The Week Ahead: Investors keen for news on Imperial’s suitors
Tuesday 26 August 2008
Imperial Energy, the Russia-focused oil and gas explorer and producer, is due to report interim results this week and, with up to three predators on the prowl, investors are likely to look beyond the numbers for any news about progress in the race to acquire the company.
Imperial has acknowledged two approaches, believed to be from ONGC Videsh, the international arm of India's Oil & Natural Gas Corporation, and China's Sinopec, while recent reports have indicated interest from the Korea National Oil Corp (KNOC).
ONGC is believed to have offered 1,290p per share for the business, and reports in India indicate that it might increase the bid to 1,500p per share if Sinopec, which is yet to table an offer, counters its initial proposal. UBS, whose analysts weighed in on the situation last week, said that while management may not be able to comment given the sensitive nature of proceedings, "the current bid approach is likely to go ahead".
For more clues, tune in to Imperial on Thursday.
Today: The distribution group Bunzl is due to publish interim results and Evolution Securities forecasts an 11 per cent hike in pre-tax profits to £111.8m, and earnings per share of 23.2p. The interim dividend is expected to increase by 10 per cent to 6.4p. "The interims will show solid double-digit growth, and demonstrate the strengths of the business model in difficult economic backgrounds," Evolution said.
Evolution also weighed in on Aggreko, the support services group that is due to report interim results today, forecasting pre-tax profits of £68m with 16.7p in earnings per share.
"We expect European profits to be around 70 per cent higher in what is a seasonally weak trading period, whilst North American profits are expected to be flat at best as the slowing construction activity starts to affect parts of the business," the broker said.
Results/updates: Cairn Energy, Rio Tinto, Wood Group, Aggreko, Bunzl.
Tomorrow: The oil and gas services group Petrofac is due to publish interim results and Deutsche Bank is forecasting a clean net income of $133m, up 46 per cent year-on-year. "We believe investor focus will be around the company's contract pipeline outlook and its ability to maintain high utilization rates in the face of delayed project sanctioning (backlog has remained broadly flat since end of 2007)," the broker said.
Antofagasta, the FTSE 100-listed mining group, is due to publish interim results, and UBS is anticipating news of a special dividend of 15 cents per share, with an ordinary dividend of 4.5 cents. The broker also forecasts $1.5bn in earnings before interest and tax, and net earnings of $750m.
Also tomorrow, the car retailer Lookers is due to publish interim results, and Panmure Gordon is anticipating news of £14.4m in adjusted pre-tax profits, down from £18.1m in 2007. The interim dividend is forecast to come in at 1.8p, compared with 1.6p last year.
Results/updates: Tullow Oil, Secro, Johnston Press, G4S, Lookers, Antofagasta, Petrofac.
Thursday: The drinks giant Diageo is due to report full-year results and UBS is confident that the company will deliver its guidance of 9 per cent organic growth in earnings before interest and tax. Looking ahead, the broker expects investors to focus on management's outlook for 2009, which is "likely to be more cautious".
"There are headwinds building from ... rising US unemployment data, [and] ... we believe the weakening macro conditions in the UK, Spain and Ireland could have an impact on premium spirits consumption," UBS said.
Also on Thursday, the car retailer Pendragon is due to publish interim results and, given the deterioration in the new and used car market, Panmure Gordon expects the figures to be "down significantly" compared with last year.
"We have pencilled in Pendragon producing an adjusted pre-tax profit of £19m, which compares to £32.7m generated last year," the broker said, adding: "The key things we will be looking for are the state of its balance sheet, and whether it is in a position to survive during the next 12 months or so."
Results/updates: Premier Foods, Kazakhmys, Amec, Pendragon, Diageo, Imperial Energy.
Friday: The property website Rightmove is due to publish interim results at the end of this week and, given the problems in the housing market, Investec expects the focus to fall on the net decline in the company's estate agent customer base.
The broker also expects the company to be questioned about the potential business model threat from Property Live, the website due to be launched by the Association of Estate Agents and its 10,000-plus members in October.
"This website will be subscription free... clearly if successful (along with Globrix, a News Corp-funded ad based model) it could pose a significant threat to the underlying subscription nature and pricing power of the Rightmove offering," the broker said.
Results/updates: Bradford & Bingley, Stagecoach, PartyGaming, Rightmove.
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