Wednesday preview: Northern Foods, Topps Tiles, Mortgage Approvals

26th May 2009 15:21

The share price of food producer Northern Foods is around 10p short of being double the price it was in mid-April, when it hit its low for the year of 37p. Despite this, the shares are still yielding 7%, which suggests that the dividend will be of primary interest to many shareholders when the company issues full-year results on Wednesday.The market consensus is for a full-year dividend of 4.48p, down from 4.50p the year before. The company has already declared an interim dividend of 1.55p, so the market consensus figure implies a final dividend of 2.93p. Broker Panmure Gordon said the company is well within its banking covenants and has plenty of banking headroom, so any decision to cut the divi would be a matter of choice rather than of need, perhaps to fund a major capital expenditure project.Full-year pre-tax profits are expected to dip to £43.41m from £45.4m the year before, on sales of £1,028m, up from £932m last year.The company has been targeting sales at discount retailers such as Poundland and the German retailers Aldi and Lidl, with some success, to offset its dependence on retailers further up the food chain such as struggling High Street giant Marks & Spencer.Tile and flooring specialist Topps Tiles is due to declare interim results and stockbroker KBC Peel Hunt is tipping them to beat market expectations. 'Our current forecast PBT for Topps Tiles, of £10.1m for the full year and £5.7m for the six months to 31 March 2009, was struck following January's trading update, which proved to be 'the eye of the storm' from a news-flow and trading perspective,' the broker said. 'At that time, we had felt the company would need to increase investment in pricing, to the detriment of gross margin. Similarly, management had rightly executed a cost savings plan before the start of the current financial year,' the broker added.Performance of the DIY sector in the last quarter has been better than anticipated, hence KBC's expectation that Topps' results will beat forecasts.'For Topps, we expect to see signs of improvement, with some weeks experiencing only single-digit LFL [like for like] sales declines, but with the period as a whole still down by a double-digit rate, perhaps -10% to -12%,' KBC predicts.April's mortgage approvals data from the British Bankers Association is forecast to show a rise in house loan deals to 29,000 from 26,097 in March, adding credence to the view that the housing slump has bottomed out, albeit at historically very low levels. INTERIMSJP Morgan Asian Investment Trust, Topps TilesINTERIM EX-DIVIDEND DATEA&J Mucklow, Baronsmead VCT, Baronsmead VCT 2, British Empire Securities & General Trust, Britvic, Carluccio's, Future, ITE Group, Local Shopping REIT, Lowland Investment Co., Octopus Eclipse VCT 3, Octopus Eclipse VCT 4, Shaftesbury, Titon Holdings, Town Centre SecuritiesQUARTERLY EX-DIVIDEND DATEM&G Equity Inv Trust Income SharesFINALSBSS Group, Clyde Process Solutions, Northern Foods, Optare, Telford Homes, TR Property InvestmentEGMSChina FoodAGMSChina Food, Derwent London, Fresnillo, Legal & General Group, ReSearch Pharmaceutical Services, Inc. (Reg S), Tau CapitalUK ECONOMIC ANNOUNCEMENTSProducer Price Index (09:30)BBA Loans for House Purchasers (09:30)INTERNATIONAL ECONOMIC ANNOUNCEMENTSExisting Home Sales (US) (15:00)CPI (GER) Consumer Confidence Indicator (FRA) (07:45)Business Confidence Indicator (FRA) (07:45)Production Outlook Indicator (FRA) (07:45)Bank of Japan MPC Minutes for 28 April (JPN)FINAL DIVIDEND PAYMENT DATEAdmiral Group, Churchill China, Fiberweb, Graphite Enterprise Trust, Northbridge Industrial Services, StatPro GroupFINAL EX-DIVIDEND DATEAberdeen Growth VCT I, British American Inv Trust, Chime Communications, Clarkson, Cobham, Concurrent Technologies, DCC, Dignity, FDM Group, Game Group, Great Portland Estates, Gresham House, HSBC Infrastructure Company Ltd., Hunting, Huntsworth, Informa, Marks & Spencer Group, Midas Income & Growth Trust, Next, Octopus Eclipse VCT 2, Octopus Protected VCT 1, Peel Hotels, Premier Farnell, Randall & Quilter Investment, The Hotel Corporation, UTV Media, Witan Pacific Inv Trust