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Thursday preview: Essar, Wellstream, Prostrakan
Thu, 09 Feb, 2012
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Thursday preview: Essar, Wellstream, Prostrakan
Wed, 18 Aug 2010, 15:56:00
Indian energy company <b>Essar Energy</b>, which floated in May and entered the list of FTSE 100 index constituents at the first time of asking, is scheduled to announce its first set of results on Thursday covering the first half of 2010. Deutsche Bank has pencilled in $335m, or £215m, for earnings before interest, tax, depreciation and amortisation. Pre-tax profits should be in the region of $112m (£72m), the German bank reckons. The bank thinks the company's oil division will have benefited from improved gross refining margins, especially in the second quarter, while "Essar Power should generate relatively stable profitability throughout the course of the year." Sticking with the oil sector, <b>Wellstream </b>will be the first of the UK oil services companies to report interim results in the second half of 2010. Panmure Gordon predicts net income of £6.5m which, if correct, would represent a 61% decline from a year ago. "The company has suffered from low utilisation at its plant at Newcastle due to the lack of orders which we believe has led to this plant being loss making," the broker said. The market is expecting weak numbers, however, and Panmure Gordon thinks the focus will therefore be on the order book, where shareholders will be hoping for signs of a pick-up in activity. The order book had recovered to £250m at the time of the company's trading update on 1 July from £168m at the end of 2009. "We would want to see the company build upon this, which should allow the Newcastle plant to increase utilisation rates and move back to profitability and allow the trend of lowering earnings estimates to be reversed," the broker said. Moving on to renewable energy, <b>PV Crystalox Solar </b>(PVCS) is set to deliver a strong set of interim results, if Panmure Gordon is to be believed. The broker thinks the consensus numbers for the full year will move up after the interim figures are announced, but then it probably would think that as it confesses to being 24% ahead of consensus. Nevertheless, Panmure Gordon thinks the outlook for the second half of the year will be strong on the back of increasing volumes and stabilising average selling prices. Earnings for next year remain a concern, not just for PVCS but for the industry as a whole, though "the company's conservative expansion plans and quality customer list suggest shipment growth and a more muted ASP [average selling price] decline than the market," the broker believes. Speciality pharmaceuticals firm <b>ProStrakan</b> expects to make an operating profit in 2010 on the back of strong revenue growth, the company said back in January. In Thursday's interim results KBC Peel Hunt is looking for the company to deliver year on year sales growth of 22% to £45m, driven largely by Europe - specifically its Abstral and Adcal products. The weakness of the euro has constrained revenue growth, however. In constant currency terms KBC thinks sales will show an improvement of around 25%. The broker is forecasting earnings before interest, tax, depreciation and amortisation of £1m, which would be the first interim profit in the company's history. An impending debt payment, due February 2012, may start to worry shareholders but KBC thinks the company "will be able to pay this through internal cash generation/existing balances, although we believe the company is more likely to refinance (most likely through debt) in the first half of 2011 to maintain its capacity for bolt-on acquisitions." On the economic front <b>UK Retail Sales</b> excluding auto fuel are tipped to have risen 0.2% in July, after rising 1.0% in June. The year-on-year change is forecast to be 1.8%, down from 3.1% in June. INTERIMS AFI Development, Capital Drilling Ld, Cineworld Group, CLS Holdings, Essar Energy, Hardy Oil & Gas, John Menzies, ProStrakan, PV Crystalox Solar, Quarto Group, TT Electronics, Wellstream Holdings INTERNATIONAL ECONOMIC ANNOUNCEMENTS Continuing Claims (US) (13:30) Initial Jobless Claims (US) (13:30) Leading Indicators (US) (15:00) Philadelphia Fed Index (US) (15:00) Producer Price Index (GER) (07:00) Machine Tool Orders (JPN) GMS Microgen, Tarsus Group IMSS Chrysalis Group EGMS Datang Intl H, Quorum Oil and Gas Technology Fund Ltd. AGMS ING UK , Omega Diagnostics Group, Stagecoach Group UK ECONOMIC ANNOUNCEMENTS CBI Industrial Trends Surveys (11:00) Leading Indicators (US) M4 Money Supply (estimate) (09:30) M4 Sterling Lending (estimate) (09:30) Mortgage Approvals (09:30) Public Sector Finances (09:30) Retail Sales (09:30)
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