Wednesday preview: Sage, Standard Chartered, L&G

3rd May 2011 17:38

Accountancy software firm Sage releases its interim results on Wednesday amid slight concerns that small to medium sized enterprises might be taking longer to upgrade their Sage products than has been the case in the past, as they wait to see whether the economic recovery is sustained.Matrix Group expects Sage to deliver an in-line update, but warns that US dollar weakness is likely to put downward pressure on full year earnings estimates. The broker predicts revenue of around £741.6m, adjusted operating income of £186.5m and earnings per share (EPS) of 9.7p.Emerging markets focused bank Standard Chartered's interim management statement should see a continuation of the positive updates seen in January and March.Nomura Securities says first quarter comments from Standard Chartered's management usually set the stage for growth for the full year. "Indications from US peers were mixed, with 1Q Asian wholesale revenues strong at JP Morgan, but down at Citi. However, even assuming strong growth, a key question, in our view, is whether growth will translate to profitability, particularly given margin pressure in Hong Kong," the Japanese broker says."We estimate relatively flat impairment charges in 2011, but see risk of increased charges given monetary tightening in emerging markets as well as growth of its unsecured book. However, management appears confident on asset quality based on the economic prospects of its key regions and key internal indicators," Nomura added.Elsewhere in the financial sector, insurance leviathan Legal & General's first quarter interim management statement (IMS) should provide an update on sales. Panmure Gordon is forecasting worldwide new business sales of £446m on an annualised premium equivalent (APE) basis, an increase of 15% on the year before. The broker thinks that puts it £4m ahead of the consensus figure, though the range of forecasts is quite wide, spanning from £353m to £477m."We are anticipating that the International performance will be impacted by a reduction in sales from India where the Regulator has restricted the sale of certain products which we expect will have similarly impacted other UK insurers such as Prudential and Standard Life. Although we are not anticipating any indication on margins (unlike Prudential), we are anticipating an update on the Q1 2011 net cash position," the broker revealed."The net cash generation in Q1 should give confirmation that the 2011 full year net cash generation is at least on track and may provide a positive surprise," Panmure Gordon reckons.The same broker has turned its attention to pubs group JD Wetherspoon and its IMS. "Recent trading has seen top-line resilience at the expense of margins and we do not see this situation changing in the near term and forecast 3.0% like for like [LFL] sales growth in Q3. EPS growth is under-pinned by recent share buybacks but the market will want to see EBIT [earnings before interest and tax] margins return to c10% and LFL sales growth of 2-3% before the P/E [price/earnings] multiple returns to recent averages, in our view," Panmure Gordon said.On the UK economic front, housing issues will be to the fore, with the Nationwide building society and the Halifax bank releasing their house price indices while official mortgage lending figures are also out.Both the Halifax and the Nationwide are expected to report a 0.1% increase in house prices in April, which in the Halifax's case would represent a repeat of the March change while the Nationwide's index showed a 0.5% increase in March.Citigroup's predictions are for the number of mortgage commitments for house purchases in March to show a 3.0% decline year on year to 47,500. In February, approvals were up 0.1% year on year at 46,967."The overall number of mortgage approvals has been down from a year ago since June 2010 and this comparison will probably stay in negative territory this month. Nevertheless, mortgage approvals have been roughly flat since last August and hence the housing market does not seem to be weakening further," notes Citigroup.Consensus is for approvals to come in at 47,900, while the amount of mortgage lending is seen easing to £0.8bn from £1.2bn in March.INTERIMSAvon Rubber, Sage GroupINTERIM EX-DIVIDEND DATELok'n Store Group, SwallowfieldQUARTERLY EX-DIVIDEND DATEBankers Inv Trust, BarclaysIMSSAZ Electronic Materials SA (WI), CRH, CRH, Legal & General Group, Logica, Next, Provident Financial, WSP GroupSPECIAL EX-DIVIDEND PAYMENT DATEAntofagasta, Edinburgh Inv TrustEGMSAvivaAGMSAbbey Protection, Aviva, AZ Electronic Materials SA (WI), BAE Systems, BBA Aviation, BlackRock World Mining Trust, Carillion, CEPS, Communisis, CRH, Grafton Group Units, Henderson Group, JSC Kazkommertsbank GDR (Reg S), Logica, Media Corp., Moneysupermarket.com Group, Nichols, Provident Financial, Quadnetics Group, Rightmove, Savills, Spirent Communications, Weir Group, WSP Group, Xstrata, Yamana Gold Inc.FINAL DIVIDEND PAYMENT DATE4imprint Group, Athelney Trust, China Shoto, Edinburgh UK Tracker Trust, Jardine Lloyd Thompson Group, RAB Capital, Rank Group, Ultra Electronics HoldingsFINAL EX-DIVIDEND DATEAG Barr, Anglo Pacific Group, Antofagasta, Blackstar Group, CBG Group, Chaucer Holdings, Cobham, Collins Stewart, Elementis, G4S, GlobeOp Financial Services SA (DI), H&T Group, Henderson Group, Highcroft Investment, Holders Technology, JD Sports Fashion, JKX Oil & Gas, KBC Advanced Technologies, Keller Group, Kentz Corporation Ltd., Kingfisher, Laird, Maven Income & Growth 3 VCT, Maven Income & Growth 4 VCT, Maven Income & Growth 4 VCT 'S' Shares, Michael Page International, Morson Group, Neptune-Calculus Income & Growth VCT, Pennant International Group, Persimmon, Porvair, Public Service Properties Inves (DI)tments Ltd., SDL, Senior, SThree, Straight, Travis Perkins, Weir Group, William HillQ1Yamana Gold Inc.UK ECONOMIC ANNOUNCEMENTSNationwide house price index - April (07:00)Construction PMI - April (09:30)Consumer Credit - March (09:30)Mortgage Lending - March (09:30)Mortgage Approvals - March (09:30)M4 Money Supply - March (09:30)INTERNATIONAL ECONOMIC ANNOUNCEMENTSFinal services PMI, index (GER) (07:53)ADP Employment Report (US) (13:15)ISM Non-manufacturing Index (15:00)---jh