Retailers to shine light on spending

Homebase's same store sales are forecast in a range of up 4 percent to down 8 percent.

Gross margins are forecast down 250 basis points at Argos and down about 350 basis points at Homebase, reflecting pressure on buying margins from the weakness of sterling.

In January, Home Retail lifted guidance for year to end-February 2010 underlying pretax profit to about 285 million pounds but warned trading would be tough this year.

Morrisons is set to post a 19 percent rise in underlying profit to 757 million pounds for the year ended January 31, according to the average forecast of 24 analysts polled by ThomsonReuters I/B/E/S Estimates.

The firm has outperformed bigger rivals Tesco, Asda and Sainsbury, for most of the past two years, helped by its focus on low prices, promotions and fresh food.

Its three-year "optimisation" plan, which has helped to boost profit margins by revamping IT systems and improving distribution, has come to an end, and some analysts think the group might set a new target.

Jefferies analysts think the firm could point to a further 150 million pounds of cost savings over the next three years.

However, a detailed strategy update, including whether Morrisons might revive a share buyback program, is likely to wait until at least September, when new chief executive Dalton Philips will have had time to settle in the job.

Morrisons reported a 6.5 percent rise in sales, excluding fuel and VAT, from stores open at least a year in the six weeks to January 3.

But industry data suggest sales have slowed since then, and analysts think the rise in underlying sales for the whole fourth quarter could be 5.0-5.5 percent.