the world’s best pet care platform. This will generate sustainable value for all stakeholders, as we create a better world for pets and the people that love them.

“We are the largest, and by far the most trusted, pet care business in the UK. We already have a leading 24% share of the £7.2bn UK pet care market, an industry supported by structural growth, underpinning resilience and predictability in our revenues.”

According to Susannah Streeter from Hargreaves Lansdown, “Desires to keep our four-legged friends fed, watered, and entertained have helped the company reach £1 billion in half-year sales. Conditions still seem clement for the pet chain, although the Competition and Markets Authority’s ongoing investigation into the vet sector is still a headwind.”

Susannah Streeter further explained that ,”While this isn’t the entire business case, an unfavourable set of rulings could hamper sentiment, but there’s cautious optimism that this won’t be the case.

“In broader business, fears that the lockdown surge in ownership would subside don’t seem to be materialising. Working from home habits have kept the trend strong, and recurring revenue is bedded in. However, given the competitiveness online, the company must ensure it keeps all its ducks in a row as it continues to expand.”

Kodal Minerals shares have sunk since the lithium miner announced the completion of the funding from their Chinese financing partner.

The recent sell-off was a classic ‘buy the rumour, sell the fact’ trade and is typical of mining companies securing financing and entering a phase of no news and little development.

Kodal Minerals lacks any catalysts for a meaningful re-rate in the short and medium term. Financing has been secured, and the mine will be built.

All Kodal investors really have to look forward to over the next year is possible announcements on issues and challenges with mine construction. This should be expected, and shares will react accordingly.

Those investors with a propensity for higher-risk junior mining exploration companies have plenty of other companies on AIM to choose from that have announced promising early-stage results and are further evaluating their assets. Kodal investors are jumping ship to pursue these opportunities.

In addition, the current circa £100m valuation seems fair given the value attributed to their Bougouni project and the work required to bring it into production.

The $100m acquisition of a 51% stake in the newly incorporated UK subsidiary holding the Bougouni lithium project naturally infers Kodal’s stake is worth a little under $100m.

Of course, this will change should lithium be produced as planned.

Kodal does have other mining assets, but these are of little value.

Looking to the future and to comparisons with peers producing lithium at meaningful volumes, there is plenty of opportunity for the Kodal share price to increase to match peer group valuations.

However, there is a long road ahead to achieving material production from the Bougouni project. Only at this point will Kodal be attributed the valuation other junior lithium miners command.

Horizonte Minerals announced multiple changes to its board and senior leadership on Monday as it worked to finance the construction of its Araguaia nickel project.

CEO Jeremy Martin, CFO Simon Retter, Non-Executive Interim Chair William Fisher, and Non-Executive Director Owen Bavinton will step down from their roles and the board.

The departures come as the company scrambles to secure financing to complete the flagship nickel project after announcing a material shortfall in the initial estimates of how much it will cost to get the project to production.

Founding CEO Jeremy Martin led Horizonte’s acquisition of two Brazilian nickel assets and oversaw feasibility studies and initial project construction. Martin was instrumental in progressing the asset to construction during his 12-year tenure as CEO.

CFO Simon Retter is also leaving the board after serving alongside directors Fisher and Bavinton since 2011. Horizonte said all departing board members and officers will aid leadership transitions.

The company said the changes are intended to support ongoing financing discussions to finish constructing Araguaia. The departures are likely the result of external pressures on the company from those considering financing options. Indeed, the Managing Partner and Co-Chief Investment Officer of one of Horizonte’s major shareholders has stepped in as interim CEO to find replacements.

The term ‘rats fleeing a sinking ship’ also comes to mind, but it seems cruel given the excellent work the team did in getting the project to the stage they did before the recent financing woes came to light.

The commodity-heavy FTSE 100 slipped on Monday as miners dragged the index lower following further concerning developments in the Chinese property sector.

The FTSE 100 was down 0.3% at the time of writing.

“Renewed worries about the outlook for the Chinese economy caused tremors across global markets at the start of the new trading week. There was a slowdown in China’s industrial profit growth during October, causing markets to speculate its government will have to come up with yet another stimulus measure to avoid the economy spluttering,” says Russ Mould, investment director at AJ Bell.

“Shares in mining companies tend to slip back whenever there are concerns about China, given it is a major consumer of commodities. True to form, the big mining stocks were in the red on Monday.

“BHP dropped 1.1%, Anglo slipped 0.9%, Rio Tinto fell 0.6% and Glencore retreated 0.4%. A 0.9% drop in the Brent Crude oil price to $79.83 pulled down BP and Shell. Prudential’s focus on Asia also saw its shares caught up in the sell-off, down 0.7%.”

The problems with China’s property market do not want to go away. This may cause problems for London’s leading index through 2024.

The FTSE 100 is heavily weighted towards China, and the index’s direction is more often than not driven by Chinese economic data and developments in the property market.

High-profile problems with Chinese property giants Evergrande and Countrywide have proved to be the beginning of a rumbling crisis for Chinese property companies that is souring commodity markets and general investor sentiment.

“China’s property sector troubles look increasingly intractable as one of its huge lenders is now mired in a criminal investigation after declaring insolvency,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“The real estate boom has turned into a slow motion bust, with companies facing spiralling debt problems, and malaise seeping deeper into the financial sector.  Authorities are probing illegal crimes at Zhongi Enterprise Group, which saw the value of its assets collapse as property prices have spiralled downwards. The latest twist in this sorry property tale of super-speculation is likely to hurt wider confidence further, as it burrows deep into household perceptions of wealth.”

Although China dragged the FTSE 100 on Monday, the losses were contained, suggesting investors are becoming conditioned to poor news from China and the slower Chinese economy is largely priced into markets.

Rightmove

Rightmove was top of the FTSE 100 leaderboard on Monday after the property portal shook off a slowing UK property to lift their guidance on key revenue metrics.

“The momentum that we reported in July has continued through the third quarter and beyond,” Johan Svanstrom, CEO of Rightmove, said.

Russ Mould explained the benefits of Rightmove’s business model and the resilience its displays during tougher market conditions; “It has long been argued that Rightmove could do well in both good and bad market conditions.”

“When times are good, it benefits from a steady flow of properties being advertised on its portal. During tougher times, estate agents and home developers need to work harder to attract potential buyers and that means spending more on advertising.”

Rightmove shares were 5% higher at the time of writing.