Companies reporting this week

By THIS IS MONEY
Updated:

 

HEAVYWEIGHTS in sectors ranging from tobacco, chocolate and frozen food to pubs, banking and supermarkets are due to turn in half yearly or quarterly numbers this week.

Analysts do not expect any major surprises when BP reports its third quarter results on Tuesday, predicting a 34% rise in pre-tax profits to about £1.81bn.

Third-quarter production is expected to be slightly ahead of the same period last year, with US gas prices remaining robust despite a fall in the quarter and particularly strong refining conditions in the US midwest and west coast boosting downstream incomes.

However. higher utility costs, currency movements and refinery downtime are likely to offset that and sterling dividend growth is likely to fall slightly due to the weakness of the dollar.

Analysts reckon pubs group Whitbread will be toasting a 5.6% rise in interim pre-tax profits to £132m when it reports on Tuesday.

The group is expected to confirm that Beefeater continued to improve, David Lloyd Leisure stayed strong and Brewers Fayre performed reasonably.

That will leave interim profits and earnings comfortably ahead of last year, despite the impact of the weak London market on the group's Marriott and Travel Inn hotel chains.

Investors want to know whether Whitbread plans to acquire Premier Lodges, which is part of the Scottish & Newcastle retail business being bought by Spirit Amber.

The market is likely to look past Wednesday's second quarter trading update from supermarket takeover target Safeway, focusing instead on rival William Morrison's expected bid for the group.

Nevertheless, Safeway is set to report a slight improvement in sales trends against the first quarter, although a small decline in market share and flat like-for-like sales are expected as food price inflation offsets a loss in volume.

A lack of supplier support could have damaged margins, making the profit outlook uncertain, Gerrard said.

'If Safeway manages to deliver this performance, it will be behind industry leaders, but ahead of restructuring Sainsbury - a creditable performance given the pressure on the company caused by takeover speculation,' an analyst added.

This week's profits warning from consumer products giant Unilever is likely to mean investors will be seeking reassurance when it unveils third quarter figures on Wednesday.

Analysts expect the results to show steady growth in profits - to £1.2bn from £1.1bn, but the second downward revision this year of leading brand growth predictions means investors will be looking for something extra.

If factors such as the Atkins Diet, which hit sales of SlimFast, can dent the progress of its Path to Growth strategy, investors will be keen to hear how the company can secure future profitability. Options may include taking out costs.

When ICI reported first half results in July, shares rose sharply as the market welcomed signs of improvement in its troubled National Starch and Quest food flavourings businesses, but nervousness remains ahead of third quarter figures on Thursday.

Current expectations are that National Starch's showing will be similar to that in the second quarter, but Quest's performance appears to be harder to call, with forecasts ranging across the board.

Analysts at stockbroker Gerrard expect profits around £96m, down by more than a quarter on the same period last year, but stable against the previous three months.

British American Tobacco is expected to post a slight fall in third quarter profits to around £689m on Tuesday amid tough trading conditions in North America - with Canadian tax changes and US price competition hitting volumes.

But taken against the previous quarter, volumes could be up slightly thanks to growth in Europe, as well as the Middle East and Africa region.

Investors will also be keen to hear comments on the performance of ETI, Italy's former state owned tobacco group which BAT bought over the summer, as well as comments on prospects for 2004 - although these could be cautious given the current weakness of the US dollar.

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