Investors Chronicle articles from September 2004

Investors Chronicle archives from September 2004

Bull markets.
September 3, 2004... "Bull markets are born on pessimism, grow on scepticism, mature on optimism and die on euphoria" - or so the theory goes. If that sounds all too familiar, that's because it is. The bull-market rally, which started in March 2003, was certainly...

History tales.
September 3, 2004... History and judgment are telling us two different stories about where the Footsie will go this month. History says September is the worst month for shares: they've fallen in half of all Septembers. But judgment suggests there are reasons for...

Too good to be true.
September 3, 2004... It's an easy mistake to make. Getting carried away by analysts' earnings forecasts is an elementary error, yet it's one that we've probably all committed. Somehow - perhaps because they try to blind us with science - we give analysts more...

Look on the long side.
September 3, 2004... Year-to-year financials get more attention than they deserve. It is rare - is it not - to read a results announcement that takes a purview greater than two years? You get this year's numbers and you get last year's. In the commentary, you get...

Milk round.
September 3, 2004... Milk is one of those things we take for granted. We may not get a pinta on the doorstep each morning like we used to - doorstep deliveries have fallen from 90 per cent of sales two decades ago to 25 per cent today - but we know that, on the...

Scarcity value.
September 3, 2004... It's odd the way that a company's share price gets hammered when the company in question misses a profits forecast. Odd because this factor above all others is the one that really clobbers a share price, yet, simultaneously, it's very common....

Chemical imbalances.
September 3, 2004... Life is tough for the chemicals industry. Record oil, raw material and energy prices are taking their toll. But there's the threat of new legislation from the European Union (EU) to deal with, too. Critics fear that the legislation, which could...

Dicom acquires TOPCALL.
September 3, 2004... In parallel with its latest results, document-processing technology provider Dicom announced the acquisition of Austrian counterpart, TOPCALL. The GBP27m cash deal looks attractive, bringing both complementary technology and a customer base....

Superscape signs more mobile deals.
September 3, 2004... Superscape, the mobile gaming company, has signed its seventh and eighth mobile-operator distribution agreements. Its games are now available for paid download on Verizon, Vodafone, China Mobile and T-Mobile, among others. Superscape has a...

Go-Ahead lands plane handling.
September 3, 2004... Go-Ahead has bought the remaining half of Plane Handling, a ground handling business in which it was already a 50 per cent shareholder, from Virgin in a GBP20m deal. But the deal is not a further commitment to ground handling. Go-Ahead has...

Household savings grow to allay fears.
September 3, 2004... Households' finances are in better shape than supposed. Figures released this week by the Bank of England show that households' bank deposits grew by 8.6 per cent in the year to July. The GBP56.2bn rise in deposits is five times the...

Brandon completes its largest deal.
September 3, 2004... Plant-hire group Brandon Hire has bought the tool and cabin hire assets of EMCOR Drake & Scull in a GBP4m deal. The deal - Brandon's largest ever - brings with it GBP1.7m of assets. And, says chief executive Charles Skinner, "It gives us some...

Freebies, perks, discounts.
September 3, 2004... Chocoholics can munch their way through a pile of money-off vouchers from Thorntons, Francophiles can get cheap ferry travel to the Continent with P&O, pestered parents can save money on admission to Disney theme parks and the necessary hotel...

Osmetech bids for Molecular Sensing.
September 3, 2004... Diagnostics specialist Osmetech is to pay GBP3.1m for Ofex minnow Molecular Sensing. The acquisition will enable the enlarged Osmetech group to grow its revenue streams, and build on recent strong performance. Osmetech is offering 47 new...

Sheffield United looks to net extra cash.
September 3, 2004... The lure of top-flight football is forcing Sheffield United to return to the market for more cash. The Coca-Cola Championship club is unwilling to sell any of its players as it hopes to mount a serious challenge for promotion to the...

Cubus takes a punt on Aim listing.
September 3, 2004... Cubus Lux has joined Aim as part of its plan to expand its casino operations in Croatia. The group operates the Las Vegas Casino at the four-star Histria Hotel in the tourist resort of Pula, but has ambitions to set up further venues. ...

