The Week Ahead: Tesco can weather storm with solid UK growth

Tesco is due to publish a first-quarter update tomorrow and despite evidence of declining sales performance, analysts expect the company to report a solid start to the year in the UK.

"[The recent TNS data on supermarkets] suggests that Tesco sales performance relative to the rest of the industry has waned slightly since March's bounce-back, but we wouldn't read too much into this – over the quarter as a whole, Tesco's growth has improve relative to [the fourth quarter]," said Deutsche Bank, whose analysts forecast 4 per cent like-for-like sales growth, excluding petrol, in the UK.

Citigroup made a similar point. It expects the company to be "well on target to hit its full-year "planned performance" of 3-4 per cent [ex-petrol like-for-like growth]".

Beyond the UK, however, things may not be going so well. JP Morgan believes there has been a "marked slowdown" in international sales growth. The broker points out that the 19 per cent growth achieved in the first five weeks of the year "already benefited from a weaker sterling, perhaps implying ex-currency gro-wth in the very low double digits" from the 21.7 per cent in the fourth quarter for last year. JPM adds that the fourth quarter was boosted by about 6 per cent by consolidation in China. As such, the broker assumes 13 per cent growth at constant exchange rates in the first 13 weeks of the year. Currency changes are estimated to boost international growth by 12 percentage points to 25 per cent.

TODAY: Hyder Consulting, the international design consultancy which worked on the Ski Dubai resort, is due to publish final results today and, after the company's positive pre-close update in April, Panmure Gordon is anticipating some solid figures. "[The April update] confirmed that trading was in line with expectations, and the order book [was] running at record levels," the broker said, forecasting adjusted pre-tax profits of £13.9m, compared with £10.4m in the year before. It added: "With in excess of 30 per cent upside to our target price [of 500p], we believe the recent share price weakness has been overdone, and maintain our 'Buy' recommendation ahead of the results."

Also today, the City of London Investment Group is due to publish a trading update. Evolution Securities, which maintains a "Buy" rating on the stock, is positive on the company's prospects.

"At the interim results announcement in January, management commented it had just won two significant mandates which, together with continuing out-performance, should offset the underlying fall in assets under management in [the second half]," the broker said. "We now estimate year-end assets at $4.9bn, up $300m or 6 per cent from the November 2007 half-year end Confidence in CLIG's prospects was boosted by the CEO spending [more than] £1m in April 2008 to augment his personal holding. He now owns 4.9 million shares, or nearly 20 per cent of the issued share capital."

Results/Updates: Intelek, Latchways, Volex, Workspace, City of London Investment Group, Hyder Consulting.

TOMORROW: Results/ Updates: Bango, Media Square, Redstone, Warner Estate and Tesco.

WEDNESDAY: A first-half trading statement is due from Royal Bank of Scotland. As UBS notes, this will be the first time the bank has spoken to the market since its rights issue, the offer period for which ended last week. "We would expect an update of the current position of the Treasury Asset securities that drove the capital raising to be the key focus of the update," the broker said.

Results/Updates: Driver, Chapelthorpe, Rensburg Sheppards and Royal Bank of Scotland.

THURSDAY: Carphone Warehouse is due to publish preliminary results and analysts are not expecting any surprises. As Landsbanki, whose analysts forecast £215m in pre-tax profits with 19p in earnings per share, pointed out in a recent preview note, "[the fourth quarter update] gave guidance on key figures".

UBS, whose analysts predict £217.5m in pre-tax profits and full diluted earnings per share of 18.2p, made a similar point and added: "Looking ahead, there are the usual plethora of key issues: whether the handset market can remain relatively immune to a consumption slowdown, the scale of start-up losses for the Best Buy JV in the UK, incremental returns on broadband subscriber growth, the Ofcom LLU [local loop unbundling] pricing review and [the company's potential interest] in Tiscali UK."

Home Retail Group is due to publish a first-quarter trading statement. UBS is forecasting -2 per cent like-for-like sales at Argos and -7.5 per cent at Homebase.

"Last seen, Argos sales were low single-digit negative, slightly ahead of expectations, for the first two months of the quarter. This reflected continued strength in flat panel and games," UBS said. "However, this had impacted the margin mix so the profit out-turn may not have been too different from management estimates."

UBS attributed the weakness at Homebase to tough-er comparatives from last year and poor weather.

Results/Updates: Charles Stanley, Home Retail Group and Carphone Warehouse.

FRIDAY: Results/Updates: Oxford Instruments.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Tony Hughes (James Nesbitt) after his son Olly disappeared on a family holiday in France
Arts and Entertainment
The Apprentice candidates Roisin Hogan, Solomon Akhtar, Mark Wright, Bianca Miller, Daniel Lassman
tvReview: But which contestants got the boot?
Arts and Entertainment
Jim Carrey and Jeff Daniels ride again in Dumb and Dumber To
filmReview: Dumb And Dumber To was a really stupid idea

Jo from Northern Ireland was less than impressed by Russell Brand's attempt to stage a publicity stunt

Scunthorpe goalkeeper Sam Slocombe (left) is congratulated by winning penalty taker Miguel Llera (right)
Life and Style
A woman walks by a pandal art installation entitled 'Mars Mission' with the figure of an astronaut during the Durga Puja festival in Calcutta, India
techHow we’ll investigate the existence of, and maybe move in with, our alien neighbours
Arts and Entertainment
Sir Ian McKellen tempts the Cookie Monster
tvSir Ian McKellen joins the Cookie Monster for a lesson on temptation
ebooksNow available in paperback
Tourists bask in the sun beneath the skyscrapers of Dubai
travelBritish embassy uses social media campaign to issue travel advice for festive holiday-makers in UAE
Arts and Entertainment
Jennifer Saunders stars as Miss Windsor, Dennis's hysterical French teacher
filmJennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress
Life and Style
Nabil Bentaleb (centre) celebrates putting Tottenham ahead
footballTottenham 4 Newcastle 0: Spurs fans dreaming of Wembley final after dominant win
Life and Style
Sebastian Siemiatkowski is the 33-year-old co-founder and CEO of Klarna, which provides a simple way for people to buy things online
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

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Carlton Senior Appointments: Sr Wealth Manager - San Francisco - Inv AdvisoryFirm

$125 - $175 per annum: Carlton Senior Appointments: Senior Wealth Manager – In...

Day In a Page

Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas
La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

Deaf community outraged by La Famille Bélier

The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
10 best high-end laptops

10 best high-end laptops

From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
Susie Wolff: A driving force in battle for equality behind the wheel

Susie Wolff: A driving force in battle for equality behind the wheel

The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

'No abs Adam' plans to muscle in on Usain Bolt's turf

After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
Calls for a military mental health 'quality mark'

Homeless Veterans campaign

Expert calls for military mental health 'quality mark'
Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

Meet Racton Man

Analysis shows famous skeleton was a 6ft Bronze Age superman
Garden Bridge: St Paul’s adds to £175m project’s troubled waters

Garden Bridge

St Paul’s adds to £175m project’s troubled waters
Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

Stuff your own Christmas mouse ornament

An evening class in taxidermy with a festive feel
Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

Joint Enterprise

The legal doctrine which critics say has caused hundreds of miscarriages of justice
Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

Freud and Eros

Love, Lust and Longing at the Freud Museum