The Week Ahead: HBOS is a happy house but it's hard at iSoft, bitter at Cadbury

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The Independent Online

In the wake of yet another set of surprisingly strong figures for house prices last week, all eyes will be on the trading statements of three UK lenders to gauge whether the buoyancy will continue. Lloyds TSB, Alliance & Leicester and HBOS will update the City on Monday, Wednesday and Thursday, respectively. The performance of HBOS, however, which accounts for around 20 per cent of the UK loan market, will carry the most weight.

"What they say will be an important 'read across' for all the other mortgage banks," said Nic Clarke of stockbroker Charles Stanley. Despite two recent interest rate rises by the Bank of England, analysts are expecting a positive outlook. Barclays analyst Neil Cooper expects HBOS to post gains on its competitors in home loans and to report a strong performance in corporate banking as well.

An update from Cadbury Schweppes, scheduled for Tuesday, isn't expected to be so sweet. The company said earlier this year that its UK confectionery business had suffered due to a recall of chocolate bars after salmonella was found in one of its factories. Analysts expect that lag to remain. They will also be keen for any guidance from the group on what impact the falling dollar will have on its overall performance. The company generates half its turnover in the US.

Far worse off than Cadbury, however, is iSoft, the beleaguered software provider to the NHS. The company, which has lost 90 per cent of its value in the past 12 months, will reveal interim results tomorrow. After the loss of its chief executive and the restatement of three years of sales, the way forward should now be clearer, if not very pretty. "Some are saying the equity is worth nothing, but I don't think it's that bad," said Paul Morland of Arbuthnot Securities. "People have been too negative on the stock."

The main talking point will be a takeover approach. ISoft has acknowledged it received an overture, but did not say who the suitor was. Speculation has centred on electronics giants Philips and Siemens, both of which are seen as credible bidders. Analysts will also want clarification on whether iSoft has made progress in restructuring its heavy debt burden.

Another company ensconced in M&A discussions is MyTravel. When it gives final results on Thursday, the group will be pressed for details on any progress in the talks with rival First Choice Holidays. MyTravel admitted last month it had approached First Choice about buying its short-haul package travel business, but it has remained silent on the talks since then.

Southern Cross Healthcare, floated earlier this year by private equity giant Blackstone, will give its maiden annual results on Monday. The UK's largest nursing-home operator is expected to produce strong numbers in the light of several acquisitions and its most recent trading statement, which reported increased occupancy rates. "We'll want to see if those improvements have been sustained," said Sebastien Jantet, an analyst at asset manger Investec.

Staying in healthcare, Renovo will unveil its first set of annual results this week. The biotechnology firm, which is developing a treatment to prevent post-operative scar tissue, will report a loss, but the City remains positive about its potential. Since the April float, its shares are up more than 43 per cent.

The focal points of the Wednesday trading statement from Whitbread will be Premier Travel Inn, which accounts for nearly two-thirds of the group's profits, as well as Costa Coffee, which is also expected to have performed well.

La Tasca, the operator of Spanish-themed restaurants, will hope to reveal a continued recovery story at its Tuesday interim results after suffering a bad World Cup. It will also provide an update on its plans for new restaurant openings.

Finally Carnival, the cruise ship operator, is hoping to hit the modestly improved guidance figures provided at its last quarterly earnings call. There are two factors that will affect this. First, demand in the US, where it derives the lion's share of its turnover, remains weak. Second, while fuel costs have retreated a bit, whether that happened soon enough or drastically enough to improve Carnival's fortunes is uncertain. The City is cautious: investment bank Dresdner Kleinwort cut its rating on the stock from "buy" to "hold" last week.

CALENDAR

Tomorrow 11

UK RESULTS: (final) (final) Shaftsbury, Southern Cross Healthcare; (interim) iSOFT, Northgate Information Solutions, RPC

Tuesday 12

UK RESULTS: (F) Civica, RWS, Theratase. ; (I) Anite, Ashtead, Carpetright, Hogg Robinson, Accident Exchange, La Tasca

Wednesday 13

UK RESULTS: (F) Slimma, Zytronic; International Greetings; (I) RHM, Telecom Plus

Thursday 14

UK RESULTS: (F) MyTravel, Renovo ; (I) Heath (Samuel) & Sons, AEA Technology, Spice

Friday 15

UK RESULTS: (F) Carnival

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