Next week.
September 3, 2004... Monday 6 September Interims: Abbot, Adventis, Amlin, Bond International Software, Bovis Homes, British Polythene, Corporate Services, Forth Ports, Intertek, IMI, ITNet, Roxboro, Stadium, Star Energy, Taylor Nelson Sofres, Travis Perkins,...

Muted response as NGT announces GBP5.8bn asset sale.
September 3, 2004... Shares in National Grid Transco (NGT) gave a muted response to the announcement that the group has agreed to sell almost half of its gas distribution networks for GBP5.8bn and pay a special dividend. After the sale, NGT will return GBP2bn (via...

Keystone ready for trading go-ahead.
September 3, 2004... One of the largest initial public offerings on Aim in 2004 closes this week as Gulf Keystone Petroleum finalises its plans for an Aim listing. Shares in the Algerian-focused oil & gas outfit should start trading on Wednesday, following a...

SVB boosts reserves for potential claims.
September 3, 2004... Lloyd's insurer SVB is still struggling to throw off the legacy of its past involvement in US liability insurance (cover for US company directors). After incurring big losses, SVB exited that market in 2002, but it said this week that it is...

Brighter outlook for oil services companies.
September 3, 2004... Business is picking up for oil services companies after a long period of weakness. Consensus estimates for the growth in capital expenditure among major oil companies now stand at around 10 per cent, compared with 5 per cent at the start of the...

MMI shares face possible rerating.
September 3, 2004... Medical Marketing International (MMI) shares could see a rerating as the company begins clinical trials on one of its major drugs. Through Genvax, its new joint venture with Southampton University, the technology management company is...

US profits point to slowdown.
September 3, 2004... Investors have received another warning about the coming US slowdown. Figures released by the Bureau of Economic Analysis (BEA) on Friday showed that corporate profits grew by just 0.1 per cent during the second quarter, causing annual growth...

Profits windfall on the cards for House of Fraser.
September 3, 2004... House of Fraser's profits could jump by over a third this year thanks to a deal the group is hammering out with a store-card operator. The card is currently run on House of Fraser's behalf by GE Capital. In a deal signed back in 1991, but due...

Inland Revenue stakes claim to compensation.
September 3, 2004... The Inland Revenue has said that it wants to tax compensation paid out for split-capital investment trusts and endowment mortgage mis-selling. It argues that part of any compensation paid constitutes interest payments and should, therefore, be...

Sanofi-Aventis 'anti fat' drug laps up plaudits.
September 3, 2004... French drug giant Sanofi-Aventis this week unveiled impressive data from trials of its obesity drug Rimonabant, putting pressure on UK biotech Alizyme, which has yet to launch fat-fighting drug ATL-962. Rimonabant, tipped as a potential...

Correct FTSE returns.
September 3, 2004... Some figures on page 56 of the 27 August issue were mis-stated. The correct figures for the total returns on the FTSE All-Share index over one, three, five and 10 years, respectively, were, 8.1, -9.58, -14.24 and 87.68 per cent.

Cheaper dealing for US stocks.
September 3, 2004... American Express Sharepeople is offering online dealing in US stocks for GBP10 per trade until the end of September. You will be able to access the 141 stocks listed on the International Retail Service, and the 7,800-plus listed on the major US...

Sector strives to earn investors' trust.
September 3, 2004... Many investors avoid investment trusts, but the sector has been introducing sensible new policies. As well as the negative sentiment generated by the collapse of highly geared funds in the split-capital investment trust sector, many people...

New fund launches.
September 3, 2004... Close Man is this month launching a second hedge fund with full capital protection, following the success of its first offering in June. Guaranteed Hedge Fund 2 targets annualised absolute returns of between 11 and 13 per cent a year after...

Investment fact or fiction?
September 3, 2004... Most investment professionals, whether they be independent financial advisers (IFAs), fund managers or stockbrokers, are guilty of propagating conventional wisdoms, many of which are well past their sell-by date. We look at 10 commonly used...

