The Business Matrix: Monday 31 October 2011

RBS to deliver profit of £400m

Royal Bank of Scotland is expected to post a third-quarter profit of £400m on Friday. However, the bank, which is 83 per cent owned by the UK taxpayer, is set to reveal a contraction in trading at its investment banking arm. Following a £1.15bn loss last year, the profit will be helped by a substantial swing in the fair value of RBS’s own debt.

Homeserve set to feel the heat

Shares in Homeserve, the listed emergency repairs company, are expected to tumble this morning after it identified that some staff may have been mis-selling insurance products. Homeserve has stopped nearly 500 staff from making outgoing and incoming calls after a review by the accountancy company Deloittte. Homeserve is valued at £1.6bn.

G4S takeover vote on a knife-edge

The vote by shareholders of the security company G4S on its £5.2bn takeover of the Danish cleaning firm ISS is on a knife-edge. Two blue-chip investors, Artemis and Schroders, are expected to vote against the deal on Wednesday, according to reports. The hedge fund Parvus Asset Management is also thought to be opposing the deal.

West Midlands takes housing hit

The average price of UK houses fell by 0.2 per cent in October, according to property analyst Hometrack. The October fall means that the price of UK homes has fallen by 2.8 per cent over the last year. The worst October price fall of 0.6 per cent was in the West Midlands, with prices treading water in London after seven months of rises.

John Lewis to don UK sourcing flag

The retailer John Lewis is to launch a “buy British” campaign in its shops. The department store chain will mark all products sourced in the UK with a Union Jack logo. The initiative will see the “Made in UK” stamp put on products made by 130 British manufacturers including Herbert Parkinson.

Brits cut spending and fear for jobs

A third of Britons are cutting back their spending and anxiety over job security is growing, according to the think tank Resolution Foundation. The poll revealed that only 35 per cent feel secure in their job, compared with 41 per cent in July. Nearly a third have already cut back spending in the last year.

Asos

Growth overseas has more than compensated for a sharp slowdown in the UK at the online fashion retailer Asos. Brokers expect first-half figures, on Thursday to benefit from the fact it did not hold a summer sale this year and from strong overseas growth. Nomura expects interim profits to jump by 63 per cent to £11.4m.

Bank’s profits rise

Barclays is expected to show revenues at its investment arm Barclays Capital fell to £2.2bn from £2.8bn in its latest quarter on Monday. But the bank is expected to deliver profits of £1.2bn-£1.7bn, up from £989m, as PPI compensation charges drop out of its comparative numbers at its retail and business banking operations.

Next

There are fears that some of the shine could come off Next on Wednesday. While the fashion retailer has seen smaller sales declines than most high street competitors, a warm September is expected to have hit sales of its autumn and winter ranges. Analysts are predicting Next’s underlying sales to have fallen by 6.5 per cent in the past quarter.

RBS

Taxpayer-backed RBS is set to post quarterly profits of £466m on Friday, up from a £657m loss in the previous quarter triggered by the bank’s PPI hit. The City will be seeking news on its investment banking arm, which RBS boss Stephen Hester has put under review amid falling revenues and mounting regulatory pressures.