Thursday preview: Shell, BAE, Rolls-Royce, BSkyB, Reed

29th Jul 2009 16:50

With BP and BG Group already having given second quarter updates this week Thursday sees Royal Dutch Shell step up to the plate. The oil giant is expected to declare net income on a current cost of supply (CCS) basis of $2.4bn. The company is expected to maintain its quarterly dividend of 42 cents for the rest of this year. Broker Panmure Gordon is expecting the company to report a decline in oil production, unlike its sector peer BP. Panmure Gordon expects production to have averaged 3.1m barrels of oil equivalent per day (boepd) in the second quarter against 3.4m boepd in the first quarter. "In the new reporting business (which includes E & P [exploration & production], Tar Sand and Gas & Power), we believe that underlying earnings will be US$2.15bn, up from an underlying US$1.84bn in Q1 2009," the broker predicted.The trading statement will be the first under the watch of new chief executive officer Peter Voser, who made the move up from finance director at the beginning of this month, so investment analysts will be keen to learn whether he plans any changes in strategy. Defence firm BAE Systems has seen its share price take a dive since the beginning of March on fears that the recession and the withdrawal of troops from Iraq will lead to a reduction in defence spending.Nick Cunningham of Evolution Securities expects the company to dismiss such fears and talk up the strength of the US market while expressing confidence in the future of major defence programmes in the UK.Aero engine company Rolls-Royce is another that has its fortune tied to defence spending, though less so than BAE. The other main string to its bow, civil aerospace, also has a cloudy outlook, though the company did better than most of its peers in terms of sales resulting from the Paris Air Show.Analysts predict an interim pre-tax profit of £411m, barely changed from the first half of last year. Pay TV and internet service provider BSkyB reports full-year results. The Sky TV service has proved remarkably resilient in the recession though the accelerating rate of unemployment might soon start to have an effect. Churn - the percentage of subscribers leaving the service - is expected to be around 10% for the April to June quarter, with average revenue per user set to be around £450 per annum.Publishing group Reed Elsevier publishes interim results, the first set of results under the stewardship of new chief executive officer Ian Smith."Although there are a number of issues that will need to be addressed, including the future of RBI, the competitive position of LexisNexis, and a wide range of strategic portfolio options, we do not expect any major announcements to be made at this stage," said Japanese broking house Nomura.The broker is expecting a strong performance from the Elsevier Science and Risk Analytic divisions. INTERIMSBAE Systems, Brit Insurance, Centrica, Charter, Hutchison China Meditech, Invista Real Estate Investment Management Holdings, Laird, Mediwatch, National Express Group, Reed Elsevier, Rexam, Rolls-Royce, RPS GroupQUARTERLIESAstraZeneca, BTQUARTERLY PAYMENT DATEHenderson Global Property Companies Ltd.INTERNATIONAL ECONOMIC ANNOUNCEMENTSInitial Jobless Claims (US) (13:30)UK ECONOMIC ANNOUNEMENTSGfK Consumer ConfidenceNationwide House PricesFINALSBritish Sky Broadcasting GroupTRADING STATEMENTSAntofagastaEGMSCentral China Goldfields, LonZimAGMSAndrews Sykes, Brainspark, Caffyns, Cellcast, Central China Goldfields, Everfor Resources, F&C Global Smaller Companies, FFastFill, Framlington AIM VCT 2, GB Group, Halma, Hansa Trust, Hansa Trust 'A' Shares, New Century AIM VCT, Northumbrian Water Group, Pennon Group, Renaissance US Growth Inv Trust, VictoriaFINAL DIVIDEND PAYMENT DATEBurberry Group, Caffyns