Markets: Housing market will help retailer Dixons

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RESURGENT electricals retailer Dixons will look to maintain its run of form this week, while brewer Greene King will reveal the spoils of a good summer.

PC World and Currys owner Dixons Retail is set to deliver another solid update on Thursday following a resurgent full-year performance that saw it switch from “survivor to winner”.

The group delivered a 15 per cent rise in underlying profits last year as it benefited from the collapse of competitors such as Comet and an improvement in its customer service standards. Analysts say the UK housing market revival could help it further.

Matthew Taylor, an analyst at Numis Securities, is predicting UK first quarter like-for-like sales to have risen by at least 5 per cent, although he said “hot weather is rarely helpful for electrical sales”. Dixons shares were a star performer of 2012 and have gained around 160 per cent in the last year.

Brewer and pubs operator Greene King is expected to reveal strong summer trading tomorrow after demand for lager and cider soared in the heatwave.

The firm, which has a retail estate of nearly 1,000 managed pubs across the UK and also brews beers including Belhaven Best, is predicted to report a pick-up in sales growth thanks to the hot summer weather.

It posted a 3.3 per cent rise in like-for-like sales in the initial eight weeks of the new financial year and analysts are pencilling in growth of more than 5 per cent over the first quarter.

However, the brewing business, which also includes Abbot Ale and Old Speckled Hen, is unlikely to have benefitted as the hot weather will have favoured lager and cider.

Payday lender Wonga will bring a more controversial twist to results tomorrow amid an ongoing competition investigation of the market.

The Heart of Midlothian and Newcastle United football clubs sponsor, which offers short-term loans of up to £1,000, has rarely been out of the spotlight this year as the £2 billion industry has come under fire over exorbitant interest rates and lending practices.

The group’s 2012 financial results will be of particular interest, given scrutiny of the sector. The previous year, net profits more than tripled to £45.8 million.

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