The Week Ahead: Maker of Goodfellas pizzas fears an offer it can't swallow

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The Independent Online

When a giant such as Marks & Spencer finds itself in the takeover spotlight, a host of other, smaller companies will sit up and take notice. And so it is with Northern Foods, the ready- meals business that is due to produce full-year numbers on Wednesday.

The group is one of the bigger suppliers to M&S, which last week caught the eye of the billionaire Philip Green. Northern Foods supplies a host of stores and supermarkets, but losing such a big client as M&S would hurt, and the results presentation is therefore likely to focus on what exactly a change of ownership would mean.

In the meantime, the manufacturer of Goodfellas pizzas and Pork Farm pork pies has already warned that fourth-quarter profits have been hit by slowing sales growth - which in turn comes after a tough 2003, when the hot summer put people off eating pizzas and pies. Pre-tax profits, under the leadership of the recently installed chief executive Patricia O'Dris- coll, are expected to slip from £98m to around £86m.

Adjusted profits are also predicted to dip, by 3 per cent to around £222m, at sugar and starch specialist Tate & Lyle, but the news otherwise is generally expected to be better.

Those with an eye for eating trends would probably steer clear of the carbohydrate giant, yet analysts retain a positive attitude towards the stock. Most believe its calorie-free sweetener sucralose could be a source of significant growth as it plays nicely into growing concerns about obesity - and, of course, growing demand for low-carb foods.

Away from food altogether, and arguably the biggest name to produce full-year figures will be Cable & Wireless. It has been a tough few years for the telecoms company, which over- stretched itself during the tech boom and is still attempting to put things right.

It has announced a further radical overhaul, focused primarily on its exit from the US, yet some in the City remain unconvinced. In a recent Williams de Broë research note, the broker commented: "We may be comfortable that there are no more huge skeletons in C&W's closet, but we don't think we are alone in failing to understand the strategy of this business. We are unclear as to what parts of the business will be retained, and what will be sold off."

The City will therefore be hoping chief executive Francesco Caio uses the full-year numbers to explain his long-term plans in more detail.

The group is, however, expected to move back into the black, with pre-tax profits of around £314m against last year's losses of £224m.

At the retail end of the telecoms sector is Carphone Warehouse. The chain recently published a trading statement that revealed pre-tax profits for the full year, due out on Wednesday, would be at the top of analyst forecasts. It was also upbeat for the current financial year, predicting demand would rise as prices fell and people sought out the latest models.

That, though, is pretty much all there is for investors in this Bank Holiday week, and the focus will fall on a series of important economic updates.

The Bank of England's rate-setting Monetary Policy Committee is not scheduled to meet until 9 June, but events in the next few days will play a vital role in determining what the decision on interest rates will be. There will be updates on manufacturing, the service sector and retail, as well as those two perennial bugbears for the MPC, personal lending and house prices.

Philip Shaw, economist at Investec bank, says of this week's manufacturing and services data: "Given the curiously weak official numbers, the Bank is placing some weight on survey evidence, and although we are pencilling in a slight softening in both surveys, we still expect them to be signalling robust expansion."

In mainland Europe, the European Central Bank will set the ball rolling when it unveils its decision on interest rates and provides an update on how it believes the eurozone economy is faring. No one believes a change to the cost of borrowing - currently 2 per cent - is likely, so the update will be of most interest, particularly when trying to gauge what the ECB's long-term policies are.

The final chunk of economic news will be provided by the oil cartel Opec, which, following a recent emergency meeting in Amsterdam to discuss the surging cost of crude, meets this Thursday for one of its more regular quota-setting debates. All eyes will be on whether it acquiesces to a call by the cartel's most powerful member, Saudi Arabia, for an extra supply of between two million and 2.5 million barrels per day.

CALENDAR

Tomorrow 31

UK: Results: None scheduled - Bank Holiday.

Tuesday 1

UK: Results: (final) Eckoh Technologies; (interim) fountains, RWS Holdings, SCI Entertainment, Synstar.

Wednesday 2

UK: Results: (F) AMG, Cable & Wireless, Expro International, Maelor, Northern Foods, Peacock, Umeco, Volex.

Thursday 3

UK: Results: (F) Applied Optical Technologies, Carphone Warehouse, East Surrey Holdings, FKI, Genus, Johnson Matthey, Oxford Instruments, Private & Commercial Finance, Speedy Hire, Tate & Lyle, Wagon; (I) Daily Mail & General Trust.

Friday 4

UK: Results: (F) Cambridge Mineral Resources, Hornby, Park Group.

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