Investors Chronicle articles from December 2006

Investors Chronicle archives from December 2006

Aiming higher.
December 1, 2006... It's been a tough few months for Aim. The market has been one of London's crown jewels for the past few years, but life has suddenly got tougher. The Alternative Investment Market (Aim) All-Share index has underperformed the FTSE All-Share by 6...

Reverting to type?
December 1, 2006... Churchill was pigheaded, Elizabeth I was independent and goal-oriented, while her father, Henry VIII, was a moody attention seeker. All of this, apparently, can be gleaned from the wartime prime minister's small and hasty handwriting, the...

I came, I saw, iPod.
December 1, 2006... Ienjoy music, but only in certain contexts. A few years ago, when I emigrated from the investors chronicle's office to work from home, I dusted down my pathetically modest music collection, recollecting that, in my student days, The Beatles,...

Putting theory into practice.
December 1, 2006... As Wall Street teetered on the edge of the Great Crash of 1929, who was it who said that there was no price too high to pay for a great growth stock? For once, Google fails me and I can't find the answer. Among the colourful characters of that...

Smell the coffee.
December 1, 2006... I have a confession to make and one that could be potentially profitable: I am addicted to an early morning Americano - two shots made from the finest Arabica beans, followed by a hefty dose of steaming hot water, and all for the bargain price...

Orchard pillage.
December 1, 2006... Sunday 29 October: Investing in disability I finally got my Excel spreadsheets to work correctly. I even wrote a formula that gives me my overall year-to-date return! Unfortunately, this works out at precisely zero, while the Footsie is up...

ITV makes the Grade.
December 1, 2006... Only last week we wrote: "If ITV can find itself a dynamic new chief executive, it might just be able to pull off a Marks and Spencer-style revival." Well, that new boss has now been found - ITV announced this week that Michael Grade,...

Protherics takes Digitalis to heart.
December 1, 2006... Protherics has snapped up the marketing rights for heart drug Digitalis Antidot from Roche. The company plans to replace Roche's product with its own drug, Digifab, early next year. Roche's drug is sold in Germany, France and Switzerland, and...

Competition leaves Low & Bonar feeling green.
December 1, 2006... Low & Bonar said this week that its artificial grass business was suffering from increased competition and that raw material prices remained high. Still, a better-than-expected performance from recent acquisition Colbond, and solid trading in...

Quotes of the week.
December 1, 2006... "A profitable biotech? I know - it's like you've banged your head or something!" Terry Sadler, chief executive of dermatology specialist York Pharma, explaining that the imminent launch of the company's anti-fungal product Abasol could...

BAE's American coup.
December 1, 2006... BAE Systems has announced a $1.2bn (GBP595m) contract to refurbish 610 Bradley fighting vehicles for the US Army, twice the size of the previous year's order. That relieved pressure on the shares from speculation that a Serious Fraud Office...

Cairn India goes down well in Malaysia.
December 1, 2006... Cairn Energy has gained 3 per cent since it pre-placed almost 40 per cent of the Cairn India shares that it will soon list on the Indian stock exchange. The price prompted analysts to upgrade forecasts for its final take. Malaysian state oil...

Old Mutual disappoints.
December 1, 2006... Old Mutual's strong third-quarter performance in Europe and the US was spoiled by a disappointing return from its South African operations. Investment performance there was weak, and a number of large multi-manager mandates were lost, while...

Principle pulls Nord Anglia bid.
December 1, 2006... Principle Capital, the investment group founded by shareholder activist Brian Myerson, has pulled its mooted 200p-210p bid for Nord Anglia Education following recent full-year results. While Nord Anglia's nursery business is still struggling,...

Premier Oil in bid war.
December 1, 2006... A bid battle for Premier Oil could be shaping up as Indian state-run ONGC has indicated it is considering an offer for the company through its ONGC Mittal joint venture. Premier has already announced an approach from an unknown suitor, rumoured...

Scott Wilson's East-End boost.
December 1, 2006... Engineering consultant Scott Wilson has announced that it has won work worth up to GBP14m on the East London Line. When the company floated in April, it highlighted this job, along with Edinburgh International Airport and Crossrail, as one of...

BHP eyes US merger.
December 1, 2006... US-based Freeport McMoRan's plan to create the world's largest publicly-listed copper company - by buying fellow American producer Phelps Dodge - has ignited speculation that BHP Billiton might scupper the deal by bidding for either...

