The Motley Fool’s Week Ahead: JJB and AstraZeneca
24/01/2010
The UK's latest GDP figures will also be released next week
The lingering question about whether the UK is in or out of recession could be put to bed next week. On Tuesday, the Office for National Statistics will report the latest Gross Domestic Product figures for the final three months of 2009.
According to a recent forecast by Ernst & Young ITEM Club, the UK economy may have grown 0.4% between October and December. However, the group warned that UK growth is likely to be anaemic in 2010 as Britain goes through a period of painful realignment. It reckons we cannot rely on cashed-out consumers to drive a recovery.
Notable results and updates w/c 25 January 2010
Monday: Filtronic
Tuesday: Intermediate Capital Group, Porvair, PZ Cussons, Sage and Severn Trent
Wednesday: Britvic, Renishaw, Tullow Oil and Vedanta
Thursday: AstraZeneca, BSkyB, Cairn Energy, Findel, JJB Sports, Kazakhmys and Tate & Lyle
Friday: Safestore
Sporting chance
This outlook doesn't bode well for embattled sports goods retailer JJB Sports (LSE: JJB), which will provide a trading update on Thursday. High street rival JD Sports (LSE: JD) has already reported buoyant Christmas sales, but this may have been at the expense of JJB. However, it would be dangerous to underestimate Sir David Jones, formerly of Next (LSE: NXT), as he attempts to turn around the beleaguered shopkeeper.
BSkyB (LSE: BSY) is also pencilled in for figures on Thursday. The satellite broadcaster, which is due to post interim results, added 94,000 new subscribers in the third quarter of 2009 and now delivers its service to over 9.5 million households. But a likely fly in the ointment could come from an Ofcom probe into premium sports content. Although the report is not expected until March, Sky may be forced to cut its wholesale prices to rivals such as BT Group (LSE: BT-A) and Virgin Media (LSE: VMED).
High on drugs
Full-year profits are expected to show a modest rise at drug maker AstraZeneca (LSE: AZN). The company said good sales of angina treatment Toprol and swine-flu vaccines has helped to boost profits. AstraZeneca may also confirm on Thursday a tie-up with Danish cancer diagnostics outfit Dako. The deal is expected to further AstraZeneca's move into personalised medicine, which tailors particular drugs for specific genetic make-ups.
Interim results are expected from PZ Cussons (LSE: PZC) on Tuesday. The maker of Imperial Leather has been largely unaffected by the global economic downturn with first-half profits expected to be ahead of last year. Performance has been boosted by Europe and Asia, which has helped to offset severe currency weakness in Nigeria. The Nigerian naira lost almost 25% of its value in 2008.
Out of Africa
It seems that Tullow Oil (LSE: TLW) can't stop finding oil. Ahead of fourth-quarter sales numbers on Wednesday, the explorer has already issued two drilling updates. It has found oil and gas in Uganda and discovered a major oil and gas-condensate field in Ghana. Cairn Energy (LSE: CNE) is also scheduled for a trading update. Shares in the Indian oil driller have touched a 19-month high on high hopes for its Greenland oil find.
Turning from oil to water, United Utilities (LSE: UU), Pennon (LSE: PNN) and Severn Trent (LSE: SVT) have decided not to challenge price cuts imposed by Ofwat. Severn Trent, which will report third-quarter figures on Tuesday, has also confirmed that it will cut its dividend to help pay for investments in Britain's creaking water network. United Utilities decided to trim its payout this week but Pennon said it intends to continue a progressive policy of growing dividends.
