Investors Chronicle articles from February 2005

Investors Chronicle archives from February 2005

Earnings trouble.
February 4, 2005... This year should be good for corporate earnings - analysts expect growth of a hefty 12.3 per cent. Sadly, though, this is not necessarily good for shares. Since 1970, the correlation between annual earnings growth and annual moves in the...

When two become one.
February 4, 2005... When a giant such as Procter & Gamble buys another giant such as Gillette, it can send repercussions around much of the business world. Merging two of the world's biggest consumer goods groups in a $57bn deal doesn't just affect them and their...

The commodity question.
February 4, 2005... Commodity used to be a dirty word. Or, at least, it did within any sort of context to do with business. Commodity items were things of little value that might just as well be thrown away as used, and commodity producers were the poor...

Pic'n'mix.
February 4, 2005... Just months after the takeover to end all supermarket takeovers, the food giants are limbering up for another tussle - and it could put some of the oldest names on the high street out of business. Big supermarkets just want to get bigger....

Living dangerously.
February 4, 2005... My unblemished driving record - no accidents in nearly 17 years - has been put sternly to the test in the past few weeks. No sooner had I avoided a multiple pile-up halfway up the M1 motorway, than just days later my driving skills were again...

Who wants the job?
February 4, 2005... UK plc is knuckling down to a new regime. Fifteen months ago, after the Higgs Report, the Combined Code of Corporate Governance was updated. The changes came into effect late last year. A few companies have already met its standards on a...

The end of the boom.
February 4, 2005... Is the US productivity boom over? Yester- day's figures suggest it might be. They're likely to have shown that labour productivity in the fourth quarter grew by barely half the 3.7 per cent annual it has averaged in the past five years. ...

Pharma fights back.
February 4, 2005... "It Is the desire to find new medicines and improve public health that makes us go to work every day," claims Dr John Patterson, AstraZeneca's new executive vice president of product strategy. But despite Dr Patterson's touching words, the...

How not to fall for a scam.
February 4, 2005... As sophisticated investors, you're all far too savvy to get hooked by financial conmen offering bogus investments, aren't you? Well, unfortunately, no - you're not. It is often the most successful and wealthy investors who fall for boiler-room...

Money talks.
February 4, 2005... Shareholders received some good news this week - the growth in companies' cash piles is now slowing down. Figures released by the Bank of England on Tuesday showed that non-financial companies' bank deposits have grown by just 7.2 per cent...

Chinese takeaway hard to swallow at TTP.
February 4, 2005... Mobile technology provider TTP has said that tough conditions in the Chinese market will dent second-half sales, with its local customers losing market share to Western handset vendors. Its 3G base-station division - ip.access - has also been...

Full-year earnings to fall short at Renold.
February 4, 2005... Shares in engineering group Renold tumbled after it warned that raw material inflation and the continued weakening of the dollar would push full-year earnings below market expectations. It also admitted that a key cost-saving initiative had...

Virgin Mobile stutters on trading figures.
February 4, 2005... The honeymoon is over at Virgin Mobile. After an impressive performance since listing at 203p in July, the shares fell 10 per cent to 238p this week on disappointing quarterly trading news. Although subscriber numbers grew 37 per cent to 5m,...

FTSE cashes in on institutional holdings.
February 4, 2005... Institutional cash holdings are rising strongly. Bank of England figures this week showed that they grew at an annualised rate of 21.6 per cent in the three months to December. Tim Congdon, of Lombard Street Research, adds that their coffers...

Quotes of the week.
February 4, 2005... "She had a fine smile when I made the offer." Werner Seifert, of the Deutsche Borse, on the reaction from the London Stock Exchange's Clara Furse when he offered to put her in charge of both UK and German equity cash markets in a merged...

Mixed outlook sees Incepta's shares fall.
February 4, 2005... Shares in Incepta, the marketing and public relations group, continued to slide this week as it issued a mixed trading statement. Although Incepta said its market has stabilised, it also said that earnings visibility is very low. What's...

Fortune to hang on to China BlueSky stake.
February 4, 2005... Fortune Oil's deal to sell its 24.5 per cent stake in China BlueSky Aviation to CAO has lapsed, almost a year after the announcement - because CAO is in financial distress. Fortune will retain ownership of its stake, and will not seek a buyer....

Apax rumours see Woolworths jump.
February 4, 2005... Shares in Woolworths climbed 22 per cent this week on news that private-equity house Apax was considering a bid. But City analysts believe the share price may have further to go. The shares are currently trading at 48p. However, according to...

Minerva slumps as talks end.
February 4, 2005... It's been a bad few weeks for property group Minerva. First, it was forced to call the administrators into ailing department store Allders, in which it owns a 60 per cent stake. Then it revealed that talks over the sale of the entire group to...