Wilson Bowden in the spotlight after hoisting for-sale sign.
December 1, 2006... Wilson Bowden has become the latest housebuilder to attract takeover interest after announcing it is in bid talks. Chairman and founder David Wilson reportedly hired an investment bank this year to explore options for his stake. That got the...

Lidco comes unstuck.
December 1, 2006... Lidco's shares fell 14 per cent after the company issued a gloomy trading update. As highlighted at the half-year results in October, the company is seeing aggressive competition from major US competitor Edwards, which is trying to persuade...

London Asia takes 12 per cent stake in Asia Wind.
December 1, 2006... The London Asia Chinese Private Equity fund has invested GBP3m for a 12 per cent stake in Asia Wind. Wind projects that London Asia Capital has been working on in China, India, Indonesia, Malaysia, Vietnam and Mongolia, will all be rolled into...

EMI attracts bid.
December 1, 2006... Music publishing and recording company EMI has received a bid approach. The shares rose 12 per cent, to 293p, on the news. Analysts believe the earlier 320p offer from Warner will set a benchmark for any takeout price. EMI now trades on a...

The week ahead.
December 1, 2006... Monday 4 December Interims: Acal, e2v technologies, i-mate, LitComp, Minorplanet Systems, Vp Finals: CareTech, Hardide EGMs: Worthington Nicholls Economics: UK CIPS November construction PMI Tuesday 5 December ...

City predicts a lean Christmas period for UK retailers.
December 1, 2006... Research by UK brokers suggests Christmas will be bleak for UK general (or 'non-food') retailers. "Christmas in 2006 will be worse than 2005 and could be as difficult as, or even softer than, 2004, which was the worst Christmas for 23 years,"...

mining Evaluation changes to boost Russian miners.
December 1, 2006... Aim's Russia-focused miners could enjoy a substantial rerating towards the end of next year if a new method of evaluating how much metal they have in the ground achieves wide recognition. The existing Russian system isn't widely used...

Roc Oil shuns UK investors.
December 1, 2006... UK shareholders in Aim-traded Roc Oil are up in arms after they were excluded from the company's recent three-for-eight rights issue. The company is raising A$219m ($88m) from Australian shareholders - primarily institutions - to fund the...

Drug trial data is just the tonic for Glaxo.
December 1, 2006... News that Novartis' new diabetes product, Galvus, has disappointed in the clinic is a shot in the arm for GlaxoSmithKline (GSK). The drug is a potential rival to GSK's Avandia. But two-year trial data released this week shows that Galvus is not...

Impairment charges trouble Barclaycard.
December 1, 2006... Barclays' trading update may have reported good news from most of its operations this week - UK banking, the international division, Barclays Capital and Barclays Global Investors all performed well - but it's a different story at Barclaycard....

RSA looks to the East.
December 1, 2006... Royal & Sun Alliance (RSA) has signed an agreement with Israeli insurer Direct Insurance Financial Investments to form a joint venture to access markets in Eastern Europe and Russia. RSA will invest a total of GBP88m in the venture. This...

ScottishPower turned on to Iberdrola bid.
December 1, 2006... ScottishPower has recommended an GBP11.6bn bid from Spanish utility Iberdrola. The offer consists of 400p cash and 0.1646 of an Iberdrola share for each ScottishPower share. ScottishPower will also pay a 12p special dividend and, including...

No festive cheer from the Treasury.
December 1, 2006... Gordon Brown will deliver what is likely to be his final pre-Budget Report (PBR) on Wednesday 6 December, but it is unlikely to contain much good news for investors. It seems improbable that the chancellor will remove stamp duty on share...

Still worth a venture.
December 1, 2006... Venture capital trusts (VCTs) have been extremely popular with investors over the past two tax years, as chancellor Gordon Brown offered a 40 per cent income-tax rebate on investment in new VCT shares. But even though this rebate has now been...

The long arm of the UK taxman.
December 1, 2006... The UK taxman has a long arm when it comes to reaching after UK taxpayers who think they've escaped his clutches by settling down to a new life abroad. And now, following a recent court ruling, he can reach even further. So, while you can...

The new way of deriving profits.
December 1, 2006... The use of derivatives opens up a world of opportunities for product providers, but the same is not necessarily true for private investors. So you should always ask yourself if a new derivatives product holds any advantages over more...

