The Week Ahead: Time for boss of M&S to reveal his strategy

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The Independent Online

With recent reports that Marks and Spencer is looking to make a dramatic return to Europe, which it exited in 2001, all eyes are on the chief executive Marc Bolland, who has been in the top job for just over six months, to find out what he will reveal in his strategy presentation when the company posts its half-year results on Tuesday.

Mr Bolland, who used to run Morrisons supermarkets, promised "evolution not revolution" and one of the brokers waiting with baited breath is Panmure, which has the stock on a "hold" recommendation.

"We are positive on Marks and Spencer's strong brand, relative exposure to a more wealthy customer, its multichannel model, its growing international business and the recovery and repositioning of the food business," said Panmure's analyst, Jean Roche. "However, without the benefit of some insight into the all-new senior management team's plans for the business we see no reason to make a change to our expectations at present."

Although he believes that a move back to the Continent is a possibility, UBS's Andrew Hughes also thinks that M&S may focus on "reaffirmation or acceleration", particularly with regard to its supply chain and e-commerce activities. However, he added: "In each case, we would not expect radical action as the business is already making good progress."

Mr Roche feels there are unlikely to be any surprises in the numbers themselves, given that "the market has seen M&S's interim sales data, and has given fairly close gross margin and operating cost guidance."

One thing to watch out for, he says, are staff bonuses, which are expected to be £25m more than the previous estimate of £35m that the broker made earlier in the year. Both analysts are expecting pre-tax profits of about £250m, up from £298 the year before.


Issuing its interim results, the online fashion retailer Asos will be hoping it can build on an impressive second-quarter update released in October. An area Singer Capital Markets is particularly interested in hearing about is the latest customer and sales growth figures for the US, where the Asos has recently launhced. The broker also forecasts pre-tax profits of £7m, "equivalent to year-on-year growth of 59.5 per cent, albeit against a weak discounting-driven comparative."

Results/Updates: Asos, G4S, Hiscox, Inmarsat, Spirax-Sarco.


With three of the big four UK banks releasing their latest figures last week, Barclays will complete the set with its third-quarter interim management statement. Jason Napier, a Deutsche Bank analyst, forecasts third-quarter revenues of £2.7bn and expects "substantial own debt losses to distort stated results". Despite warning of the risks of "a fall in capital markets activity and an unexpected spike in corporate and wholesale credit costs", Mr Napier keeps the broker's advice on the stock as "buy".

Also revealing figures on Tuesday is Associated British Foods, the owner of the Primark clothes chain, with Panmure expecting the company "to confirm a remarkable year". The broker notes talk about how rising cotton, freight and wheat prices could affect the company, but points out that "wheat prices could be beneficial for the grain-trading and animal-feed businesses, while world sugar prices hitting fresh 30-year highs have dragged Chinese prices with them and should ensure tight EU supply next year."

Results/Updates: Associated British Foods, Barclays; Drax; Hammerson; InterContinental Hotels; Legal and General; Marks and Spencer; Northern Foods; Randgold Resources; Schroders; Vodafone; Yell.


Results/Updates: Aveva Group; Fenner; Gartmore; Great Portland Estates; Johnston Press; Micro Focus; Novae; Prudential; J Sainsbury; Scottish and Southern Energy; Tullow Oil.


Euromoney, which is due to release its preliminary results, still has a big fan in Numis Securities, the broker which had the events organiser and business-to-business publisher as its key pick for the year. "We remain positive on the B2B subsector," analysts from Numis said in a preview note, "and believe that Euromoney exemplifies how groups have been able to evolve their revenue mix away from print and advertising towards online subscriptions and events over the past decade." The broker also states its belief that good results will benefit both DMGT and Informa.

Results/Updates: 3i; Balfour Beatty; BT; Cookson; Dairy Crest; Eurasian Natural Resources; Euromoney; Howden Joinery; IMI; International Power; Land Securities; Trinity Mirror; The Restaurant Group; Trinity; WH Smith.


Results/Updates: Aegis; Catlin; Hornby; Rolls-Royce; Spectris; Tullett Prebon.