Investors Chronicle articles from May 2004

Investors Chronicle archives from May 2004

A guide for wimps.
May 7, 2004... MRS MITTY Popped her head round the door. "Okay, I'm going now," she said. "Mind you take your indigestion tablet, and don't forget that the Goldbergs are coming over for supper tomorrow. Bye." "Bye," said Walter Mitty, as he swirled the last...

Forecast errors.
May 7, 2004... Markets know more than the so-called 'experts'. This seems the obvious lesson of this year's rise in the dollar. Although it has embarrassed the many dollar bears, it has been - in direction, if not magnitude - exactly what uncovered interest...

Home thoughts.
May 14, 2004... I've got something in common with Rebecca Loos - we've both made a lot of money lying on our backs. Over the past three years, I've probably made more from the rising price of my modest house than I have from working. A fair reflection of my...

Playing it safe.
May 14, 2004... The tremors that HIT world stock markets on Monday were a clear reminder of just how volatile life for equity investors can be. The question is, how should we interpret the latest slump? Is it because the cyclical recovery theme is running out...

Value worth storing up.
May 14, 2004... It may just be a timely coincidence that my recent interest in the self-storage sector has been practical rather than financial - after months of deliberation, builders are about to transform my flat in a way that I hope will add more value...

DIY for would-be arbs.
May 14, 2004... It hardly takes a genius to work out that hedge funds are flavour of the month. Just look at the quantity of column inches that the financial pages devote to them nowadays. It started with the 2000 bear market, when the truth began to dawn that...

Sparks of imagination.
May 14, 2004... Poor old Marks AND Spencer (M&S) must have felt a bit like Bridget Jones this week. There was no shortage of friends rushing to console the company as yet another man walked out of its life. "Don't worry, you're better off without him," the...

No-brainer for Dame Stella.
May 14, 2004... So it's au revoir from Luc Vandevelde, who four years ago was called in to rescue Marks and Spencer (M&S) in its darkest hour. Its darkest hour, to date, that is. Despite the handsome package awarded to him on arrival in February 2000, which...

Money, method & models.
May 14, 2004... Believe it or not, there's been some good news for US tech stocks recently - monetary growth is picking up. In the past three months, the M2 measure of the money stock has risen at an annualised rate of 10 per cent, reversing its fall over the...

Savings gap baloney.
May 14, 2004... We are not saving enough for our retirement - or so we're told. The Association of British Insurers (ABI) reported recently that "the majority of young people have only limited interest in and awareness of the need to save for their...

Cambridge surges on new bid speculation.
May 14, 2004... There was fresh bid speculation this week involving Cambridge Mineral Resources, the Aim-listed mining company with a polymetallic project on the Iberian Pyrite belt. Following heavy volumes of share trading, and a sharp rise in the share...

Huveaux acquisition spree continues apace.
May 14, 2004... Fast-growing publishing group Huveaux has completed its most significant deal to date by acquiring leading politics journal firm Parliamentary Communications (PC) for GBP15.7m. Following a raft of corporate activity, it is the sixth deal for...

It pays to sell in May.
May 14, 2004... It's time to sell your shares. This isn't because the market is 'overvalued' (whatever that means), or because interest rates will rise, or because consumer spending and the housing market are about to crash. It's just because it's that...

RC Group targets security demand.
May 14, 2004... Aim-hopeful RC Group plans to take advantage of growing demand for increased security. The Hong Kong-based provider of biometrics solutions already has extensive contacts in the Asia-Pacific market, and is joining the junior market to help...

MKM plans for Aim move.
May 14, 2004... Cheshire-based travel promotions firm MKM plans to join Aim next month in a bid to step up its expansion plans. Established in 1989, it was acquired 10 years later by British Airways' subsidiary, Air Miles. The founding management team, led by...

Local radio company tunes up for flotation.
May 14, 2004... Richard Wheatly, former chief executive of Jazz FM, is returning to the airwaves with The Local Radio Company (LRC), Aim's latest accelerated initial public offering. Having secured GBP47.3m via a placing at 95p a share, which has been...

Intelligent Energy unveils launch plans.
May 14, 2004... Intelligent Energy, a fuel-cell development group that hopes to float on Aim, expects to power the world's first fuel-cell-driven manned flight. The project, which it expects to complete later this year, has sprung from its relationship with...