HALFORDS (HFD).
December 1, 2006... These results reveal that Halfords is driving smoothly in cruise mode. Underlying sales rose by 6.5 per cent (around 5 per cent, adjusting for the timing of Easter), and finance director Nick Carter believes this strong performance is down to...

LONDON MERCHANT SECURITIES (LMSO).
December 1, 2006... Central London office group London Merchant Securities (LMS) has demonstrated just what it has to offer following its merger with Derwent Valley. The group reported a hearty 11.1 per cent like-for-like increase in its portfolio valuation...

CIREF (CRF).
December 1, 2006... According to Mike Watters, a non-executive director of Ciref and chief executive of Corovest (which manages Ciref's property investments), Ciref is seeking the holy grail of being "a growth stock with a high dividend". Already, the dividend...

SUTTON harbour (SUH).
December 1, 2006... Sutton Harbour has made progress with its plans to redevelop a former boat yard in Plymouth. The company now has planning permission for 101 apartments, 31,000 sq ft of office space and 8,000 sq ft of retail space, and the BBC has already been...

YORK PHARMA (YRK).
December 1, 2006... "The company's in really good shape," boasts chief executive Terry Sadler. And York Pharma is now on the verge of seeing its first product hit the market. Abasol, a treatment for fungal infections of the skin, is under review by the UK...

UBC MEDIA (UBC).
December 1, 2006... UBC's results were dominated by the announcement that its digital music download (DMD) service is due for full national launch in May 2007. This service will allow real-time downloads of tracks from radio stations as the listener hears them,...

AVESCO (ASO).
December 1, 2006... Avesco clocked up a solid six months of organic growth, boosted by the establishment of offices in Las Vegas and Cologne. It also made two acquisitions: a small audio-visual rental firm in Holland, and MVS, a specialist provider of radio...

TELFORD homes (TEF).
December 1, 2006... With its focus on London's east end, Telford is in pole position for the 2012 Olympics. All 179 private homes at its OneStratford development were snapped up in the first half as buyers were quick off their marks to grab a piece of the Olympic...

RM (RM.).
December 1, 2006... RM is the UK's leading IT supplier for schools. Not only does it install and run the equipment, but it provides training, too, making it a stable business. And despite investing in the bid process to win a chunk of the Building Schools for the...

DANIEL STEWART SECurities (dan).
December 1, 2006... The crash in online gaming shares SPOILT the first half for Daniel Stewart. The company held a number of investments in these shares, principally options in World Gaming. So the changes to US legislation covering the sector wiped GBP2m from the...

PROVENTEC (PROV).
December 1, 2006... Proventec's business is growing slowly but surely, and these results were boosted by the disposal of part of its shareholding in Aim-listed Hardide, and its entire interest in the Ultra Motor Company - both legacy stakes from its previous...

SILVERJET (SIL).
December 1, 2006... Silverjet, which floated on The Alternative Investment Market (Aim) at 112p in May, should soon become the UK's first low-fare business-class airline. Chief executive Lawrence Hunt says he is "feeling very confident" that Silverjet will launch...

ARLA FOODS (ARU).
December 1, 2006... Arla's restructuring programme resulted in further exceptional charges. The remaining Express depot-based doorstep business was sold to Dairy Crest in August - leading to a disposal loss of GBP15.4m - and Arla also took a GBP7.2m hit from a...

FULLER, SMITH & TURNER (FSTA).
December 1, 2006... A hot summer was good news for the publicans at Fuller Smith & Turner. The Gales estate of pubs, acquired last year, are better performers in the warmer months, which helped balance the group's former weighting towards winter. So, now with...

UNITED DRUG (UDG).
December 1, 2006... After six acquisitions in the past two years, it's not surprising that United Drug is delivering decent growth. In fact, adjust for last year's exceptional GBP8.9m property gain, and pre-tax profits (before amortisation of intangibles and...

DART (DTG).
December 1, 2006... Dart's low-cost airline Jet2.com has really taken off. It now serves 32 destinations from its six bases in the north of the UK and plans to expand its network by more than 30 per cent next summer. Jet2.com is also seeing good growth in...

RENOLD (RNO).
December 1, 2006... Renold hasn't thrown off the industrial chains it produces, it's just making them more efficiently now. That's because manufacturing in the core industrial chains business is moving to lower-cost areas in Poland, Malaysia and China, and...

