The Week Ahead: Buoyant Marks & Spencer bucks retail gloom

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The Independent Online

The fourth-quarter trading statement issued by Marks & Spencer in April confirmed, at least for the moment, the remarkable turnaround engineered by the chief executive Stuart Rose. As the majority of retailers struggled, M&S reported strong sales growth, strengthening margins and operational improvements.

M&S shares have seen a substantial re-rating in the two years since the retail entrepreneur Philip Green made a 400p-a-share approach, reaching an eight-year high in the process.

There have been some corporate activity rumours in the past month but most analysts do not expect the company to receive another approach in the near future.

In light of the difficult trading conditions on the high street, Stuart Rose is about as safe in his job as any FTSE 100 company chief, and the City expects another set of strong numbers. Consensus forecasts are for pre-tax profits of £760m for the year.

TODAY: Mitie Group is involved in a myriad of activities, from contract cleaning and catering services to pest control and air-conditioning installation.

Its shares fell almost 10 per cent in the past week, but analysts expect a solid set of numbers after March's confident trading statement highlighting three big contract wins in the past year. Pre-tax profits are likely to come in at about £51m.

Recent radio listening figures were bad news for Chrysalis, whose Heart FM slipped from first to third place among London stations, meaning a tougher advertising sales environment for the company. Traditional advertising is under attack from online media, although Chrysalis has a strong regional radio presence, which should perform better.

The broker Numis expects pre-tax profits of £2.4m on revenues of £69.4m.

Results: Full year - Homeserve; Mitie. First half - Cambridge Antibody; Care UK; Chrysalis; ITE; Punch Taverns; Treatt; Windsor.

TOMORROW: Expect to see British Land follow its peers by confirming it will seek to convert to Real Estate Investment Trust status, just as Land Securities, Hammerson and Slough Estates have done. Bumper results from Land Securities last week have put the pressure on British Land to deliver, and analysts expect to see net asset value per share rise to 1,200p, along with pre-tax profits of approximately £365m.

Shares of the music publisher EMI have been buoyed recently by speculation that the company will merge with its US rival Warner Music, after an initial approach by EMI was rebuffed this month. Analysts believe such a deal makes sense for EMI, and speculation is rife that an agreement will be struck soon. Expect to see pre-tax profits of about £160m on revenues of a little more than £2bn.

Results: Full year - British Land; Business Post; Cranswick; Emap; EMI; Endace; Kingston Communications; Marks & Spencer; RDF Media; SSL International; Telford Homes; Viridian; Yell Group; Zirax. First half - Cardpoint; GET Group; Innovation; Paragon Group.

WEDNESDAY: Cash generation is not a problem for De La Rue - the world's largest non-governmental printer of banknotes churns out notes in 150 currencies. The company surprised analysts with strong growth in the first half of the year. Williams de Broë expects pre-tax profits of £75.6m, a 16 per cent increase on 2005.

No surprises are expected in full-year figures from the retail giant GUS. The company plans to demerge the consumer credit rating agency Experian towards the end of the year and a high valuation is already in the price, according to Williams de Broë, which has a "sell" recommendation on the stock.

Consensus forecasts are for pre-tax profits of £821m.

Results: Full year - Dairy Crest Group; De La Rue; GCap Media; Great Portland Estates; GUS; Imagination Technology; Kelda Group; Land of Leather; Mothercare; Scottish Power. First half - Sarantel Group.

THURSDAY: Invensys shareholders are right to be nervous before the engineering group's results - Invensys has struggled to deliver sustained improvement since being created by the merger of BTR and Siebe in 1998. Williams de Broë is looking for pre-tax profits of £63m.

The newspaper industry is another that is suffering from a competitive ad market. Daily Mail & General Trust saw a 9 per cent decline in advertising revenues in the first half, although analysts expect to see some improvement in the second half, with pre-tax profits forecast to come in at £117m.

Results: Full year - Alterian; Bristol Water Group; Burberry Group; Cable & Wireless; Invensys; LSE; Paypoint; Telent. First half - Arla Foods; Daily Mail & General Trust; Intec Telecom Systems; Zytronic. Third quarter - Sportingbet.

FRIDAY: Results: Full year - Virgin Mobile Holdings; Young & Co Brewery. First half - Nord Anglia Education; Wolverhampton & Dudley Breweries.

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