The week ahead (12/12 - 16/12/11)

Company reports are pretty thin on the ground this week, as the momentum starts to wind down ahead of the Christmas season.

BAA flies onto the scene on Monday with a trading update, just a few days after it completed a new eight-year term loan arranged by AMP Capital. The Heathrow airport operator hailed the facility as demonstrating 'investors' continued confidence in financing Heathrow's investment programme, despite current difficult financing market conditions'.

Carpetright makes an appearance 24 hours later and the outlook isn't rosy given the downbeat consumer demand. The FTSE 250-listed company saw second-quarter UK like-for-likes decelerate to -3 per cent having been flat through the first quarter.

'In the short term we remain concerned that the initiatives planned for the second half will not deliver the material improvements management expect, while the almost ceaseless promotional activity could start to lose impact,' warned James Dilks-Hopper, analyst at Numis.

Longer term, he sees the increased durability of polypropylene carpets extending the carpet replacement cycle, reducing the overall market size and thwarting Carpetright's return to peak profitability levels.

Petrofac is due to report on the same day and in contrast, is on track for like-for-like profit growth of well over 20 per cent. The medium-term outlook for this oil services company remains robust given its enthusiastic bidding on several large full-field development contracts in Iraq.

And making it a Tuesday hat-trick, Whitbread is also due to release its third-quarter statement. For the second half, Numis anticipated a slowdown in trading at Premier Inn, given recent lacklustre data from the UK hotel sector. However, it does believe the FTSE 100-listed company will continued to take market share from underinvested independents and B&B operators and has continued to benefit from dynamic pricing and improved marketing.

Wednesday welcomes Weir Group after what has been a tremendous year for the company. It gained entry into the FTSE 100 and the share price has risen over 130 per cent in the last 12 months. Demand has remained high for the company's products, although it does have a dependency on the mining sector, which has come into turbulent times of late.

Thomas Cook Group is also thrown into the midweek mix, after what has been a testing time for both the company and its shareholders. It was originally due to report towards the end of November but delayed the announcement as a result of 'deterioration of trading in some areas of the business of the current quarter'.

Rival group TUI Travel recently said the next three months would prove critical in determining whether Thomas Cook's troubles have caused lasting damage to its reputation.

'In our view, the long-term future shape and prospects for the business are uncertain and the focus for analysts is likely to be on the merits of its restructuring plan,' according to Wyn Ellis, analyst at Numis.

Supergroup turns the focus from holidaymakers to fashion. At the start of October, the company reported that a systems upgrade has resulted in problems with stock availability, prompting pre-tax profit to come in some £6-9 million lower than previously expected.

At the interim results, the market will be looking for any news on the current trading trend and confirmation that the downgrade associated with the stock difficulties remains in the previously guided £6-9 million range.

Sports Direct keeps the retail theme running on Thursday. In the second quarter the company delivered retail sales of 12.1 per cent; clearly the bonus scheme is being successful at driving service levels to ensure that cash-strapped consumers are provided with the right service and product at a suitable price.

The group confirmed that it was confident of reaching the full-year target underlying EBITDA of £215 million, but investors will be keen to see an outlook statement as we approach 2012.

And last but not least, it's the turn of the pub industry to whet investors' appetite on Friday. Punch Taverns watched its net income fall 5.2 per cent in 2011 but this is forecast to improve to -3.5 per cent in 2012, driven by its pub disposals and numerous initiatives to improve licensee support and competitiveness.

Looking at the economic diary this week, the markets will have much to mull over. First up is the Rics housing market survey for November which should shed light on the supply-demand dynamics of the housing markets, as well as latest price developments.

Of real interest will be details of the number of new properties coming on to the market and buyer interest. Activity indicators were slightly stronger in October so it remains to be seen whether this improvement was sustained last month.

On Tuesday, the Consumer Prices Index measure of inflation is expected to have moderated to 4.8 per cent in November after dipping to 5 per cent in October.

'Inflation seems to have finally embarked on what should be an extended, marked downward trend,' said Howard Archer, chief UK and European economist at IHS Global Insight. 'Inflation should dip particularly sharply at the start of 2012 as the impact of January 2011 VAT hike from 17.5 per cent to 20 per cent drops out.'

Unemployment data is due out midweek and somewhat unsurprisingly, is likely to show further overall deterioration, extending recent worrying developments. Claimant count unemployment is forecast to have risen by 17,000 in November, which would mark the ninth successive increase and push the number to a 25-month high of 1.6150 million.

And wrapping up events, retail sales volumes are released on Thursday for November and should show a 0.2 per cent month-on-month drop after a surprising increase of 0.6 per cent in October.

Indications are that retailers suffered a very weak start to the critical Christmas sales period and are under pressure as the seasonal shopping heads towards its climax.

Monday 12 December

Results

(Interim) Bglobal, Eco Animal Health Group, Ensor Holdings, O Twelve Estates, Solid State

Trading update

BAA

AGM/EGM

Aberdeen Latin American Income Fund, Avation, Capital Lease Aviation, Henderson Fledgling Trust, Leaf Clean Energy Company, Skywest Airlines, World Careers Network

Tuesday 13 December

Results

(Final) Domino Printing Sciences, Jelf Grouo

(Interim) Carpetright, Imagination Technologies Group, Polar Capital Technology Trust

Trading update

Go-Ahead Group, IG Group Holdings, Petrofac, Whitbread

AGM/EGM

Billing Services Group, KleenAir Systems International, Mentum, RSM Tenon Group, Tristel, Tottenham Hotspur

Wednesday 14 December

Results

(Final) IDOX, RWS Holdings, Thomas Cook Group

(Interim) Expansys

Trading update

Nexus Management

AGM/EGM

African Medical Investments, Avanti Capital, BowLeven, Bezant Resources, Epistem Holdings, EnCore Oil, Firestone Diamonds, Greenko Group, LP Hill, Prosperity Russia Domestic, Pure Wafer, PureCircle, Sareum Holdings, Uranium Resources, Westmount Energy, Weatherly International

Ex-Dividend Payment Date

Babcock International Group, Bellway, Caffyns, CVS Group, Falkland Island Holdings, Hornby, Hydre Consulting, KCOM Group, Marston's, MITIE Group, Origin Enterprises, Red24, Sportingbet, SVM Global Fund, Telford Homes, United Utilities Group

Thursday 15 December

Results

(Final) Hiwave Technologies, Nasstar, Pursuit Dynamics

(Interim) Cohort, Planet Payment, Sports Direct International

Trading update

Keller Group, Moss Bros Group, Senior, Serco Group, John Wood Group

AGM/EGM

Acorn Income Fund, British Empire Securities & General Trust, Churchill Mining, GCM Resources, Standard Life Equity Income Trust

Friday 16 December

Results

(Final) Jersey Electricity Company

(Interim) Siteserv

Trading update

Access Intelligence, Spirit Pub

AGM/EGM

Croma Group, Lochard Energy, Palmaris Capital, Punch Taverns, Sportingbet, Solo Oil, Spirit Pub, TXO.

This was written for our sister website, Interactive Investor

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