Investors Chronicle articles from April 2004

Investors Chronicle archives from April 2004

Technological blight.
April 2, 2004... Read investors chronicle, read the financial pages of the national newspapers, read stockbrokers' research and there is a common assumption behind much of what is written - that a keen understanding of the technologies in which companies are...

Rational slumps.
April 2, 2004... Household debt hit a record high this week, prompting fears of a slump in spending as chickens finally come home to roost for spendthrift consumers. But let's put this into perspective. My credit card bill looks horrible right now, because I...

Cracks in China.
April 2, 2004... China is one of the world's great growth stories. As it has got to grips with market economics, growth has boomed and investment has flooded into the low-cost country, which also happens to be potentially the biggest market in the world. The...

Cosmetic improvements.
April 2, 2004... Say what you like about sexual equality, but men still get funny looks when they buy make-up. Even after seven years of buying it for TV, I still notice the furtive glances between the counter girls when I march in for the quarterly panstick...

The greatest story ever told.
April 2, 2004... I don't think I would employ many fingers totting up how many times my articles have moved markets, but I do look back with some satisfaction on the occasion when a piece of mine resulted in the total wipeout of a stock. The stock in question...

The red-tape burden.
April 2, 2004... Just ask Reed Health whether government regulation hurts. The temping agency, which supplies nurses to the National Health Service, has found itself squeezed by tighter rules this year regarding the type of staff it employs and the range of...

Engineering growth.
April 2, 2004... The UK engineering sector enjoyed a storming run in 2003, outperforming the wider market by 19 per cent amid hopes that a US-led global economic recovery will trigger a pick-up in capital spending. Rising gilt yields, an important influence on...

Twenty years on.
April 2, 2004... Over the past 20 or so years, 43 public sector companies have been privatised - with all but three of them coming to the stock market under Margaret Thatcher's premiership. And although she didn't invent privatisation, the policy has always...

Lonmin's nouvelle cuisine.
April 2, 2004... New Lonmin chief executive Brad Mills had been in the job barely 24 hours before summoning analysts for a strategy lunch last week, with diversification the main item on the menu. The group feels its shares would be more highly rated if it...

Universal Salvage hit by price pressures.
April 2, 2004... Universal Salvage, the scrap vehicle specialist, has issued the latest in a string of profit warnings. The company says the prices it's getting for salvaged cars are down, as is the volume of cars that it is processing through its sites. The...

Trial success for Celltech.
April 2, 2004... Celltech has reported that its CDP870 drug was effective in easing the symptoms of rheumatoid arthritis in trials on 250 sufferers. The drug achieved a 20 per cent reduction in the American College of Rheumatology (ACR) score, which measures...

Vernalis buys back migraine drug rights.
April 2, 2004... Vernalis is buying back the North American rights to Frovatriptan - its migraine drug - from marketing partner Elan, paying a total of $50m. Elan's salesforce is geared towards promoting specialist hospital products, but the 'triptan' class of...

Mayflower on the brink of sinking.
April 2, 2004... Shares in Mayflower were suspended at 6.75p this week when the automotive engineer told investors that its lenders were unlikely to offer better credit terms. This follows a series of profit warnings and the revelation this week that...

Dairy Crest hit by tough cheese sales.
April 2, 2004... Dairy Crest has reported that its cheese business has performed "below expectations". Numis Securities cut its pre-tax profit forecast for 2004 by GBP2m to GBP85m and for 2005 by GBP6m to GBP86m. Other parts of Dairy Crest's business performed...

Energy Technique aims for full recovery.
April 2, 2004... Energy Technique, the loss-making manufacturer of heating and air-conditioning equipment, is raising new money to expand its air-treatment business. The company also plans to step down from the main market onto Aim. Energy will raise GBP3m...

Tullow takeover trail.
April 2, 2004... Tullow Oil shares were suspended after it revealed it is in talks on a $500m reverse takeover of Energy Africa, a Johannesburg-listed exploration and production company. Energy Africa is majority-owned by Malaysia's Petronas. It has some...

Next week.
April 2, 2004... MONDAY 5 APRIL Finals: Burren Energy, Havelock Europa, Zi Medical AGMs: Henderson TR Pacific EGMs: Corpora Economics: UK February industrial production, manufacturing output TUESDAY 6 APRIL Interims: Bellway, Premier...

