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Penny Share Review 264

06 December 2004

The Small Cap Comment section of the Sunday Telegraph tipped 1st Dental Laboratories (FDT) as a ‘buy’, following the completion of its acquisition of Benchmark last week. The Group’s strong balance sheet and banking facilities of £5.25m should allow the Company to make further acquisitions. The article concluded with the comment, “Demand for dental services is growing and the company is considering paying a maiden dividend in 2006.” The shares rose 3.75p to 35.25p this morning.

The Express from Saturday noted that the shares in Aerobox (ARX) moved slightly lower on Friday following the clearing of an overhang of stock arising from the sale of 4.8m shares by Watermark. The stock was unchanged from Friday’s close of 16.25p.

Cater Barnard (CRB.L) featured in the Market Movers section of Saturday’s Independent, after the confirmed acquisitions of Navitas Hemway and Telco solutions helped push the stock higher. Shares dipped slightly on Monday and were 0.05p off at 0.48p-mid.

After seeing the shares fall because the Company and its flagship product was not mentioned in a recent Department of Health review, Energy Technique (ETQ) updated the market last week and the shares reacted favourably. The news was carried by Saturday’s edition of the Daily Express, which also pointed out that ETQ’s Nightingale product was, after all, outside the review’s remit. The stock was unchanged this morning at 4.13p.

Edmond Jackson, writing in The Sunday Telegraph, included his opinion on the proposed acquisition by Oakdene Homes of Honeygrove Group (HYG). In what read as a reluctant acceptance to the deal, Mr Jackson pointed out the disparity between the terms of the acquisition and previous statements given by Honeygrove directors as to the value of the assets under their control. The article suggested that Oakdene’s due diligence may have uncovered a problem in Honeygrove’s balance sheet, but under new management the assets could deliver better returns. The shares stood firm at 6.75p on Monday morning.

Saturday’s Daily Express picked up on the recent sharp gains in Namibian Resources (NBR) “on hopes of a positive update”, the market having been reminded of the Company’s prospects in the 30 November results. The stock dropped back by 2.5p to 39.75p on Monday.

“Profit taking after recent strong gains”, was the reason given by The Independent on Saturday for last week’s fall in the share price of Northern Petroleum (NOP). Shares in the oil explorer advanced by 0.75p to 10.25p on Monday.

According to a report in Saturday’s Daily Mail, dealers expect a decision from the Iraqi government by the end of the month on whether Petrel Resources (PET) has been successful in its application for tenders over two projects in the country. The Independent on Saturday also noted the rise in the share price as “Investors wait for an update.” The Stock declined by 2.5p to 100p on Monday.

Ahead of today’s announcement, The Business talked about Pipex Communications’ (PXC.L) plan to launch a voice over internet (VoIP) service for small businesses, which could cut phone bills by as much as 75%. Pipex shares traded higher by 0.63p to 8.13p this morning.

The Independent on Saturday reported that the previous days fall in the shares price of Planestation (PTG) was due to investors continuing to worry about the Group’s funding shortfall. Edmond Jackson’s column in The Sunday Telegraph was particularly scathing, suggesting that new chief executive Martin May “has a lot to answer for.” The decision to finance a start-up airline before solving Wiggins legacy issues seems to have rankled more than one market commentator. Meanwhile, the Daily Mail from Saturday pointed out that the Group’s net asset value is 37p a share, according to an unnamed industry analyst. The shares traded unchanged on Monday at 17.00p.

A sharp faller last week was Protec (PRC), after a poor trading statement was revealed at the firm’s AGM on 3 December. The Independent on Saturday followed with news that the Chairman, Philip Parker, also intends to step down after 6 years at the head of the table. The stock ticked up by 0.25p to 4.00p on Monday.

Monday’s Independent reported on the rise in the share price of Zi Medical (ZIM.L) last Friday and said that with a £6m valuation it looks a “risky proposition for investors”. The report focuses on the negatives and concludes that if Zi fails to gain a major deal before June of next year then it could face a cash crunch, with cash burn running at £100,000 a month. Shares in Zi dropped 0.50p to 7.75p on Monday morning.

Monday’s prices, quoted above, were taken just after 10.30am on 6 December 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.

Black Rock Oil & Gas (BLR) – Drilling Report.

Gamingking (GGK) – Interim Results.

Pipex Communications (PXC.L) – VOIP Launch.

River Diamonds (RVD.L) – Exploration update

Sareum Holdings (SAR) – New Cancer Collaboration.

Symphony Plastic Technologies (SYM) – Court Hearing.

Toledo Mining Corporation (TMC) – Interim Results.

Look out for this week

Monday, 6 Nov – Toledo & Gamingking results.

Tuesday, 7 Nov – nothing of note.

Wednesday, 8 Dec – nothing of note.

Thursday, 9 Dec – BoE interest rate decision.

Friday, 10 Dec – nothing of note.

The next Penny Share Review will be posted on Monday, 13 December 2004.

Compiled by Jason Robertson.

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