Wednesday preview: BHP Billiton, BSkyB, Home Retail, GKN

18th Oct 2011 15:43

Mining giant BHP has its annual general meeting on Wednesday, the same day it is set to produce quarterly production statistics. Credit Suisse forecasts that the company will have produced 35m tonnes (attributable to BHP) of iron ore worldwide in the third quarter of 2011, while copper production is forecast to be in the region of 294,000 tonnes, which would represent an improvement on the previous quarter's output of 272,000 tonnes."In petroleum we forecast 56.1Mboe [millions of barrels of oil equivalent], up from 43.3Mboe in the June quarter due to the consolidation of Petrohawk," the Swiss bank added. It has been an eventful year for pay-TV broadcaster British Sky Broadcasting (BSkyB), what with the abortive bid from its major shareholder, News Corporation, and the involvement of its chairman, James Murdoch, in the investigation into the phone hacking scandal at News Corp.The company seems to consistently defy the market's expectations of a slow-down in growth, but with consumer sentiment down in the dumps, even this formidable performer might have to confess to have found the going tough when it gives a first quarter trading update on Wednesday.Broker Nomura is forecasting "only" 15,000 new subscribers to the Sky TV service in the first quarter, but this "should be enough to keep the equity story on track and prevent the company being seen and rated as a utility."Nomura expects the performance of the High Definition service will be weak, but the broadband and telephony offering will have put in a good showing."We are of the opinion that the market (rightly or wrongly) is greedy and wants to see core customer growth as well as product up-sell and revenue, EPS [earnings per share] and FCF [free cash flow] growth. We see the decline in TV net adds as being primarily economically driven, and with a 57% pay-TV penetration rate in the UK we see room for more customer growth when the economy improves," the Japanese broker added. On the subject of churn - the proportion of subscribers who give up the service - Nomura expects the rate will remain unchanged at 11.2%."We forecast c.22% growth in adjusted EPS in Q1 2012 vs 18% for FY [full year fiscal] 2012. We expect slight growth in ARPU [average revenue per user] to £541 from £539 in Q4 2011. If ARPU is accounted including standalone customers (not decided), it could fall," Nomura predicted. Argos and Homebase owner Home Retail's interim results may not be for the squeamish, with the market predicting underlying profit before tax will be down 70% on last year at £30m, although the range of expectations runs from £24m to £36m, which suggests a large degree of uncertainty in the market."We look for a small loss at Argos (£2m), compared with a profit of £54m last year and consensus that expects a small profit (£1m). While we expect the full year dividend to be cut, we would not be surprised to see the relatively light interim dividend of 4.7p being maintained, given the board's oft-repeated strategy of waiting until after the year end before making a decision," said Panmure Gordon.Automotive and aerospace engineering specialist GKN gives a third quarter trading update. "Near term the group is unlikely to curtail expectations for the remainder of FY2011, although we believe that the negative share price reaction since the 1H [first half] results reflects investor nervousness about longer term trading patterns in a weakening macro environment," reckons Charles Stanley. On the economic front, the Bank of England will release minutes from the most recent meeting of the Monetary Policy Committee, which will provide further detail on the thinking behind the committee's decision to revive the quantitative easing programme.INTERIMSC&C Group, e-Therapeutics, Home Retail Group, Vertu MotorsINTERIM DIVIDEND PAYMENT DATEAggreko, French Connection Group, Fyffes, Premier FarnellINTERIM EX-DIVIDEND DATEBAE Systems, British Polythene Industries, Game Group, NB Global Floating Rate Income Fund Ltd GBP, NB Global Floating Rate Income Fund Ltd USD, Octopus Apollo VCT 1, Octopus Apollo VCT 2, Octopus Apollo VCT 3, Octopus Eclipse VCT 2, Scisys, Spectris, Ted Baker, TT ElectronicsINTERNATIONAL ECONOMIC ANNOUNCEMENTSCurrent Account (EU) (09:00)Construction Output (EU) (10:00)Building Permits (US) (13:30)Consumer Price Index (US) (13:30)Crude Oil Inventories (US) (15:30)Housing Starts (US) (13:30)MBA Mortgage Applications (US) (12:00)Beige Book Fed Survey (US) (19:00)IMSSDiageo, GKN, GlobeOp Financial Services SA (DI)SPECIAL DIVIDEND PAYMENT DATENews Corp. 'A' Shares, News Corp. 'B' SharesSPECIAL EX-DIVIDEND PAYMENT DATEAegis Group, Ludgate Environmental Fund Ltd.EGMSMHP SA GDR (Reg S), Natasa Mining Ltd. (DI)AGMSBrooks Macdonald Group, Diageo, Haynes Publishing GroupUK ECONOMIC ANNOUNCEMENTSBoE Interest Rate Minutes (09:30)FINAL DIVIDEND PAYMENT DATEAirsprung Group, News Corp. 'A' Shares, News Corp. 'B' Shares, Stagecoach Theatre ArtsFINAL EX-DIVIDEND DATEAvingtrans, Interior Services Group, JD Wetherspoon, Ricardo, Stavert Zigomala, Strategic Equity Capital, Thorpe (F.W.), Wilmington GroupQ1British Sky Broadcasting GroupPRODUCTION REPORTBHP Billiton