Thursday preview: Rank, Debenhams, Dunelm

13th Apr 2011 16:39

Casino and online betting operator Rank issues a trading statement on Thursday in which it might give more detail on its recent victory over Her Majesty's Revenue & Customs (HMRC). HMRC is appealing against the decision, which saw the bingo hall operator get a rebate totalling £74.8m, covering overpaid VAT on games of bingo from 1973 to 1996. On top of that it also received interest of £79.5m, raising questions regarding what it plans to do with the windfall.Peel Hunt estimates that - assuming Rank gets to keep all the cash - it should have a cash surplus of over £40m by the end of 2011, wiping out around £110m of net debt. "If it does pursue acquisitions we believe these are most likely to be in the areas of online gaming and casinos. Management has thus far been cautious and we do not expect it to embark on a reckless acquisition programme," said analyst Nick Batram.Panmure Gordon is expecting Rank to have enjoyed a robust first quarter trading performance "with double-digit growth in Casino admissions and strong trading in Interactive." The broker reckons that a return of cash to shareholders could be on the cards. "The group should now be in a net cash position and, in our view, there is potential for a c£350m cash return to shareholders in the medium-term. ""We understand that the group will seek to renew its existing banking facilities at the end of the first half in order to provide flexibility for repayment should the ECJ {European Court of Justice] judgement go against them. We also await an update on the B3 machines. stakes and entitlements review which could increase group EPS [earnings per share] by up to c9% on a pro forma basis, we estimate," the broker added. Department store group Debenhams announces interim results which Matrix Group thinks will herald a return to the dividend list by the company for the first time in three years. "We expect an interim dividend of 1.0p and a total full-year dividend of 3.1p, based on 3x cover. We do not expect any major changes to the direction of the group; rigorous stock controls and a changing product mix are driving up gross margins, and we believe that the company is on track to meet first half and full-year profit forecasts," the broker said. Matrix is forecasting interim pre-tax profits of £126m.Fast growing home wares seller Dunelm's trading update covers the third quarter of the retailer's financial year. Peel Hunt is expecting year on year like for like (LFL) sales to remain in negative terri-tory, "reflecting the tough trading backdrop.""Well correlated to the BRC Home Textiles data, we expect January to have delivered a positive outcome for Dunelm, reflecting the strong sales period in early January. Since then, underlying trading has remained more subdued we believe, albeit against an easing comparative. With March trading against the prior-year Easter and Mother's Day build-up, we expect LFL sales to remain in negative territory for the quarter overall. On the positive front, we believe the outlook for gross margin delivery remains positive, with Dunelm on track to deliver further gains over the second half," Peel Hunt said.INTERIMSDebenhams, Namakwa Diamonds Ltd. (DI), WH SmithINTERIM DIVIDEND PAYMENT DATEIndigoVision Group, Plexus HoldingsQUARTERLY PAYMENT DATEYamana Gold Inc.INTERNATIONAL ECONOMIC ANNOUNCEMENTSContinuing Claims (US) (13:30)ECB Report (EU) (09:00)Initial Jobless Claims (US) (13:30)Producer Price Index (US) (13:30)GMSGoldman Sachs Dynamic Opportunities Ltd. EUR Shares, Goldman Sachs Dynamic Opportunities Ltd. GBP Shares, Goldman Sachs Dynamic Opportunities Ltd. USD Shares, Orascom Telecom Holdings SAE GDR (Reg S)FINALSAmiad Filtration Systems Ltd., Dori Media Group Ltd., Ideal Shopping DirectANNUAL REPORTPetropavlovskIMSSAshmore Group, Dunelm, Eaga, Filtrona PLC, Rank GroupEGMSCambium Global Timberland Ltd., Orascom Telecom Holdings SAE GDR (Reg S)AGMSBP, Cenkos Securities, Filtrona PLC, Plant Health Care, Rank Group, Smith & Nephew, Telekomunikacja Polska GDR (Reg S), Tiszai Chemical Group GDR (Reg S)---jh