Death duties.
September 3, 2004... If a friend or relative asks you to act as executor to a will, should you agree? "A lot of people don't appreciate how much they are taking on, and that they won't get any payment for their time," says Anne Lewis, partner at south-east law firm...

DIY online analysis.
September 3, 2004... Given the volume of data currently available on the internet, there is plenty of material available free to investors who want to run their own portfolio of funds. So we've looked at a number of the sites that offer 'my portfolio' analysis...

Signing off.
September 3, 2004... Investors chronicle's DIY Pensions columnist, Patrick Hosking, is moving on - after nearly three years of showing how it's possible to manage your own pension fund using a self-invested personal pension (Sipp). So, in the issue of 1 October, we...

HHG (HHG).
September 3, 2004... After the upheaval of the past year, chief executive Roger Yates is now focused on improving profits at fund manager Henderson, and extracting shareholder value from the group's three closed books of life assurance business. At Henderson, funds...

LAING (J) (LNGO).
September 3, 2004... Laing looks set to begin selling some of the private finance initiative (PFI) investments it has been making. And investors are now willing to pay higher prices than they were when the secondary market for PFI stakes first emerged. Finance...

BUNZL (BNZL).
September 3, 2004... "Not a lot of excitement" was how one analyst described Bunzl's results. However, it is clear that the global outsourcing company is making steady progress. At constant exchange rates, the company grew both turnover and underlying profits by 10...

HUNTING (HTG).
September 3, 2004... Last year, Hunting's GBP21.1m of pre-tax profit equated to earnings per share (EPS) of 6.4p. This year, a forecast profit of GBP20.3m will generate EPS of 13p, according to house broker ABN Amro. The difference is down to financial engineering....

SLOUGH ESTATES (SLOU).
September 3, 2004... Analysts are divided over Slough's intention to swap its retail property portfolio with Land Securities' industrial assets, and these results highlight why. A modest 2.8 per cent uplift in the value of the group's portfolio was helped along by...

REXAM (REX).
September 3, 2004... Among packaging firms, Rexam is one of the least economically-sensitive around. Steady demand for beverage cans gives its business a comforting reliability in the eyes of investors. However, since peaking at 468p at the end of April, the...

ASSOCIATED BRITISH PORTS (ABP).
September 3, 2004... These results were damaged by a GBP44.9m write-off, announced back in April, which was necessary when the government denied Associated British Ports (ABP) planning permission to develop a deep-sea container port at Dibeden. The project, which...

RENTOKIL INITIAL (RTO).
September 3, 2004... It has been a pretty dismal year so far for Rentokil, which announced a brutal profit warning in May, followed closely by the departure of chairman Sir Clive Thompson, and not long after, its chief executive James Wilde. But current management...

SAVILLS (SVS).
September 3, 2004... An upbeat trading statement in July set the tone for these results, and any concerns investors may have had over a repeat of last year's slowdown should now evaporate. Trading at the transactional division has "gone from one extreme to...

LAMBERT HOWARTH (LMBT).
September 3, 2004... It's not easy having Marks & Spencer (M&S) as a major customer, but Lambert Howarth looks to be weathering the storm. It supplies M&S with footwear and accessories, and admits that the recent M&S management changes have led to price reductions...

JOHNSTON PRESS (JSG).
September 3, 2004... Johnston has made a habit of pleasantly surprising the markets with its runaway earnings growth. But up against stiff comparatives, advertising revenues - which make up almost four-fifths of total revenues - won't be growing at quite the same...

TOMKINS (TOMK).
September 3, 2004... Around two thirds of Tomkin's profits and sales are derived from North America, so the effects of a weak dollar have again come into play with this latest set of results. Sterling sales were hit to the tune of GBP140m - or 9 per cent - falling...

DOMNICK HUNTER (DKH).
September 3, 2004... Domnick Hunter's Pre-tax profits have increased at a compound annual growth rate of 16 per cent over the past five years. And the upward trend continues with this latest set of figures, despite some adverse currency effects. Organic...

