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Penny Share Review 249

Monday 23 August 2004

Caplay's (CLY) plans to buy a quarter of Canadian financial services business Catalyst Investment Corp was reported by Saturday's Guardian, which saw the shares move down in trading on Friday. The shares were down 2.63p this morning and stood at 9.88p.

The extension of CMS Webview's (CWV) deal with the Chicago Board of Trade was noted in Saturday's Guardian. Corporate Synergy, the Company's broker, explained that the fee CMS will receive for the extension is modest compared with that for the full contract, but the deal shows increased interest in the technology, so "the pipeline of interest in the product is actually running ahead of our original estimates". The shares were up 1.00p to stand at 8.00p.

Saturday's Independent reported on the appointment to the board by CYC Holdings (CYC) of Vladimir Egger, a director at Lukoil. The shares were up 0.10p at 1.90p.

Earthport's (EPO) robust trading statement, which noted that its quarter to the end of June was the strongest, in revenue growth terms, since 2000, was picked up by the Guardian on Saturday. However, there were whispers, amongst traders that there is a significant short position in the stock, which is holding back the price. The shares were down 0.05p to stand at 1.63p.

The Ennstone (ENN)/Johnston saga rumbled on last week, with the latest events being picked up by the weekend's edition of the FT. North Atlantic Value, the investor group leading the shareholder revolt accused the management of failing shareholders and questioned the logic of the bringing the two businesses together. The purchase would also weaken Ennstone's financial strength. Charles Grove of North Atlantic does not see how chief executive Vaughan McLeod can improve profits in difficult markets and is calling on shareholders to block the deal and elect Jonathan Scott-Barrett as a non-executive to lead a strategic review of the business that could result in a sale. Elsewhere, the Mail on Sunday, noted that Tarmac might make a bid for Johnston Group as early as today to thwart the Company's efforts to expand. Tarmac has until Wednesday to make a bid and its advisers Cazenove are believed to have met Johnston's advisers, Close Brothers, on Friday. Tarmac, the paper noted, may choose to gamble that opposition to the deal from Ennstone's shareholders could yet foil the takeover. The shares were up 0.25p at 37.50p.

The liquidation of hedge fund manager Laxey Partners' holding in Intellexis (ILX) got the attention of Monday's Independent. The shares were sold at 59.7p, a 13% discount to the prevailing share price, but roughly the level of a small placing undertaken last week to pay off some debt. However, Ken Scott, the chief executive, had to pay 71.5p to increase his stake by 14,000 shares. The Company also noted last month that trading was "going well" and that several new courses were to be launched in the autumn. The shares were up 1.00p at 71p.

Mano River Resources (MANA) is included within a larger piece in the weekend's FT, on the global search for new diamond deposits and production projects. The joint-venture with BHP Billiton to look for diamonds in Sierra Leone as well as its exploration activity in neighbouring Liberia is mentioned. The shares were unchanged in trading this morning.

In Monday's Independent regular small companies notebook MOS International (MOI.L) comes under the spotlight. The paper notes that the Company is being transformed by Philip wood, who was previously chairman of Ansell Jones, which was acquired by MOS last week. There is talk that a "star accountant" could be unveiled as early as this week to help in squeezing cost savings from the integrated businesses. MOS is promising to be profitable by the end of this year, according to the paper and this helped in the recent fundraising, as "fund managers…were happy to stump up £1.2m…to bolster the company's cash position in the expectation of strong sales growth from next-year." The shares were unchanged in trading this morning.

The launch of Pavilion Insurance Network's (PVL) new product Studentguard, to cover students against the cost of leaving university prematurely, was previewed in Saturday's Independent. The policy promises to pay out a fixed sum for each completed term or part-term, for students who are unexpectedly unable to complete their studies. There are three levels of cover - gold (£399), silver (£299), bronze (£199) - which promise to pay out either £2,000, £1,500 or £1,000 for each term, or part-term, completed by the student at the time they terminate their studies. There are over 300,000 new students entering university each year, with over a fifth of students failing to complete their degree. However, the policy will not cover those who voluntarily drop out, or who stop due to stress, anxiety, depression or pregnancy. (See the announcement below for more details). The shares were unchanged in trading this morning.

Pipex (PXC.L) remains a 'buy', according to The Sunday Telegraph, following the acquisition of Accent earlier this month. The deal, worth £12.9m, will add 35,000 customers, a third of which are higher-margin business clients and will also bring on board a profit-making and cash generative business. The shares were unchanged in trading this morning.

Stanelco (SEO) was one of the weekend FT's 'Stars of the week' following the deal with Robert Reiser to retro-fit RF sealing technology to its tray lidding machines. Reiser has targeted 100 machines for adaptation during the first year and an annual licence fee will be agreed for each machine. The shares were up 0.13p to stand at 6.13p.

Zyzygy (ZYZ) was mentioned in Saturday's Times 'Stockwatch' column, which noted that it sounds more like a character from Sesame St. than an investment vehicle listed on AIM. The name, we learn, is derived from a celestial alignment of planets and the sun, but has been altered to ensure the last place in the Yellow Pages. The Times commented that whatever success it has pursuing its new strategy of investing in biotechnology companies, "its exotic name will ensure at least some interest from investors". The shares were unchanged in trading this morning.

Monday's prices, quoted above, were taken between 10.45am and 10.55am on 23 August 2004.

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.

Advanced Medical Solutions (AMS) - Notice of results.
Claims People (CLM.L) - Appointment of Advisers.
E-primefinancial (EPF.L) - Suspension.
Pavilion Insurance Network (PVL) - New product launch.
Tertiary Minerals (TYM) - Drilling report.

Look out for this week

Monday, 23 August - Nothing of note.
Tuesday, 24 August - Claims People (I).
Wednesday, 25 August - Accident Exchange AGM.
Thursday, 26 August - UK CBI industrial trends survey (Aug), BBA mortgage lending (July).
Friday, 27 August - UK GDP (Q2 first revision), GfK consumer confidence survey (Aug), US GDP (Q2).

The next Penny Share Review will be posted on Tuesday, 31 August 2004.

Compiled by Andrew McLintock

Penny Shares Online - penny shares research and information service.