Investors Chronicle articles from May 2006

Investors Chronicle archives from May 2006

Lazy discipline.
May 5, 2006... It is often said that the key to success is talent and hard work. Nonsense. In investing, and possibly life in general, there is one thing that is more important than either: discipline. The returns to seasonal investing demonstrate this....

The problem with profits.
May 5, 2006... News this week from the BBC that the nation's happiness has declined in the past 50 years, despite a threefold increase in personal wealth, begs a number of questions for investors. "What's the point?" and "Why are you reading this?" are two of...

Brokeheart Marconi.
May 5, 2006... Friday 27 January - Home, home on the range At 3pm, I finally got through to someone in Telent's (ie, Marconi's) company secretary department. Very helpful woman, too. It seems that the GEC takeover of English Electric in 1968 was of five...

Underwhelming websites.
May 5, 2006... Members of the Investor Relations Society (IRS) may be late in to work this morning, because last night they were slapping backs at their Best Practice Awards dinner. But despite the promising title, very little that is meaningful to investors...

Credit control.
May 5, 2006... For what is widely seen as a relatively staid component of the market, the UK retail sector has lately been generating no shortage of headlines. House of Fraser shares surged by over 9 per cent after the company acknowledged a "very preliminary...

Property investors head to the CIty.
May 5, 2006... The rush of money into UK shopping centres has finally run out of energy, with investors switching their cash into City offices instead. In the first quarter of 2006, property companies, pension funds and private investors spent GBP1.01bn...

City Index takes a shine to IFX.
May 5, 2006... Long overdue consolidation could soon happen in the spread-betting industry. Privately-owned City Index has been sniffing around listed IFX Group. City Index's approach to IFX in late March was rebuffed, but the company says that it is...

As easy as B2B.
May 5, 2006... Television, radio and magazine companies are under siege from new-media players, which are presenting a stiff challenge to the business models of traditional media players. As a result, shares in such old-media organisations have tumbled over...

CRH goes on major spending spree.
May 5, 2006... Irish building materials group CRH has announced two major acquisitions. First, the group snapped up MMI, a leading US building products company for $350m (GBP189m). Just days later, CRH announced the acquisition of Helfen-Deha, a European...

Costain builds solid start to year.
May 5, 2006... Costain has released an encouraging trading update, saying that a pick-up in water sector spending helped keep its order book at record levels. The group reiterated its target of double-digit growth in turnover and underlying profits over the...

Elan's MS drug gets European thumbs up.
May 5, 2006... A return to the market of Elan's multiple sclerosis drug Tysabri has moved closer. The European Medicines Agency's scientific committee recommended that the drug return to the market for patients who fail to respond to beta-interferon...

BBA update disappoints.
May 5, 2006... Shares in BBA fell 3 per cent as the group's trading update highlighted challenging trading conditions for Fiberweb, its non-woven materials business. BBA plans to demerge Fiberweb during the last quarter of 2006, in order to concentrate on...

Ark Therapeutics ends cash concerns.
May 5, 2006... Shares in Ark Therapeutics rose 6 per cent after the company announced that it is raising GBP25.5m after expenses. The proceeds of the placing and open offer at 85p - a slight premium to the 82p closing price on 26 April - will help to fund a...

A Bridge too far?
May 5, 2006... The UK is becoming more like a satellite of the eurozone. In the past year, the correlation between weekly changes in the dollar/sterling exchange rate and the dollar/euro exchange rate has been 0.82, the lowest since 1994. This means that the...

Private investors take their money and run.
May 5, 2006... Private investors withdrew GBP3.1bn from the stock market in February and March, according to research by share registration provider Capita Registrars. The company says that the cash withdrawals were across all sectors, although most money was...

Resolution talks to Abbey.
May 5, 2006... Resolution, the UK's largest consolidator of closed-life funds, is in exclusive negotiations to acquire the entire UK and offshore life businesses of Santander Central Hispano's Abbey National division. The purchase, which should cost around...

