Punch Taverns in high spirits as move promises profit boost
The Week Ahead
The housebuilding, transport and restaurant sectors will be in the spotlight this week during an otherwise quiet few days for results and updates.
Train and bus operator Go-Ahead is set to report rising profits as soaring petrol prices push people onto public transport.
They are expected to reveal on Thursday that underlying profits rose 6% to £93.8m to July 2.
Housebuilder Bovis has addressed the stagnant market by focusing on family homes rather than first-time buyer flats, which are proving harder to sell because banks are demanding deposits of up to 20%.
The group's last trading update revealed a 16% increase in reservations in the first half of the year, and an improving rate of sales. Average sale prices increased by about 3%.
Taylor Wimpey recently said it returned to profit in the first half of the year. And Persimmon reported a 40% drop in pre-tax profits to £60.3m, as revenues fell 8% to £712.8m in the period although it has seen an improvement in trading in recent weeks.
Fund manager Hargreaves Lansdown will hope to draw a line under its recent share price turbulence when it posts full-year results on Thursday.
The stock, which was recently promoted into the FTSE 100 Index, has slumped by a third in the last three months amid fears over the impact of plans by the Financial Services Authority to ban referral payments from fund managers.
The owner of Chiquito and Frankie -amp; Benny's restaurants will shed light on the health of the eating out sector when it posts half-year results on Thursday.
The Restaurant Group, which operates over 390 restaurants and food-led pubs, said in its last update it was confident of reporting improved profits in its half year.
It said its pub-restaurants had put in a particularly strong performance but its restaurants at cinemas and retail parks had suffered from "variable" footfall. Former Punch Taverns and Spirit Group are due to give their first trading updates on Thursday, since they demerged earlier this month.
Debt-laden pub operator Punch Taverns split its Chef -amp; Brewer and Fayre -amp; Square branded pubs into a new managed pub business, leaving Punch as a tenanted pubs specialist.
The split will enable Spirit to invest in its 1,372 managed pubs, increasing their focus on the faster growing, eating-out sector of the pub market.
When Punch last updated the market with trading figures, in June, it said the hot spring weather and its refurbishment programme had helped boost sales.
Both companies are due to issue fourth quarter trading updates on Thursday for the year to the end of August.
Simon French, an analyst at Panmure Gordon, expects Punch to make £78m in pre-tax profits for the full-year.
Spirit is likely to report a 17% increase in pre-tax profits to £48m, according to Greg Johnson, an analyst at Shore Capital.