Two of the UK’s biggest pub companies and retailers B&Q and Topps Tiles will come under the spotlight this week, while James Murdoch faces a vote over his future at satellite broadcaster BSkyB.
James Murdoch will resist further calls to resign as chairman of BSkyB at the satellite broadcaster’s annual meeting on Tuesday amid fears his links to the phone hacking inquiry at News Corporation will damage the company’s reputation.
The son of media tycoon Rupert Murdoch, who currently serves as deputy chief operating officer at News Corp, BSkyB’s controlling shareholder, has come under pressure to step down since the allegations first came to light.
Mr Murdoch, who earlier this month faced tough questioning from MPs over reporting practices at the News of the World, has been BSkyB chairman for just under four years and recently resigned as director of News Group Newspapers, publisher of The Sun and The Times.
Lobby group Pensions & Investment Research Consultants (Pirc) has urged shareholders to oppose Mr Murdoch’s re-election at the annual meeting on the grounds that he is not independent enough and over concerns he may damage the company’s public image by association.
In a statement to shareholders, Pirc said: “Mr Murdoch’s involvement in the phone hacking inquiry increases the risk that the company’s public standing image overall will be damaged.”
Mr Murdoch told MPs he “disputed vigorously” claims from former editor Colin Myler and ex-legal manager Tom Crone that they informed him of the significance of an email indicating phone-hacking was widespread.
However, BSkyB and a number of shareholders have stood by Mr Murdoch and the company wrote to investors to explain why they were backing him.
Nick Ferguson, BSkyB’s deputy chairman, said in the letter that Mr Murdoch had “done a first class job” in executing the key roles of a chairman, including facilitating a constructive relationship with the senior management team.
Mr Ferguson said Mr Murdoch was “respected and trusted” by chief executive Jeremy Darroch, had always acted with “integrity” and possesses “excellent” strategic insights.
Considering the negative reputational effect on the company as result of issues surrounding the News of the World, Mr Ferguson said: “We have seen no effect on sales, customers or suppliers over the last five months.”
The accusations first came to light over the summer when it emerged the phone of murdered teenager Milly Dowler’s was hacked by a private investigator employed by the News of the World - eventually leading to News Corp shutting the paper down.
A third-quarter trading update from B&Q owner Kingfisher on Thursday will underline the current struggle faced by retailers as it is expected to report a 1.5 per cent decline in like-for-like sales in the UK.
The FTSE-100 company, which has 330 B&Q stores in the UK and Ireland, has seen sales come under pressure as the economic outlook deteriorates but has managed to keep its head above water through boosting profit margins.
Kingfisher, which also owns Screwfix in the UK and has operations in France, is consequently expected to report a near 10 per cent increase in group retail profits to £263 million.
Investors will be keen to see if B&Q has started to feel any benefit from the closure of rival Focus after heavy clearance activity at the collapsed firm initially dragged customers away.
Andrew Hughes, analyst at UBS Investment Research, said: “The impact of Focus is still hard to gauge, as some of the aggressive clearance activity may have drawn sales forward from the third quarter as well as affecting the second quarter.”
Kingfisher revealed a 24 per cent rise in half-year profits to £439 million and also announced plans to open 40 new Screwfix stores by the end of January, 30 of which will be in a new smaller format.
The group bought 31 stores from the administrators of Focus following its collapse into administration in May and will convert them all to B&Q stores.
Two of the UK’s biggest pub companies are set to report strong results this week despite the pressure currently being placed on the sector.
Marston’s and Greene King, like many pub operators, were squeezed by the recession when a toxic cocktail of the smoking ban and consumers tightening their belts led to thousands of closures across the country.
Both companies are now looking in much better shape, having closed or sold underperforming pubs and increased sales of pub grub to help plug the gap left by falling beer sales.
They have also increasingly focused on expanding their more profitable managed estates.
Marston’s, which operates more than 2,000 pubs, is expected to reveal a 9 per cent increase in underlying profits to £79.8 million when it reports full-year results on Wednesday.
The company, which operates the Tavern Table and Pitcher & Piano brands, has benefited from its F-Plan, which has seen it focus on food, families, females and people in their forties and fifties to drive trade.
Its share price and profits slumped by three-quarters in the wake of the recession, but both have since partially recovered.
When it last updated the market, it said that like-for-like sales at its 500 managed pubs rose 2.9 per cent in the year to October 1, driven by strong demand for food, which accounted for 42 per cent of its sales.
The Wolverhampton company’s tenanted and leased division saw like-for-like profits rise 0.6 per cent after it closed unprofitable pubs.
And its beer company, which brews Pedigree, Bank’s, Hobgoblin and Brakspear, reported a rise in sales volumes after benefiting from the sponsorship of England’s Ashes tour of Australia.
The company raised £166 million from shareholders in 2009, which it has used to fund the building of about 25 pub-restaurants a year.
