The Week Ahead: Black gold production is down but profits set to rise

The focus is on the giant oil companies this week as BG, BP and Royal Dutch Shell issue third-quarter results. Given the spike over the last year in the price of the black gold, earnings comparisons are likely to be strong across the board, although crude has edged back in the last few months.

BP, which unveils its figures on Tuesday, received a boost last week from the news its main partner in the Macondo well prospect, Anadarko Petroleum, will pay $4bn towards costs from the Gulf of Mexico disaster. With a massive court case regarding the tragedy due to start in February, Deutsche Bank's Lucas Herrmann believes that "news flow will now start to improve" in the run-up to the trial, as shown by the settlement.

The analyst expects BP's production to have fallen 12 per cent from the same period the previous year, with recent disposals, maintenance projects and integrity tests continuing to bite.

However, he predicts positive news from its downstream operations, citing "a slightly better margin environment and improved refining availability" as supportive of his belief that profits will enjoy "a useful improvement".

BG Group's numbers are also out on Tuesday, and – like BP – its production numbers are expected to disappoint, with Societe Generale warning it has suffered a "heavy maintenance season". However, the broker does say there could be a positive surprise from its LNG operations thanks to higher spot prices in Asia.

There is perhaps the most optimism around Shell and its results on Thursday. Saying the update will "underscore [the] growth prospects" for the company, Collins Stewart's Gordon Gray points out that Shell's three major near-term growth projects are "just on stream or ramping up" and that, therefore, "the next few quarters represent the key period for delivery".


Results/updates: Afren and McBride.


A few City voices have started to question Arm Holdings recently, thanks partly to a number of its fellow chip companies cutting their forecasts. However, as Royal Bank of Scotland notes, it is industrial and PC operations that seem to have been hit rather than mobile phones, which account for nearly two-thirds of Arm's shipments.

Therefore, although RBS "expect softer royalty revenues" from the chip designer's third-quarter numbers on Thursday, it believes "this is already reflected in our estimates". It adds that this will be largely offset by its licensing activity and forecasts quarterly revenues of £121.1m.

Results/updates: Arm Holdings, BG Group, BP, Bunzl, International Personal Finance, Reckitt Benckiser and Senior.


The pharmaceuticals giant GlaxoSmithKline releases is set to release third-quarter results and UBS believes this will be the quarter GlaxoSmithKline returns to growth "after headwinds ... diminish" from its declining pandemic anti-flu, Valtrex antiviral and Avandia diabetes drugs, all of which knocked its interims back in July.

Meanwhile, JP Morgan Cazenove is "curious" over a potential update on GSK's buyback scheme, noting the company said the initial target was £2bn at most, but had already spent £1.85bn by July.

Results/updates: British American Tobacco, CSR, GlaxoSmithKline, Informa and Stobart.


Deutsche Bank's Simon Champion believes recent "below average football results" will be partly to blame for William Hill reporting weak margins at its third-quarter results. The analyst also highlights the fact the bookie is up against tough comparatives for the period.

Results/updates: AstraZeneca, Croda, DS Smith, Go-Ahead, Inchcape, Kazakhmys, Laird, Royal Dutch Shell and William Hill.


Sir Martin Sorrell's advertising giant WPP releases third-quarter figures, after a number of vague trading updates during the period. Last week, it told investors that organic growth for September was in-line with July, which saw a 4.5 per cent jump. Given August was stronger, JP Morgan Cazenove expects that WPP will post organic revenue growth of just under 5 per cent, which "would also indicate a fairly steep hurdle" for the rest of the year if the company still wants to hit its forecasts.

Results/updates: Shire and WPP.

Economics Diary


Eurozone PMI; eurozone industrial new orders; US Chicago Fed national activity index.


BBA loans for house purchase.


Confederation of British Industry industrial trends survey; ECB bank lending survey; US durable goods orders; US new home sales.


CBI distributive trades survey; eurozone business climate indicator; US GDP; US pending home sales.


GfK consumer confidence survey; US University of Michigan confidence data.

Start your day with The Independent, sign up for daily news emails
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

The secret CIA Starbucks

The coffee shop is deep inside the agency's forested Virginia compound
Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

How the Establishment closed ranks over fallout from Nessie 'sighting'

The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
One million Britons using food banks, according to Trussell Trust

One million Britons using food banks

Huge surge in number of families dependent on emergency food aid
Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

2,500 years of history in 3,000 amazing objects

Excavation at Italian cafe to fix rising damp unearths trove
The Hubble Space Telescope's amazing journey, 25 years on

The Hubble Space Telescope's amazing journey 25 years on

The space telescope was seen as a costly flop on its first release
Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

Did Lord Ashcroft quit the House of Lords to become a non-dom?

A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
Apple's ethnic emojis are being used to make racist comments on social media

Ethnic emojis used in racist comments

They were intended to promote harmony, but have achieved the opposite
Sir Kenneth Branagh interview: 'My bones are in the theatre'

Sir Kenneth Branagh: 'My bones are in the theatre'

The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
The sloth is now the face (and furry body) of three big advertising campaigns

The sloth is the face of three ad campaigns

Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
How to run a restaurant: As two newbies discovered, there's more to it than good food

How to run a restaurant

As two newbies discovered, there's more to it than good food
Record Store Day: Remembering an era when buying and selling discs were labours of love

Record Store Day: The vinyl countdown

For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
Usher, Mary J Blige and to give free concert as part of the Global Poverty Project

Mary J Blige and to give free concert

The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
10 best tote bags

Accessorise with a stylish shopper this spring: 10 best tote bags

We find carriers with room for all your essentials (and a bit more)
Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

Paul Scholes column

I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
Jessica Ennis-Hill: 'I just want to give it my best shot'

Jessica Ennis-Hill: 'I just want to give it my best shot'

The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...