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From UK-Analyst.com: Monday 10th December 2012
Competition Congratulations to Alun Morris whose caption (below) has been voted the funniest and has won the UK-Analyst Friday competition. Watch out for another contest at the end of the week. 
"New Starbucks scandal. Puppy slavery is secret of unique 'nutty' taste." The Markets Italian stocks tumbled sharply on news that Prime Minister Mario Monti plans to resign and former leader Silvio Berlusconi is to run for office. Again. This development came after Mr Berlusconi's People of Freedom party withdrew its support from government on Thursday and he announced plans himself to lead his party into next year's elections, elections now likely to take place before originally expected in April. David Thebault, a trader at Global Equities said "Monti's surprise resignation brings back the political risk in the equation, something we had forgotten about". Over in Asia, revised figures from Japan suggested that the world's third largest economy may be entering recession. The Japanese economy shrunk by 0.9% in the July-September quarter, while growth in GDP of 0.1% in the April-June quarter has now been downgraded to a contraction of 0.03%. This would of course mean that Japan is technically already in recession, having contracted for two quarters in a row. Tomo Kinoshita, Chief economist at Nomura Securities, argues "we had already said Japan was in a recession. Today's numbers strengthened our case". Staying in Asia, China's export growth came in at 2.9% for November, well below market expectations for around 9% growth. The figures serve as a reminder that China remains exposed to problems in Europe, the United States and Japan and contrasts with data released over the weekend which pointed to significant rises in factory output. At the London close the Dow Jones was up by 31.45 points at 13,186.58 and the Nasdaq grew by 15.66 points to 2,656.20. In London the FTSE 100 increased by 7.23 points to 5,921.63; the FTSE 250 finished 9.41 points down at 12,178.15; the FTSE All-Share gained 2.28 points to 3094.80; and the FTSE AIM Index slipped down by 2.13 points to 686.40.  Broker Notes Canaccord Genuity has maintained a "buy" stance on sweetener specialist Tate & Lyle (TATE), with an 8% increase in target price to 840p. The broker was impressed with the company's recent Capital Markets Day in Chicago where "exciting strong positions in key markets" were highlighted. The broker also is of the opinion that the firm's Speciality Food Business, which makes up 55% of total group operating profits, will exceed guidance by 4-5% after a number of high quality product launches. The shares rose by 10p to 769p. Seymour Pierce stuck with its "buy" recommendation on Faroe Petroleum (FPM) with a target price of 286p. The broker notes that the firm has commenced drilling its first exploration well at its Rodriguez prospect, located on the Halten Terrace in the Norwegian Sea. Seymour Pierce believes the current share price is a "clear entry point", with four significant exploration wells scheduled to be drilled in Norwegian waters next year. The well currently being drilled is expected to take 75 days to complete and is being undertaken by the operator of the licence, Wintershall. The shares were down by 1.75p at 126p. Panmure Gordon has reiterated its "sell" recommendation on Domino's Pizza (DOM) with an unchanged target price of 360p. This comes after the group's largest competitor, Pizza Hut Delivery, announced plans to open at least 100 stores by the end of 2014. The broker perceives this to be a substantial threat to Domino's own expansion plans and believes the threat from third party websites such as Just Eat and Hungry House could prove to be a significant obstacle for the firm to navigate. Moreover, the broker is of the persuasion that Domino's will not be able to keep up with this year's performance which, according to the broker, has been artificially enhanced by Euro 2012, the London Olympics and the wettest summer for 100 years. The shares fell by 1p to 501p. 
Blue-Chips Mineral exploration company Eurasian Natural Resources (ENRC) announced that its subsidiary, ENRC Congo BV, is due to to complete the acquisition of the remaining 49.5% of Camrose Resources by the 28th December, for a fee of 550 million dollars (343 million pounds). The acquisition of Camrose, which holds high quality copper and cobalt licenses in Congo, is part of the firm's strategy to make acquisitions that generate significant cash flows while having the potential to benefit greatly from the increased synergy that a partnership could bring. Near-term production estimates from Camrose's assets stand at approximately 100,000 copper contained tonnes per annum. The shares lost 7.4p to 275.6p. Telecoms giant Vodafone (VOD) has entered into two partnerships with a goal of increasing childhood vaccination levels in sub-Saharan Africa. Firstly, it has partnered with the GAVI Alliance, which is supported by the UK government and helps 73 of the poorest countries in the world to obtain new vaccines to strength their health system infrastructure. Secondly, the telecoms giant has entered into a partnership with GlaxoSmithKline, which is supported by the Save the Children charity and has initially agreed to a one year vaccination pilot with the Mozambique Ministry of Health. Vodafone's role will include providing handsets to health workers amongst other constructive measures. The shares slipped down by 0.43p to 161.42p. 