Keller on course for blistering first half.
May 5, 2006... Ground engineering specialist Keller issued a very positive trading statement this week. Rapid sales growth, a record order book and significantly higher margin means that the company's first-half performance is expected to be substantially...

Not so hip: Smith & Nephew results disappoint.
May 5, 2006... Shares in Smith & Nephew fell 9 per cent after first-quarter results were slightly below expectations. Chief executive Sir Chris O'Donnell says that trading conditions have worsened, and should improve only marginally in the second quarter,...

Spirent cautious about recovery.
May 5, 2006... Spirent has confirmed that it's on the recovery path after plunging to a GBP41.7m loss last year. The company, which specialises in manufacturing telecoms testing equipment, said that first-quarter sales were better than expected despite a...

Pawnbroker H&T to float.
May 5, 2006... H&T, the UK's largest pawnbroker by size of pledge book, is to float on Aim. H&T will also raise GBP49m through a placing of 28m shares at 172p each, giving it a market capitalisation of GBP54m. First dealings are expected on 8 May. Chief...

Streetnames moves into recruitment.
May 5, 2006... Cash shell Streetnames has announced the GBP22m all-share acquisition of Networkers International, a recruitment company. Networkers specialises in recruiting engineers for mobile-telecoms companies, and is particularly active in emerging...

Essentially moves into rugby.
May 5, 2006... Ofex-traded sports management group Essentially intends to acquire Global Sports Management (GSM) and move to Aim. Essentially specialises in Formula One racing, but the addition of GSM will give the company a solid base in rugby, managing...

MOG gets the go-ahead on Italian job.
May 5, 2006... Following a favourable decision by the Italian government on a neighbouring field, development on Mediterranean Oil & Gas's (MOG) 20 per cent-owned Guendalina gas project will now go ahead. According to Italian oil giant ENI, which will operate...

Globalisation boosts investors.
May 5, 2006... UK equity investors are reaping one of the benefits of globalisation. Purchasing managers' surveys released this week confirmed that UK manufacturing industry is badly lagging behind the rest of the world. They show that manufacturing activity...

Price-cap looms for sub-prime lenders.
May 5, 2006... Sub-prime lenders reacted with dismay to publication of the Competition Commission's provisional findings on its 15-month enquiry on home credit. Market leader Provident Financial, where doorstep lending accounts for around 70 per cent of...

House of Fraser announces fresh approach.
May 5, 2006... Department store retailer House of Fraser has, yet again, announced that a preliminary approach has been made for the company. Analysts speculate that the potential bidder this time is Icelandic company Baugur, which is already a 9.5 per cent...

Hardman resources to raise new funds.
May 5, 2006... Hardman Resources is raising GBP65m via a placing of nearly 66m shares at 98p a share. The company plans to use the money to develop existing exploration assets in French Guiana, Uganda, Tanzania and Surinam, and to pursue new opportunities off...

Mitchells & Butlers to return GBP500m.
May 5, 2006... Mitchells & Butlers (M&B) is promising to return at least GBP500m to shareholders in an attempt to preserve its independence. The managed pub company - which owns the All Bar One and O'Neill's chains - has also highlighted the recent good...

Yell to buy telefonica's tpi.
May 5, 2006... Yell is buying Telefonica's 60 per cent stake in TPI for GBP2.3bn. TPI operates print and online directories in Spain. Yell says the acquisition will increase earnings per share in the first full year of ownership, and deliver a return on...

Bluetooth demand keeps csr smiling.
May 5, 2006... Chip designer CSR says there is no sign of slowing growth in demand for Bluetooth chips. It believes that the market will grow by between 60 per cent and 70 per cent in 2006. The company doubled sales in the first quarter to $134.9m...

Week Ahead...
May 5, 2006... News Monday 8 May Botanic drug developer Phytopharm will announce its half-year results. The company has had a difficult 12 months following the firebombing of a director's car by animal rights activists, the loss of its licensing...

G'day for Regent Inns.
May 5, 2006... The owner of the Aussie-themed Walkabout chain of bars has received a takeover approach. Regent Inns, which recently admitted a slowdown in trading, has looked like a probable takeover target for some time. The company's lack of size puts...

