Companies Reporting: Barclays, BAT, Unilever, NatWest

Our regular look at the FTSE 350 and other companies reporting from 10 – 14 February.

• Barclays looks to replicate strong results from US rivals
• British American Tobacco to update on impact of Canada litigation
• Unilever’s turnaround in focus
• NatWest looks to build on recent momentum

Barclays, full year results, Thursday 13 February

Matt Britzman, senior equity analyst, Hargreaves Lansdown: Investors will be watching for a potential £1bn share buyback with the bank leaning on its strong capital position – though nothing is guaranteed. Barclays LON:BARC has more exposure to the US than other UK banks, so there will be focus on how its US credit card customers are keeping up with repayments, as well as the usual eyes on UK loan default levels which have been robust of late. Interest rate expectations for 2025 will also be key, particularly any guidance on UK net interest income.

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Another big talking point will be the Investment Banking arm, after US rivals posted strong results. It’s a competitive arena and Barclays has struggled to keep pace of late, so strong growth here could help lift sentiment. On the flip side, higher costs, largely due to a rising UK bank levy, are expected to squeeze profits on a quarter-to-quarter view, with pre-tax profit forecast at £1.6bn.

Unilever, full year results, Thursday 13 February

Matt Britzman: Investors keen to see how Unilever LON:ULVR CEO Hein Schumacher’s turnaround strategy is taking shape. Last quarter, Unilever reported sales of €15.2bn, with underlying sales growth of 4.5%, beating market expectations.  We’ll be keen to see if Unilever has maintained its streak of consecutive quarters of positive and improved volume growth.  With inflation pressures easing, investors will also focus on whether price hikes have continued to moderate and how this impacts overall sales growth, with 3-5% growth the latest guidance for 2024.

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Gross margin improvement is another critical area, as the company aims for an underlying operating margin of 18% driven by cost saving initiatives . Updates on the productivity program and separation of the ice cream division will also be key.

British American Tobacco, full year results, Thursday 13 February

Derren Nathan, head of equity research, Hargreaves Lansdown: Despite the continued rapid decline of the tobacco market, British American Tobacco LON:BATS is set to deliver single digit growth in underlying revenue and operating profit when it reports 2024 numbers. But a strong US currency is inflating the value of its dollar denominated debt, meaning the balance sheet may look a bit more stretched than some may have hoped for.

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Attention now turns to 2025 guidance, where growth hopes largely rest with New Category products such as vapes. That said, the recent decision by the Trump administration to withdraw a proposed ban on menthol cigarettes removes one potential headwind to legacy products. We’re also expecting an update on the financial impact of the proposed multi-billion-dollar legal settlement in Canada which relates to historical cover-ups of smoking-related cancer risks.

NatWest Group, full year results, Friday 14 February

Susannah Streeter, head of money and markets, Hargreaves Lansdown: NatWest LON:NWG has been on a roll, with its share price doubling over the past year. It’s up 8% in 2025 so far, benefitting from the tailwind of positive sentiment towards UK stocks and by its third quarter results beating expectations. Despite the pessimism in the run up to and after the UK Budget, default rates remained at stable and low levels. However, with the economy stagnating and a recent forecast for UK growth this year revised down, there is a risk more loans could turn bad if the conditions take a turn for the worse. Although more interest rate cuts are on the cards this year, in the medium term they are expected to stay a bit higher for longer compared with previous forecasts.

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While more expensive borrowing costs could affect the broader economy, for NatWest higher rates build in improved underlying performance. It keeps the money the bank can earn from loans – net income margins – that bit more robust. There’s been continued progress in keeping costs under control and although mortgage pricing has been proving a little painful over recent quarters as more profitable business during the pandemic was replaced, that will drop out of the equation moving forward with profitability of new and existing business now the same.

NatWest is a big beneficiary of its large structural hedge. Banking books have inherent interest rate risk, and like an insurance policy, the hedge is designed to reduce this and smooth out net interest income. The way the hedge has been designed means it’s going to be rolling onto better rates in the coming years from some of the lowest rates in the sector, it’ll be another sector tailwind to enjoy.

This article has been brought to you in association with Hargreaves Lansdown. All opinions expressed in this article are from the analysts and do not necessarily represent the opinions of The Armchair Trader.

FTSE 100, FTSE 250 and selected other companies scheduled to report