… the new office space leased in the city which is up from 10% since 2009.
Last week …
… economic indicators were relatively benign. UK Production improved 1% with Manufacturing up 1.2% while Retail Sales improved 1.6%. The FTSE 100 at 5666 was 0.1% better while the FTSE 250 declined -0.2 and the Aim All Share at 694, was unchanged. Internationally, Spain said the right things about a 65 billion budget cut, but Chinese GPD growth stalled at an annualised 7.6%, the lowest rate since 2009.
This week …
… given the fragile economic background the corporate interim results may create the trading interest. This week economic news will be UK Inflation on Tuesday which should continue to fall from last month’s 2.8%. On Wednesday, the BOE Interest rates meeting minutes may support GDP being revised lower ad also the Unemployment Rate is reported. In the US, Production is on Tuesday and on Thursday Employment and Confidence figures will be reported. Further sideways drift seems likely.
Phytopharm (PYM) – £22m at 6.2p
An end in sight for tremor
Following the interims, June’s RNS reminded us that the investment case rest on the success of for the PD Phase II trial of Cogane’s efficacy for early-stage Parkinson’s disease. The results are due in Q1 2013 and no further funds are needed. Phytopharm has raised a total of £78.3m since its flotation in April 1996, and obtained £12m in funding under three now-discontinued licensing agreements. Positive data could allow Phytopharm to secure a development and commercialisation partner for Cogane, milestones that would significantly increase its NPVof £48m. The failure of Cogane in the Confident-PD study could reduce the company’s market value to cash or lower, although encouraging data in amyotrophic lateral sclerosis may offer support.
Phytopharm has 14 employees and for the six months to 31 March 2012 reported a balance of cash and equivalents of £13.3m, and no debt. This should be sufficient funds to last until December 2013.
Cupid (CUP) – £160.8m at 198p
A date with Double EPS
A positive pre-interim Trading Statement puts online dating services provider Cupid is on course to grow earnings by more than 50% in 2012. The interim results will be published on 3 September and new markets including mobile dating are growing rapidly. Marketing spending is the key to growth and revenues from new markets in the first half of 2012, which is similar to the £22.2m for the whole of last year. The US, although a relatively mature market, is a new market for Cupid and is set to be key for future growth. Cupid’s main markets in the UK, Australia, New Zealand and Ireland are also growing at above overall market growth rates of 5%-10%. Profits are forecast for December 2012 are £16.3m which is up from £7m for an EPS of 15.1p up from 7.1p which gives a prospective P/E of 13x. This rapid growth is supported by a yield of 1.2%
Cupid is cash generative and there is cash in the bank. It can easily afford the 3p a share dividend forecast for this year.
BGlobal (BGB) – £9.83m at 9.25p
No longer Smart to wait
Finals reported from smart meter installer and services provider Bglobal was hit by a sharp fall in installation revenue but its higher margin software and services operations made up for it. Revenue fell from £29m to £18.4m in the year to March 2012 but a profit £620k was made compared to last year’s loss of £3.81m. The software and services division sets up shell electricity companies, which can be acquired to enter the UK electricity market and three have been sold since the beginning of 2012 for Energetic. Since the financial year end Bglobal signed a three year contract with npower to supply smart metering data collection and data aggregation services. Bglobal has launched Bsmart Energy Solutions to provide a complete range of data, analysis, procurement and energy management services. A compelling way to reduce costs and will start to contribute this year while the roll-out of smart metering is likely to take place once the Retail Market Review and Electricity Market Reform are known. The development of higher margin and quality business should see profits for the 2013 year-end improve to £1m for an EPS of 0.73- and a prospective P/E of 13x.
Net cash was £2.5m at the end. Cash flow was helped by the reduced inventories, but £3.82m was paid in deferred consideration.