All eyes will be on Chancellor Philip Hammond when he presents the Autumn Budget on Wednesday.
He has the difficult task of cutting the budget deficit while delivering on government’s promise to boost public spending and keep taxes low.
This is all while the government is trying to negotiate the UK’s withdrawal from the European Union.
READ: Budget 2017: What to expect as Chancellor Philip Hammond lays out Brexit spending plans
On corporate front, full year results from EasyJet PLC (LON:EZY) will provide an indication on the current state of the budget airline sector, which has been under pressure from tough competition, a weaker pound and a spate of recent terrorist attacks.
The week ahead calendar also includes trading updates from William Hill plc (LON:WMH) and Kingfisher PLC (LON:KGF) along with interims from Fuller Smith & Turner PLC (LON:FSTA), Mothercare plc (LON:MTC) and United Utilities Group (LON:UU.).
EasyJet profits to fall on rising costs
EasyJet PLC (LON:EZY) expects profits for the year will be at the high end of its forecasts following a strong performance over summer.
The budget airline, which reports its full year results on Tuesday, has guided to profits of between £405-410mln, compared to £495mln last year, amid costs and pricing pressures facing the industry.
Competition on pricing cut revenue per seat by 1.4% over the second half and by 3.7% in the fourth quarter. EasyJet also took a £100mln currency hit during the final three months of the year.
With overcapacity and aggressive pricing hitting the sector, easyjet’s profit margins have come under pressure on the back of increasing the number of available seats and cutting fares.
UBS predicts revenue to rise to £4.8bn from £3.6bn and pre-tax profits to reach £407mln.
Post-period, EasyJet in October agreed to buy some assets at Berlin Tegel Airport from the insolvent Air Berlin for €40mln. Investors will be keen to hear more about the benefits of the deal, which is expected to close in December.
Impact of FOTBs review in focus at William Hill
Monday will see the first update from bookie William Hill plc (LON:WMH) since the review on fixed odds betting terminals.
Late last month the Department for Digital, Culture, Media and Sport (DCMS) made a preliminary recommendation on the machines dubbed as “the crack cocaine of gambling”.
Currently, the maximum stake is £100 but the government is looking at, and asking for feedback on, four options involving the reduction of the maximum stake to: £50; £30; £20; £2.
Not surprisingly, the bookies have been lobbying for the £50 stake.
While regulatory developments in the UK are starting to get stricter, the bookie can draw encouragement from the liberalisation of the US sports betting market but against that, things might be about to get a bit tougher in Australia with the implementation of a credit betting ban early next year.
Results at the beginning of the month from rival Paddy Power Betfair were upbeat, with the bookie enjoying a strong third quarter so William Hill shareholders have cause to be cautiously optimistic.
United Utilities faced with rising inflation, regulatory risks
United Utilities plc (LON:UU.) were downgraded by HSBC ahead of its interim results next week with its analysts citing “downward inflationary pressure” along with regulatory and political risks for the change in call.
The bank moved to ‘hold’ from ‘buy’ ahead of results next week and trimmed its price target to 900p from £10.
It expects the company’s earnings line to be hit by cost pressures as its indexed linked debt means the cost of borrowing rises along with the retail prices.
UU may is also at risk from a fragile government that may look to launch a vote-grabbing assault on the privately owned utilities, the bank added.
Regulator Ofwat’s next pricing assessment may also pose a threat: “UU is relying on financial prudency and outperformance to give it headroom into what is likely to be a challenging review.
“In Ofwat’s latest financial resilience report, UU does not seem to have significantly more financial headroom than its listed peers, in our view.
“Given its small incentive rewards to be taken at the end of the regulatory period we have less visibility than we have for other companies who are taking them in period.”
HSBC is expecting UU to post half-year operating profits of £342mln, up 10%, when it reports next Wednesday.
Investors await Kingfishers Plc restructuring update
B&Q owner Kingfisher Plc (LON:KGF) releases a trading statement on Tuesday when it is expected to update on its ongoing restructuring activities.