Company spending points to share price rises.
April 2, 2004... Equity investors have had some fantastic, but little-appreciated, news: company finances are improving sharply. Official figures show that non-financial companies' net lending - the gap between retained profits and capital spending - rose...

EMI to cut artists.
April 2, 2004... EMI has prepared the way for bumper profits this year, by outsourcing most of its CD manufacturing, and culling another 20 per cent from its artist roster. The company will take a GBP75m cash charge in the year to March 2004, leaving it...

Standard Life confirms float plans.
April 2, 2004... Life assurer Standard Life has confirmed that it plans to list on the stock market, in order to raise new capital. The company had defended the benefits of mutuality and survived a demutualisation vote in 2000, but pressure from the...

Bidding war erupts for Wembley.
April 2, 2004... Investors are gambling on MGM Mirage increasing its offer for casino operator Wembley, after American consortium BLB made a counter-bid on Tuesday. As anticipated after news of its stake-building emerged last month, BLB trumped MGM's offer...

From Russia with love.
April 2, 2004... BP delighted the markets this week by saying that it will return all free cash flow to shareholders via share buy-backs, as long as oil prices remain above $20 a barrel. It added that the downstream businesses - refining, marketing and...

Catlin to float.
April 2, 2004... Insurance group Catlin, which was due to float on London's main market on 1 April 2004 (after investors chronicle went to press), announced an offer price range of between 350p and 420p, valuing it at between GBP560m and GBP664m. "This IPO will...

3DM boosted by new licence agreements.
April 2, 2004... Shares in plastics technology specialist 3DM received a boost earlier this week with confirmation of new licensing agreements. To date, agreements signed have been for the company's PIM process, which allows the production of a plastic...

Investors profit from NAV uplifts.
April 2, 2004... Pressure on investment trust boards has resulted in a number of wind-ups and tender offers, which have lifted the trusts' share prices, narrowing their discounts to net asset value (NAV). Merrill Lynch European is offering investors the...

London debut for iBoxx and iShares.
April 2, 2004... Two ETFs, iBoxx Sterling Corporate Bond and iShares FTSE 250, started trading on the London Stock Exchange on 29 March. The iBoxx ETF tracks the 40 most liquid sterling-denominated, investment-grade corporate bonds and has a total expense ratio...

New issue round-up.
April 2, 2004... nThe arrival of more than 50 Aim new issues so far this year is evidence that the market for raising funds is strong. In March, a massive GBP340m was raised - that compares to just GBP2m at the same stage last year. Efforts to get this message...

High earners urged to top up contributions.
April 2, 2004... High earners should maximise this year's pension contributions by 5 April if they want to protect their funds under the chancellor's new post-2006 regime. Nigel Chambers, of IFA Alexander Forbes, says you should use an additional voluntary...

Foreign affair.
April 2, 2004... Chancellor gordon Brown's determination to close what he views as tax loopholes, reiterated in the Budget, could see Britons who own homes abroad hit with a hefty tax bill. Many UK residents set up an offshore company specifically to buy a...

Patient profits.
April 2, 2004... The best-performing stock in my DIY pension has been Patientline. I made a small investment in the business last May and the shares have more than tripled since. Naturally, after such a spectacular run, I've been wondering whether to bale out...

More misery at Sainsbury's.
April 2, 2004... Sir Peter Davis' last day as chief executive of Sainsbury's was marred by a profits warning and the revelation that underlying sales are still falling. The shares fell 7 per cent despite the simultaneous announcement of the sale of US...

A certificate of excellence.
April 2, 2004... Covered warrants are coming into their own as an asset diversification tool for sophisticated investors. The established wisdom among many commentators is that the great covered warrants revolution has been something of a damp squib. But a new...

SIGNET (SIG).
April 2, 2004... The tumbling US dollar is responsible for these anaemic-looking results. Signet generates over two-thirds of its turnover in the US, so little could be expected in the way of headline turnover and profits growth. But once exchange-rate...

