Peter Ranscombe: Dixons and M&B may signal consumer confidence

Half-year results from electronics giant Dixons Retail, the owner of Currys and PC World, and full year figures from pubs empire Mitchells & Butlers are this week expected to give a flavour of consumer spending ahead of the key Christmas season.

Dixons reports interim results on Thursday after recent trading figures suggested its recovery plan was paying off. Its first-quarter update in September revealed UK like-for-like sales increased by 6 per cent, buoyed by an exclusive deal to market the iPad, as well as promotions on televisions at the time of the football World Cup.

Analysts at Execution Noble expect half-year figures to show the same positive trends after a survey of 700 customers at Lakeside Thurrock shopping centre, where the Currys brand competes with Best Buy and Comet.

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Execution claimed the results signalled that Currys' price perception was strong and that it can compete on price with Best Buy, which recently launched in the UK. Execution Noble recently raised its profits forecast for the retailer for the full year by 15 per cent to 138 million.Dixons - formerly known as DSG International - is two-thirds of the way through a three-year revival plan. It reported a 61 per cent rise in underlying pre-tax profits to 90.5m for the year to 1 May.

Mitchells & Butlers will tomorrow report back on efforts to transform itself into a food-led business when it delivers full-year results.

The group is rolling out a strategy to focus on food sales as part of an overhaul announced in March to invest in its six mid-market eateries, including Harvester, Toby Carvery, Crown Carveries and Sizzling Pub Co.

Restaurant-led pubs are an attractive area for the entire industry after smoking bans, alcohol duty increases and the recession hit the drinking market.

M&B's food-focused offering suffered during the World Cup, but it revealed in September that sales have since picked up, ahead by 3.6 per cent in the nine weeks to 18 September. Food sales rose by 7 per cent in a sign its strategy is bearing fruit.

Most analysts are pencilling in pre-tax profits of 166m, up from 134m last year. This would mark a turnaround on the 24 per cent profits drop reported a year ago.

M&B's 1,580 restaurants and food-led pubs include Deacon Brodies Tavern and the Sheep Heid Inn in Edinburgh and the Horseshoe Bar and the Three Crows in Glasgow.A year on from Ofwat's "tough" ruling on household bills south of the Border, water company Severn Trent is expected to disclose its dividend policy for the four years to 2015 when it presents half-year results tomorrow.

The utility giant, which serves more than eight million customers, has already announced a one-off 10 per cent cut to its dividend in 2010-11 following the Ofwat decision, which required Severn to cut average household bills by 4 per cent in real terms by 2015.

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Morgan Stanley said it expected Severn to announce its dividend will grow by the equivalent of the retail prices index (RPI) inflation measure plus 3 per cent in the years between 2011 and 2015, although it added there was potential for an "upside surprise".

Healthy dividend payments are essential to attract investors as firms look to raise the billions of pounds needed to pay for spending on the network.

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