Earning power: Deutsche Telekom has a 67 per cent stake in T-Mobile
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Diary commentary from FT reporters; data and company announcements, unless otherwise stated, from Thomson Reuters. Company announcements are of information publicly available before last week.
BHP Billiton’s interim results should see the world’s most valuable mining company give updates on capital spending in the light of a broad commodities downturn. BHP will reveal cuts to its shale drilling budgetfor this year after the oil price slide, having already said it will reduce the number of rigs it operates.
Investors will also want to know whether BHP is still on track for its most radical corporate restructuring in years — a spin-off of its smaller operating divisions into separately listed South32. The results will show those assets’ performance and may give some guide as to how much group debt will be parcelled into South32 ahead of its launch.
Consensus estimates are for a 9 per cent year-on-year fall in revenues, to about $31bn, and a drop of more than one-third in underlying post-tax profit to about $5bn. BHP has already flagged that petroleum impairments will hit underlying profit by $200m-$250m. James Wilson
HSBC’s private bank may account for only 3 per cent of total pre-tax profits, but the unit is still likely to dominate discussions about the annual results.
A media and political firestorm erupted around HSBC a fortnight ago after dozens of news outlets published damaging details of how it helped clients of its Swiss private bank to hide assets from the taxman between 2005 and 2007.
Douglas Flint, chairman, is due to appear on Wednesday before the influential Treasury select committee to answer questions about the affair from MPs. Stuart Gulliver, chief executive, is expected to appear before the public accounts committee soon afterwards.
Analysts expect a slight fall in 2014 pre-tax profits to about $21bn, against $22.6bn the previous year.
Investors will be watching for any extra provisions for litigation costs and pushing for fresh targets on cost efficiency and return on equity fter earlier ones were abandoned. Martin Arnold
BHP Billiton H1 $1.47 ($1.47)
HSBC FY $0.87 ($0.84)
Holcim Q4 SFr0.97 (SFr0.71)
Ferrovia lFY €0.52 (€0.92)
Hewlett-Packard Q1 $0.91 ($0.90)
Macy’s Q4 $2.40 ($2.31)
Persimmon FY 120p (82.80p)
AP Moeller M Q4 $48.03 (n/a)
Axa FY €2.07 (€2.03)
Barratt Develop H1 (FY estimate) 43.03p (30.40p)
Brit FY 32.15p (n/a)
Bouygues FY €1.89 (€2.03)
Com de St Gobain FY €2.19 (€1.86)
Dollar Tree Q4 $1.14 ($1.02)
HSBC FY $0.87 ($0.84)
Liberty Media Q4 $0.17($5.17)
Man Group FY $0.18 ($0.14)
Target Q4 $1.46 ($0.90)
Telefónica FY €0.83 (€0.99)
TJX Companies Q4 $0.90 ($0.81)
● Fourth-quarter earnings before interest, tax, depreciation and amortisation at T-Mobile US, the smallest of the main US mobile phone networks, rose 41 per cent year-on-year to $1.75bn.
T-Mobile US has grabbed market share by paying the contact termination fees of customers who switch. It gained 1.3m of the most lucrative “postpaid” customers in the fourth quarter.
The US subsidiary now represents about 35 per cent of Deutsche Telekom’s revenues and a fifth of core profits.
The German telecoms operator attempted to sell its majority stake in T-Mobile to larger rival Sprint last year, believing it lacks the scale to compete with market leaders AT&T and Verizon.
But the deal collapsed in the face of hostility from US regulators, and Deutsche Telekom rejected an offer for T-Mobile from French carrier Iliad.
Analysts predict stable earnings in Germany, Deutsche Telekom’s core market, following a 2.1 per cent decline year-on-year in the third quarter. Revenues and earnings in central and eastern Europe, excluding Germany, are expected to show a worsening decline.
Deutsche Telekom is investing heavily in high-speed mobile and broadband networks to defend its position in its German home market.
Chief executive Timotheus Höttges said last month that the company planned to spend €23.5bn over five years to improve German infrastructure.
Deutsche Telekom is moving to a pan-European “internet protocol” network in which all customers, whether on mobiles or landlines, make calls and send data through a unified infrastructure.
Deutsche Telekom’s entire customer base in Slovakia and Macedonia was moved to “all-IP” last year. Analysts expect a further rollout of the technology will allow the telecoms operator to cut costs. Jeevan Vasagar
● It is almost exactly a year since Ross McEwan launched Project Cook, a five-year restructuring plan designed to finally put Royal Bank of Scotland
back on a stable footing after it was almost blown away by the financial crisis.
The New Zealand-born RBS chief executive is expected to say that the plan is ahead of schedule when he presents annual results that analysts predict will feature a return to pre-tax profits after six consecutive years of losses.
RBS has been pulling out of many activities in Asia, the Middle East, continental Europe and the US. It has drastically cut back its once mighty investment bank, listed its Citizens branch network in the US and is selling the international part of its Coutts private bank in Switzerland.
Mr McEwan, who ran RBS’s retail bank before he replaced Stephen Hester as CEO in 2013,
told the Financial Times in a recent interview that he expects to hit his £1bn cost-cutting target for the past year. Investors will be keen to hear of progress in shedding the £38bn of toxic assets put into its “bad bank” in 2013. Martin Arnold
ACS FY €2.25 (€2.20)
Ahold FY (Q3 estimate) €0.89 (€0.92)
Allianz FY €13.91 (€13.05)
Ambev Q4 R0.30 (R0.30)
Anheuser-B InB Q4 $1.37 ($1.47)
BAT FY 206.96p (216.60p)
D Telekom Q4 €0.10 (€0.08)
Domino’s Pizza Q4 $0.93 ($0.78)
Gap Q4 $0.73 ($0.68)
Premier Oil FY $0.38 ($0.43)
Repsol Q4 €0.27 (€0.14)
RBS FY 38.19p (-38.30p)
RSA Insurance FY 25.00p (34.62p)
As long as IAG’s €1.35bn bid for Aer Lingus remains stuck on a Dublin runway while the Irish government weighs whether or not to accept, investors know to expect little more on that subject from the UK-based airline group when it publishes annual results.
The focus is instead likely to be on what the future holds in a world of far lower fuel prices and investors will want an update on hedging policy. The question will be whether IAG sees fit to raise its 2015 target for operating profits of €1.8bn. While lower fuel prices may have made life more difficult for some heavily hedged legacy carriers by encouraging even more aggressive competition — from Gulf rivals in particular —this is not expected to affect IAG’s carriers.
But there may be questions about how IAG intends to work with Qatar, the Gulf airline which last month revealed that it had taken a 10 per cent stake in the airline group.
IAG said in November it expected 2014 operating profit to increase by between €550m and €600m on 2013’s €770m, so there seems little chance that the parent of British Airways and Spain’s Iberia will disappoint. Peggy Hollinger
IAG FY €0.405 (€0.21)
Airbus Q4 €0.99 (€1.14)
Lloyds Banking Group FY 7.81p (6.92p)
Pearson FY 65.27p (70.10p)
Vivendi FY €0.45 (€1.15)
William Hill FY 29.59p (28.80p)
Results forecasts, from Thomson Reuters, are for fully diluted, post-tax EPS in local currency for the stated fiscal period. The comparable period of the previous year is bracketed. Non-UK reporting periods are broken by quarter: Q1, Q2, Q3, Q4. UK periods are designated: Q1, H1 (first half), Q3 and FY (full year). Thomson Reuters calculates mean earnings estimates based on a majority policy where the accounting basis used for each company estimate is that used by the majority of contributing analysts