City File: Sterling faith

Investors in P&O have put a great deal of faith in the assurance from Lord Sterling, the chairman, that they will not have to wait too much longer until the property division comes good. It is proving a long haul.

Tuesday's results, expected to show a pre-tax rise of pounds 20m to pounds 220m, will be accompanied by a write-down of about pounds 30m on the land bank and about pounds 80m on investment properties.

But future big write-downs are unlikely, and profits and values of both housebuilding and property should begin to pick up this year. The benefits of sterling's devaluation are beginning to feed through and other parts of the empire, such as the ferry business, are holding up well. So there seems little reason not to expect P&O to maintain its dividend at 30.5p.