Wednesday 22nd October - It's good news week
I mentioned on Monday about businesses that do well in difficult times (if you didn't read that, it was escapism, maintenance, low ticket and high ticket items) and then blow me down - in the press this week three businesses announced good profits - two that I would have expected and one surprise!
Firstly, Thorntons, the chocolate people. Now there's a niche market if ever there was one but haven't they done well? Profits to the year end to June 2008 were up 19.6%, and have continued to grow a further 6.4% to October. They have recorded increased sales in every one of their last 8 quarters. Why? Out and out escapism I reckon!
Then we turn to Tesco. They have just announced their pre tax profits for the first half of 2008 - at £1.45 billion, which is a 10% increase on the previous six months. And it again proves the point that people will buy low price options, and Tesco and Morrissons have gained where the up market grocers have lost. But with Tesco, it's more than that because they have become a solid institution in the eyes of the populace and in the week that Bradford and Bingley got into difficulty, applications for the Tesco deposit account doubled. So it seems that the people trust Tesco to look after their bread and milk supplies AND their spare cash.
Finally, the one that does surprise me - Disney Land Paris. After years of difficulty and financial losses, it is about to announce (apparently) an £8 million profit, a complete turn around from the loss of £32 million last year. That's amazing and normally we would expect to see profits fall for holidays and what is a luxury service - but maybe kids need a bit of escapism too!
