Smaller players to step into limelight next week

Smaller firms in sectors ranging from car sales to electrical services will share the limelight with a handful of top flight players during a quiet week for corporate news.

International mining group BHP Billiton is expected to turn in a 60% rise in group net income to $3.15bn (€2.5bn) when it reports full year results on Wednesday.

Its copper, stainless steel and petroleum businesses are tipped to show strong performances following recent strength in commodity prices. However, the blue-chip firm’s aluminium and diamond businesses are likely to produce more modest performances.

The group, based in London, should also have benefited from continuing cost-cutting measures.

Billiton’s outlook statements should be relatively positive, with the group being confident about future commodity prices, Chinese demand and oil exploration and prices.

Analysts do not expect advertising giant WPP – one of the world’s largest communications groups – to report much change in recent trading when it posts interim results on Friday.

An update in June reported like-for-like revenue growth of almost 4% in the first five months of the year, meaning growth had not accelerated in April and May, and nothing much is likely to have changed in June, stockbroker Gerrard said.

WPP said at the time that its main European markets were not recovering that quickly and there was little evidence of the market gathering momentum.

The results will continue to be held back by a negative impact from the US dollar, but the group’s net debt should have improved due to working capital movements.

The group is tipped to turn in pre-tax profits of £225.6m (€336.4m) against £197.1m (€293.9m) last time.

Recruitment group Michael Page is expected to post interim pre-tax profits of £16.7m (€24.9m) against £11.1m (€16.55m) last time on Monday.

The company is tipped to report strong growth in revenues against a relatively fixed cost base in the first half.

It has reported second quarter gross profits of £52.3m 9€78m), up 16% year-on-year, in line with one analyst’s forecast of £51.9m (€77.4m).

The company has said that although European markets are still tough, there were some signs of improvement, mainly in permanent placements in France.

Analysts describe the firm’s performance as solid, but say the key risk to the upside at the moment is volume driven wage growth that could kick in during the next 12 months.

Car dealership Lookers will underline the importance of the after-sales market to its business on Monday when it unveils results for the half year.

The group, which has around 90 outlets, generates a large slice of its profits from higher margin parts and accessories and recently improved that position with the £31 million purchase of FPS Distribution, an operation with 19 centres.

Analysts, who expect half-year profits to improve to around £10m (€14.9m) from £9.2m (€13.7m) a year earlier, will also be interested in comments on the car market as a whole, particularly following recent interest rate rises.

Signs of an upturn in London and the South East will be the key to Friday’s half-year results announcement from electrical engineer T Clarke.

The group, which has just completed wiring at the new London Stock Exchange building, warned in March that it faced a battle to improve annual results as the commercial market in London continued to be “patchy”.

Recent acquisitions of smaller electrical businesses around the UK are likely to have bolstered the group, which analysts expect to report unchanged sales of £143m (€213m) for the full year and slightly weaker profits of £8.4m (€12.5m). Half-year forecasts for the group, which employs some 750 staff, are not available.

IQE, a maker of materials for the semiconductor industry, operates in a highly cyclical sector so guidance on a possible recovery in its markets will be the main focus for investors with its half-year results on Wednesday.

Signs of a pick up in orders will be crucial for the Cardiff-based company, which said in March that annual sales had fallen 18% to £18.7m (€22.9m) because of exchange rate movements and price pressures. Despite the fall, IQE’s operating losses narrowed by 43% to £12.6m (€18.8m) because of cost controls and lower raw material prices.

Analysts will be looking for a continuation of that trend, with Evolution Beeson Gregory recently pencilling in an improvement in both sales and profits at the full-year stage. There are no forecasts for the half-year.