Companies reporting next week

SUPERMARKET chain

Tesco

Tesco has produced a series of stellar trading updates in recent months and analysts are hopeful that its full-year results on Tuesday will again beat expectations.

The group reported like-for-like sales growth of 7.5% in the seven weeks to January 3 and recent market data has suggested that Tesco's dominant grip on the food retail industry has tightened. Full-year profits of £1.67bn are expected, up from £1.4bn a year ago.

Investors will also want an update on how Tesco has been using £750m raised in a placing of new shares - as well as its outlook in the wake of the Morrisons takeover of Safeway and consolidation in the convenience store sector.

Drinks giant Allied Domecq is set to shake off the impact of the weak US dollar and post a rise in pre-tax profits to £270m for the six months to the end of February, compared with £256m a year ago.

The announcement of its half-year results on Thursday should contain news on how its major brands are performing. In January, it reported that Makers Mark, Stolichnaya vodka and Sauza tequila were all showing good organic growth in the United States.

There has been a solid recovery in Spain after the destocking of inventories by wholesalers there last year, but conditions remain tough in France and Germany. Investors will also want to know whether sales have improved in Korea and Mexico, which are important markets for the group.

A poor Christmas trading performance at retailer WH Smith is likely to be reflected in its interim results announcement on Thursday, with pre-tax profits expected to fall to £65m from £91m a year ago.

But the attention of investors will be trained on the results of the operating and financial reviews instigated by chief executive Kate Swann, which could include the number of jobs to be lost at the retailer's head office in Swindon.

However questions about WH Smith's long-term competitive stance are unlikely to be answered. Analysts say its position in the retail sector is currently like that of a convenience store, winning on neither price nor range while saddled with high operating costs from prime high street locations.

Abbey National will be under pressure on two fronts on Thursday when it announces first quarter trading figures and stages its annual general meeting.

The banking giant will be anxious to show progress at an operating level after chief executive Luqman Arnold promised in February that this year's results would show a substantial improvement on the £686m loss of last time.

Abbey, which has restructured in the last year to focus on personal financial services, also faces criticism at its AGM as the National Association of Pension Funds has already expressed concern about bonus payments to Mr Arnold.

Household products maker Reckitt Benckiser forecast strong growth in 2004 at the time of its annual results announcement in February, and a first-quarter trading update on Monday will provide the first clues as to whether this outlook has been borne out.

The Anglo-Dutch group, which makes products such as Lemsip, Dettol, Airwick air fresheners and Harpic disinfectant, is targeting net revenue growth of 5% or more and low double digit net income and earnings per share increases.

Analysts will want to know whether strong growth has been maintained in its western European business and that sales in North America and developing markets have continued to gather pace since January.

Cambridge-based chip designer Arm Holdings warned investors in January to expect flat US dollar-denominated revenues for the first three months of 2004, implying that sales will decline at constant exchange rates.

However, better news is expected from the group in a trading update on Tuesday with revenues likely to be 6% ahead of last year at £32.7m.

Profits will remain under pressure as the vast majority of Arm's costs are in pounds while 90% of its revenues are in dollars. Analysts expect pre-tax profits of £7.9m for the period compared with £6.2m a year ago.

Fund manager Gerrard said close attention would be paid to the progression of royalty revenues and licensing income - the two key components of Arm's income stream - although both are expected to fall in sterling terms.

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