From UK-Analyst.com: Thursday 20th November 2012
The Markets Retail sales in the UK remained flat in November according to the Office for National Statistics, fuelling fears that consumers tightened the purse strings before Christmas. However, there was positive news in the shape of a 3.8% increase in sales of household and electrical goods, thought to be partly boosted by a rush to buy discounted stock at the now-closed Comet stores. British Retail Consortium director-general Helen Dickinson said "With Christmas falling on a Tuesday this year, this weekend will be the critical one". Staying in the UK, house sales and mortgage lending should increase next year according to the Council of Mortgage Lenders (CML) as activity is predicted to be boosted by the government's funding for lending scheme (FLS); a programme which provides cheap funds for banks and building societies. Bob Panell, the CML's chief economist said "In our view the FLS now has the potential to underpin a modest pick-up in mortgage lending activity". Over in Japan, the national bank has boosted its central stimulus measure in an attempt to revive the world's third-largest economy. The country has extended its asset purchase programme by 73 billion pounds in an attempt to keep borrowing costs down. Japan has been trudging through years of sluggish growth and many analysts said this measure will not be enough to make a big impact on the economy. "This is a disappointing decision given the level of expectations." said Robert Rennie, Chief Currency Strategist at Westpac Bank. At the London close the Dow Jones was down by 13.94 points at 13,238.03 and the Nasdaq fell by 7.86 points to 2,683.13. In London the FTSE 100 fell by 3.25 points to 5,958.34; the FTSE 250 finished 20.36 points up at 12,422.77; the FTSE All-Share gained 0.26 points to 3,122.58; and the FTSE AIM Index crept up by 2 points to 694.87.  Broker Notes Cannacord Genuity reiterated its "buy" recommendation on security and facilities management firm Mortice (MORT) with a target price of 73p. This comes on the back of news that the company has appointed Basil Arun Keelor as group CEO and Vishnu Sultania as CFO. The broker is impressed with the experience that these two appointees bring to the company as they have worked for several of its global peers. Seymour Pierce is of the belief that this indicates the intention of the company to expand its fledgling facilities operations throughout India and believes it could possibly be a precursor to wider geographic moves. The shares remained flat at 59p. Panmure Gordon maintained its "buy" recommendation on 888 Holdings (MTC) with a target price of 143p. This comes after the company released a pre-close trading update stating that it remains confident it will meet management expectations. The broker is reassured by this and takes it as indicative of the good shape the company is in heading into 2013. Furthermore, 888 has been awarded a poker license in the German state of Schleswig-Holstein, which will allow it to offer products across Germany, providing a significant catalyst to increasing revenues and a boost to the European presence of the group. The shares were down by 2p at 117p. Daniel Stewart initiated coverage on Strategic Minerals (SML) with a target price of 10p and a "buy" recommendation. The broker's discounted cash flow valuation model - looking at the next 5 years - values the shares slightly higher at 12p, almost three times the current share price. According to the broker, the 10p per share valuation is at a level which should give significant comfort to investors. The main driver of cash flows comes from the commencement of full scale production of magnetite in Australia following a contract signed with Glencore back in March. The shares remained flat at 4.03p. 
Blue-Chips Business support group Serco (SRP) revealed in a pre-close statement that it remains on track to meet expectations for 2012, underpinned by a year of strong revenue growth. The group also confirmed that it has received approval regarding the purchase of Australian maritime services operator DMS Maritime at a cost of 82 million pounds, comprising of a cash consideration of 69 million pounds and incremental net debt of 13 million pounds. The shares increased by 0.5p to 544.5p. Engineering firm Weir Group (WEIR) has agreed to acquire Mathena, a provider of pressure control rental equipment for onshore oil and gas drilling applications. The company will pay an initial 148 million pounds, with a further 91 million pounds payable depending on future profits. The acquisition will be funded from the company's existing bank facilities. Weir has bought Mathena in an attempt to accelerate the growth of the business through its extensive North American and International operations. The shares climbed by 51p to 1,863p. Marketing giant WPP (WPP) declared that its 100% owned subsidiary Wunderman, a worldwide global digital and relationship marketing network with revenues of approximately 1 billion dollars (620 million pounds) in 2011, has acquired a majority stake in Mayko Trading Pty Limited (MTP), an analytics consultancy based in Sydney. MTP trades under the name of Bienalto and specialises in optimising customer experience and engagement on digital platforms. The acquisition fits in with WPP's strategy to grow its digital capabilities. The shares gained 9p to 892p. 
