Tuesday preview: Bellway, Whitbread

17th Oct 2011 16:06

House builder Bellway issues full-year results on Tuesday which should show the continued revival in profitability since the dark days of 2009, with the company's London-focus and a rebound in the buy-to-let market driving growth.Market expectations are for profit before tax of £63.8m, up from £44.4m the year before, on sales of £859m, up from £768m. Earnings per share are tipped to rise to 38.80p from 29.7p last year, and there should be good news for shareholders looking for income, with the full-year pay-out set to rise to 11.44p from 10p, though that would still leave the dividend yield on a relatively parsimonious 1.7%. "The results for the full year to July 2011 may not offer many surprises given the detail of the IMS [interim management statement] at the fiscal year end but our discussions with housebuilders in recent days implies solid sales through to the end of September and a steady pricing market on lower cost land," Northland Capital Partners said. The broker reckons underlying profit before tax will be £59.0m on revenues of £848m.Peel Hunt is another broker that is predicting few surprises. "The standout point is likely to be the reporting of the best period margins so far in this cycle. The IMS pointed to EBIT [earnings before interest and tax] margins approaching 10%, but in industry doublespeak this is likely to mean above 10%," the broker said.Going out a limb with the hard numbers, Peel Hunt predicts units completed will have risen to 4,922 from 4,595 the year before, while the average selling price is predicted to have improved to £175,000 from £163,000 the year before. Peel Hunt forecasts profit before tax of £64.5m, and a cash pile of £3m."A note of caution on current trading commentary; remember that Q4 of 2010 was especially weak in the run-up to the [government's] Comprehensive Spending Review and public job cuts, so any positive comments on how much of a pick-up is seen in trading must viewed against that backdrop," Peel Hunt advises.Whitbread includes the Premier Inn, Beefeater and Brewers Fayre brands under its umbrella, but it is the success of the Costa Coffee chain in this nation of tea drinkers that has been garnering the headlines of late. The chain has reported 38 successive quarters of like-for-like growth in sales, with second quarter sales up 9.7% from a year earlier in coffee shops open for a year or more.Analysts will be keen to see whether the chain has continued in the third quarter, or whether the dip in consumer sentiment has prompted customers to nestle less frequently in the coffee chain's comfy chairs.INTERIMSB.P. Marsh & Partners, First Derivatives, JZ Capital Partners Ltd., Next Fifteen Communications, WhitbreadINTERIM DIVIDEND PAYMENT DATEViCTory VCTINTERNATIONAL ECONOMIC ANNOUNCEMENTSNationwide Department Stores (JPN)Machine Tool Orders (JPN)New Car Registrations (EU) (10:00)ZEW Survey (EU) (10:00)ZEW Survey (GER) (10:00)Producer Price Index (US) (13:30)NAHB Housing Market Index (US) (15:00)Q1Discovery MetalsQ3Bank of America Corp.GMSLondon & St lawrence Inv Co.FINALSBellwayANNUAL REPORTThorpe (F.W.)EGMSORA Capital Partners Ltd.AGMSArcontech Group, Crystal Amber Fund Ltd., Orosur Mining Inc.UK ECONOMIC ANNOUNCEMENTSConsumer Price Index (09:30)Retail Price Index (09:30)FINAL DIVIDEND PAYMENT DATEMattioli Woods