Friday preview: UK public finances; results from IHG, Acacia, Renishaw

UK public finances will come under the microscope on Friday 20 October, while later on US Fed Chair Janet Yellen speaks and there are results from InterContinental Hotels, Acacia Mining and Renishaw.

The Office for National Statistics will report on September's UK public finances at 0930 BST, a month after public sector borrowing was revealed as £5.09bn or £6.7bn when excluding stakes in banks.

The finances have been on a bit of a roller-coaster this year, noted HSBC, recovering from a poor start with better outturns for June and July, meaning that year-to-date borrowing is actually down very slightly on the same period of last year.

"However, with weak output and wage growth, as well as some on-off factors that reduced the deficit last year, we expect it to widen over the remainder of this fiscal year.

"With the OBR apparently poised to revise down its productivity forecasts in the next economic and financial outlook, this will make for some difficult questions for the Chancellor ahead of the 22 November Budget."

Economists at Pantheon Macroeconomics expect borrowing of £6.5bn on the PSNB excluding stakes in banks

"Borrowing in 2017/18, however, still is set to be about £8bn lower than the OBR forecast in March."

COMPANY RESULTS

InterContinental Hotels is scheduled to report on third quarter results.

In August, the Holiday Inn and Crowne Plaza operator reported first-half growth in revenue per available room (revpar) of 2.1%, down from the 2.7% at the start of the year.

Revpar growth slowed to 1.5% in the second quarter, including a decline of 0.4% in the US due the timing of Easter.

Underlying revenue hit £788m for the first six months of the year, up 4% year on year at constant exchange rates, with operating profit rising 7% to $365m.

New chief executive Keith Barr, who was promoted in July after 17 years at the company, hailed the continued progress in executing predecessor Richard Solomons' strategy to deliver high quality sustainable growth, and said he would continue the company's focus on cost efficiency to generate funds for reinvestment.

Analysts at UBS forecast global revpar will be lower than than the second quarter due to hurricane and calendar. "We expect up circa 1% with circa 7k rooms opened."

Barclays was going for 2%, with 1.2% in Americas, 3.9% in Europe, 1.6% in AMEA and 4.2% in Greater China, overall expecting US commentary to be more favourable than in the second quarter, with a smaller underperformance than the market.

Broker Numis noted that market data for the US was largely unchanged in the third versus the second quarters at 2.2%, whereas Europe and China have both showed an improving trend, leading it to forecast 2.8% revpar growth.

Acacia Mining is scheduled to release its Q3 results a day after parent company Barrick Gold agreed a revenue-sharing deal with the Tanzanian government, which will be subject to a shareholder vote.

Ahead of the trading statement Acacia revealed last week that it produced 191,203 ounces of gold and sold 132,787 ounces of gold during the third quarter.

Before the Barrick intervention, analysts at Jefferies said most of the newsflow for had already been and do not expect any material update on Friday.

"In our opinion, the medium- to long-term share price performance will be, in large part, determined by a resolution over the concentrate export ban and resulting fiscal and operating landscape for the company in country."

UBS expects total cash costs up the top of the guidance range of $580-620/oz and all-in-sustaining costs to be 2% up the top of guidance range of $880-920/oz, with a small cash position of $60m and a small net debt position of around $5m.

Engineer Renishaw's first quarter trading update is expected to reveal some details on both revenues and profits.

Guidance at July's full year results was for growth in both revenue and profits in the current financial year despite the ongoing uncertainty surrounding Brexit and FX volatility.

For the year, the company reported an adjusted profit before tax of £109.1m and a statutory profit before tax of £117.1m, an increase of 25% on an adjusted basis, on underlying revenues up 14% to £537m with growth in all regions.

For the new year, UBS forecast revenues of £606m with 8% organic growth and EBITA of £130m with 21.5% margins.

Friday October 20

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Current Account (EU) (09:00)
Existing Home Sales (US) (15:00)
Producer Price Index (GER) (07:00)

UK ECONOMIC ANNOUNCEMENTS
CBI Industrial Trends Surveys (11:00)
Public Sector Net Borrowing (09:30)

FINALS
Oncimmune Holdings

TRADING ANNOUNCEMENTS
Acacia Mining, InterContinental Hotels Group, Record, Renishaw

AGMS
Vast Resources

ANNUAL REPORT
James Halstead

FINAL DIVIDEND PAYMENT DATE
Green Reit, Hargreaves Lansdown, Hargreaves Services, HML Holdings, Kainos Group , Norish Units

INTERIM DIVIDEND PAYMENT DATE
Applegreen, Barr (A.G.), Braime (T.F.& J.H.) Holdings (Non-Voting), Christie Group, Convatec Group , Costain Group, Derwent London, Eddie Stobart Logistics , Epwin Group, Henry Boot, Hunters Property , Inmarsat, Petrofac Ltd., Phoenix Spree Deutschland Limited Shs NPV , Shire Plc, Stadium Group, Vitec Group