Surveys hide the real retail story.
February 4, 2005... Retail sales aren't slowing down as much as surveys suggest, say economists. The Confederation of British Industry (CBI) reported this week that a net balance of 3 per cent of retailers said sales in January were lower than a year ago -...

Lookers increases its used-car exposure.
February 4, 2005... Lookers has bought the Bristol Trade Centre, a used-car supermarket, which will boost its presence in the used-car sector. The GBP8.5m acquisition should add about GBP35m to Lookers' turnover and will be earnings-enhancing immediately. It will...

Ferraris falls as clients cut costs.
February 4, 2005... Shares in Ferraris fell 7 per cent after the medical diagnostics group issued a profit warning. Chief executive Steven Mills insisted that half-year results are on track - even though pharmaceutical clients are cutting costs by halting...

Protherics could be close to licensing deal.
February 4, 2005... Protherics could be close to licensing out sepsis product Cytofab. A source claims the drug developer is licensing the drug to AstraZeneca. Protherics chief executive Andrew Heath was previously a senior sales director for Astra USA before its...

Exel fuelled by bid speculation.
February 4, 2005... Shares in Exel hit their highest level for over two years this week as bid rumours surfaced. Following comments made by UPS on its acquisition strategy, speculation mounted that the North American giant was considering a GBP10-a-share bid for...

Poor trading barely dents Carpetright.
February 4, 2005... Carpetright's shares fell just 2 per cent this week, despite a worse-than-expected trading performance. Like-for-like sales in the three months to the end of January fell by 3.8 per cent. Analysts had been expecting a 1 to 2 per cent increase....

Aussie miner digs in.
February 4, 2005... Xstrata has raised its bid for Australian copper, nickel and uranium miner WMC Resources to A$7.20 (GBP2.96) a share, after its original A$6.35 offer found few takers. The group says the bid is final unless there is a rival offer. So far, none...

Bristol & West accepts Bridgewater offer.
February 4, 2005... Bridging loans minnow Bristol & West (B&W) has succumbed to a GBP11.3m cash bid from privately-owned Bridgewater Investments. The rationale behind the 10.65p-a-share deal is that, as a listed company, B&W has been too focused on short-term...

Vicorp raises monies.
February 4, 2005... Vicorp has raised GBP1m to help boost its international presence. The software company, which joined Ofex last November, has already spent around $10m developing its xMP product. The new monies will be used to rebuild its balance sheet and...

Brokers to merge.
February 4, 2005... The long-awaited consolidation of the stockbroking sector took a leap forward this week with the announcement of two deals. Icelandic bank Landsbanki is buying Teather & Greenwood for GBP42.8m, while Durlacher is to make a reverse takeover of...

Friedland the likely new partner for Hereward.
February 4, 2005... Hereward Ventures, themining and oil and gas minnow with onshore oil interests in the UK, and gold exploration assets in Bulgaria and Serbia, has announced the termination of its gold exploration joint venture with mining major Goldfields. ...

York Pharma buys molecular skincare.
February 4, 2005... York Pharma has splashed out GBP5m on Molecular SkinCare (MS), which specialises in the prevention and management of skin diseases. As well as adding six patent families, MS will boost the group's cash balance by GBP2m, to a total of GBP5m....

Frontier Mining goes for gold.
February 4, 2005... Frontier Mining, the company that hopes to mine gold and copper on a former nuclear test site in Kazakhstan, has announced that initial recovery testwork on its Beschoku and Yubleiny licences has delivered favourable results. But there's...

Caledon announces drilling results.
February 4, 2005... Caledon Resources, which was Aim's best-performing stock in 2003, has announced drilling results from its Mojiang gold project in China, and the acquisition of an interest in Dynasty Gold Corporation, a Chinese exploration company. Caledon...

Internet Music & Media to acquire Timestrip.
February 4, 2005... After months of seeking a reverse takeover candidate, Internet Music & Media has agreed to acquire Timestrip for GBP6.4m. Founded in 2000, the company produces what is effectively a strip used on food products to measure elapsed time, which was...

The week ahead.
February 4, 2005... Tuesday 8 February Elan has been stuck in a trading range between GBP18 and GBP24 since late last year, and City analysts believe that positive newsflow at its results presentation on Tuesday could help it break out. It is expected to...

Shed aims for more TV hits.
February 4, 2005... The fact that football and scandal seem to go hand in hand these days is good news for Shed Productions, which hopes to join Aim. The producer of Bad Girls and Footballers' Wives, which is famous for its outrageous plot lines, now hopes to take...

CAT beats abbot again.
February 4, 2005... Cambridge Antibody Technology (CAT) has won the second round in its battle with Abbott Laboratories over royalties from rheumatoid arthritis drug Humira. In the High Court, Mr Justice Laddie refused to grant Abbott permission to appeal...