Graham Spooner, analyst at online broker The Share Centre, reckons better times may be nearer for the retailer.
“Structural changes and the unification programme of bringing different operations together have had its difficulties,” the analyst said.
“However, it’s hoped we will begin to see the benefits come through shortly.
“While there is some expectation that the hard pressed consumer in the UK is feeling the pinch and making fewer visits to B&Q stores in the UK, we should still expect to see good growth in their Screwfix division which targets the professional market.”
Questions remain for Mothercare
Little has been guided ahead of Mothercare plc’s (LON:MTC) interim results, due out on Thursday, though investors will be hoping that the child and baby focussed retailer maintained a positive performance through the second quarter.
Mothercare started the first half with like-for-like sales growth, with the performance in the first three months described in July as ‘in line with expectations’.
In September JP Morgan repeated an ‘overweight’ rating, but moved its target price lower to 120p from 140p.
Fuller, Smith & Turner interims
London Pride brewer Fuller, Smith & Turner PLC (LON:FSTA) made a decent start to its financial year.
In the 16 weeks to 22 July like-for-like sales in its managed pUBS and hotels were up 6.6% year-on-year, with like-for-like profits in its tenanted inns up 5%.
Chief executive Simon Emeny did have a grumble about cost headwinds, such as increased business rates, the impact of the National Living Wage and the introduction of the Apprenticeship Levy, but mercifully no long rant about Britain's membership of the European Union.
Britain's reliably unreliable weather stopped playing ball round about the end of July, so the strong start to the year may have tailed off somewhat.
Significant events expected:
Monday 20 November
Finals: Diploma (LON:DPLM), Progility (LON:PGY)
Interims: Bonmarche Holdings (LON:BON), Mitie Group (LON:MTO), Nex Group (LON:NXG)
Trading statements: TT Electronics (LON:TTG), William Hill (LON:WMH)
Economic events: CBI Trends
Tuesday 21 November
Finals: Compass Group (LON:CPG), CYBG (LON:CPG), easyJet (LON:EZJ), Renew Holdings (LON:RNWH), Stride Gaming (LON:STR), Focusrite (LON:TUNE), Utilitywise (LON:UTW)
Interims: AO World (LON:AO.), Big Yellow Group (LON:BYG), CML Microsystems (LON:CML), Halma (LON:HLMA), Homeserve (LON:HSV), IMImobile (LON:IMO), Johnson Matthey (LON:JMAT), Scapa Group (LON:SCPA), Severfield (LON:SFR), Solid State (LON:SOLI), Telecom Plus (LON:TEP), VP (LON:VP.), Babcock International Group (LON:BAB)
Trading statements: Intertek Group (LON:ITRK), Kingfisher (LON:KGF), AFI Development (LON:AFRB), SIG (LON:SHI), Frutarom Industries Ltd GDR (LON:FRUT)
Economic events: UK public finances
Wednesday 22 November
Finals: Cambria Automobiles (LON:CMAB), Countryside Properties (LON:CSP), Euromoney Instiutional investor (LON:ERM), Sage Group (LON:SGE), SSP Group (LON:SSPG)
Interims: Accsys Technologies (LON:AXS), Biffa (LON:BIFF), Charles Stanley Group (LON: CAY), Creightons (LON:CRL), Eckoh (LON:ECK), New River REIT (LON:NRR), Quiz (LON:QUIZ), United Utilities Group (LON:UU.)
Economic events: UK Autumn Budget
Thursday 23 November
Finals: Paragon Banking Group (LON:PAG)
Interims: CMC Markets (LON:CMCX), Mothercare (LON:MTC), Severn Trent (LON:SVT), Liontrust Asset Management (LON:LIO), Hogg Robinson Group (LON:HRG), First Property Group (LON:FPO), Caledonia Investments (LON:CLDN)
Trading statements: Empiric Student Property (LON:ESP), Rotork (LON:ROR)
Friday 24 November
Finals: Future (LON:FUTR)
Interims: Fuller Smith & Turner (LON:FSTA)
Economic events: BBA loans for house purchases, CBI reported sales