The Week Ahead: Updates due from Dixons Retail, Greene King, Wonga and Go-Ahead

The Greene King brewery in Bury St Edmunds.

The Greene King brewery in Bury St Edmunds. - Credit: Archant

Resurgent electricals retailer Dixons will look to maintain its run of form this week, alongside updates from Greene King, Wonga and Go-Ahead.

PC World and Currys owner Dixons is set to deliver another solid update on Thursday after delivering a 15% rise in underlying profits for the year to April 30 as it benefited from the collapse of competitors such as Comet and an improvement in its own customer service standards.

Its prospects amid the UK housing market revival will also be in sharp focus as experts predict its sales of white goods will be boosted by a buoyant property sector.

Dixons, which has electrical retail operations across Europe, has been benefiting from a strong performance in the UK and Ireland, where annual profits jumped 39% to £113.3million.

This helped offset further big losses in southern Europe and its PIXmania division, with underlying group profits up by £12.4m to £94.5m.


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Matthew Taylor, analyst at Numis Securities, is predicting UK first quarter like-for-like sales to have risen by at least 5%, although he said “hot weather is rarely helpful for electrical sales”.

Bury St Edmunds-based pubs and brewing group Greene King is expected to reveal strong summer trading on Tuesday after demand for lager and cider soared amid the heatwave. The firm, which has a retail estate of nearly 1,000 managed pubs across the UK, is predicted to report a pick up in sales growth thanks to the hot summer weather.

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It posted a 3.3% rise in like-for-like sales in the initial eight weeks of the new financial year and analysts are pencilling in growth of more than 5% over the first quarter.

However, while Greene King’s pub chain will have benefited, its brewing business may not have seen any significant pick-up. Douglas Jack of Numis Securities said: “We do not expect any improvement in beer volumes as good weather tends to favour lager and cider, rather than real ale.”

Greene King beat City forecasts with its annual results for the year to April, with underlying pre-tax profits up 6.6% to £162m as its focus on food sales continued to pay off. But profits in the brewing business were 9.1% lower at £30m due to supplier cost increases and declining volumes in the tenanted pub industry.

Payday lender Wonga publishes annual results on Tuesday amid an ongoing competition investigation of the market.

The Competition Commission is conducting a probe after the Office of Fair Trading found that features of the market had the potential to “prevent, restrict or distort competition”.

Wonga maintains it is a “pioneer of better regulation” in the sector and has welcomed the competition inquiry but its 2012 financial results are still bound to come under close scruinty. The company’s net profits more than tripled to £45.8m in 2011 while the number of loans it made almost quadrupled to 2.5m.

Transport group Go-Ahead expects to rev up earnings from its bus division, which includes Anglian Bus, Hedingham and Chambers in East Anglia, when it announces full-year results on Thursday. The operator is aiming to increase operating profits from its buses from £70m to £100m by 201-16 at a time when its rail business is plagued by uncertainty over refranchising dealays.

In a trading update earlier this year it said revenues from the bus division were expected to be up 4% outside London and by 6.5% in the capital on an underlying basis

Revenues from its Southeastern, London Midland and Southern rail franchises, which operate through its Govia joint venture, are also expected to show growth but increased costs are likely to hit earnings.

Analysts expect group operating profits to be down 8.5% at £100.8m, on revenues up 4.4% to £2.53billion.

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