A couple of trading updates to start the week

Computacenter  (CCC), the independent provider of IT infrastructure services that enables users and their business, today provided an update on trading for the year ended 31 December 2017. This turned out to be acurates egg of an announcement as they started out by saying: "The adjusted pre-tax results for the year are anticipated to be ahead of the Board's expectations as at the time of our trading update on 14 November 2017 and which have been upgraded a number of times throughout 2017."  They did however go onto say in the outlook that a number of one-off costs and investments within the Group in 2018 that will not repeat in 2019, will hold back the enhancement of profitability in 2018. As a result they disappointingly said that at this early stage they therefore expect 2018 to be a year of "stable profitability", hence my curates egg comment. Looking at the forecasts I see there was only modest growth suggested for 2018 so maybe this won't be such a shock but could lead to downgrades of around 3% which is not great. This leaves them on a fairly full looking 18x with a well covered yield of around 2.2%, so probably up with events for now.

Alliance Pharma plc (AIM: APH), the specialty pharmaceutical group, announced its pre-close trading update ahead of the announcement of its preliminary results for the year ended 31 December 2017.
This was of the in line variety with the main features being a strong performance from their growth brands, a boost from FX  & a reminder about recent acquisitions that they made. They also highlighted that this had led to debt levels rising to 2.5x EBITDA at the year end, but they also flagged their strong cash flow generation and therefore that they expect their debt ratio to decline to 2x EBITDA by the end of 2018. This strong cash flow and good levels of earnings cover (3x) should continue to underpin their progressive dividend policy of about 10% per annum growth. On this basis and assuming no changes on the back of this update they trade on around 15x earnings with a yield of just over 2%, in summary not that exciting a bit like the business.