The Week Ahead: Logica to reveal impact of public spending cuts

The potential impact of the Government's cost-cutting drive will be among the talking points when the IT group Logica posts its half-yearly results this week.

Goldman Sachs has warned that with around 13 per cent of revenues exposed to the UK public sector, Logica could be hit as spending is rolled back. The company is likely to be questioned about its views on the probable impact. Happily for investors, Logica is not involved in any of the projects singled out for immediate cuts, according to Panmure Gordon. As the broker notes, the company is "well spread in the UK public sector", with contracts across 55 departments and agencies. "Much of Logica's revenue is either outsourcing or in 'key skills', which are difficult to readily replace," Panmure said, adding that the company also has "good relationships with the key players" in the new administration and "with the civil servants who will advise them".

Goldman, on the other hand, is more bearish and reckons the market may be overlooking the risks posed by the fiscal squeeze. "Consensus does not yet reflect these risks, and we expect estimates to track down as incremental details around the department and nature of public-sector cuts emerge," the broker said in a round-up of the IT services sector published last week.

Today

The ground engineer Keller is due to post its interim results this morning and, following on from the first quarter, when bad weather weighed on the business, Numis expects the company to report an improvement in performance over the second quarter of the year. "The main focus will be [the] US and the trends Keller is seeing in the residential, commercial and infrastructure markets," the broker said. "Additionally, the market will be looking to gain an insight over the competitive pressures currently prevalent in the US, and whether these have the potential to emerge elsewhere or, in fact, are easing."

Results/Updates: Fidessa, Intertek, Keller, Management Consulting Group, Senior, Telecity, Ultra Electronics, Xchanging and XP Power.

Tomorrow

Deutsche Bank is anticipating Drax's half-yearly figures to be in line with market hopes, with the power-station operator expected to report a modest year-on-year increase in earnings before interest, tax, depreciation and amortisation.

Beyond the figures, the broker expects the company to issue an update on its plans for biomass-fired generating plants, though actual investment in standalone biomass projects is not expected until later in the year.

Results/Updates: 888 Holdings, Capital & Counties Properties, Drax, Fresnillo, GKN, Meggitt , Rotork, Taylor Wimpey, Weir and Xstrata.

Wednesday

Results/Updates: Arbuthnot, Cookson, Legal & General, Lloyds Banking Group, Premier Foods, Standard Chartered, Wolfson Microelectronics, British Land, WS Atkins, Carpetright, Antofagasta, the Eurasian Natural Resources Corporation and Marston's.

Thursday

Panmure is looking forward to a dividend increase alongside half-yearly results from RSA Insurance later this week. The broker expects the company to increase the first-half payout by 6 per cent to 3.07p per share, slightly above consensus hopes of a rise to 3.06 per share.

Turning to the lenders, and interim figures from Barclays are likely to show slower second-quarter trading at the group's Barclays Capital investment banking division. The expectations stem from weakness among peers and an update at the end of June, when Barclays confirmed that "investment-banking market conditions in May and June have been softer...reflecting lower levels of capital markets and mergers & acquisitions activity". That said, Barclays Capital may still outperform the broader investment-banking market, according to Citigroup.

"We believe that the top-line revenues of Barclays Capital will hold up much better than the industry average...and that the negative market reaction to the updated trading guidance provided by Barclays on 30 June may therefore have been overdone," the broker said in a preview published last week.

Also on Thursday, the aircraft-services group BBA Aviation is due to post its interim figures. Analysts expect the company to report £42.4m in underlying pre-tax profits, compared with £38.4m last year, while underlying earnings per share are expected to rise to 7.6p.

Results/Updates:Aviva, Barclays, BBA Aviation, Cobham, Ferrexpo, Ladbrokes, Millennium & Copthorne Hotels, Novae, Rio Tinto, RSA Insurance, Randgold Resources, Bellway and Unilever.

Friday

Results/Updates: Brammer, Catlin, Inmarsat, Old Mutual, Royal Bank of Scotland and Logica.

Economics Diary

Today

CBI SME trends survey

CIPS manufacturing PMI

Tomorrow

CIPS construction PMI

Wednesday

Shop price index for July

REC & KPMG report on jobs

CIPS services PMI

Thursday

Bank of England's Monetary Policy

Committee's decision on interest rates

and Quantitative Easing

Monthly car registrations report

Friday

Insolvency statistics for the second quarter

Producer prices report

Monthly industrial production figures

NIESR monthly GDP estimates

PROMOTED VIDEO
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

AIFMD Business Analyst / Consultant - Investment Management

£450 - £600 per day: Harrington Starr: AIFMD Business Analyst / Consultant - I...

Business Analyst Solvency II SME (Pillar 1, 2 & 3) Insurance

£450 - £600 per day: Harrington Starr: Business Analyst Solvency II SME (Pilla...

Manager - SAS - Data Warehouse - Banking

£350 - £365 per day: Orgtel: Manager, SAS, Data Warehouse, Banking, Bristol - ...

SQL DBA/Developer

£500 per day: Harrington Starr: SQL DBA/Developer
 SQL, C#, VBA, Linux, SQL Se...

Day In a Page

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home
Lauded therapist Harley Mille still in limbo as battle to stay in Britain drags on

Lauded therapist still in limbo as battle to stay in Britain drags on

Australian Harley Miller is as frustrated by court delays as she is with the idiosyncrasies of immigration law
Lewis Fry Richardson's weather forecasts changed the world. But could his predictions of war do the same?

Lewis Fry Richardson's weather forecasts changed the world...

But could his predictions of war do the same?
Kate Bush asks fans not to take photos at her London gigs: 'I want to have contact with the audience, not iPhones'

'I want to have contact with the audience, not iPhones'

Kate Bush asks fans not to take photos at her London gigs
Under-35s have rated gardening in their top five favourite leisure activities, but why?

Young at hort

Under-35s have rated gardening in their top five favourite leisure activities. But why are so many people are swapping sweaty clubs for leafy shrubs?
Tim Vine, winner of the Funniest Joke of the Fringe award: 'making a quip as funny as possible is an art'

Beyond a joke

Tim Vine, winner of the Funniest Joke of the Fringe award, has nigh-on 200 in his act. So how are they conceived?
The late Peter O'Toole shines in 'Katherine of Alexandria' despite illness

The late Peter O'Toole shines in 'Katherine of Alexandria' despite illness

Sadly though, the Lawrence of Arabia star is not around to lend his own critique
Wicken Fen in Cambridgeshire: The joy of camping in a wetland nature reserve and sleeping under the stars

A wild night out

Wicken Fen in Cambridgeshire offers a rare chance to camp in a wetland nature reserve