Greene King is expected to reveal more strong sales when it reports half-year results on Thursday.
The Bury St Edmunds-based company, which owns the Hungry Horse, Old English Inns and Loch Fyne Restaurants, reported a 4.2 per cent rise in like-for-like sales through its managed pubs in the first 18 weeks of its financial year.
It said it was on course to increase the size of its managed estate to around 1,100 sites, driven by transfers from its tenanted pubs and acquisitions such as its recent £70 million deal for the Capital Pubs Company in London.
Its own brewed ales, such as IPA and Old Speckled Hen, were up according to its last update but its leasehold and tenanted division saw underlying like-for-like profits fall. It wants to cut the size of this estate by 300 to 1,200.
Geof Collyer, an analyst at Deutsche Bank, expects the group to report a 6 per cent rise in sales £513.7 million, and a 5 per cent increase in underlying profits to £115.3 million.
He said: “The interim results should show that the sector leadership still resides in Bury St Edmunds.”
The company’s shares and profits slumped by about two-thirds following the recession but have since rallied.
Homebuilder Berkeley’s focus on more affluent locations in London and the southeast will help it buck the gloom surrounding the property market when it reports half-year results on Friday.
The group is expected to reveal more healthy profits growth as it benefits from a strong pipeline of building projects after snapping up land at bargain basement prices following the recession.
But Berkeley has a strong presence in London where prices have exceeded their previous peaks and says with high numbers of investors driving the market means it has not been affected by the mortgage drought or high unemployment dragging down prices in much of the UK.
It has reported a shortage of quality homes in areas with good transport links, infrastructure and employment opportunities, which is driving up prices.
The group has proved a stock market darling and has seen its share price almost double since the housing crash in 2008.
The group recently said it will bring forward its target of doubling profits in five years to three years and announced plans to return £1.7 billion to shareholders over a 10 year period, reflecting its buoyant performance.
When it last updated the market, in September, it said forward sales were 42 per cent higher than a year ago, and it had a significant number of planning consents coming through.
The City expects full-year profits to rise 25 per cent to £170.3 million.
Gregor Kuglitsch, an analyst at UBS, said he believes Berkeley’s robust trading could also see it speed up the return of cash to shareholders.
He said: “Although Berkeley has brought forward its doubling of profit target, we believe the outlook beyond is also favourable.”
He said a number of flagship London sites will boost future earnings, including One Tower Bridge and Tideway Wharf.
Topps Tiles is set to report another fall in profits on Tuesday as it struggles against falling consumer spending.
The City expects underlying profits at the UK’s largest tile and wood flooring specialist to fall 19 per cent to £13.2 million in the year to October 1.
The homewares market has been particularly badly hit by the squeeze in consumer spending and falling house sales, which normally drive home improvement projects.
Topps, which operates 320 stores including about 30 trading as Tile Clearing House, has already revealed a sharp fall in demand over the summer with full-year like-for-like sales down 1.9 per cent, having been up 1.8 per cent in the first half of the year.
It blamed falling consumer confidence but analysts said it was also suffering as DIY chains have stepped up their battle for market share.
Topps currently has about a quarter of the tiles market but B&Q is understood to be breathing down its neck.
The group reported adjusted profits of £7.2 million in its first-half, against £7.8 million during the previous year.
Leicester-based Topps said it has protected its market leading position by saving on costs, including through more direct sourcing, and investing in marketing and store openings.
The group, which started trading in Manchester in 1963, has opened 15 stores over the year although it closed or relocated seven outlets.
Software group Sage will reveal whether the recent slowdown in global growth has derailed its recovery when it provides full-year results on Wednesday.
The company, which sells software to small and medium-sized businesses, reported a 4 per cent rise in half-year revenues earlier in the year as its customers grew in confidence.
The Newcastle-based firm’s shares are now more than 50 per cent higher than their troughs at the end of 2008, reflecting a gradual recovery in confidence among small businesses around the world.
The group’s last update in July said its performance remained strong and the City expects it to report a 4 per cent rise in underlying profits to £381 million.
But investors will scrutinise any information about recent trading for indications that the slowdown in global growth has hit its customers’ confidence.
Companies can easily postpone investing in new software in the event of a downturn and Sage is in some ways seen as a barometer for the health of small and medium businesses.
It even produces its own Sage Business Index, which surveys 6,000 small firms across the globe, to gauge sentiment among its customers.
At its half-year results, it found that confidence appeared to be returning, particularly in Germany, while the UK and the US were “somewhat confident”.
But the company warned that the strength of the recovery varies around the world and “remains uncertain”.
The firm, which employs around 13,000 people and serves more than six million businesses worldwide, also has offices in Manchester, Winnersh, near Reading, central London and Witney in Oxfordshire.
Its business in the UK and Ireland, which accounts for about a fifth of sales, saw growth of 4 per cent in the half-year after the roll-out of its new SageOne online accounting package.