SIR TERRY Leahy is likely to warn of still tougher times ahead for the UK's grocery trade when he is due to produce his latest trading update for the dominant Tesco supermarkets chain on Tuesday.

Brokers believe the chief executive will admit like-for-like sales growth has slowed and margins fallen, weeks after the group announced a "strong" start to its trading year in the middle of April.

"At the time, he was able to show a 4% increase in like-for-like business, incorporating the effects of 1.5% inflation for the opening five weeks of the year," commented one observer. "But we believe that conditions have deteriorated since then and food costs have risen, while underlying growth may have fallen back to as little as 3%."

The latest update comes as Tesco promotes another round of price cuts in a bid to protect its 30%-plus share of the grocery market, n the face of increasing competition, particularly from the revitalised Morrisons chain.

Followers say the tougher conditions in its home market means Tesco will step up its expansion overseas and in non-food sectors.

The group recently announced victory in its £156 million takeover of the Dalkeith-based Dobbies Garden Centres and paid almost £1 billion for a chain of Korean supermarkets.

It is also in advanced talks to buy out its partners at Royal Bank of Scotland in Tesco Finance, which made £128m profit last year. and has 5m customers.

It is likely Sir Terry will announce he is ending the freeze on expansion at the group's fledgling US operations despite trades union opposition, and will confirm the opening of its 62nd Fresh'n'Easy store in the wealthy Californian town of Manhattan Beach. where residents include Johnny Depp and Rachel Hunter.

Despite tougher times at home, most brokers still expect Tesco to lift profits by 10% to about £3.1bn this year because of the growth of its international and non-food businesses.

Marketing group Media Square, owner of Edinburgh's Smarts public relations agency, will count the cost of a strategic review with news of heavy losses and write-downs on Tuesday.

New chief executive Roger Parry, who said the previous structure was "held together by bits of string and Blu Tack", will announce some £5m restructuring costs and a further £16m writedown of goodwill after selling or merging some 25 business units.

Brokers at Collins Stewart say the group should make £2m profits this year, although the company's shares have been testing new lows at about 5.5p, valuing the business at £17.7m.

Design consultancy Hyder is expected to double its dividend payments tomorrow when directors announce a lift in underlying profits from £10.4m to as much as £13.9m on last year's trading.

The figures were boosted by architectural work on the Burj Dubai Tower - the world's tallest building- and other 100-storey plus skyscrapers in the Middle East, although there are concerns directors will confirm a slowdown in UK business.

Carphone Warehouse should confirm a lift in profits from £123m to about £218m when it finally announces annual results on Thursday - a week later than originally expected.

Debts are likely to show a jump from £600m to about £840m as a result of its heavy promotion of the AOL and Talk Talk internet services, but the company is due to pick up £1bn cash from the sale of a half share in its retail businesses.

AIM listed property services and fund management group First Property should justify its decision to concentrate on eastern European markets with news of a jump in annual profits from £1.2m to as much as £6m on Wednesday.

Safety equipment specialist Latchways should also defy gloom over the UK property and construction sector tomorrow when brokers expect to hear of a lift in annual profits from £7.8m to about £9m, helped by increased demand for its fall protection equipment for wind turbine constructions.

Business telecoms and IT services group Redstone should announce its long-awaited breakthrough into profits on Tuesday after a series of small acquisitions in the past year or so.

Analysts at KBC Peel Hunt expect the group to replace previous losses with annual pre-tax profits of about £9m and believe the group will take a bigger part in future industry consolidation after directors announced plans to increase borrowing limits from £25m to £100m.