The Week Ahead: Glencore bid for Xstrata: sweetener doubts raised

Today

Glencore has already announced its full-year numbers, so the proposed merger with Xstrata is instead expected to be the major focus when it reveals its preliminary results today. Although some in the Square Mile believe the commodities trader will bow to pressure and improve the terms of the tie-up, Liberum Capital claims Glencore "is indifferent as to the timing of the deal and will convey reluctance to spend more".

The next step will see the two companies meeting shareholders. Analysts from the broker say that "with both managements espousing the merger merits, we expect dampened expectations of an increase to the recommended terms".

Also today, Amlin kicks off a busy week for the insurers with its final results. Numis Securities' Nick Johnson is expecting it to have suffered a £177m loss after 2011 proved to be a major year for natural disasters. However, he points out that this is unlikely to be much of a shock given the Lloyd's of London firm pre-announced catastrophe losses last month.

Results/Updates: Amlin, British Polythene Industries, City of London Investment Group, Glencore International, Intertek, Ocado and Petrofac.

Tomorrow

A number of profit warnings made 2011 a year to forget for Pace, and the set-top box manufacturer will announce its preliminary results with a fresh team in charge. In December, Mike Pulli, the head of its Americas division, took over from Neil Gaydon in the top role. Roddy Murray was last month named as its new chief financial officer.

As a result, comments from management are likely to be closely watched while the latest on its hard-disk supply chain, which was hit last year after its supplier Western Digital suffered major flood damage in Thailand, will also be of interest to investors.

Results/Updates: Alliance Trust, Ashtead, Betfair, Cape, Cupid, easyJet, Fresnillo, Inmarsat, John Menzies, John Wood Group, Johnson Service Group, Meggitt, Michael Page, Pace and Tullett Prebon.

Wednesday

With Admiral having blamed an increase in claims for a profits warning last November that prompted its share price to drop more than 25 per cent in just one session, this issue will be in focus again on Wednesday when the car insurer announces its full-year figures.

Deutsche Bank's David Bracewell says the key question is whether the recent trend is temporary and industrywide or "a structural decline in Admiral's underwriting advantage", adding that the results should provide insight into this.

Results/Updates: Admiral, Chime Communications, Cobham, Costain, Dignity, Hardy Oil & Gas, Jupiter Fund Management, Legal & General, Lookers, Melrose, RPS Group, Sportech and Tarsus.

Thursday

Morrisons unveils its preliminary results on Thursday, with the grocer expected to announce an underlying pre-tax profit of £922m. Bank of America Merrill Lynch's analysts, meanwhile, believe that the main focus will be the performance of its new trial concepts and they will be on the lookout for the supermarket's roll-out plans.

Aviva is also releasing full-year figures, and Citigroup is predicting that after the insurer's surplus capital suffered a sharp drop to £2.7bn over the third quarter, it will have managed to recover £100m since. Nonetheless, the broker points out, this will still leave its capital buffer £1bn lower than 12 months previously.

Results/Updates: Aviva, Balfour Beatty, Cineworld, Clarkson, DS Smith, H&T, Hunting, Morrisons, Schroders and Spirax Sarco.

Friday

A strong performance in December means Numis' Douglas Jack is expecting JD Wetherspoon to reveal on Friday that its first-half pre-tax profits jumped 4 per cent to £33.4m. However, the analyst warns that the rest of the financial year will end up proving rather more difficult for the pubs company, with its margins continuing to be hit by the increasing cost of both food and drink.

Results/Updates: Aga Rangemaster, Aggreko, JD Wetherspoon, Marshalls, Old Mutual and SThree.

Economics Diary

TODAY Eurozone services PMI; Services PMI; US factory orders; US ISM non-manufacturing PMI.

TOMORROW BRC retail sales monitor.

WEDNESDAY BRC shop price index; US ADP national employment report; US crude oil inventories; US MBA mortgage applications.

THURSDAY Asset purchase facility; Bank of England Monetary Policy Committee interest rate decision; European Central Bank press conference; Trade balance; US unemployment data.

FRIDAY Consumer inflation expectations; Industrial production; Manufacturing production; NIESR GDP estimate; PPI data; US trade balance.

Independent Comment
blog comments powered by Disqus
Career Services

Day In a Page

The 50 Best beachwear

The 50 Best beachwear

The hottest summer gear for men and women
Still standing: George Galloway reveals why his staunchly Leftist outlook is still invariably right

Still standing: George Galloway

Written off, ridiculed, wrongly accused of taking bribes the honourable member for Bradford West, has never bowed to the critics.
How will Daniel Radcliffe's fans react to his latest turn - as a damaged, drug-taking Beatnik poet?

Daniel Radcliffe as drug-taking Beatnik poet

His decade as the boy wizard may be over, but that hasn't hexed Daniel Radcliffe's enchanted life.
For whom the bell tolls: £20m 'Memo' project takes shape on Dorset's Jurassic coast

'Memo' project takes shape on Dorset coast

It started as a stonemason's visionary idea – to commemorate all the species that have ever existed and are now extinct.
Just add sunshine: Bill Granger's Turkish delights

Just add sunshine: Bill Granger's Turkish delights

Turkish cuisine is perfect for those long, sociable weekend meals with friends. It's just a shame that money can't buy the key ingredient.
Objets czar: David Usborne’s collection of myriad objects is quite the mystery

Objets czar: David Usborne’s collection of myriad objects

To others, they're junk. To David Usborne, they are his life: useful gizmos, mysterious thingamajigs and anonymous articles that dominate his home.
The iron ore lady: Why the world's richest woman is mired in controversy

World's richest woman: Gina Rinehart

Family feuds, attempts to control the Australian media and bitter public disputes are keeping the mining magnate in the headlines.
We just click: How Lego keeps building on its success

How Lego keeps building on its success

This year, Lego announced record profits. Gerard Gilbert visits its Denmark HQ.
The other bits: Mark Hix creates delicious and economical meals with cheaper cuts of meat

Mark Hix cooks with cheaper cuts of meat

Our chef creates delicious and economical meals on a budget
Strokes of genius: How to create summer's bold make-up look

Strokes of genius: Summer's bold make-up

From coral lips to fly-away fringes, make-up artist Kim Brown and hair stylist Richard Scorer reveal how to create the look
Marking his territory: Kilian Hennessy creates fragrances designed to provoke the senses

Marking his territory: Kilian Hennessy

The perfumer creates fragrances designed to provoke the senses
Photo essay: Britain's 1948 Olympians today

Britain's 1948 Olympians today

Photo essay
The top five E3 2012 triumphs: From Ubisoft's suite of titles to Dishonored and The Last of Us

The top five E3 2012 triumphs

The games and moments that left us grinning like the Cheshire Cat
The green movement at 50: Can the world be saved?

Can the world be saved?

Population growth and climate change are the big problems facing the earth in the next 50 years. But are there any solutions?
France: Will xenophobia go mainstream?

France: Will xenophobia go mainstream?

In the beautiful Rhone delta, John Lichfield visits a village where a dangerous new political landscape is taking shape