Wolseley profits expected to fall 30%

Heating and plumbing giant Wolseley�s final results today are likely to make grim reading after a year of turmoil for the Reading-based business.

WEEK AHEAD

Heating and plumbing giant Wolseley's final results today are likely to make grim reading after a year of turmoil for the Reading-based business.

At first it was buffeted by the US housing collapse, but rapidly declining conditions in European and UK markets are now dealing a fresh blow.

The group, which earns around half of its annual £16bn sales across the Atlantic, is best known for its Build Centre and Plumb Centre trading names.

Analysts predict that its underlying earnings are likely to fall by 30% to £608m in the year to July 31, compared with £877m the previous year.

Wolseley has cut 6000 jobs in the space of a year as it battles the deteriorating conditions, as well as axing the shareholder dividend in a move which will save £150m.

AG Barr
The Irn-Bru maker's latest comments on current trading after another wet summer will be closely watched when the firm posts interims tomorrow.

Like-for-like sales were up 4% in the first quarter of the year although poor weather in June and July is likely to have dampened sales.

Barr may also update on its £58.9m deal to buy tropical juice firm Rubicon, announced last month.

Brewin Dolphin analyst John Dickinson expects an "encouraging set of results" with pre-tax profits of £11m in the six months to July 26, compared with £10.1m previously.

Smiths Group
The industrial group may give further hints on whether it is likely to become the latest firm to join the tax exodus from the UK on Wednesday.

Alongside a restructuring of the business announced in June, the firm said it was "closely monitoring" possible changes to UK tax laws, due to the high profits it makes overseas following last year's sale of Smiths Aerospace.

Although there is "no current intention" to move abroad, Smiths joins a growing number of businesses actively considering a relocation to more competitive tax regimes.

Charles Stanley analyst Jeremy Batstone-Carr predicts pre-tax profits of £364m, although comparisons with the previous year are made difficult by the impact of the sale of Smiths' former aerospace division.

British Energy
The next step in the takeover saga of the UK nuclear generator could unfold this week if French giant EDF comes back to the table with an improvement on its £12bn offer for the nuclear power firm.

Two major British Energy shareholders blocked a deal in August at the 11th hour, but reports suggest EDF - which is majority owned by the French Government - could be ready to improve its approach.

British Energy's investors were originally offered 765p in cash, or an alternative of 700p plus a slice of future profits. EDF is now said to be ready to offer 774p a share.

A deal is seen as key to kick-starting the UK's programme to build new nuclear power stations. The government has a 36% stake in the generator and came out in favour of the previous deal.

If an EDF takeover goes ahead, British Gas owner Centrica is expected to take a minority stake in the business. Centrica is considering a number of other options including an all-share merger with British Energy if the EDF takeover deal falls through. It is also mooting a long-term deal to buy power from British Energy, as well as participating in its potential new nuclear developments.

British Energy's eight nuclear power stations include Hunterston B in Ayrshire, and Torness in East Lothian. The group also owns a coal-fired power station at Eggborough, east Yorkshire.

Lloyd's of London
The impact of this month's hurricane season will be the focus of attention when Lloyd's of London posts half-year figures on Thursday.

Lloyd's made a £3.8bn profit in 2007 after the insurance market benefited from a limited exposure to catastrophes.

That put downward pressure on rates and prompted Lloyd's to report a softening of conditions across all lines of business.

Lloyd's is not an insurance company but a society of members, both corporate and individual, who underwrite in syndicates on whose behalf professional underwriters accept risk.

Supporting capital is provided by investment institutions, specialist investors, international insurance companies and individuals.

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