ALKANE ENERGY (ALK).
April 2, 2004... Until the UK government gives Alkane a break and includes coal-mine methane in a green-energy support system, lobbying will continue. But to ensure its ongoing viability, Alkane acquired a 51 per cent stake in Germany-based Pro2 last year. That...

Spring Grove.
April 2, 2004... Aim. Despite a full-year loss, Spring Grove returned to profitability in the second half. The build-up of work levels from major contracts was slow in the first half of the year.

Symphony Plastic.
April 2, 2004... Aim. No longer a licensee seller, Symphony now owns its own technology. Cash-flow break-even was achieved in the year, but there is still a lot to be done.

Thomson Intermedia.
April 2, 2004... Aim. Sales, so far this year, are better than anticipated. Thomson is on the verge of delivering an improved product range from a third party. Over 80 per cent of client revenue was renewed.

Venturia.
April 2, 2004... Aim. Recognised revenue consisted of revenue deferred from earlier years. Venturia continues to look for a suitable acquisition.

What Doctors Don't Tell You.
April 2, 2004... Ofex. By developing a range of condition-specific reports, the group will focus on targeted sectors of the market here and overseas.

William Jacks.
April 2, 2004... Aim. Last year, Jacks sold two BMW dealerships. Significant trading losses in the latter period of ownership hit results. The launch of new models should provide a boost this year.

NICHOLS (NICL).
April 2, 2004... IN A shake-up of everything that could improve returns, Nichols has restructured its business, changed broker and decided to move to Aim. With more small company funds launching, it believes this move could attract more investors. It also hopes...

BARR (AG) (BAG).
April 2, 2004... AG Barr had a bumper year, thanks to the sweltering summer. Although demand tailed off in the second half, brands such as Findlay's Natural Mineral Water, Lipton Ice Tea and Simply Citrus all sold "extremely well" - even if the group is better...

INDEPENDENT NEWS AND MEDIA (INSW).
April 2, 2004... The tabloid version of The Independent caused a sensation in the newspaper industry - boosting the title's circulation by 15 per cent - but whether it will finally drag the newspaper into profitability is not clear. Launch costs, estimated at...

MUSIC CHOICE EUROPE (MUS).
April 2, 2004... Digital television broadcasters, such as BSkyB, now transmit numerous commercial radio stations and the internet is awash with countless more - all of which are free to receive. For those who want to pay, record labels and online distributors...

ENTERTAINMENT RIGHTS (ERT).
April 2, 2004... There are about 40m households in America that at own DVD players. And Entertainment Rights' chief executive Mike Heap says the $20m acquisition of the Filmation film library from Hallmark, announced alongside these results, opens the door to...

METAL BULLETIN (MTLB).
April 2, 2004... the fall in turnover last year conceals a strong recovery in the second half after the first half was hit by a number of "one-off" factors. These included the war in Iraq and the Sars virus, as well as Hurricane Fabian. The second-half...

TELEVISION CORPORATION (TCP).
April 2, 2004... Last year should prove a milestone for TV Corporation. The company sold its struggling post-production business Molinare and closed down its loss-making motor sports business Fastrax - both of which resulted in exceptional write-offs of...

NEWCASTLE UNITED (NCU).
April 2, 2004... The secret to running a successful football club is consistently achieving success on the field, while keeping a lid on costs. That's easier said than done and many leading clubs have got the balance wrong, with disastrous consequences. By...

GYRUS (GYG).
April 2, 2004... Gyrus battled against a headwind during 2003. With 85 per cent of revenues generated in the US, the depreciating dollar took its toll. Excluding the drapes business, which was sold in 2002, underlying revenues grew 6.6 per cent, but would have...

TED BAKER (TBK).
April 2, 2004... Ted Baker is opening another store in Covent Garden, London. However, this time the store will be named "Endurance" and will only sell Ted Baker's Endurance line of menswear. The GBP299 non-crease, Endurance suit, complete with mobile phone...

Guilty IFAs must be made to pay for their misdemeanours.
April 2, 2004... The Financial Services Authority (FSA) should clamp down on independent financial advisers (IFAs) that are escaping compensation payments relating to the mis-selling of products. Some IFAs facing liabilities for compensation have been going...

