Copper prices have been largely becalmed since the start of 2017, weighed by a firmer dollar and slowing demand for the metal from top consumer China, as well as continuing supply disruptions at the world’s two biggest copper mines, operated by BHP Billiton plc (LON:BLT) and Freeport-McMoRan Inc (NYSE:FCX) respectively.
Given this background, investors will be scanning full-year results from Chilean copper producer Antofagasta PLC (LON:ANTO), due on Tuesday, for progress on the expansion of its Los Pelambres asset.
The FTSE 100-listed company is planning a phased expansion to spread the financial cost at the mine, and it expects to complete the feasibility study for the expansion by the end of this year.
In a results preview, broker Peel Hunt said: “We expect serious investment to start in 2018 after a decision later this year. In the current capital environment, we will be looking for capital cost savings from the US$1.1bn pre-feasibility cost estimates.”
The broker is on the optimistic side with its forecast for Antofagasta to report adjusted 2016 pre-tax profits of US$1.06bn, versus the market consensus of US$980mln, and it is estimating sales of US$3.7bn versus market expectations for US$3.6bn.
Pru growth ...
Elsewhere, full year results from blue chip life assurance and savings giant Prudential PLC (LON:PRU) should see a continuation of the momentum reported in its third-quarter update in November, where the firm posted a 19% increase in new business profit.
Analysts at Barclays Capital expect the Pru to have increased their full-year earnings by 2% to £4.1bn, as growth in Asia and the US offsets lower earnings from the UK and its M&G asset management business.
They also forecast the financial group’s business profits to be flat year-on-year at £2.6bn, with a slightly lower new business margin due to lower UK annuity sales - which have a healthy margin.
The strength of Pru’s solvency II ratio will also be keenly sought, particularly with investors expecting the dividend to rise in the region of about 5%.
Away from the blue chips, results from merged broking giant TP ICAP PLC (LON:TCAP) are expected to reinforce January's update which highlighted strong trading towards the end of the year, driven by macroeconomic volatility, and led to upgrades in forecasts.
The focus for the group - formed late last year when Tullett Prebon bought the voice broking business of rival ICAP for £1.3bn – will be on 2017 guidance as well as on how quickly expected merger cost synergies can be realised, and whether the initial estimate is overly conservative.
In a preview note, analysts at Peel Hunt pointed out: “On initial estimates after the acquisition, TP ICAP is now trading on c12x 2017 earnings, although there is scope for upside surprise if trading remains strong/expectations for cost savings are increased.”
Meanwhile, online grocery group Ocado PLC (LON:OCDO) will issue a first-quarter trading update, with Barclays Capital’s analysts expecting the firm to deliver gross retail sales growth of around +13.0% for the 12 weeks to February 19, very similar to the +13.1% growth reported in the preceding quarter.
Significant announcements expected on Tuesday:
Finals: Antofagasta PLC (LON:ANTO), Advanced Medical Solutions Group PLC (LON:AMS), Applegreen PLC (LON:APGN) , Brady Plc (LON:BRY) , Burford Capital Ltd (LON:BUR) , Crossrider Plc (LON:CROS), French Connection Group PLC (LON:FCCN), Gresham Computing plc (LON:GHT), InterQuest Group PLC (LON:ITQ), Prudential PLC (LON:PRU) , SIG PLC (LON:SHI) , Surgical Innovations Group PLC (LON:SUN) , TCS Group Holding PLC (LON:TCSA), The Gym Group PLC (LON:GYM), TP ICAP PLC (LON:TCAP)
Interims: Close Brothers Group PLC (LON:CBG) Kalibrate Technologies PLC (LON:KLBT)