NHS is blameless as iSoft warns again.
May 5, 2006... iSoft has issued a second profit warning after it was affected by delays to the delivery of contracts. The company, which provides software to the healthcare sector, says that it will report worse-than-expected sales of GBP210m to GBP215m,...

IMPERIAL TOBACCO (IMT).
May 5, 2006... Smokers are under siege across the western world. Punitive taxes and bans on public enjoyment of cigarettes are hurting consumption. In Germany - the second most important single country for Imperial - the market shrank by an alarming 13 per...

SMC (SMC).
May 5, 2006... SMC floated in 2005 with the intention of consolidating the fragmented architecture sector. So chief executive Stewart McColl made three acquisitions last year, and has already made three more this year. There should be more deals to come,...

KENMARE RESOURCES (KMR).
May 5, 2006... Getting the Moma mineral sands project into production has really been a labour of love for the Carvill family. Along the way, the Carvills' company, Kenmare, has been beset by disasters both man-made and natural. But the end is now in sight....

HIGHLAND GOLD MINING (HGM).
May 5, 2006... It says a great deal about the current commodities bull market that Highland Gold's share price has risen sharply over a period in which sales have dropped, profits have turned into losses, the dividend has disappeared, and senior directors...

NOBLE INVESTMENTS (NBL).
May 5, 2006... Noble Investments, formed out of a cash shell in 2003, is the only rare-coin trading company listed on the Alternative Investment Market (Aim). It generates its revenue through numismatics - the science of studying money. It invests in coins...

LIDCO (LID).
May 5, 2006... "We can't complain," says chief executive Terry O'Brien of Lidco's surprisingly strong sales to the NHS. Last year, UK sales rose 78 per cent to GBP1.5m, albeit from a low base, driven by the efforts of the company's small, direct sales team....

LAMBERT HOWARTH (LMBT).
May 5, 2006... Lambert Howarth's largest customer, Marks and Spencer (M&S), is driving an increasingly hard bargain. Discounts extended to M&S rose by GBP2.8m last year and this hit profits in the footwear division, which fell 22 per cent to GBP10.3m. And the...

J SMART & CO (SMJ).
May 5, 2006... J Smart's impressive performance was largely due to its substantial GBP73.8m property portfolio, which maintained profits at GBP2.17m. However, much of the overall improvement in pre-tax profits came from increased contracting work - profits...

METAL-TECH (MTT).
May 5, 2006... Metal-Tech processes low-grade metals, such as mining tailings and waste, to turn them into higher-value metal oxides and metal powder products for the stainless steel, petrochemical and cutting tools industries. And company, which raised...

PREMIER RESEARCH (PRG).
May 5, 2006... Premier manages clinical trials for other drug companies - a market growing at 10 to 14 per cent a year as pressure grows on drug companies to outsource trials to ensure objectivity. And although relatively small, Premier is growing even faster...

ALEXANDRA (AXD).
May 5, 2006... Alexandra has adapted well to the changing workwear market - boiler suits are out, customised corporate uniforms are in. In fact, the company now generates around 50 per cent of its turnover in the bespoke uniform market. But, while its...

EMBLAZE (BLZ).
May 5, 2006... In its original incarnation as GEO Interactive, which planned to deliver video over the internet, Emblaze was a dot-com darling. That never quite worked out, but it did survive 2000's dot-com meltdown and, after 2004's major restructuring, the...

TANFIELD (TAN).
May 5, 2006... Tanfield's restructuring programme - undertaken in 2004 - helped as the milk-float maker move back into profit. Operating profits before tax were GBP2m, compared with an operating loss of GBP5.8m in 2004. What's more, output at Smiths Electric...

CHARACTER (CCT).
May 5, 2006... These results highlighted an impressive turnaround, that saw Character move back into the black. A major shake-up culminated in the sale of the digital business just before the year-end, which left the group focused purely on toys, games and...