Pilat Technology.
April 2, 2004... Aim. The decrease in sales largely reflects adverse market conditions and the discontinuation of loss-making activities.

WHATMAN (WHM).
April 2, 2004... The rescue of Whatman is way ahead of schedule. Only 18 months since the turnaround team started overhauling the ailing and overextended business, it has already met analysts' 2004 forecasts. Drastic cost cuts have transformed cash flow. Staff...

ALLTRACEL (AP.).
April 2, 2004... Alltracel has developed a simple concept: using the cellulose in natural cotton for use in wound-care dressings. The powder forms a gel over the cut that stops the bleeding. To start with, the group licensed the ingredient to other first-aid...

CODASCISYS (CSY).
April 2, 2004... CODASciSys is in talks to sell the two major divisions of the SciSys business to Vega, in a deal that could be structured as a reverse takeover. SciSys' space and defence arm delivered an operating profit of GBP1m. But contract deferrals in the...

EVOLUTION (EVG).
April 2, 2004... Evolution saw a sharp improvement in trading in 2003, but it wasn't quite as good as the numbers below suggest. The results for 2002 were hit by investment write-offs, while numbers for last year were flattered by a GBP15m profit from the...

INTERMEDIATE CAPITAL (ICP).
April 2, 2004... Intermediate Capital (IC) continues to benefit from its decision to build up its presence on the Continent. European loans now account for 70 per cent of its portfolio. With strong demand for mezzanine finance to fund buyouts, the group...

S&U (SUS).
April 2, 2004... S&U's recovery from the problems that hit it two years ago is evident in these results. The bad debt charge, which ballooned after fraud problems in its London business, has returned to a more usual 5.5 per cent of loans, while pre-tax profits...

REGUS (RGU).
April 2, 2004... Regus's rehabilitation is now complete. The group emerged from Chapter 11 bankruptcy in the US late last year, having closed down offices and renegotiated onerous property leases. The restructuring has saved GBP65m a year from overheads, which...

SVB (SVB).
April 2, 2004... SVB has come a long way since hitting the rocks in 2001 with its US liability book. Sure, the Lloyd's insurer isn't out of the woods yet with its liability business (which posted a GBP22.8m underwriting loss last year), but it exited the...

NEXT (NXT).
April 2, 2004... An accusation often levelled at Next is that its stores are boring and its clothes are unexciting - an accusation that can't be levelled at its shares. Over the past five years, earnings have grown 171 per cent thanks to Next buying back 29 per...

HARDY UNDERWRITING (HDU).
April 2, 2004... In the midst of a healthy insurance market, Hardy reported an 81.2 per cent combined ratio, leaving it among the sector's most profitable underwriters. And with 88 per cent of its managed syndicate capacity under its belt, Names don't have too...

MINERVA (MNR).
April 2, 2004... As part of its ambitious retail development in Park Place, Croydon, Minerva took over struggling department store group Allders, via a 60 per cent stake in a joint venture, Scarlett Retail. Losses at Allders and the finance costs of the deal...

CAPITAL & REGIONAL (CAL).
April 2, 2004... The strength of Capital's results took the market by surprise. Consensus expectations had been for net assets of 491p and earnings of 16p - small wonder the discount to fully-diluted net asset value (NAV) of 521p vanished. Capital...

BRIXTON (BXTN).
April 2, 2004... Improved sentiment towards the property sector contributed towards the success of Brixton's rights issue last month, which raised GBP68.5m to help fund acquisitions. Brixton is paying GBP111.4m to acquire the 50 per cent share that it doesn't...

OYSTERTEC (OYS).
April 2, 2004... Pipe-fitting manufacturer Oystertec has thundered into profitability from a trading loss of GBP1.6m in 2002. Profits reached GBP5.8m in 2003, of which GBP4.3m came in the second half. Excluding GBP12.5m of sales from its joint venture...

The price of research.
April 8, 2004... Go back some years and I had little doubt about the companies that had to - or wanted to - spend wadfulls of cash on research and development (R&D). The bosses of these businesses insisted that their R&D spending was fuelling future growth -...

Real hype in real estate.
April 8, 2004... UK quoted property shares have enjoyed a storming run during the past 12 months, as the excitement surrounding the introduction of real-estate investment trusts (REITs) in 2005 reaches fever pitch. Bullish observers reckon these tax-exempt...

