Lloyds Banking Group plc and Barclays plc to dominate manic week of corporate earnings

plc () and plc () lead a flood of FTSE 250 corporate earnings with their second quarter results.

Lloyds, which reports its results on Thursday, has made a strong start to the year despite tackling claims for payment protection insurance and compensation for victims of fraud at its HBOS Reading branch.

A successful turnaround under chief executive Antonio Horta-Osario has seen the bank return to private hands after the government sold the last of its stake earlier this year following its bailout during the 2008-09 financial crisis.

In the first quarter, Lloyds doubled its profits and upgraded its full year guidance for net interest margin  — the difference between the interest it receives from lending and the amount it pays out —  to about 2.8% from a previous forecast of about 2.7%.

Analysts expect NIM to reach 2.82% in the second quarter, including the benefit from the bank’s acquisition of credit card business MBNA in May. The dividend will also be in focus after announcing a special dividend at its full year results in February.

Investors await update on restructuring 

Fellow UK lender, , posts its second quarter results on Friday. Much like Lloyds, Barclays has been grappling with legacy issues. 

Earlier this week, it emerged that Barclays plc (LON:BARC) and four of its former top executives will appear in court on 9 January 2019 to begin a trial on charges of conspiracy to commit fraud over deals made with Qatar as part of its £12bn emergency fundraising in 2008.

Chief executive Jes Staley is also being investigated by the UK’s Financial Conduct Authority for his attempts to unmask a whistleblower.

In terms of its financial performance, the lender also made a good start to the year with its first quarter profit smashing expectations.

Barclays has been undergoing a restructuring that has seen the bank offload its non-core businesses to focus on its core in the UK and the US. Ian Forrest, investment research analyst at The Share Centre, said investors will be keen for an update of the progress of asset disposals and the streamlining of the business.

“Investors will also lookout for any improvement in its net interest margin and capital ratios as a sign of progress,” he said.

reports second quarter with pipeline progress eyed

joins the bevvy of companies reporting, with its second quarter results on Thursday.  In the run up to the results, the pharmaceutical giant has been dominated by rumours that chief executive Pascal Soriot was leaving to join Israeli generic drug maker Teva.

Those reports, which hit the share price hard, look to be wide of the mark now and Soriot will present the results as usual, although investors would surely appreciate a Jordan Belfort-esque ‘I’m not leaving’ remark.

The actual numbers to be reported are fairly meaningless given that the focus will be on the pipeline progress and in particular how the MYSTIC study is coming along.

Results from that immuno-oncology trial, seen as pivotal by many analysts, are due out any time now so it would make sense for Astra to wrap them up into the results.


GlaxoSmithKline fast approaching crossroad

GlaxoSmithKline’s () second quarter will be accompanied by new chief executive Emma Walmsley’s plans to revive both the brand and share price.

A clue as to what is to come was possibly the disposal of the Horlicks brand and the emphasis going forward is expected very much to be on Glaxo’s future as a major pharma group.

An over-reliance on the respiratory and HIV portfolio is seen as a key weakness, as is a drug development programme seen as some way short of convincing and lagging its main rivals

Solving these problems will take time, but some reassurance over the cash flow and dividend sustainability would definitely buy some and allow Walmsley look at the bigger picture.

Goldmans Sachs predicts second quarter revenue of £7.3bn and earnings per share of 26.5p, numbers that the broker says are broadly in line with the market consensus.


Significant events expected:

Monday July 24

Trading updates: ()

Interims: (Q2) PLC (LON: RB), (Q1) Holdings PLC (),  PLC (), (), SThree PLC (), WH Ireland Group PLC ()

Finals: Tungsten Corp. ()

Tuesday July 25

Trading updates: PLC ()

Finals: PLC ()

Interims:  PLC (), Gresham Technologies PLC (), Informa PLC (), PLC (), SEGRO PLC (), (), PLC (), Holdings PLC ()

Wednesday July 26

Trading updates: PLC (), PLC ()

Interims:  (), PLC (), Capita PLC (), PLC (), PLC (), Thompson Group PLC (), Jupiter Fund Management PLC (LON:JUP), PLC (), (QTX), PLC (), (), Group PLC (), PLC ()

Finals: ()

Thursday July 27

Interims:  PLC (), PLC (), (), Burford Capital PLC (LON:BUR), PLC (), PLC (LON::INCH), PLC (), Properties PLC (), Group PLC (), PLC (), PLC (LON: LLOY), Lancashire Holdings PLC (), (), PLC (LON:RDSA, ), RELX (), PLC (), (),  Greencoat Wind UK PLC (), (), PLC ()

Finals: ANGLE PLC (), (), PLC (), (), Sky PLC ()

Trading updates:  (), (), Hogg Robinson Group PLC (LON:HRG), PLC (), (), PLC (), PLC ()

Friday July 28

Interims: Barclays PLC (), (), PLC (), PLC (), PLC (), Morgan Advanced Materials PLC (LON:MGAM), Rightmove PLC (), UBM PLC ()

Trading updates: PLC (), Gear4Music Holdings PLC ()


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