Companies reporting next week

THE banks' earning season draws to an end next week with Asian giant

HSBC will be the last bank to update the market this season when it posts full-year figures on Monday.

The group has not had an easy time of it in 2001, with both the US and Asian markets suffering gloomy economic conditions and Argentina and Enron increasing the bad debt provision, analysts say.

But fund manager Gerrard said HSBC was hugely diversified, with massive economies of scale and profits are expected to rise from $10.3bn (£7.25bn) to $10.6bn.

Pearson announced this week that it is considering selling its business magazine arm, and investors will be keen for an update when the group posts full-year figures on Monday. Pearson issued two profits warnings in 2001 as the group, like most in the sector, suffered from the advertising downturn. Any comments on forecasts for advertising volumes in 2002 will thus be keenly watched.

Pre-tax profits for the full year are expected to fall from £333m to £267m. Thistle Hotels posts final figures on Monday, after an extremely tough year for the leisure sector. The slowing US economy and foot-and-mouth crisis meant tourist numbers were already falling even before September 11, at which point overseas travel slumped. Thistle said earlier this year turnover had fallen by almost 6% and pre-tax profits are forecast to fall from £67m to £55m.

But what is going to be of more interest to investors will be any signs the hotel industry is moving towards recovery. In recent years cigarette giant Gallaher has owned much of its success to acquisitions overseas and final results on Wednesday are likely to once again show the group's reliance on its international activities.

Despite losing market share in the UK to Imperial Tobacco, Gallaher is forecast to report pre-tax profits of £375m, compared with £347.7m helped by the consolidation of Austria Tabak and Russia's Liggett-Ducat. International operations should account for 40% of Gallaher's profits and analysts will want to be guided on the likelihood of further acquisition activity in the coming year.

Engineering group GKN demerged its industrial services companies in August only to see the prospects for one of its two remaining businesses, aerospace, impacted by the terrorist attacks in the US. GKN's other core arm, automotive, was already suffering from the slowdown in its North American markets and the group's final results on Thursday are likely to show a sharp fall in profits from £386m to £240m.

Aero-engine maker Rolls-Royce axed 5,000 permanent staff in October as it reacted to the impact of September 11 and cost cuts should ensure full year profits come in at around £440m, from £436m the previous year, on Thursday.

The real impact of the attacks is expected to be felt in terms of engine orders, deliveries, spares and after-market demand this year and next and the group's comments on any developments since October will be key.

Marine and financial services are expected to have performed well in 2001 but military profits may be flat due to the timing of major programmes.

United Business Media is forecast to report a sharp fall in full year profits on Tuesday after seeing advertising at its hi-tech magazines in the US hit by the downturn in the American economy.

While the group has won market share in the US, revenues could have fallen at the group's professional media division by as much as 30% in 2001, analysts say, in stark contrast to the strong growth experienced in 2000.

UBM's PR Newswire arm is likely to show marginal growth for the year while the group's market research business is set to show organic growth of 6%. Gerrard forecasts overall profits will come in at £82m, down from £196m.