The Week Ahead: Boots is on a downer but Kesa looks a livewire in electricals

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The high street remains at the forefront of City minds this week, and yet again the news is likely to be very mixed.

The high street remains at the forefront of City minds this week, and yet again the news is likely to be very mixed.

Boots is pencilled in to supply the gloom. Shares in the chemist took a beating last week on fears that Thursday's trading update, ahead of the interim presentation later in the autumn, will not make for pleasant reading.

The retailer's own broker, Merrill Lynch, downgraded its forecast for like-for-like sales at the core Boots the Chemist chain, from 4 per cent growth to a fall of 0.2 per cent. Neither was it a lone voice. A note by Investec, for example, predicted interim pre-tax profits would slump by around 20 per cent and downgraded its rating.

The main concerns are the unpredictable summer weather taking its toll on sales and the impact of increased investment, particularly in cutting prices.

In contrast, Kesa Electricals is expected to strike a cheery note when it publishes interim results. A recovery in extended warranty sales at Comet is expected to help lift profits at the brand by around £3m, while its French chain Darty is predicted to show an improvement in margins as restructuring measures start to pay dividends. Group pre-tax profits are ex- pected to come in around £48m.

However, there will be some flies in the ointment. Darty sales are likely to have suffered from weak comparatives in August as last year's heatwave sparked massive demand for air-conditioning units, and that won't have been repeated this time round. French furniture chain BUT also continues to underperform.

Other retailers issuing num- bers include department store group House of Fraser, where losses are expected to improve slightly from £3.9m last year to £2.6m, Ann Harvey owner Alexon and Clinton Cards.

Music and books chain HMV will provide an update on trading at its annual general meeting, while Hennes & Mauritz takes up the baton overseas with third-quarter results.

Analysts are predicting that the poor weather and slower consumer demand in many of the Swedish retailer's core markets will dampen underlying sales growth. There are also concerns that markdowns could squeeze margins.

Manchester United posts final results. The listed company may not have had the best start to new season but it remains that rare thing - a football club investors like.

The latest market chatter is that Malcolm Glazer, the club's second-biggest shareholder with a 19.2 per cent stake, continues to lust after more control and is trying to do a deal with racing millionaires JP McManus and John Magnier. With 29 per cent between them, their Cubic Expression vehicle is stillthe biggest shareholderin the club.

In the meantime, Manchester United gets on with running its business. The main topics of discussion this week are likely to be an extension to the Old Trafford stadium, the arrival of England star Wayne Rooney and the continuing row with Fifa over compensation for releasing players for internationals.

Pubs company Mitchells & Butler, pub and brewing business Wolverhampton & Dudley and hotel chain De Vere are all updating on trading. For the pub groups, just as on the high street, poor summer weather is likely to have dented demand.

De Vere should have fared better, however, as the recovery in the hotel sector gathers pace. Investors will also want to hear how chief executive Carl Leaver's strategy is progressing after the company successfully fought off a partial bid from activist shareholder Guinness Peat Group earlier this year.

Others updating on trading include Emap, which owns consumer magazines such as Heat, FHM and Empire as well as a host of business titles, and mmO 2. The mobile phone firm is expected to report robust interim demand although is unlikely to change full-year forecasts ahead of the crucial festive trading period. Analysts also remain jittery about future UK performance.

In the United States, drinks, both the soft and hard varieties, will feature, with second-quarter figures from Constellation Brands, the giant owner of Corona Extra lager and Hardys wines, and third-quarter numbers from PepsiCo.

British economic news will have something of a high day midweek. Data out on Wednesday includes the second revision to GDP; mortgage lending; balance of payments; the CBI Distributive Trades survey; and consumer credit. Nationwide will also publish its latest house price index, and is expected to show a further, if gentle, deterioration in the market.

CALENDAR

Tomorrow 27

UK: Results: (final) ICM Computer Group, Manchester United, Quadnetics, Wolseley; (interim) Alexon, Alizyme, Futura Medical, Pixology, Plant Health Care, Regal Petroleum, Smallbone, Visonic.

Tuesday 28

UK: Results: Avanti Screenmedia, Centaur, Envesta Telecom, James Halstead, White Young Green; (I) AG Barr, Atlantic Global, Atrium Underwriting, Fortune Oil, Havelock Europa, Huntsworth, Inditherm, Maclellan, Maiden, Music Choice Europe.

Wednesday 29

UK: Results: (F) Dickinson Legg, Finsbury Food; (I) Bioprogress, CNG Travel, Coliseum, Development Securities, House of Fraser, Kesa Electricals, LiDCO, Symphony Plastic Technologies, Tellings Golden Miller, Watermark.

Thursday 30

UK: Results: (F) ADVFN, Country & Metropolitan, Minco; (I) Dana Petroleum, Empire Interactive, Private & Commercial Finance.

Friday 1

UK: Results: Gourmet Holdings, Waterman.

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