MICE (MEG).
December 1, 2006... Mice is an interesting proposition. Although it bills itself as a global marketing services group, a little under half of its business is in low-margin shop-fittings manufacturing in the UK. Turnover there was up 26 per cent to GBP53m, but the...

DAILY MAIL & GENERAL TRUST (DMGT/DMGO).
December 1, 2006... The stunning rise in profitability at Daily Mail & General Trust (DMGT) was largely down to a profit of GBP174.8m on the disposal of businesses. On an adjusted basis (which excludes amortisation and impairment of intangibles, as well as those...

GCAP MEDIA (GCAP).
December 1, 2006... These results reveal that times remain tough for GCap, with management reporting a particularly poor June and July, as advertising revenue was negatively impacted by the football World Cup. However, the decline in advertising turnover cannot be...

EROS INTERNATIONAL (EROS).
December 1, 2006... This is the first set of results since Bollywood film specialist Eros listed on Aim in July. And its performance looks good - Eros says that pre-tax profits (before goodwill amortisation) doubled, year on year, to $9m (GBP4.6m). What's...

ASOS (ASC).
December 1, 2006... This strong set of results left ASOS looking all dressed up with somewhere to go. The group provides affordable celebrity-inspired fashion - for example, it offers a backless sequin dress "in the style of Kate Moss" over the internet for GBP65....

HOMESERVE (HSV).
December 1, 2006... Homeserve has built a successful business in the UK out of insuring against, and fixing, household mishaps such as blocked drains and burst pipes. And now it's turning its attention to the US. The company made significant progress there during...

TOPPS TILES (TPT).
December 1, 2006... Topps Tiles saw underlying sales drop by 1.8 per cent in the period, but the picture is now much brighter: in the first seven weeks of the new financial year, like-for-like revenue increased by a respectable 3.3 per cent, as the tiles and...

TRIBAL (TRB).
December 1, 2006... Tribal's shares fell 11 per cent on disappointing results from its public-sector consulting business. Consulting revenues fell 15 per cent and divisional operating profits tumbled 58 per cent during the period. However, Tribal's Mercury...

DE LA RUE (DLAR).
December 1, 2006... De La Rue could find it a struggle to improve on its recent stunning performance. And that's because its mature banknote business is experiencing a cyclical high at the same time as the group reaps the benefit of moving production to China - a...

KINGSTON COMMUNICATIONS (KCOM).
December 1, 2006... The sharp rise in Kingston's dividend can be interpreted two ways: it could be either be seen as statement of confidence in the business or, alternatively, as a necessary sop to the largest shareholder, Hull City Council (which holds 31 per...

KELDA (KEL).
December 1, 2006... Kelda, which owns Yorkshire Water, has announced plans to return GBP750m to shareholders once the disposal of its US water business, Aquarion, is completed. Aquarion was sold to Macquarie for $860m (GBP441m) in February and the deal is just...

RENEW (RNWH).
December 1, 2006... Renew's first results in years without any exceptionals beat City expectations. All seven of the company's businesses traded profitably in the year, with the order book reaching GBP208.7m, against GBP193m the year before. In most of its...

TOROTRAK (TRK).
December 1, 2006... After years of development, Torotrak is finally about to see its gearbox technology enter volume production. Infinitrak, a 50:50 joint venture with US company MTD, will use Torotrak's infinitely variable transmission (IVT) technology to make...

RENOVA ENERGY (RVA).
December 1, 2006... Renova successfully increased production capacity by 140 per cent during the period thanks to the construction of a new plant at Torrington in Wyoming - and this proved good timing as the ethanol price surged to $2.80 a gallon soon after. The...

CHARACTER (CCT).
December 1, 2006... "The sale of our digital business was the best thing that could have happened to us," says Character chairman Richard King. The disposal was completed in February, and the company is now reaping the benefits of a three-year strategy to take...

SAGE (SGE).
December 1, 2006... Sage has always prided itself on providing "local products for local markets". But while user interfaces will remain regionally tailored, the company is gradually standardising the technology underlying its products. Recent acquisitions have...

WS ATKINS (ATK).
December 1, 2006... WS Atkins' solid performance was overshadowed by its 20 per cent stake in underground contracting consortium Metronet, which knocked GBP1.4m off first-half pre-tax profits. A recent three-year review by Metronet's independent arbiter, Chris...