Hardy sells Atrium stake.
May 14, 2004... Lloyds vehicle Hardy Underwriting has sold off its 23.2 per cent stake in fellow Lloyds vehicle Atrium Underwriting for GBP20.7m. Not only has this proved a shrewd investment - Hardy acquired the stake for just GBP8.9m in the autumn of 2002 -...

First Technology is no dummy withacquisition spree.
May 14, 2004... First Technology, the safety equipment group known for its dominance of the crash-test-dummy market, has capped its recent acquisition spree with the C$260m (GBP105m) acquisition of a Canadian gas instrumentation manufacturer, BW Technologies....

Carillion sells mechanical and electrical unit.
May 14, 2004... Building contractor Carillion has sold its Crown House mechanical and electrical engineering business to rival contractor Laing O'Rourke for GBP17.3m. The deal will generate a net exceptional profit of GBP9.9m. Crown House no longer fits in...

Next week.
May 14, 2004... MONDAY 17 MAY Interims: Cambridge Antibody Technology Finals: British Airways, DCC, Mice, William Hill AGMs: Fulmar, GlaxoSmithKline EGMs: Clubhaus, Yoomedia Economics: UK RICS April housing survey British Airways...

Low & Bonar hit by European probe.
May 14, 2004... Building materials group Low & Bonar is being investigated by the European Commission over price-fixing. The investigation relates to an industrial bags business that the group sold in 1997. According to Mike Foster, analyst at KBC Peel...

Two pints of cider and a packet of crisps please.
May 14, 2004... It's going to be second time lucky for Irish beverage and snack maker C&C. The company - whose most recognisable products are Bulmer's cider and Ballygowan mineral water - is set to list on the UK and Irish stock exchanges next week. This...

Well armed.
May 14, 2004... If you have followed the latest problems at BAE Systems, you might think that being a UK defence contractor is a thankless task. The Ministry of Defence (MoD) insists on fixed-price bidding for major contracts, in contrast to the 'cost plus'...

Bell agrees takeover bid from Securitas.
May 14, 2004... Bell, the electronic security group, has agreed to a 175p-a-share takeover approach from security giant, Securitas. The offer represents a healthy 54 per cent premium to Bell's share price the day before the deal was announced, and is at a 46...

Bunzl makes strategic push into europe.
May 14, 2004... Bunzl, the support services group, made its first foray into France this week, buying Groupe Pierre Le Goff, a distributor of cleaning and safety products. Bunzl says that the GBP207m cash-and-debt deal will lift European sales by...

Water companies gain ground.
May 14, 2004... The water sector gained ground last week as companies revealed their final plans for bill increases. These were generally toned down from their initial proposals, first submitted last year, but they still asked for price increases of 6.3 per...

Reg reports healthy trading outlook.
May 14, 2004... In its pre-close trading update, Reg Vardy, the UK's second-largest quoted car dealer (by market capitalisation), said that used and new car market conditions have remained favourable since it reported its first-half results in January. ...

Pinewood makes glittering debut.
May 14, 2004... Nearly 70 years in the movie business have certainly taught Pinewood how to make a good entrance - its shares rose 13 per cent from their 180p market debut this week, valuing the business at GBP93m. Pinewood may have all the glamour of the...

Rising oil price threatens shares.
May 14, 2004... Oil prices hit a 14-year high of $37.50 a barrel this week. And while speculation that the latest rises are entirely responsible for this week's fluctuations in the FTSE is silly, the rise of the oil price does have interesting implications for...

Great growth shares.
May 14, 2004... Small growth stocks are tomorrow's blue-chips. So it makes sense to try to spot them as early on in their life as you can. But that's not as simple as it may sound, so we've done the hard work for you. We've found the fastest-growing companies...

BSkyB suffers slowdown in new subscribers.
May 14, 2004... BSkyB shares have tumbled over the past few months after suggestions that its third-quarter results statement would show a dramatic fall-off in new subscribers, perhaps down to 45,000. On Wednesday, the group revealed it had added 66,000...

