The Week Ahead: DSG prospers as World Cup fever burns hotter

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The Independent Online

In a quiet week for blue-chip companies, DSG International looks set to shine when it reports full year results on Wednesday. DSG operates the Dixons and Currys electrical goods high-street retail chains, and benefited from a surge in sales of high-definition televisions in the build-up to this year's World Cup and Wimbledon. With the BBC and BSkyB broadcasting in high definition, consumers have flocked to the shops to buy new televisions.

Televisions account for only 10 per cent of DSG's sales and a potential recovery in the UK white goods market also has some analysts excited. Sales of products such as washing machines and refrigerators declined about 9 per cent last year, but a strengthening housing market has raised hopes of a resurgence.

In May, DSG issued a bullish trading statement, pointing to full-year revenue growth of 6 per cent after second-half strength. It forecast profits before tax to be up to £318m, above market expectations at that time. Investors will also be keen for comments on computer pricing and any signs of a turnaround at its mobile phone chain The Link.

TODAY: Thus, the Glasgow-based telecoms company, reports full-year results, with few surprises expected. The company said in an earlier trading statement that it anticipates revenue to exceed £370m. Investors will focus on the integration of its Your Communications and Legend acquisitions, which are anticipated to deliver annual cost savings of about £25m by 2008.

Results: Full year - Acal, Alba, Majestic Wine, Petards, Thus Group. Fourth quarter - British Energy Group. Trading statements: Lloyds TSB.

TOMORROW: The recovery of Kewill Systems is expected to continue when it reports full-year results. Since 2002, the company has turned itself around and is now profitable across all of its divisions. Kewill provides its clients with supply-chain execution software and has a £12m war chest to pursue further acquisitions.

Also of note will be a trading statement from the fixed-line telecoms company Fibernet after its disappointing second-quarter performance. Bridgewell Securities hopes to see new orders of at least £10m and service revenue of about £12.1m.

Results: Full year - James Cropper, Halma, Kewill Systems, Tribal Group. Trading statements: Fibernet. EGMs: Trafficmaster. AGMs: Whitbread.

WEDNESDAY: The biotech that has developed medicines derived from cannabis, GW Pharmaceuticals, reports first-half results, although there will be little interest in the numbers. GW's cash position will be in focus as it looks to get its potential blockbuster product Sativex to market. Sativex can be used for neuropathic and cancer pain relief, both multibillion-pound markets. More significantly, it can be used to treat multiple sclerosis spasticity.

Ibraheem Mahmood, at Investec Securities, said Sativex has received regulatory clearance to sell in Canada, and to run trials in the US, but GW has thus far been frustrated by the more mechanistic approach of the UK regulator. Investec expects net cash of £25m at the end of the first half. That's enough to fund the company for a further two years, although it is likely to sign a US partner before then.

Results: Full year - DSG International, ILX, Millbrook, Trifast. First half - GW Pharma. First-quarter sales - J Sainsbury. Trading statements: Brambles, HBOS.

THURSDAY: The chemicals company Dyson Group has had a year it will wish to forget. Higher energy costs have impacted its Saffil and Thermal Technologies businesses, while slow progress commercialising its Carolite technology has also hurt its prospects. Profits in fiscal 2006 will be lower than in previous years as a result. Williams de Broë expects profits before tax to be about £4m for the full year, down from £5.5m last year.

Analysts believe the company's technology portfolio justifies its valuation, and growth prospects are strengthening with automotive demand for Saffil a key driver. Brewin Dolphin said despite the setbacks in 2006, it expects strong growth from Dyson in the medium to longer term.

Also reporting full-year results is the construction services firm WS Atkins. Williams de Broë also expects a confident statement about its prospects in the fiscal year 2007. WS Atkins is part of the high-profile Metronet London Tubejoint venture. The company's rail results are improving as investment gathers pace, and the company has considerable opportunities in the Middle East and China.

Crest Nicholson, the house builder at the centre of market speculation regarding its rival Bovis building a stake, also reports interim results.

Results: Full year - WS Atkins, Computerland UK, Dyson. First half - Crest Nicholson, Driver Group.

FRIDAY: Results: Full year - Caldwell Investment, Cybit Holding.

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