The Irish corporate earnings season gains momentum this week, with results due from Bank of Ireland, Kingspan, Kerry, Fyffes, and Glanbia.
While all – except Bank of Ireland – have substantial businesses overseas, close attention will be paid to what they say about the Irish market.
Bank of Ireland’s results will be watched, in particular, as will its comments on current trading, loan demand and bad debts. The big dairy players also still have interests in the home market, even if most of their profits are now earned in huge overseas operations.
Currency gains
Dairy giants Kerry and Glanbia both have stable business models based on large overseas operations and appear able to ride out issues such as the fall in milk prices. Glanbia is expected to benefit significantly from currency factors, mainly the strength of the US dollar against the euro.
Netting this out earnings per share (EPS) are still guided to rise by some 10 per cent, while Kerry’s Group’s adjusted EPS is guided to rise by some 8 per cent.
Elsewhere in the food sector, Davys forecast that Fyffes will report underlying EBITDA of close to €47 million, after the company upgraded its guidance in the middle of last year.
For Bank of Ireland , Goodbodys is forecasting a net profit of €980 million, up from €844 in the 2014 financial year. It expects net interest margins to remain flat at 2.2 per cent.
Davys says that “2015 will demonstrate ongoing progress towards sustained profitability” for the bank.
It feels that profits can reach the €1 billion barrier. Both brokers believe the bank can outperform the market.