M&S chief executive faces uncertain future.
May 14, 2004... Pressure is mounting on Marks and Spencer's chief executive, Roger Holmes, after the resignation of part-time chairman Luc Vandevelde earlier this week. Mr Holmes was appointed by Mr Vandevelde and analysts say that, if the new chairman is a...

Surface lands MoD agreement.
May 14, 2004... Surface Transforms has signed an agreement with the Ministry of Defence (MoD) to develop a carbon fibre-based material for use in body and vehicle armour. Over the next nine months, Surface will test various compositions to satisfy the MoD, and...

Parliament punches enterprising pubs.
May 14, 2004... Shares in tenanted pub operators are still reeling after a parliamentary body said it was to probe the way they do business. The Trade & Industry Select Committee is responding to fears that the pub industry is being dominated by giant pub...

Umbro targets football fever.
May 14, 2004... Umbro is taking advantage of the football fever expected to grip the City in June. It intends to float on 3 June, with a market capitalisation of up to GBP202m, just nine days before the kick-off of the Euro 2004 tournament in Portugal. ...

IBL prepares to launch Admiral range.
May 14, 2004... Aim-minnow International Brand Licensing (IBL) has teamed up with ASDA to launch a new range of retro clothing based on its Admiral sports brand. In collaboration with George, the retail giant has designed 30 styles of apparel and footwear,...

New service from TD Waterhouse.
May 14, 2004... Broker TD Waterhouse is offering online access to Level 2 share prices, which allow you to see market makers' spreads and trading volumes. The service will cost GBP200 per quarter, falling to GBP100 if you trade more than 25 times a quarter, or...

Fund changes can suit investors, but representation is crucial.
May 14, 2004... Investment trust boards have led the way in changing their funds' remits to suit investors. Merrill Lynch European is set to be rolled over into Merrill Lynch Greater Europe, which will use a focused portfolio, plus strict controls, to prevent...

Endowments force new fund charges.
May 14, 2004... Guarantees to meet endowment mortgage projections have forced Norwich Union and Standard Life to introduce new charges on some of their with-profits funds. Both companies will charge up to 0.75 per cent each year in order to cover their...

Angel delight.
May 14, 2004... The chances are that, unless you got a lucky break as Gabriel in your school nativity play, you won't have had much experience at playing the role of an angel. But while you might have missed out on the full wings-on experience (for now), no...

MFI hit by pension shortfall.
May 14, 2004... Analysts have been downgrading their profit forecasts for MFI, following the retailer's admission that the shortfall in its pensions scheme could be as much as GBP50m higher than previously disclosed. This will require it to make extra annual...

North Atlantic Smaller Companies IT.
May 14, 2004... Investment trust: North Atlantic Smaller Companies Sector: North American Smaller Companies Manager: Christopher Mills Three-year total return (to 10 May, source: Trustnet): 5.8% Rank in sector: 4 Sector average: 22.6% ...

Multi-tasking.
May 14, 2004... Multi-manager funds have become popular in a funds industry that is crying out for good news and new products. At one tme, the option of contracting external fund managers to run your investment portfolio was only the preserve of institutional...

EASYJET (EZJ).
May 14, 2004... Although these numbers were better than analysts' forecasts, easyJet's shares still nosedived 25 per cent on the day they were released as the market was spooked by the company's recent trading figures. Management told the City that...

PROPERTY ACQUISITION & MANAGEMENT (PAQ).
May 14, 2004... Previously called CNC Properties, Property Acquisition & Management (PAM) is still smarting from an unfortunate foray into high-yield bonds just as equity markets were peaking in 2000. This caused nearly GBP13m to be wiped off its GBP60m...

Managers on the move.
May 14, 2004... Research by the multi-manager team at fund manager Credit Suisse points to record low levels of consistency by funds. Just 3 per cent have been consistently top-quartile over the past three years. Over one year, the difference between the best...

PANTHER SECURITIES (PNS).
May 14, 2004... Chairman Andrew Perloff could go on all day about the "ludicrous examples of red tape" with which the "legislatively incontinent" Labour government has hampered the property business. But being a conservatively-run (with a small and large 'c')...

LONDON SECURITY (LSC).
May 14, 2004... The few outside shareholders there are in London Security will have enjoyed a whopping increase in the dividend - but unfortunately just 3 per cent of the shares are freely floated. The bumper payout reflects the improved performance since the...

