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Expect Brtivic’s Results To Be Full of Fizz


Analysts expect no surprises when Britvic, the soft drinks maker behind the Robinsons and Tango brands, issues preliminary results on Wednesday. Britvic pre-released its sales figures in an update last month and confirmed that it was on track to meet expectations for 2009. Numis expects to hear of top-line growth in the UK and overseas, mainly driven by strong market share gains. Over in Ireland, profits are likely to be hit by the tough consumer environment, but this should be partially offset by cost savings, the broker added.

Looking ahead, the focus will be on growth prospects, says Citigroup. “[Earnings guidance for 2010] stands at around £120 and we look for greater clarity as to the levers that should deliver this,” the broker said in a preview note published last week.

TODAY: Deutsche Bank is looking for a “reasonable” set of numbers from Northumbrian Water, which is due to issue its half-year results today. Operating profit is expected to be flat on a year-on-year basis, after the price rises at the core water business were offset by higher power costs and lower volumes. Pre-tax profits and earnings per share are forecast to be higher, however, thanks to lower interest costs.

Panmure Gordon expects a robust update from Hyder Consulting, the design company which issues interim results this morning. The hopes are well founded, as the company has said its first-half revenues and operating profit will both come in towards the top end of market expectations. The share price reaction may be subdued, however, with Panmure pointing out that, at current levels, valuation is in line with the sub-sector average.

“In its last update, Hyder confirmed it was trading at the upper end of expectations, which was primarily driven by its overseas business, which [now makes up two-thirds] of revenues,” the broker said. “Its Asia-Pacific business is trading particularly well, with its Middle East business stable now, albeit the debt profile of this business will be monitored closely.”

Results/Updates: MITIE, Hyder Consulting and Northumbrian Water.

TOMORROW: Hamworthy’s interim results should be in line with expectations, according to Numis, which is looking forward to news of a strong first half thanks in part to the timing of deliveries and the mix in the marine engineering group’s order book.

“Visibility on its order book leaves us comfortable with our [forecasts for 2010] and we do not expect to change numbers upon this announcement,” the broker said. “We remain positive on the long term prospects for Hamworthy, given its exposure to structural growth markets, a robust aftermarket business and its strong cash position.”

Also tomorrow, Intec Telecom Systems, the business support software specialist, is due to issue full-year results. Following the recent trading update, when the company said its adjusted pre-tax profits were likely to exceed market expectations, Panmure reckons that there is an upside risk to forecasts for the year ahead.

“Our underlying grudge is that Intec could make better progress to becoming a purer software company … and thereby derive up gross margin and create greater operational leverage,” the broker said, “These criticisms will fall on deaf years as it delivers a lovely set of recovery results and issues a broadly optimistic outlook statement, although it will caution that currency is a wildcard.”

Results/Updates: BSS, De La Rue, Homeserve, SSL International, Severn Trent, Intec Telecom Systems and Hamworthy.

Wednesday: United Utilities will report half-yearly results midweek and, as with Northumbrian Water, Deutsche Bank expects largely flat operating profits, as price rises at the water company are offset by lower volumes and higher power costs. “We see stronger growth in clean pre-tax profits [the key metric for United Utilities] and earnings per share, due to a lower interest charge,” the broker said.

Also on Wednesday, the catering group Compass is due to issue full-year results. Numis expects to hear of £772.2m in pre-tax profits, with a 15 per cent increase in the dividend. “We believe that, near term, tough economic conditions will continue to negatively impact growth,” the broker said. “However, we see signs that employment levels are bottoming, and while Compass may lag a recovery slightly, this will eventually result in a better demand environment.”

Results/Updates: WS Atkins, Johnson Matthey, Sportingbet, Speedy Hire, Superglass, Telecom Plus, Compass, United Utilities and Britvic.

Thursday: Results/Updates: Assura, Antofagasta, Daily Mail & General Trust and Mitchells & Butlers.

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Saturday, January 20, 9:04 am

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