Market watch: Tariff row tensions

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THE City is waiting to see if SSE chief executive Ian Marchant will use this week’s interim results to wade into the row over the Prime Minister’s comments regarding cheap tariffs.

David Cameron sparked ire among the utility companies when he suggested they should be forced to place customers onto their lowest price plans.

Angela Knight, chief executive of trade body Energy UK, hit back at the proposals, highlighting the work being done by power regulator Ofgem to simplify tariffs.

Analysts will study Perth-based SSE’s half-year report 
to see if Marchant vents his opinion on the subject. But 
the City isn’t expecting any surprises on Wednesday as far as SSE’s figures go.

Following a pre-close trading update, Charles Stanley analyst Tina Cook predicted adjusted interim pre-tax profits would be closer to 2010’s £386 million than last year’s £287m, which had been hit by a loss at the retail supply business.

Cook said there was no 
immediate pressure on the company to name a successor to Marchant – who has been in charge for the past ten years – but noted that the recent 
appointment of Alistair Phillips-Davies as deputy chief 
executive was a sign of early succession planning.

Profits at distribution company John Menzies’ aviation division are expected to have benefited in a small way 
from two recent acquisitions, according to Peel Hunt analyst Christopher Bamberry.

Adding Kamino Cargo in 
Bucharest and Prague airport’s ground-handling unit to its 
operations is forecast to grow Menzies’ bottom line next year, but Bamberry predicts a “small” benefit this year too when the Edinburgh-based firm posts its third-quarter trading update on Tuesday.