CATTLES (CTT).
September 3, 2004... Cattles' loan book grew 21 per cent in the first half as the group concentrated on selling loans to the direct-payment market. These customers borrow more than traditional home-collected customers (average loan size is GBP5,000, against GBP200...

METAL BULLETIN (MTLB).
September 3, 2004... Fortune has smiled on Metal Bulletin of late. The group's financial publishing activities, which were started in part to reduce its reliance on the metals market, have continued to enjoy strong growth, thanks to an appetite among investors for...

ANTONOV (ATV).
September 3, 2004... Major developments in the automotive industry can take as long as 15 years to come to fruition. And that is how long it will be before Antonov, set up in 1991, begins to earn royalties on its smaller and lighter automatic gearboxes. To date, it...

CHACO RESOURCES (CHP).
September 3, 2004... Chaco Resources is the new name for Gold Mines of Sardinia (GMS), now shorn of its Sardinian gold interests. Italian bureaucracy defeated GMS's attempts to develop either the southern Furtei mine or a gold deposit at Monte Ollasteddu to the...

ERINACEOUS (ERG).
September 3, 2004... Erinaceous joined Aim last November via a placing that raised GBP9m at 130p a share. The group was founded in 1999 and now employs more than 2,000 people. It offers a one-stop shop for property services, including residential letting (where it...

PINEWOOD SHEPPERTON (PWS).
September 3, 2004... With young stars like Harry Potter and Charlie of Chocolate Factory fame on its side - Pinewood's studios are being used in the production of the latest versions of both - it's no wonder that the 70-year-old company looks so sprightly. ...

REDSTONE (RED).
September 3, 2004... In May 2002, Redstone stemmed its losses and ensured survival when it sold its telecom infrastructure to BT. As part of the deal, BT Wholesale supplies Redstone with network services, extended to 2012. In turn, Redstone sells on telecom...

WEIR (WEIR).
September 3, 2004... Impressive progress with its order book, which has increased by 25 per cent to GBP451m at constant exchange rates, leaves Weir well-placed for a strong performance in the second half and beyond. The improvement was underpinned by new product...

FIRST PROPERTY (FPO).
September 3, 2004... First Property's first venture was marketing commercial properties online - a service for which it charged half the normal rate of commission. It now e-mails details of available premises to over 35,000 property agents and last year sold...

GLOW COMMS. (GLW).
September 3, 2004... Glow Communications has lost its sheen. Under the leadership of Duncan Hickman, the company was to "become a strong business with a bright future". Yet its share price chart told a different story, and Glow is now de-listing. Mr Hickman's...

GUINNESS PEAT (GPG).
September 3, 2004... It's been a frustrating six months for activist investor Guinness Peat. A proposed bid for a 25 per cent chunk of hotel group De Vere was scuppered when the struggling hotelier made its own approach for low-end rival, Premier Lodge. Guinness...

ENSOR (ESR).
September 3, 2004... Some two years ago, Ensor made manhole covers and wire products for the construction industry - and it did so on wafer-thin margins. It is now primarily a distributor, making use of an office in China to import products such as below-ground...

MARCHPOLE (MPH).
September 3, 2004... Marchpole's founder, Michael Morris, fell out of love with the Marchpole board on St Valentine's Day 2000. Four years and two different boards later, he is the director responsible for sales, production and brand development - and has rebuilt...

FOCUS SOLUTIONS (FSG).
September 3, 2004... Focus Solutions makes software that allows applications for financial products to be made online - and the UK's top 10 life and pensions insurers all now use Focus's products. But last year's drop in turnover reflected a GBP2m reduction to...

HUMAN RESOURCE.
September 3, 2004... Human Resource's (HR's) disappointing 2003 performance is blamed on weak recruitment demand from its four key sectors: engineering, retail, information technology and finance. At the same time, setting up eight more start-up ventures (making a...

ARCON (AIN).
September 3, 2004... Fortunate Arcon has found a new and 19-per-cent-rich zone of zinc mineralisation at its Galmoy mine. The find will extend the life of the mine by three years to 2010 and half of current production now comes from that zone. Zinc output is...

