Diary commentary from FT reporters; data and company announcements, unless otherwise stated, from Thomson Reuters. Company announcements are of information publicly available before last week.
● Investors will be looking for signals of 4G uptake when Anite publishes its full-year results, writes Henry Mance.
The FTSE 250 company, which tests the connectivity of mobile phones, is benefiting from the switch to 4G LTE networks, but has seen uneven demand in recent quarters.
News of slow sales in late 2012 knocked a third off its share price in March and April, but signs of a stronger start to this year have led to a modest rally.
Analysts estimate that Anite’s ebitda increased 22 per cent to £38.3m in the 12 months ending in April, with revenues rising 11 per cent to £136.4m. The company’s results have edged ahead of consensus in each of the past three years.
Although there have been rumours of a potential takeover, the lack of a public pronouncement by Chris Humphrey, Anite’s chief executive, suggests that no deal is being negotiated.
Any buyer would have to grapple with Anite’s travel division, which sells software to Thomas Cook and others, and looks anomalous compared with the main testing business.
●When Constellation Brands presents its first-quarter results, analysts expect the beverage company to report continued sales growth but flat profits, writes Connor Radnovich.
The wine, beer and spirits group’s sales are forecast to rise 6 per cent from a year ago to $674m in the quarter to the end of May.
Analysts regard beer as one of the company’s most attractive businesses – the division’s sales grew 27 per cent in the quarter to the end of February.
It is expected to double capacity of its Piedras Negras beer facility and management wants to lift the operating margin of the beer business into the low to mid 30 per cent range.
For the past quarter Constellation’s net income is expected to be $75m, with earnings per share of 40 cents, the same as one year ago.
Constellation is the world’s largest wine producer, but it recently tempered expectations for its wine business due to higher input costs.
Constellation finalised its acquisition of Grupo Modelo’s US Beer business in June, and while that is expected to transform the company, its impact will not be fully felt immediately.
Constellation shares have risen 9.4 per cent in the past three months, outpacing the market overall.
Analysts at D.A. Davidson & Co said the most attractive parts of the drinks sector were imported and craft beer, whiskey and tequila.
“Across the alcoholic beverage space, consumers are craving...full-flavour crafted and unique products. That is really good news for Constellation,” they said.
● Investors and analysts will be looking for more detail on Ocado’s joint venture with Wm Morrison when the online retailer announces half-year results, writesAndrea Felsted.
Last month, Ocado said it had entered into a 25-year partnership with Wm Morrison to provide its online grocery operation.
Investors and analysts will be looking for any further details of the financial impact, and whether Waitrose, with which Ocado has a supply agreement, and which has raised concerns about the partnership with Morrison, is taking a more conciliatory stance.
They will also be keen to hear whether Ocado has any further partnerships in train, after the agreement with Morrison.
Shares in Ocado have risen from 56.32p in November to over 300p this month, on a reappraisal of the company from a struggling online grocer to a technology company. The deal with Morrison has also reignited speculation that Ocado could be the subject of a takeover approach, with online giant Amazon touted as one potentially interested party. The shares closed at 298.3p on Friday, above its float price of 180p per share.
“We are going to be in a period of waiting for bigger outcomes for Ocado, that is does Waitrose serve notice in 2015? Is progress with Morrison going to plan and can Ocado deliver a satisfactory profit?” said Clive Black, analyst at Shore Capital.
The consensus of analysts’ forecasts is for Ocado to make a half-year loss of £2.3m, compared with a small profit last time, and earnings before interest, tax, depreciation and amortisation of £18.07m, on sales of £382.18m.
Anite FY 7.89p (7.20p)
Constellation Brands Q1 $0.40 ($0.40)
Ocado Group FY (FY estimate) -0.87p (0.00p)
●Tullow Oil provides an update on trading flush from their success in a legal dispute with former partner Heritage Oil over tax payments made to the Ugandan government, writes Michael Kavanagh.
A judgment delivered in London’s high court a fortnight ago ruled that Heritage was liable for $313m of payments that had been made on its behalf by Tullow to meet capital gains liabilities on the $1.45bn sale of oil interests in the country.
The sale left Tullow, Total of France and Cnooc of China in charge of a project to develop oil reserves in the Lake Albert basin.
However, the legal victory did little to lift Tullow’s shares that, after riding high following a bout of exploration success a year ago, have since been on the slide.
Tullow’s shares, priced as high as £16 a share last February, have been rattling around the £10 mark in recent weeks as analysts have queried whether the Africa-focused explorer can regain its momentum of finding and helping develop major oil deposits.
Tullow, which has already signalled its intention for a sell-down of its interests in one of its licences off the coast of Ghana, insists it remains set on an aggressive programme of exploration drilling which includes sinking further wells in Mauritania, French Guiana and Kenya this year.
Trading and sales update
Results forecasts, from Thomson Reuters, are for fully diluted, post-tax EPS in local currency for the stated fiscal period. The comparable period of the previous year is bracketed. Non-UK reporting periods are broken by quarter: Q1, Q2, Q3, Q4. UK periods are designated: Q1, H1 (first half), Q3 and FY (full year). Thomson Reuters calculates mean earnings estimates based on a majority policy where the accounting basis used for each company estimate is that used by the majority of contributing analysts