Tuesday preview: Market braces for batch of full year earnings results

The market is bracing for a busy day of full year earnings releases from a slate of FTSE 350 companies on Tuesday.

GKN is expected to report a drop in earnings per share to 26.4p in 2015 from 29.0p the previous year as weakness in its Aerospace and Land Systems businesses offsets growth in Automotive.

Aerospace faces the challenge of getting the production of Airbus’s latest A350 jet up to speed, introducing an upgraded version of the A330 and accelerating the output rate of the best-selling A320 series.

“Aerospace reflects a transition in programmes with A330 softening and A350 ramp-up inevitably reflecting lower profitability given the A350 is only expected to be around break even,” said Numis analyst David Larkam.

“Military aero will be impacted by the C17 which was a low volume high shipset programme now completed. Focus will be on the A350 progress and the integration of the recently acquired Fokker business as well as spares business given the travails at Rolls, Meggitt etc.”

Larkam added that the Automotive results should not surprise with attention likely on the Powder Met business. Focus will also be on any changes in management margin targets which Numis believes will inevitably rise as steel prices fall.

“Driveline progress will also be closely watched given the state of the Chinese and North American markets creating some concerns for 2016," Larkam said.

Meanwhile, struggles at Land Systems reflect weaker agriculture and construction markets, which Numis expects to continue into 2016.

Another FTSE 100 company set to report finals is Standard Chartered. UBS has estimated underlying profit before tax of $1,347m and loss before tax of $512m for the second half driven by driven by weakening revenues, elevated loan losses, and below the line restructuring charges. “We forecast a closing common equity tier 1 ratio of 13.1% and TNAV per share of 863p,” UBS added.

Other London-listed firms set to report full year earnings include InterContinental Hotels, Ladbrokes, Persimmon, Morgan Advanced Materials, Meggitt, Wood Group and Drax.

Tuesday 23 February

INTERIMS
BHP Billiton, DotDigital Group, Just Retirement Group, Pan African Resources

INTERIM DIVIDEND PAYMENT DATE
Puma VCT 9

QUARTERLY EX-DIVIDEND DATE
Honeywell International Inc.

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Confidence (US) (15:00)
Existing Home Sales (US) (15:00)
Gross Domestic Product (GER) (07:00)
IFO Business Climate (GER) (09:00)
IFO Current Assessment (GER) (09:00)
IFO Expectations (GER) (09:00)

FINALS
Croda International, Drax Group, GKN, InterContinental Hotels Group, Ladbrokes, Meggitt, Morgan Advanced Materials , Persimmon, Provident Financial, Standard Chartered, Unite Group, Vitec Group, Wood Group (John)

ANNUAL REPORT
GKN

AGMS
Image Scan Holdings, OMG, Thomas Cook Group