Stock market stars get punished heavily when they trip up, and Burberry was no exception after its profit warning a month ago.
Consequently, Thursday's fiscal second quarter trading update from the luxury goods firm will be closely analysed to see whether the material slow-down in its retail business got any worse in the final three weeks of September.
Seymour Pierce is forecasting like-for-like (LFL) retail sales will be down 2% year-on-year, with total sales on a constant currency basis up 5%.
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"Key focus will be for news on whether the retail slowdown has worsened or stabilised, how the stock position is and, more importantly, the management's expectations for the wholesale business for the spring/summer 2013 collection (H1 [first half] wholesale guidance was for mid-single digit growth: SPL [Seymour Pierce] H2 assumption +3.9% underlying)," the broker said.
"We are also looking for an update on what action management has taken beyond freezing headcount, travel, cutting marketing spend and deferring IT projects in its 'pay-as-you-go' approach. In addition, we are still waiting for an update on Fragrance after management terminated its licence earlier this year," Seymour Pierce's Kate Calvert said.
"While other luxury players have also spoken about a slowdown, there is concern from some quarters that there is a brand issue and management has pushed some of its prices too high," Calvert notes.
Full year results from WH Smith could see the newsagent chain announcing pre-tax profits of £100.3m on sales of £1,248m, according to broker forecasts.
Kate Calvert of Seymour Pierce is predicting an improvement in the retail LFL sales trend in the fourth quarter (Q4) from the fall of 4% in the third quarter.
"The focus will be on an update on the Travel, the driver of growth, and progress internationally winning contracts and how confident management are feeling about High Street's prospects in the run-up to Christmas. Certainly, it feels as if the book publishing schedule is stronger this year with '50 Shades' having a positive benefit on Q4 LFL sales and JK Rowling 'The Casual Vacancy' as well as a better selection of cookery books," Calvert predicts.
INTERIM DIVIDEND PAYMENT DATE
Berendsen, Macfarlane Group, Molins, Standard Chartered, UBM, Zotefoams
QUARTERLY PAYMENT DATE
XP Power Ltd. (DI)
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (US) (13:30)
Bloomberg Consumer Confidence (US) (14:45)
Consumer Price Index (GER) (07:00)
Continuing Claims (US) (13:30)
Crude Oil Inventories (US) (15:30)
ECB Report (EU) (09:00)
Import and Export Price Indexes (US) (13:30)
Initial Jobless Claims (US) (13:30)
Treasury Budget Statement (US) (19:00)
FINALS
Air Partner, WH Smith
IMSS
Ashmore Group, Greggs
AGMS
Angle, Goodwin Plc, Monitise, Standard Life UK Smaller Companies Trust
TRADING ANNOUNCEMENTS
Burberry Group
JH
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