Companies reporting next week

WHILE record oil prices and higher employee costs have added to the problems of

Broker Charles Stanley expects profits of £90m, against record first-quarter losses of £45m a year ago when figures to the end of June were affected by the 'most testing period in aviation history'.

Analysts will be looking for more guidance on the profitability of rejuvenated telecoms equipment group Marconi on Monday after a sales update last month indicated gross margins were at the lower end of its 30% to 32% range.

Sales of £339m for the first quarter have already been announced so an area of interest will be the outlook for the current three-month period, with Gerrard looking for a 5.6% quarter-on-quarter sales rise to £358m.

In terms of the first quarter, losses of £13.4m are forecast, down from the £3m profits of a year earlier, after Marconi announced in July that a number of customers had temporarily cut spending.

Scottish Power added 600,000 customers in the last financial year and should show further gains when it reports first-quarter figures on Thursday.

Although the US dollar has been weak, the group has hedged its position to offer some protection to US profits - accounting for 57% of overall earnings. Across the group, profits of £195m are expected for the three months to 30 June, down slightly on the £204m seen a year earlier.

Signs that the premiums charged by general insurers are starting to fall from their peak will be the main focus for analysts when Royal & SunAlliance announces its half-year results on Thursday.

Last week's sale of the company's life fund for £850m should have dramatically boosted its capital position but uncertainty remains about restructuring in the US. Fund manager Gerrard has pencilled in profits of £298m for the six months, down from £351m a year earlier.

The ferries division will be the main focus for investors when P&O posts half-year results on Thursday.

The company recently warned that the ferries operation was likely to perform below expectations due to price cuts by competitors, and the impact of higher fuel costs.

Gerrard is expecting improved fortunes at the company, and has forecast pre-tax profits of £50m against losses of £10m last time. Strong organic growth and acquisitions by its ports division should contribute to the figures.

Mining group Xstrata will show the benefit of its recent acquisition of Australian rival MIM when it updates the market on progress during its first half on Thursday.

The group will have made a full contribution to results and should help boost pre-tax profits to 575m US dollars (£312m) against 69m US dollars (£37m) previously, according to broker Charles Stanley.

Although margins remain under pressure from the continued weakness of the US dollar, demand for metal and coal is strong due to economic growth in the Far East, particularly China, and economic recovery in western economies.