Sheridan Admans, Investment Research Manager at retail stockbroker, The Share Centre, gives his thoughts on what to expect from companies announcing results w/c 20 August 2012.
Afren (Q2 results)
Afren recently started exploring in Kurdistan, which is yielding positive results, and investors will welcome an update on when it expects commercial production to begin. The Kurdistan regional government is in dispute with the central government in Baghdad over oil revenue, which resulted in export bans for a short period, so any news on this will be of interest.
Investors will also be keen to hear whether the group is on track for full year net production guidance of 42,000-46,000 barrel oil equivalent per day. Full year sales and earnings figures are expected to almost triple so any material shortfall in the half year results is likely to hit the share price significantly.We currently list Afren as a BUY
Companies also reporting today include Glencore International (Q2 results) – HOLD
BHP Billiton (Q4 results)
Despite the company’s record production figures, the health of the global economy and its downward pressure on commodity prices is likely to dampen BHP’s earnings figures. We have already seen the same theme play out with a number of the company’s peers who have already reported first half results.
Investors will also be looking for updates on the on-going investment programmes to expand productive capacity. Further updates on cost cutting and the write down of shale gas assets would also be welcomed.We currently list BHP Billiton as a BUY
Companies also reporting today include Clarkson (Q2 results) – HOLD and Carillion (Q2 results) – BUY
Diageo (Q4 results)
Diageo’s share price has risen around 20% since the start of the year so investors will be keen to see continued evidence that the company can keep up such a pace. This may come from strong performance from its emerging market operations and some momentum in its US recovery.
Any update on Diageo’s three year plan and news on sales growth in its China market will be of interest for investors.We currently list Diageo as a HOLD
Companies also reporting today include Essar Energy (Q2 results) – HOLD, IMI (Q2 results) – HOLD, Kazakhmys (Q2 results) – HOLD
Companies also reporting today include AGA Rangemaster (Q2 results) – BUY
Economic announcements for the w/c 20 August
21 August Public Sector Finances, July 2012 – ONS
Last month’s data on UK public finances was worse than expected. June’s public sector net borrowing was £14.4 billion compared to £13.9 billion in June and a consensus of £13.4 billion. As a result, the UK’s government borrowing this year is on course to overshoot the OBR’s estimate. Will July’s data indicate an improvement in the underlying picture?
24 August Second estimate of GDP, Q2 2012 – ONS
Not all economists believed the first estimate of UK GP for Q2 of this year. The ONS estimated growth at minus 0.7 per cent, but this finding was not supported by either Purchasing Managers’ Indices or positive data on UK employment. Will the second estimate, out today, show an upwards revision as some expect? It is unlikely it will be revised sufficiently for the data to suggest that the UK is no longer in recession.
Other economic announcements include:
- Monthly Industrial Trends Survey – CBI
- FOMC Minutes, Meeting of July 31-August 1, 2012 – Fed
- Services Producer Price Indices, Quarter 2 2012 – ONS
- Quarterly Distributive Trades Survey – CBI
- Business Investment, Q2 2012 Provisional Results – ONS
- Index of Services, June 2012 – ONS