SECURICOR (SCR).
May 14, 2004... Market conditions in the security industry remain tough, but Securicor still managed a creditable set of results. That's partly down to the absence of last year's heavy write-offs, incurred when the group closed down businesses and wrote off...

SAGE (SGE).
May 14, 2004... Sage has many virtues. The company consistently delivers a solid return on equity (16 per cent on an annualised basis), while throwing off plenty of cash. Free cash flow totalled GBP85m in the first half (almost equalling pre-tax profits),...

CHRYSALIS (CHS).
May 14, 2004... Reflecting disappointing quarterly listening figures at its flagship London station, Heart, Chrysalis's shares fell about 10 per cent in the week before these results. Heart saw its audience share tumble from 7 to 5.8 per cent in the past...

TULLOW OIL (TLW).
May 14, 2004... Tullow's results were overshadowed by the $570m acquisition of Energy Africa, which gives the company a more interesting growth profile (see 7 May, page 13). On the results front, a 41 per cent increase in operating profit was largely down...

EL ORO MINING & EXPLORATION (ELX).
May 14, 2004... Robin Woodbine Parish, the refresh-ingly unconventional chairman of this newly merged company, is confident that it will "stand fast in storm and sunshine". There weren't really any problems before, but the merger made sense as it increased the...

INCEPTA (ITA).
May 14, 2004... Analysts downgraded their earnings forecasts after these results because the much-vaunted boom in corporate activity has proved somewhat illusory. Chief executive Richard Nichols says activity has been patchy, with a handful of blockbuster...

BLACKS LEISURE (BSLA).
May 14, 2004... "Niche retailing is a good place to be in, and we've chosen two good niches - camping and surfing," says Blacks Leisure's chief executive Roy Crossland. He's right - Blacks Leisure comfortably outperformed most fellow clothing retailers last...

BRAEMAR SEASCOPE (BMS).
May 14, 2004... It's been full steam ahead for Braemar, powered by buoyant underlying trading conditions that led to a storming second half after the Iraq war hiatus. Shipping freight rates in both its 'dry' and 'wet' markets were boosted by high demand for...

FENNER (FENR).
May 14, 2004... The best news from Fenner was confirmation that demand from the US industrial and coal mining sectors (a crucial market for the company) is finally picking up. This drove a "noticeable increase in order intake" at its US belting operations...

ENODIS (ENO).
May 14, 2004... Enodis says that the US food equipment market, which has suffered as struggling fast-food outlets reigned in capital spending, is at last picking up. This helped lift like-for-like food equipment sales in the US (which traditionally account for...

DIPLOMA (DPLM).
May 14, 2004... Diploma's markets are finally staging a recovery. Diploma says that it first began to notice its markets bottoming out last year. But, since then, organic growth has picked up and has been weighted towards the group's second quarter. The...

ROBERT WISEMAN DAIRIES (RWD).
May 14, 2004... "People said that we were throwing money away when we built Droitwich, but we've proved them wrong," says chief executive Alan Wiseman. The west-Midlands super-dairy is now processing over 400m litres of milk a year and running at 80 per cent...

The healthy way to make money.
May 14, 2004... Great investments are a rare find. But a good place to search for fast-growing, profitable companies are the healthcare and biotech sectors. These markets cover the rich grounds of drugs, devices and diagnostics, from initial discovery all...

PHYTOPHARM (PYM).
May 14, 2004... Despite the discouraging news in December that Pfizer was backing out of its partnership on the anti-obesity drug, P57, Phytopharm appears in good shape. The company is currently in talks with four other potential licensing partners for P57...

INNOVATION (TIG).
May 14, 2004... If companies were judged on past transgressions, Innovation would still be in some outer circle of investment hell. But investors have short memories and, as Innovation's share-price chart shows, all appears to have been forgiven. Reported...

JENNINGS BROTHERS (JBC).
May 14, 2004... Jennings, which boasts that its beer is "the genuine taste of the Lake District", has done a fine job of revamping its 175-year-old business after the foot-and-mouth setback two years ago. No longer primarily a managed pubs business, 87 per...