INTEC BUSINESS COLLEGES.
May 5, 2006... After reporting 2004-05 interim profits of GBP159,000 (up from GBP148,000), the final three months of the year were difficult for Intec, and that continued into the first quarter of 2006. The group provides on-site NVQ and apprenticeship...

LONRHO AFRICA (LAF).
May 5, 2006... Another mining stalwart heading a new venture is David Lenigas. He founded Bangladeshi coal-mine developer Asia Energy and is also chairman of BDI Mining, Indonesia's largest producer of gold and diamonds. Then in December, he became chief...

CARR'S MILLING INDUSTRIES (CRM).
May 5, 2006... Profits at Cumbria-based agriculture, food and engineering group Carr's Milling were far better than the headline numbers suggest. Strip out a GBP4m property gain the previous year, and pre-tax profits before goodwill amortisation actualy rose...

HYDRO INT'L (HYD).
May 5, 2006... In May 2005, Hydro bought Vexamus for GBP150,000. So last year's results included a GBP0.2m restructuring charge relating to that purchase, less a GBP79,000 property write-back. The deal was timely, though, as the new UK water industry fourth...

MALLETT (MAE).
May 5, 2006... For once, Essex pensioner Jack Petchey has backed off an asset play. Via his offshore company, Trefick, he has cut his stake in Mallett from 29 per cent to less than 8 per cent. And that's perhaps not surprising - Mallett has been thwarted in...

ARICOM (TIO).
May 5, 2006... Aricom was originally established to produce and trade titanium dioxide in Russia. But the company, which was floated off from Peter Hambro Mining in 2003, has recently changed direction. This year, Aricom acquired a 49 per cent stake in the...

FORTUNE OIL (FTO).
May 5, 2006... China is now the second-largest energy market in the world, and Fortune Oil is at the heart of the action. It has a string of oil and gas infrastructure projects across the country, including 468km of gas pipelines, oil import terminals and...

AMINEX (AEX).
May 5, 2006... Aminex's modus operandi is to buy exploration prospects in under-explored areas in a bid to gain first-mover advantage. It then brings in partners to help fund exploration and production. Most exploration activity during the year occurred in...

ABERDEEN ASSET MANAGEMENT (ADN).
May 5, 2006... Aberdeen Asset Management's strong performance at the half-year stage was helped by strong equity markets, but also by rising levels of new business and the GBP265m acquisition of the UK-based arm of Deutsche Asset Management (DeAM) in July...

PANTHER SECURITIES (PNS).
May 5, 2006... Property investor Panther Securities is better known for chairman Andrew Perloff's diatribes about the state of the nation that he publishes alongside the final results than anything to do with the business. And this year's six-page litany of...

REA HOLDINGS (RE.).
May 5, 2006... REA's has finally resolved its legal dispute with US-based minority shareholder MEZ Group, which was first lodged in 2001 and claimed breach of contract relating to loans. The settlement took place in January 2006, which was too late to...

ANDREWS SYKES (ASY).
May 5, 2006... Andrews Sykes, a specialist machine hire business supplying mobile heaters and air-conditioning units, should arguably do well in any weather. And this year, the winter cold snap proved very good for business, with chairman Jaques Murray saying...

HYDRO HOTEL.
May 5, 2006... Debtors deserve a higher profile. During 2004-05, the amount Hydro was owed rocketed from GBP113,000 to GBP1.62m. This included most of the proceeds from the GBP1.53m sale of White Lodge Hotel, north-west of Eastbourne. White Lodge, bought by...

GRESHAM COMPUTING (GHT).
May 5, 2006... Gresham Computing has renegotiated its collaboration on the Real Time Nostro (RTN) service with Cable & Wireless (C&W). The service allows banks to view their Nostro account positions in real-time. Nostro accounts are held with banks in foreign...

EL ORO & EXPLORATION (ELX).
May 5, 2006... El Oro chairman Robin Woodbine Parish has done it again, with a statement that frustrates and amuses in equal measure. The frustration is due to the lack of detail, and the amusement derived from his commentary on the state of the world. In...