Plane sailing for Ryanair.
February 4, 2005... Budget airline Ryanair saw off the bears this week as it reported robust nine-month results and a substantial upgrade to full-year guidance. The feared winter bloodbath among low-cost airlines has been more of a storm in a teacup for Ryanair -...

Shire plugs attention deficit hyperactivity gap.
February 4, 2005... After promising investors that it would license in a new drug by the end of 2004, Shire Pharmaceuticals has agreed to buy NRP104 from New River Pharmaceuticals, a US biotech company. NRP104 is a treatment for attention deficit hyperactivity...

Takeovers to hit recruitment sector.
February 4, 2005... A wave of takeover activity looks set to hit the recruitment sector. As activity levels continue to recover, the pressure is now on smaller players to submit to consolidation in what is a highly fragmented industry. The catalyst could...

Pace cool over listings furore.
February 4, 2005... Set-top box manufacturer Pace has agreed a settlement with the Financial Services Authority (FSA) over charges that it contravened listing rules in 2002. The company will pay a penalty of GBP450,000, but it still refuses to admit any...

Inheritance tax: Run the rule over the changes.
February 4, 2005... From 6 April, new rules will upset many people's estate-planning arrangements, leaving them with the choice of paying extra income tax, or leaving an inheritance tax (IHT) bill for their heirs. Particularly in light of the rapid growth of...

Income investments: Yield of dreams.
February 4, 2005... With the outlook for stock markets clouded by uncertainty over global growth prospects, and interest rates at historically low levels, many investors are seeking income investments. The situation is especially pressing for senior citizens -...

Order wins boost Dawmed Systems.
February 4, 2005... Shares in DawMed Systems received a shot in the arm earlier this week on news that the washer disinfector specialist has secured two orders worth over GBP1m. The larger contract is for a machine to be used in a decontamination unit at the Royal...

Time to tech stock.
February 4, 2005... If the past five years have highlighted anything, it is the volatility of technology funds. Had you invested and sold at the right times, you could have made a fortune. Sadly, many investors lost a fortune instead. This sector of the stock...

Highbury scores own goal with falling sales.
February 4, 2005... Highbury House, the publishing group, reported disappointing sales this week. It said that circulation and advertising sales in its consumer division were down on last year. Overall, sales in the fourth quarter of the financial year were down 7...

DIY Pensions: Taking stock of absolute returns.
February 4, 2005... When I started my self-invested personal pension (Sipp) in June last year, I set myself a target of 8.5 per cent growth a year. Six months later, and I've already passed this 'absolute return' target, generating a total return of 9.4 per cent...

Questions & Answers.
February 4, 2005... Legal eagles Do I need a solicitor to set up a bare trust to hold investments for a child? John McLeod replies In most cases, a solicitor will be unnecessary. Cash accounts and fund investments can be taken out in your name, but...

Bargain portfolio 2004 review.
February 4, 2005... The performance of our eight selections last year was hardly vintage stuff, despite beating the wider market for the sixth year in a row. It was always going to be hard matching the massive 146 per cent gain the portfolio delivered in 2003, but...

SANCTUARY (SGP).
February 4, 2005... These results were released just two days after a profits warning, when Sanctuary was forced to writedown GBP11.4m against loan notes relating to its former TV business, and to report a GBP2.1m loss from bad debts in its book publishing arm....

ASTON VILLA (ASV).
February 4, 2005... Aston Villa has reported negative earnings for five straight years and has scrapped its dividend. But that hasn't stopped the football club's share price from more than doubling over the past 12 months. This has nothing to do with the team's...

Beleaguered Jarvis sells Tubelines.
February 4, 2005... Jarvis, the struggling support-services group, has finally sold its stake in the Tubelines joint venture, and has ring-fenced its liabilities on loss-making private finance initiative contracts. But there's still scepticism in the City. "I...

CPL (CPS).
February 4, 2005... As Ireland's largest recruitment business, CPL is riding the country's booming economy. Gross fee income (the revenues that it can actually claim for itself), surged 57 per cent and, although it was forced to spend more on increasing its...

JELF (JLF).
February 4, 2005... Insurance broker Jelf is focused on commercial and healthcare insurance for corporate clients - it also provides independent financial adviser (IFA) services to them, as well as to their directors. October's Aim flotation (at 81p) raised...

OSMETECH (OMH).
February 4, 2005... Osmetech's shares did suffer after losses almost doubled at the half-year, but chief executive James White says the diagnostics company is in good shape. Revenue compares unfavourably with last year's figure, which was boosted by one-off...

EURODIS ELECTRON (ELH).
February 4, 2005... Electrical components distributor Eurodis Electron spent most of 2004 looking into the void. Hit hard by the two-year cyclical downturn, only a GBP56.8m emergency rights issue last year and swathes of cost-cutting pulled it back from the brink....