Jobs for the girls.
April 8, 2004... One thousand job cuts at Standard Life. Fifteen hundred lay-offs at EMI. One thousand posts axed at Marks & Spencer. It appears another jobs massacre is underway. But the key word here is 'appears' - and appearances are deceptive. While it...

Yu Shi Ju Jin.
April 8, 2004... Last 7 November, I ventured the opinion that all our carefully crafted micro-investment decisions could be diluted beyond significance by two mega trends - the US trade deficit and China's emerging manufacturing supremacy. I suggested that the...

The new frontiers.
April 8, 2004... The capital city is "a study in poverty", according to one western journalist who recently visited. There are open sewers, ruined buildings and starving children scavenging alongside dogs on mounds of rotting rubbish. The countryside is barely...

Next week.
April 8, 2004... Monday 12 April - Bank Holiday Tuesday 13 April Economics: UK February house prices Wednesday 14 April Interims: Associated British Foods, St Ives Finals: Henry Boot, JJB Sports EGMs: Informa Associated British...

iSoft in joint-venture with Microsoft.
April 8, 2004... iSoft chief executive Tim Whiston says this week's partnership agreement between the medical software vendor and Microsoft has more substance than the usual run-of-the mill marketing deals. Software developers are awarded various levels of...

Aveva warns of contract delay.
April 8, 2004... Aveva, the industrial design software vendor, has warned that a delay in signing a large contract will see it miss full-year revenue forecasts by about GBP500,000. But the delay is not significant. Chief executive Richard Longdon says the...

SkyePharma closer to royalty-based income.
April 8, 2004... SkyePharma has licensed the European rights to DepoMorphine to Medeus Pharma, in the first of three delayed deals needed to take the drug delivery specialist into profits. The drug - a slow-release, injectable version of morphine - will be...

Housebuilders shine again.
April 8, 2004... The housebuilding sector has once again proved that it's one of the safest places to be between January and March. For the fourth year in a row (and the eighteenth time in the past 20 years), housebuilders outperformed the FTSE All-Share index...

Mushy peas send trucker skidding.
April 8, 2004... Just as it seemed that Christian Salvesen's long haul of misery might have ended, the trucking group has once again admitted that it will not meet profit expectations. Accidentally-thawed frozen peas are the culprits this time - the company is...

IFX trading improves.
April 8, 2004... Having told investors only a month ago that it would fail to meet profit expectations for the year, IFX Group has said that the situation isn't as bad as it first seemed. The financial trading and spread betting firm was hit by the sharp moves...

ScS Upholstery shares spring into action.
April 8, 2004... Shares in ScS Upholstery sprung into action this week after the sofa maker confirmed business is back on track after November's profit warning. Underlying sales have surged 7 per cent in the six months to 31 March, and pre-tax profits for the...

Pipex sets its sights on Host Europe.
April 8, 2004... Pipex, the broadband and telecoms firm chaired by entrepreneur Peter Dubens, has another company in its sights. It's looking to acquire Host Europe (HE) in an all-cash deal for GBP31.2m, or 2.549p a share. Pipex first announced its intentions...

The Market Age nears profitability.
April 8, 2004... Shares in internet content provider The Market Age (TMA) rocketed this week on news that strong sales continue to push it towards profitability. The company also revealed that it's seeking advice on protecting the GmailTM trademark, following...

Dignity float at a dignified price.
April 8, 2004... Besides taxation, death is this world's only certainty. Accordingly, the burial business is one of the steadiest industries around. Now investors have the opportunity to benefit from this eternally thriving trade during their lifetimes,...

Turning pennies into pounds.
April 8, 2004... Finding a penny share that multiplies in value several times over is the stuff investors' dreams are made of. And if you're willing to buy a selection of penny shares - priced at say 10p or less - there is every chance that some will be big...

Floors 2 Go aims for rapid expansion.
April 8, 2004... Laminate wood retailer Floors 2 Go joined Aim last week to help fulfil its plans for rapid expansion. The company trades from 100 outlets and is predominantly focused on the retail trade, selling a wide range of laminate and hardwood flooring...