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The Scotsman: IPods and oil set to power up profits

THE WEEK AHEAD
MARTIN FLANAGAN
SCOTTISH group Wolfson Microelectronics is expected to unveil doubled full-year profits on Wednesday, helped by the surge in popularity of iPod music players.
Wolfson, which makes the chips that change digital signals to analogue ones so that people can hear sounds or see images, said in October that demand for chips used in iPods and other consumer electronics had accelerated since its July update.
Analyst Ian Robertson at broker Altium Securities said the group's results should be “impressive”. Robertson said: “The recent news flow from other semiconductor companies, except Intel, has been comforting, giving us increased faith that Wolfson will have had a good end to the year.” Altium predicted pre-tax profits of $32 million (£18m) against $15m in the previous 12 months.
Star turn on the big reporting canvas this week will be oil major Royal Dutch Shell, with many analysts believing that its first set of full-year results as a unified company will be marked by the biggest profits performance in UK corporate history.
Analysts expect Shell to reveal on Thursday that it made $23 billion (£12.9bn) in 2005, fuelled by buoyant oil prices, against $17.6 billion the previous year.
That is despite hurricane damage in the Gulf of Mexico meaning that Shell's production in 2005 was about 3.5 million barrels of oil a day – at the bottom end of earlier targets laid out by the group.
There should be information about the cost of repairs to rigs in the region and whether they are in line with Shell's estimates at the end of October, along with the group's forecast for oil and gas output in 2006.
On the “current cost of supplies” measurement, Shell is expected to report earnings of $5.48bn in the fourth quarter compared with $5.22bn in the same period of 2004.

Strong sales of blockbuster drugs are expected to inject life into pharmaceuticals giant AstraZeneca's full-year figures on Thursday.
The British-Swedish company forecast sales growth around the double-digit mark in an update in October, after sales of its top five medicines rose 25 per cent in the three months to September.
Anti-obesity drug Crestor and ulcer treatment Nexium are among the company's biggest-selling products.
Analysts will be interested in any more news on Astra's pipeline of new drugs – the firm recently struck four deals in the course of a month, including the £121m acquisition of KuDOS Pharmaceuticals.
According to a consensus of analysts' forecasts, operating profits for the full year should be about $6.5bn against $4.77bn last time.
Soaring fuel costs will be a major factor in lower third-quarter profits from British Airways on Friday after it forecast an annual fuel bill of £1.67bn in November.
But another issue of concern is the airline's £1.3bn final salary pension deficit, which is one of the biggest among FTSE 100 companies.
Pre-tax profits for the three months to the end of December are expected to come in at £145m against £151m last time, according to a consensus of analysts.
Satellite broadcaster BSkyB hit its goal of eight million UK subscribers by the end of 2005 but the City will be interested in how its “churn rate” – the percentage of subscribers that leave BSkyB each year – has turned out after putting prices up by between £1.50 and £3 per month in the summer.
The consensus estimate for operating profits for the six months to the end of December stands at £399 million – up from £354m in the same period of 2004.
This article: http://business.scotsman.com/index.cfm?id=147942006
Last updated: 30-Jan-06 02:25 GMT

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