TRANS-SIBERIAN (TSG).
September 3, 2004... Trans-Siberian joined Aim in November - and it has two projects that will need additional equity and debt financing. The leading one is the epithermal Asacha deposit in the far north-east of Russia. A bankable feasibility study was completed...

FIRST QUANTUM (FQM).
September 3, 2004... First Quantum joined Aim in April 2001 and is starting to motor as Chinese demand pushes up copper production and prices. Last year, copper production jumped nearly 1.5 times to almost 30,000 tonnes - and this is expected to reach 120,000...

AUTOLOGIC (ALG).
September 3, 2004... Autologic shares tumbled 18 per cent to a year-low of 228p after the car transportation company admitted that its performance in France is "dragging the rest of the company down". Finance director Philip Nuttall says that the French car market...

CITY OF LONDON (CIN).
September 3, 2004... After HEAVY tech-investment LOSSES, City of London Group is "back to life", even though operating losses rose from GBP49,000 to GBP191,000 last year. The company promotes mining firms, although it appears not to have won its fair share of...

GOLDEN PROSPECT (GOL).
September 3, 2004... Golden Prospect has a core investment portfolio of minority stakes in 16 mining exploration companies. They range in size from a third share in fellow Australian natural resource investor Samson Exploration to 0.5 per cent of South African...

DCS.
September 3, 2004... Aim. DCS has cut its debts and improved its banking facilities. Profit was achieved thanks to the disposal of a 33.3 per cent stake in DCS Automotive for GBP6m.

FBD.
September 3, 2004... Main market. FBD's improved performance was down to continuing favourable underwriting conditions. Strong personal-lines business was also achieved.

Generics.
September 3, 2004... Main market. Generics' consulting business is approaching break-even and the company is now planning for growth. It expects continuing improvement in the second half.

Claims People.
September 3, 2004... Aim. The Claims People Group has increased its client base and the second half has started well. Acquisitions are being sought.

Hemscott.
September 3, 2004... Aim. Hemscott is boosting its presence in the US via the GBP7.3m acquisition of CoreData. The group is also subject to a partial offer from Centerpoint Data at 55p a share.

Monstermob.
September 3, 2004... Aim. The Monstermob group is paying an initial consideration of GBP1.6m for 9 Squared, a US-based provider of mobile entertainment products. It still has GBP6.7m in cash.

Network.
September 3, 2004... Aim. Network initially floated as a biotech business. Its outdoor media operation has made good progress and achieved results ahead of expectations.

Pilat Technologies.
September 3, 2004... Aim. Improved trading conditions and a reduced cost base have helped Pilat swing back into the black.

JAMES FISHER (FSJ).
September 3, 2004... James Fisher's transition from ship owner to marine support services group continues apace. Operating profits in the support division now account for 46 per cent of the total - up from just 17 per cent two years ago - and management isn't...

Bolton Group (International).
September 3, 2004... Main market. Bolton's principle asset is Angel House. The group is seeking methods to raise funds or sell the property.

Spring Grove Property Maintenance.
September 3, 2004... Aim. Spring Grove has agreed a cash bid at 43.125p a share. If unsuccessful, further funds will be required. Costs have been cut.

Robinson.
September 3, 2004... Aim. Improved manufacturing efficiencies boosted Robinson's margins. The dip in profits is due to Aim float costs and a GBP1.15m exceptional gain last year.

Dunham-Bush.
September 3, 2004... Main market. Improved purchasing and a focus on higher-margin business helped Dunham-Bush report record results. Investors will now be looking for a return to the dividend list.

Hemisphere Properties.
September 3, 2004... Aim. Having joined Aim last August, Hemisphere Properties has acquired a number of investment properties throughout the UK and is focusing on building up its portfolio.

Namibian Resources.
September 3, 2004... Aim. Namibian Resources floated on Aim to raise GBP2m. The funds are being used to equip a mine in Namibia.

LOGICA CMG (LOG).
September 3, 2004... There was little here that varied from July's trading statement, but sometimes no news is good news and Logica's shares rallied with relief. Germany - where first-half revenues were down nearly 25 per cent - remains a thorn in the group's...