RICHMOND FOODS (RFD).
May 14, 2004... for the first time, Richmond Foods has made a pre-tax profit during the slow winter months. This bodes well for the all-important summer ice cream season, though the company admits that it will be tough to better last year's performance, when...

TF & JH BRAIME (ORD: BMTO) ('A': BMT).
May 14, 2004... There was "no bright spot" at Braime last year, which was hit by a GBP20,000 bad debt, dollar currency losses, and a foreign tax charge that increased post-tax losses to GBP48,000. Like other hard-pressed UK manufacturers, Braime is now...

HIGHLAND TIMBER (HTB).
May 14, 2004... UK timber prices have halved since Highland Timber became a forest-owning business in 1997 - so it's not surprising that recent results have been disappointing. So until prices improve, Highland can't do much more than manage its plantations -...

MATALAN (MTN).
May 14, 2004... Matalan's chief executive, John King, is keen to stress that current trading is showing a big improvement on last year, when he admits the company "lost direction". Underlying sales in the past nine weeks have increased by 3.1 per cent, with...

KEYCOM.
May 14, 2004... New chairman Rod Matthews has started to cut costs at Keycom. This is a necessity before the company raises any more money. Keycom provides telecom services to 50 universities across 150 sites. Last year, a move into internet services helped...

HOLDERS TECH. (HDT).
May 14, 2004... The jump in Holders Technology's 2003 turnover was largely due to the acquisition of Cimatec, a German supplier of printed circuitboard (PCB) backing materials, and a similar business in Holland. Better second-half demand for PCB materials in...

URBIUM (URM).
May 14, 2004... Following consolidation (no new club openings in 2002-03) and a year of fairly flat profits (excluding exceptional costs and amortisation), Urbium is expanding again. It expects to spend GBP10m-GBP12m this year opening six new clubs, and...

PENTAGON protection (PPR).
May 14, 2004... Pentagon joined Aim just over a year ago. Its principal business then was supplying security glass and tinted windscreens for cars. But a change in the Road Traffic Act last February outlawed tinted windscreens and that reduced demand and hit...

SYSTEMS UNION (SUG).
May 14, 2004... Systems Union Group (SUG) gets a bit sniffy when asked why 2003 sales did not grow much - in fact, before acquisitions, they fell 7 per cent to GBP69.35m. This can largely be blamed on delayed orders, increased competition and the absence of...

TIKIT (TIK).
May 14, 2004... Just the Tikit! After two cautious years, legal firms (which account for 85 per cent of Tikit's revenues) have opened their wallets again and are spending on upgrading IT systems. Tikit markets document-handling, time-recording and marketing...

STADIUM (SDM).
May 14, 2004... Stadium's latest results REFLECT THE fact that it has moved electronics production to China. Before exceptionals and goodwill amortisation, last year's profits rose from GBP1.3m to GBP1.9m. Stadium has also been able to win high-margin export...

CRC (CCG).
May 14, 2004... CRC is recovering well from the shock of losing more than half its business with key customer Nokia. In 2002, Nokia accounted for around GBP87m of turnover - last year, that fell to GBP42m. CRC has partly replaced Nokia's business with the...

Exeter Investment.
May 14, 2004... Main market. Exeter is constrained by legal costs relating to a Financial Services Authority enquiry. However, systems upgrades at its administration companies bode well for the future.

Cardiff Property.
May 14, 2004... Main market. As the markets show signs of improving, inquiry levels have risen - especially relating to office space in the Thames Valley region where Cardiff operates.

Titon.
May 14, 2004... Main market. Lower-margin sales and tough competition have dented profits at Titon. Second-half results are now likely to be similar to those for the first six months.

Trio.
May 14, 2004... Main market. Trio describes the period as "uneventful", so it's little surprise that the trading performance was lacklustre. The cash balance is GBP10.2m.

Dawson International.
May 14, 2004... Main market. Following a strategic review, Dawson will soon announce details of new debt facilities and a fully underwritten loan stock issue.

Shiloh.
May 14, 2004... As expected, last year was tough for Shiloh. But conditions have since picked up and the company is hopeful of securing government contracts for sterilisation services.

Campus.
May 14, 2004... Aim. The group won a number of new clients during the period and, without a proportionate increase in the cost of sales, revenues increased strongly.