Thursday preview: Morrisons, SABMiller, Halfords, National Grid

18th Nov 2009 16:33

The timing of the interim management statement from supermarket chain Morrisons is intriguing, given that it comes one day after the news that its chief executive is to jump ship to take up a similar role at Marks & Spencer.In common with the other supermarkets, Morrisons is expected to report that growth in like for like sales is slowing as inflationary pressures ease. Market expectations are for underlying sales growth, excluding fuel and VAT, to have risen by 4.5% in the 13 weeks to 2 November, compared to a 7.8% year on year rise in the first half of the financial year.UBS expects total sales growth to exceed 8%, with new selling space contributing around 4% of that.Brewing giant SABMiller is forecast to announce first half earnings before interest, tax, depreciation and amortisation of $1.9bn tomorrow, down from $2.23bn at the interim stage last year.The company is struggling with higher input costs and adverse currency trends, but these are expected to change course in the second half of the financial year, which means the outlook statement may be moderately cheerful. Beer volumes have been hit by the recession, and here, too, the company may project a reversal of trends for the second half.Bike and car parts seller Halfords has moved up a gear this year, with like for like (LFL) sales in the company's third quarter - the three months to the beginning of October - growing 2.2% from a year earlier, after the first half had seen LFL growth of just 1.7%.The retailer's product range has suited the money conscious mood of late, with car buyers looking to save money on petrol by cycling more often, while even those disinclined to abandon four wheels for two are more likely to patch up their existing motor than upgrade to a new one. Meanwhile, the company's move into the camping market has also caught the spirit of the age and the so called 'staycation' trend for holidaying in the UK.All of the above has contributed to steadily rising earnings forecasts over the last few months. Expectations now are for interim profits before tax of around £61m, up from £49m a year ago.An update on the group's overseas operations may be provided. The 22 stores in the Republic of Ireland have been facing a tough trading environment, and the Czech Republic, where Halfords has five outlets, has also been hit by the recession.Gas and electricity pipeline grid operator National Grid is not expected to surprise with its interim profit figures tomorrow. Broker Charles Stanley is predicting earnings per share will rise to 20.8p from 17.4p at the halfway stage last year.Perhaps more importantly for many National Grid shareholders, the broker is predicting a rise in the interim dividend from 12.6p to 13.6p, and expects the company to reiterate its commitment to raising its dividend by 8% each year until March 2012.Net debt remains a concern, but credit rating agency Moody's recently upgraded its classification of National Grid's debt outlook from negative to stable.On the economic front, UK retail sales are out and may give retailers a lift after mediocre readings in August and September. Expectations are for a 0.7% increase from September's level, which would give an annual increase of 3.1%, up from 2.4% in September.The Public Sector Net Borrowing Requirement (PSNBR) figure is likely to be eye-wateringly large and underline why consumers are wise to be cautious about spending while the UK's finances remain in such a bad way.Expectations are for PSNBR to soar to £6bn in October from £122m a year earlier, as the recession and unemployment continue to depress tax revenues.INTERIM DIVIDEND PAYMENT DATE Game Group, M&C Saatchi, Tomkins, Tullett Prebon INTERNATIONAL ECONOMIC ANNOUNCEMENTS Initial Jobless Claims (US) (13:30)Leading Indicators (US) (15:00)Philadelphia Fed Index (US) (15:00)EC OECD Economic Outlook (EC)Department Store Sales (JPN)FINALS Renewable Energy Generation EGMS Rathbone Brothers AGMS Hansard Global, Ricardo Group, Town Centre Securities UK ECONOMIC ANNOUNCEMENTS Internet Retail Sales (09:30) Public Sector Finances (09:30) Retail Sales (09:30) FINAL DIVIDEND PAYMENT DATE Close Brothers Group, JPMorgan Mid Cap Inv Trust, Thorpe (F.W.) TRADNG STATEMENTMorrison (Wm) Supermarkets