HELICAL BAR (HLCL).
December 1, 2006... "When you get to the top of the market you need to spread your risk," says Helical Bar's chief executive Mike Slade. So he has been spreading the developer's risk through joint ventures and by targeting a range of niche markets. Among the...

COMPASS (CPG).
December 1, 2006... Having sold off various parts of its business for GBP1.8bn and with plans to slim its operations down further, Compass now looks like less of a dog's breakfast. It is more focused on its core catering activities and has lighter debts. Still,...

GRAINGER TRUST (GRI).
December 1, 2006... Grainger invests in regulated tenanted housing that it sells once it becomes vacant, and it has benefited in two ways from the seemingly insatiable appetite for UK residential property. First, regulated properties have been changing hands at...

INTERMEDIATE CAPITAL (ICP).
December 1, 2006... Intermediate Capital arranged or provided a record GBP736m of funds, spread across 19 deals, which, coupled with a strong fund-management performance, pushed profits sharply higher at the half-way stage. The company provides mezzanine finance -...

CALEDONIA INVESTMENTS (CLDN).
December 1, 2006... Since it took on investment trust status in April 2003, Caledonia has delivered strong outperformance, as evidenced by the fact that the share-price discount to the company's net asset value (NAV) has narrowed from 30 per cent back then to just...

FERRARIS (FER).
December 1, 2006... Back in January 2006, Ferraris HOPED TO sell its poorly performing non-core cardiac and respiratory monitor businesses for GBP20m. What it actually received was just over GBP14m, and this led to the sharp fall in this year's share price. ...

INTELEK (ITK).
December 1, 2006... Intelek's share price ticked up on news of these interim results - and rightly so. As well as higher sales and profits, there was (excluded from the table below) a GBP3m pension transfer gain because Intelek, like many other firms, has...

RED ROCK RESOURCES (RRR).
December 1, 2006... Red Rock has changed tack again. When it joined Aim in July 2005, the company's main investment was exploration acreage in the East Pilbara area of Western Australia. There, it holds licences over nearly 700 sq km of rich manganese acreage,...

CONTENTFILM (CFL).
December 1, 2006... cult film maker ContentFilm took over poorly performing film financier and marketer Winchester Entertainment in March 2004, and then spent the next 12 months cutting costs. As a result, in the year to end-March 2006, losses were much reduced...

AVANTI CAPITAL (AVA).
December 1, 2006... Private equity companies don't wind up too often, but Avanti Capital is about to do just that. The firm is not going to make any new investments, and will now return cash to shareholders via share buy-backs. It bought back GBP2m-worth of shares...

DOMESTIC & GENERAL (DGG).
December 1, 2006... Warranty insurance specialist Domestic & General's operating profit before investment returns rose by a solid 17.9 per cent during the period to GBP13.8m. Warranty profits were boosted by a continuing low claims ratio, which helped drive down...

TOUCHSTONE (TSE).
December 1, 2006... Touchstone's share price has been rising steadily for almost two years, and now has further to go. The company's two main software products deal with customer-relationship management and enterprise report planning, respectively. But, by far its...

VICTORIA OIL & GAS (vog).
December 1, 2006... For once, Victoria Oil & Gas did nOT appear in TD Waterhouse's weekly review of the shares most heavily traded by private investors. In fact, the shares perked up 10 per cent on these results as bears on the company covered short positions in...

CARDPOINT (CASH).
December 1, 2006... After a year punctuated by profit warnings and bid approaches, it is little wonder that recently appointed chairman Bob Thian was expecting the worst when he joined the cash-machine operator. However, he has now changed his tune: "I had been...

IMAGINATION TECHNOLOGIES (IMG).
December 1, 2006... Imagination Technologies trades on its intellectual property. It licenses designs to semiconductor manufacturing partners for an upfront fee, with royalties received whenever chips are shipped. And a strong performance in handsets - with over...

TELENT (TLNT).
December 1, 2006... When the bulk of Marconi was bought by Ericsson last year, what remained became Telent. Now almost entirely UK-focused, Telent comprises two divisions: telecoms services and enterprise services, with a large legacy pension fund attached. But it...

PHOENIX IT (PNX).
December 1, 2006... Phoenix IT provides niche services to niche markets. Specifically, the company focuses on small, but highly complex, contract services to large firms, subcontracted through such players as LogicaCMG and Sun. And recent acquisitions have seen...