HOLDERS TECH. (HDT).
May 5, 2006... The EUROPEAN UNION (EU) is increasingly determining UK tax rules, and this was to little Holders Technology's benefit last year. Weak European demand for printed circuit-board materials hit both sales and profits, but the tax charge was...

EASYJET (EZJ).
May 5, 2006... Although easyJet made a loss in the first half, it was smaller than expected, so these results helped push the low-cost airline's shares up 4 per cent. easyJet always makes a first-half loss because the period includes the quieter winter...

ATRIUM UNDERWRITING (AUW).
May 5, 2006... Atrium's profits slumped after being hit by GBP26m of underwriting losses following last year's hurricane season. Inevitably, that resulted in an overall underwriting loss and the group's combined ratio - of claims and expenses to premiums -...

CHEEKYMOON ENT. (CHKY).
May 5, 2006... CheekyMoon Entertainments reversed into one of Michael Edelson's cash shells, called Pine Ventures, in April 2006. The all-share deal comprised the issue of 80m shares plus deferred consideration of up to 140m shares. CheekyMoon then launched...

FIRST ARTIST CORP. (FAN).
May 5, 2006... Back in 2002, First Artist Corporation (FA) was almost completely dependent on football transfers for income. Then came the demise of TV groups ITV Digital and Bertlesmann in Europe, plus the introduction of restrictive transfer windows. So, to...

HAT PIN (HTP).
May 5, 2006... In December 2005, Hat Pin bought 70 per cent of executive recruiter Saxton Bampfylde Hever for up to GBP4.91m and doubled its revenues. Hat Pin (through its Kendall Tarrant subsidiary) recruits ad executives and creatives from GBP40,000...

WELLINGTON MARKET.
May 5, 2006... Wellington's 2004-05 turnover and profits were adversely affected by GBP2.7m of renovation work at the major Luton indoor market. Refurbishment has been undertaken in five phases and should be completed in July. As a result, 130 stalls in a...

QUANTICA (QTA).
May 5, 2006... Last September, Quantica acquired two recruitment businesses for GBP12.5m, financed by a GBP10m placing and open offer. Then, in November, it sold its construction recruitment division. Now, it seems set to announce more acquisitions sooner...

BOLTON (BOL).
May 5, 2006... Murky is perhaps the best description of what has been going on at Bolton. In 2003-04, there were a large number of directors' appointments, resignations and vacations as the future of Bolton's one asset, Angel House in Islington, was fought...

IMAGE SCAN (IGE).
May 5, 2006... After trending down for ages, Image Scan's share price has risen sharply this year - and with good reason. Finally, there's evidence of more demand for its 3D X-ray scanners for security purposes. For the past two years, the company has had to...

WIDNEY (WDNY).
May 5, 2006... Widney started 2004-05 well, with interim profits up from GBP472,000 to GBP1.87m. But third-party supplier problems with a key customer cut fourth-quarter sales by GBP1.8m, and now Widney Cabs (formerly part of Airflow Streamline) is facing a...

COMPASS FINANCE (CAF).
May 5, 2006... Compass Finance certainly had a "very eventful" time in its first full year of trading, following flotation in March 2004 at 48p a share. New management was appointed in May 2005 following disappointing revenues linked to the bad timing of a...

Creative education.
May 5, 2006... Aim. Pre-school nursery education & training

Ashton Penney Holdings.
May 5, 2006... Aim. Interim management solutions

CLINTON CARDS (CC.).
May 5, 2006... The Birthdays chain, acquired by Clinton Cards in December 2004, has proved difficult to digest. So, even though Clinton says that it's made some progress - Birthdays' distribution centre has been closed and a new back-office system introduced...

Global Gaming Technologies.
May 5, 2006... Aim. Technology for the gaming market

Clarkson Hill.
May 5, 2006... Aim. Financial advisory services

Feonic.
May 5, 2006... Ofex. Smart materials

Greatfleet.
May 5, 2006... Aim. Recruitment consultancy

Meriden.
May 5, 2006... Aim. Business services

Waltech Services.
May 5, 2006... Ofex. Software

Black Raven Properties.
May 5, 2006... Aim. Property development