Companies reporting in the week ahead

Graham Spooner, investment research analyst at The Share Centre, gives his thoughts on what to expect from companies announcing results in the week commencing 8 February 2016.

Companies reporting in the week ahead
Monday

Companies reporting today include: Randgold Resources (Q4 results)

Tuesday

TUI Travel (Q1 results)

With many people currently booking summer holidays, this is a critical time of year for tour operators such as TUI. However, recent terror attacks in Tunisia, Nation of Thailand and Paris has raised some concerns about the impact on the travel sector generally.

Having beaten market expectations in its full year figures in December the shares have subsequently outperformed the market. Investors will therefore be keen to hear if the company is still forecasting a 10% increase in earnings this year. As the owner of cruise ships and airlines, the market will also be interested in any comments about costs with the sharp fall in the oil price in mind.

Wednesday

ARM Holdings (Q4 results)

Arm Holdings has produced some good numbers of late as licensing deals and royalty revenues have shown good growth. This is as a result of growing demand for its technologies in a variety of consumer products. However, recently there has been some concern due to slowing sales of Apple iPhones which is a key revenue generator for the group. Consumers have also been happier to buy lower end smart phones or hold on to their older phones for longer, which is additionally likely to affect royalties and margins.

 

Companies also reporting today include: Tullow Oil (Q4 results)

Thursday

Imperial Tobacco (Q1 results)

Imperial Tobacco’s shares have been boosted in recent weeks by a steady stream of reports in the media about possible takeover bids or mergers with peers including Japan Tobacco and China Tobacco. In the more volatile market conditions experienced in the last six months, the solid and defensive characteristics of a tobacco giant have proved attractive for some investors.

The market will be keen to hear how sales of vaping products are performing, any comments on the expected impact of the new plain packaging regulations in the UK, and whether the group is planning to change its name to Imperial Brands.

 

Companies also reporting today include: Informa (Q4 results) and Rio Tinto (Q4 results)

Friday

Rolls-Royce (Q4 results)

The company has had a very tough time which has not been helped by the lower oil price affecting its marine division. Warren East has taken over as CEO and previously announced a major restructuring of the business with a layer of senior management already moved on.

Investors will look to see what other changes are likely to come along and how its high fixed costs can be cut. They will also be taking note on the size of the order book, which should have risen courtesy of a new large contract it has won with Norwegian Air. Investors should also be aware that there is the possibility of a dividend cut in difficult times.

Economic announcements for the w/c 8 February 2016:

10 February, UK index of production, Dec 2015 – ONS. 

In November 2015, UK industrial production contracted by 0.7% month on month, while manufacturing saw a 0.4% contraction compared to the month before. The purchasing manager’s index tracking UK manufacturing in December fell below the November reading, so this closely watched index appears to suggest that, if anything, manufacturing may have seen an even greater contraction in December. However, there is a discrepancy between the findings of the purchasing manager’s indices which are consistent with modest growth, and the more gloomy data from the Office of National Statistics.

12 February, Flash Estimate EU and euro area GDP – Eurostat.

In Q3 of last year, the Euro area saw growth in GDP of 0.3%, while EU GDP grew by 0.4%. Most recent purchasing manager’s indices suggest that the euro area may have seen a modest improvement in the final quarter, with growth in Eurozone GDP possibly rising to 0.4%. The big fear relates to France. The composite PMI tracking the French economy in Q4 of last year fell to an 11 month low.

Further announcements include:

9 February

  • UK trade, Dec 2015 – ONS

11 February

  • Mortgage and landlord possession statistics, October to December 2015 – ONS

12 February

  • Construction output in Great Britain, Dec 2015 and Oct to Dec 2015 – ONS

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