Mid Caps Insurance group Lancashire Holdings (LRE) estimates the net impact on its fourth quarter results from Hurricane Sandy to be in the region of between 40 million dollars and 60 million dollars. This is based upon market data, client loss data and other assumptions. However, Lancashire said that the estimate is uncertain and that as information emerges, the ultimate loss may vary significantly from the current estimate. The shares fell by 7.5p to 795p. International infrastructure group Balfour Beatty (BBY) announced that its 50% owned subsidiary Gammon Construction has been awarded a 270 million pound contract to work on a major section of the new Shatin to Central link in Hong Kong. The contract includes the construction of two running tunnels covering 1km of track connecting the existing East Rail Line to Hung Hom Station to the future Ho Man Tin Station. The shares were up 6.3p to 274.7p. Provider of LED lighting technology Dialight (DIA) has secured an order from a major oil and gas supplier in the Gulf Coast for the installation of LED fixtures on 15 offshore heliports in the Gulf of Mexico. The order consists of over 1,300 solar powered LED lighting fixtures, allowing the offshore heliports to operate their required lighting completely off grid. Dialight stated that it will continue to invest in its sales force in the region as the company focuses on generating further orders. The shares slipped by 2p to 1,015p. 
Small Caps & AIM Developer of marketing and advertising software for ATM's, i-design (IDG), announced a 113% increase in operating profits to 215,000 pounds for the year ended 30th September despite a 7% fall in revenues to 3.28 million pounds. The increase in profits was boosted by the company adding two major ATM operators, FDR Limited and a Canadian bank, to its client base and a further increase in software license sales. Despite post-tax profits rising by 71% to 258,000 pounds the shares fell by 3.25p to 28.75p. Synectics (SNX), the surveillance technology company, released a year-end update confirming that trading is ahead of expectations which were previously raised in October. Trading has further strengthened and margins in a number of business areas have improved from previous forecasts. As a consequence the board believes that results for the year ended 30th November will be materially above expectations. The shares soared by 39p to 329p. Investment firm Radiant Growth Investments (RADG) announced that it generated no revenues for the year ended 31st July, while recording a loss of 828,000 pounds. The company floated on AIM in September this year, raising 7.1 million pounds, and since then has spent 3.1 million pounds, including on the acquisition of a 15% stake in Rancang Istimewa Sdn Bhd (RISB), a company set up to manage a multi-bouy mooring system that will be constructed at the Trans Thailand Malaysia gas separation plant in Thailand. The remained flat at 4.5p.
Visual entertainment company Prime Focus London (PFO) announced a 49% slump in turnover and a drop in pre-tax profits to 0.183 million pounds from 1.8 million pounds over the 6 month period ended 30th September. The company is currently going through a transition phase and is embarking on a stringent cost cutting programme. This includes a 6.2 million pound cut in administrative expenses, of which 4.8 million relates to the disposal of its View D business. The shares remained flat at 9p. Zattika (ZATT), the digital games entertainment group, announced that its Concept Art House business has agreed a schedule of work for multiple game projects for KLAB Japan. This includes "Lord of the Dragons"; a game where humans, elves and dwarves battle against fire breathing monsters. The company sees the Japanese market as key for the group's future and as a accelerator for growth. The shares dropped by 3p to 51.5p. Jeweller Theo Fennell (TFL) reported an 8% slump in turnover to 4.94 million pounds, with losses halving to 610,000 pounds, for the six months to September. The company attributed the drop in sales to a fall in international clients in the summer months, due to the Olympics. The company is cautious about the outlook as it enters this Christmas period but still has belief in its brand. The shares remained flat at 11.75p. 
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