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Penny Share Review 220

Monday 02 February 2004

The deal with Japanese pharmaceutical company Takeda Chemical Industries had a positive effect on Alizyme's (AZM) shares Saturday's Times reported. The deal worth around $42m (£23m) will see the Japanese company develop Alizyme's anti-obesity drug. Takeda exercised an option to develop and market the drug in Japan following positive trials in Europe, which cost them $3m. Future milestone payments could generate a further $37m for the company and it will also benefit from "double-digit" royalties on sales of the drug in Japan. Takeda will also foot the bill for the drug's development. Alizyme is in talks with several top drugmakers about a worldwide licensing deal and hopes to launch the drug in 2007, which analysts expect to generate more than $1bn in sales. Nevertheless, the shares at 11.01 were down 17p to 196.5p from Friday's close.

Saturday's Daily Mail featured Cytomyx (CYX) in its 'Broker buys' section. Teather & Greenwood recommends to 'buy' the shares at 31p, as there is "considerable upside based on a comparison with UK and US peers". The shares at 11.05 were up 0.5p to 33p from Friday's close.

Hartest Holdings' (HTH) contract win with the North Tees and Hartlepool NHS Trust made it into the Weekend edition of the Financial Times. Cross Technologies, the Company's medical division, will supply the Trust with its digital imaging system and also install a system to provide x-ray digital imaging, data storage and manipulation, primarily for use in orthopaedics. The government, according to the newspaper, is committing £5bn to be spent on upgrading the NHS information technology infrastructure and Cross expects to take advantage of this market. At 11.05 the shares were up 0.38p to 6.88p from Friday's close.

The Board changes at Hereward Ventures (HEV.L) were reported in Monday's Financial Times. Michael Thomsen has taken over as non-executive chairman, a role he also undertakes at Hereward's sister company Cambridge Mineral Resources (CMR). Michael has been involved in the natural resources industry for more than 25 years and "was impressed by the prospective gold projects held by Hereward." At 11.06 the shares were unchanged at 5.38p.

Talk on Friday of a big contract win at Iomart Group (IOM) had the effect of moving the shares forward, Saturday's Guardian wrote. This morning's acquisition announcement may not have been what The Guardian was expecting, but it could be an indication that corporate activity is picking up at the network security specialist. The shares at 11.07 were off 0.25p from Friday's close and stood at 62.75p.

Raft International (RFT) comes under the spotlight of the Financial Mail on Sunday's 'Aiming High' column. A review of the Company's operation is followed by an appraisal of the "edge" that it has on its competitors. Raft believe that its key difference is that it uses a component-based approach, which provides its products with a high level of flexibility. This means that the new software can be integrated into its customers' existing systems with minimal disruption. The Company is expanding its sales team to target new areas, continuing to build a product library, develop existing software as well as addressing clients' new requirements. The shares were unchanged at 15.25p at 11.07.

Saturday's Telegraph described Ronson's EGM as "shambolic", as shareholders who attended the meeting voted against a rights issue to raise fresh funds for the Company and stave off the threat of receivership. The Company argues that without the rights issue it would be insolvent, while rebel shareholders counter with the charge that Ronson is being sold on the cheap and that Mr Farzad Rastegar, a non-executive director should resign. Mr Rastegar's company AMY, is likely to increase it's holding to over 50% if the rights issue is approved and according to the newspaper this looks likely once the proxy votes are counted. Ronson's shares were delisted in July 2003.

Profit-taking in the exploration and mining sector left both Southern African Resources (SFU.L) and African Eagle (AFE) lower, Saturday's Daily Express wrote. Shares in Southern African Resources at 11.06 were up 1p to 26.5p from Friday's close, while at 11.04 African Eagle's were down 2.75p to 20p from Friday's close.

Shares in Toad Group (TOA.L) moved forward on talk that full year figures, due in March, would "smash expectations", the Guardian from Saturday wrote. The deal with Unipart to install hands-free mobile phone kits for Vodafone customers is said to be behind the strong trading. At 11.06 the shares were unchanged at 23.5p.

Today's Announcements

The following companies, in which City Equities customers may have an interest, released announcements to the market this morning. These can be found by entering the relevant company name or ticker code in the search box on this site.

African Eagle (AFE) - Drilling report.
Datacash (DATA) - Additional listing.
DawMed Systems (DSY) - Annual Report and Accounts.
Fundamental-e Investment (FEI) - Investment.
Iomart (IOM) - Acquisition.
Media Square (MSQ) - Preliminary results.
NWD Group (NWD.L) - Director Change.
Patsystems (PTS) - Director Shareholding.
Scipher (SIP.L) - Disposal.

Look Out For This Week

Feb 2 Monday - Media Square (F), Real Affinity EGM Feb 3 Tuesday - nothing of note.
Feb 4 Wednesday - nothing of note.
Feb 5 Thursday - UK interest rate decision, Eurozone European Central Bank
meeting. Feb 6 Friday - US non-farm payrolls (Jan).

The next Penny Share Review will be posted on Monday, 9 February 2004.

Compiled by Andrew McLintock

Penny Shares Online - penny shares research and information service.