OCEAN POWER TECHNOLOGIES (OPT).
February 4, 2005... The world's first publicly quoted wave-power generator has yet to make a splash. Admittedly, Ocean Powers Technologies' PowerBuoy wave-generation system is revolutionary - it captures and converts wave energy into a controlled mechanical force....

PKL (PKL).
February 4, 2005... Shares in PKL slumped 19 per cent as the market digested news of a profit warning. As a supplier of portable kitchens to the food service and healthcare markets, the problem is due to a change in customer buying patterns. While healthcare...

TERRACE HILL (THG).
February 4, 2005... Terrace Hill says that West End tenant demand was relatively subdued at the start of the year, but has since improved. The group's commercial development book now stands at almost GBP600m. In the residential operation, a slowing market...

WYNNSTAY (WYN).
February 4, 2005... Internal hedging is the key to farming group Wynnstay's success. This means that, when feed commodity prices are high - as they were last year - its arable division benefits, while higher input costs have an adverse effect on its feeds...

HAYNES PUBLISHING (HYNS).
February 4, 2005... First-half trading has been mixed for Haynes, the specialist automotive publisher. In the US, sales in constant-currency terms rose - the business would have beaten company records had it not been for the sliding dollar, which left turnover...

QUADNETICS (QDG).
February 4, 2005... Whether it's recording violence and vandalism on the night bus, or monitoring the goings-on in a swish casino, Quadnetics is on hand with a solution. And with the authorities and businesses increasingly relying on surveillance, the market for...

NWF (NWF).
February 4, 2005... Profits at NWF took a knock in the first half, thanks to the disposal of five country stores which resulted in a GBP780,000 goodwill write-off. Despite this accounting hit, underlying progress across all four trading divisions was sound. ...

AVINGTRANS.
February 4, 2005... Aim. Avingtrans' order intake is strong and the company is trading at, or above, expectations across all divisions.

GOLD OIL.
February 4, 2005... Aim. Gold Oil is currently seeking acquisitions and has just over GBP300,000 on the balance sheet. The focus at the moment is on acquiring offshore acreage.

HEALTHCARE COMMS.
February 4, 2005... Aim. Healthcare hopes to achieve revenues from text-messaging in the second quarter of 2005.

HONEYCOMBE LEISURE.
February 4, 2005... Aim. Honeycombe's progress has been reasonable, despite poor weather and three underperforming units. Managed pubs are likely to generate future growth.

NETCALL.
February 4, 2005... Aim. Netcall is still focused on its flagship QueueBuster product, used in call centres. Cash is strong at GBP1.1m and costs have been cut.

NUMERICA.
February 4, 2005... Aim. Numerica transformed itself into a limited liability partnership in June 2004, incurring a GBP700,000 one-off exceptional charge. Before that it was profitable.

SOUTHAMPTON LEISURE.
February 4, 2005... Aim. Attendances fell as kick-off times were changed. The board also had to settle on a new manager. Harry Redknapp is now in charge, but the key issue is whether Saints can avoid the drop.

IDN TELECOM.
February 4, 2005... Aim. IDN has achieved a record performance thanks to new client wins and margin improvements. Current trading is strong.

ASTRAZENECA (AZN).
February 4, 2005... AstraZeneca's fourth-quarter sales rose 19 per cent and operating profits jumped 68 per cent. Even though the comparative period in 2003 was weak (due to destocking), and despite an exchange-rate fillip, underlying sales growth reached 20 per...

AMBERLEY.
February 4, 2005... Aim. Property investment

COBURG.
February 4, 2005... Aim. Coffee and tea importer

FITZWILLIAM CAPITAL.
February 4, 2005... Aim. Investment company

INNOBOX.
February 4, 2005... Aim. Hotelier

Bargain shares for 2005.
February 4, 2005... Benjamin Graham, the father of value investing, once said: "If we assume that it is the habit of the market to overvalue common stocks which have been showing excellent growth, or are glamourous for some other reason, it is logical to expect...

Commercial sense.
February 4, 2005... There are two types of property you can invest in: residential and commercial. The risk of severe house price falls makes residential property a poor investment at the moment - and, since most of your wealth is probably already tied up in your...

LEISURE VENTURES.
February 4, 2005... Aim. Shell company

TADPOLE TECH. (TAD).
February 4, 2005... Tadpole acquired StreamTheory in October, which designs distribution platforms for managing application software. StreamTheory had an exclusive distribution deal with Softbank, the Japanese broadband internet provider, to use its technology to...

MONDAS.
February 4, 2005... Aim. Software solutions provider

MEDICO-LEGAL CONSULTANCY.
February 4, 2005... Ofex. Specialist medical-legal practice

HOWLE.
February 4, 2005... Main market. Engineers' cutting tools

MERIDEN.
February 4, 2005... Aim. Business services