Mid Caps Soft drinks group A.G Barr (BAG) reported a 9% increase in revenues for the 18 weeks ended 1st December as revenues increased by 6.5%. The group attributed growth to a good performance by its core brands and said there had been "no significant changes" in the financial position of the group since the publication of interims for the 6 months ended 28th July. The company also stressed that construction of its new manufacturing plant in Milton Keynes is well underway, with the handover expected in February 2013. The shares rose by 2.1p to 480p Waste management business Shanks Group (SKS) announced that its subsidiary, Van Tujil, has been awarded a contract to recycle 15,000 tonnes of glass bottles for international brewer Heineken. This comes after the decision by Heineken to produce beer only in green bottles and to completely stop producing beer in brown bottles. As a consequence, Heineken will need to recycle its entire inventory of brown bottles and the contract, agreed for an undisclosed amount, has been awarded to Van Tujil. The shares fell by 1.5p to 76.55p. Commercial property owner Great Portland Estates (GPOR) has exchanged contracts to acquire Minerva House, SE1, from the Minerva Trust, SREIT Property Limited and Clerical Medical Managed Funds Limited for 60 million pounds. The building is a prominent office and residential building, totalling 103,686 sq ft, situated on the South Bank of the River Thames and close to the vibrant Borough Market. The building represents a net initial yield of 5.4% and is the first purchase by the company since the 140 million pounds equity placing announced less than a month ago. The shares were up by 0.3p at 485p. 
Small Caps & AIM Supplier of electronic components Solid State (SSP) announced a 39% increase in revenues to 15.8 million pounds and a 16% rise in pre-tax profits to 813,000 pounds for the 6 months ended 30th September. The increase in revenues were boosted by a contract won in May for 3.5 million pounds to supply in-vehicle electronics for an export client. The group did acknowledge that profits have not risen as much as desired from this increase in revenues and attributed this to margin pressures from broader economic conditions and increased competition in the specialist electronic components division. The shares remained flat at 256.5p but have more than doubled since the beginning of 2012. Engineering company Hardide (HDD) reported a 49% increase in turnover to 2.91 million pounds and pre-tax profits of 265,000 pounds for the year to September after a loss of 446,000 pounds in the previous year. The improvement was attributed to a relatively small 12% increase in the cost of sales, while sales rose by 49%. The improved margin was down to fixed production salaries and improved utilisation of assets. The company is now looking to increase its marketing spend in order to continue this level of growth. The shares climbed by 0.19p to 1.08p. Technology firm Imaginatik (IMTK) has signed a new contract to provide software and consultancy to the Research and Engineering division of one of the world's largest publicly traded multi-national oil and gas companies. The contract was agreed on a three year basis and is for the delivery of Imaganatik's innovation software to stimulate employee engagement on a range of different challenges. The firm also revealed that it has signed up two additional customers on a pilot project basis with the hope of converting them into annual contracts early next year. The shares increased by 0.035p to 0.33p. 
Alternative Networks (AN.), the provider of IT networks, reported a 36% increase in pre-tax profits to 16.7 million pounds despite a 2% drop in revenues to 114.84 million pounds for the year ended 30th September. The group attributed this improvement in performance to the establishment of dedicated enterprise and SME teams which have, according to the company, both been successful in further penetrating their respective target markets. As a result the board increased the total dividend for the year by 15% to 11.5p per share. The shares increased by 10.5p to 266p. Angle (AGL), the medical technology company, confirmed that its partner ORIGIO has decided to stop development of EmbryoSure, a technology for assessing the viability of embryos in IVF. This comes after ORIGIO was taken over by The Cooper Companies who have decided not to pursue the technology. Separately, the company expects to be able to release a research version of its potentially breakthrough Parsotix cancer screening device for sale to the research sector early next year. The shares tumbled by 6.5p to 29.75p. Shares in Nature Group (NGR), the waste management company for the oil and marine industries, crashed by 8.75p to 21p after the firm issued a profits warning. The company said that because of delays in the completion of a number of projects and increased costs relating to the expansion of the business, results for the year ended 31st December will be materially below market expectations. The company went on to argue that the balance sheet was "healthy", having 1 million pounds in net cash despite recent capital expenditures. | 
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