Marconi faces the City again this week in one of several key corporate updates – spanning the retail, telecom and energy sectors – that will give analysts further clues as to the timing of the economic recovery.
Safeway boss Carlos Criado-Perez will need to be on his best form at the supermarket chain’s final results on Wednesday when the group is forecast to post pre-tax profits of £354.8m, up 11%.
Analysts will need to be reassured about the retailer’s growth prospects going forward given the disruption caused by a hefty overhaul programme designed to improve the stores, add new features and pull in shoppers.
Disappointing fourth quarter sales figures last month were blamed on the refurbishment work and with more cash being invested in keeping prices keen margin growth may also be weaker in the coming months.
Ben Verwaayen’s back-to-basics push as chief executive of BT means the major interest in Thursday’s annual results will centre on financial details after a year of major transformation at the telecoms giant.
News on cash generation, net debt and the cost cutting programme at the significantly slimmed-down BT business will be key as Verwaayen looks to get the house in order and prepare for growth in areas such as broadband.
Profits will be distorted by various charges and write-downs, the disposal of Yell and demerger of mmO2. Fund manager Gerrard believes pre-tax profits will come in around £1.39bn, down from £2.07bn a year ago.
Fallen telecoms group Marconi group faces the City again this week with its annual results due to come out on Thursday. After the company’s high-profile problems in the past year they are likely to make bleak reading.
Pre-exceptional losses for the group as a whole are likely to be around £678m compared to profits a year ago of £662m but a host of one-off costs could see Marconi fall over £5bn into the red.
Analysts will want an update on the board’s financial restructuring plans with its banks and bondholders, which are seen as crucial to securing the group’s future. A debt-for-equity swap may not be out of the question.
Gas transportation group Lattice is changing its year end and will therefore post figures for the 15 months to 31 March on Tuesday.
Analysts are forecasting pre-tax profits of £993m but as Lattice has already reported figures for 2001, the first three months of 2002 will be the period under scrutiny.
However, investors hoping for an update on Lattice’s merger with National Grid are likely to be disappointed. The deal was only announced last month and analysts are doubtful Lattice will have much to add so soon afterwards.
Cable & Wireless warned in February that profits had been rocked by the tough trading environment, so full-year update on Wednesday are unlikely to hold too many surprises.
What they are likely to contain is an update on C&W’s recently acquired web hosting businesses, Digital Island and Exodus, as well as an outlook for the rest of the group over the coming months.
Fund manager Gerrard is forecasting a fall into the red, from profits of £3.39bn to pre-tax losses of £651m. But the numbers are distorted – last year there were £3 bn-worth of gains on disposals and this year C&W is changing the way it reports to include the web-hosting business.
Power generator British Energy posts final figures on Wednesday, and pre-tax profits are expected to increase from £10m to £32m.
However, British Energy’s profits are extremely sensitive to wholesale electricity prices, which are currently very weak. There is therefore a certain amount of uncertainty about the outlook for the coming year.
British Energy reiterated earlier this week that it remained in talks with BNFL over a range of issues including taking over the operation of its Magnox nuclear plants.
EGi News 13/05/02
