After HSBC Holdings PLC (LON:HSBA) kicked off the UK banks' fourth-quarter reporting season by disappointing investors on Tuesday, it will be the turn of part-state owned lender Lloyds Banking Group (LON:LLOY) to attempt to rescue the sector picture next.
Like most other lenders, Lloyds has been cutting jobs and branches in order to target £1.4bn of cost savings, boosting its investment in digital services and products.
The bank – now less than 5% owned by the UK taxpayer – is close to finishing its main restructuring, and investors will be hoping there are no more provisions for the mis-selling of payment protection insurance.
Lloyds is forecast to report a jump in 2016 pretax profits to around £4.4bn, up from £1.6bn a year earlier when it was hit by a huge bill for PPI scandal provisions.
Investors will also be closely watching any news on a special dividend, which could be scrapped given Lloyds is spending £1.9bn on buying MBNA’s credit card business.
The bank’s views on the UK post-Brexit, its cost base target and the housing market will also be sought.
Barratt bricked-in ...
The state of the UK housing market will be more closely illustrated, however, by first-half numbers from construction firm Barratt Developments PLC (LON:BDEV).
The housebuilder gave a detailed trading update in January when it revealed that first-half sales volumes were expected to be slightly lower than the prior year, due primarily to the timing of London completions.
Barratt’s pretax profit is forecasts to be around 7% ahead of the previous year at £315mln, while the group’s forward order book was 16% ahead at £2.3bn at the start of January.
Shopping centres developer Capital & Counties Properties PLC (LON:CAPC) will also give a snapshot of the post-Brexit property sector in its full-year results.
In a preview of the Capital & Counties numbers, broker Peel Hunt, said: “The weak pound and continued strong tenant demand led us to upgrade our Central London retail assumption, but we still expect NAV to decline in H2, driven by a further write-down at the Earls Court residential land holding.”
And student accommodation specialist Unite Goup PLC (LON:UTG) will reveal final numbers as well, with Peel Hunt expecting continued strong earnings per share growth of more than 10%.
Away from the property world, first-half results from staffing firm Hays should show the impact of Brexit uncertainty on the UK recruitment market, although the firm’s overseas business should have been a beneficiary of favourable currency factors.
In its second-quarter trading update on January 12, Hays reported net fee growth of 2% on a like-for-like basis, down slightly from 3% a year earlier.
Significant announcements expected on Wednesday:
Finals: Capital & Counties Properties PLC (LON:CAPC), Indivior PLC (LON:INDV), Lloyds Banking Group PLC (LOY:LLOY), Petrofac Limited (LON:PFC), Unite Group PLC (LON:UTG)
Interims: Barratt Developments PLC (LON:BDEV), Hays plc (LON:HAS), Hotel Chocolat Group PLC (LON:HOTC), Mcbride PLC (LON:MCB)