From UK-Analyst.com: Monday 28th January 2013
The Markets Prime Minister David Cameron confirmed that the country will press ahead with a controversial high-speed rail link from London to cities in the North, arguing that it will help to revitalise the floundering economy. The route for this second phase of the 32 billion pound project will run between Birmingham and Leeds, cutting current journey times by 50%. Chancellor George Osborne said, "It's not just about cutting journey times. It's also about the new stations, the prosperity that is going to come, the jobs that are going to be created around this infrastructure." Staying in the UK, a survey of 6,000 estate agents by property website Hometrack revealed that house prices were flat month-on-month across England and Wales in January following six months of falls. The survey also revealed that 79% of estate agents were more optimistic about the housing market for the coming year compared to the start of last year. Richard Donnell, director of research at Hometrack said, "Despite the slow start, the housing market looks to be in slightly better shape than the start of the previous two years." Elsewhere, the European Central Bank (ECB) has dismissed Ireland's offer of refinancing the promissory note which it pumped into defunct lenders during its banking crisis, as negotiations surrounding a resolution on Irish debt continue. The Irish government was hoping for a deal which would extend its payment schedule to 30 or 40 years, allowing the country to secure access to debt markets by the time it receives the last of its bailout loans at the end of 2013. Irish Deputy Premier Eamon Gilmore commented, "If we can reach an agreement on these issues, Ireland and Europe will have a positive story to tell." 
At the London close the Dow Jones was down by 18.00 points at 13,877.98 and the Nasdaq grew by 7.91 points to 2,744.64. In London the FTSE 100 increased by 9.66 points to 6,294.41; the FTSE 250 finished 3.61 points down at 13,132.49; the FTSE All-Share gained 4.66 points to 3,299.04; and the FTSE AIM Index slipped by 0.66 points to 739.43.  Broker Notes Panmure Gordon retained its "buy" recommendation on low cost airline Ryanair (RYA) with a target price of 5.50 Euros. The broker is impressed with the airline's recent Q3 results which disclosed profits of 18 million euros (15.4 million pounds), a figure at the top end of market expectations. Furthermore, Panmure envisages strong profit growth over the medium term, driven by higher fares as a result of a deceleration on capacity growth and higher fares across the sector in general. The shares were up by 0.04 euros to 5.54 euros. N+1 Singer retained its "buy" recommendation on semi-conductor specialist IQE (IQE) with a target price of 45p. The broker is excited by the group's acquisition of Kopin's III-V business earlier in the month and believes it will increase the firm's market share in the wireless space. The broker also appreciates that the acquisition enhances the group's risk-mitigation strategy as it adds Skyworks, a wireless handset chip provider, as a major customer. The shares jumped by 0.75p to 34p. Westhouse Securities reiterated its "buy" stance on smoke and carbon monoxide detector supplier Sprue Aegis (SPRP) with a target price of 87p. Westhouse notes the group's recent trading update which suggests that revenue for 2012 is expected to be marginally ahead of its 37 million pounds forecast. However, the real source of encouragement for the broker is that 2013 will see the benefit from significant contract wins signed in 2012 with clients such as B&Q, British Gas and Baxi. The shares closed up by 2.5p at 68.5p.
Blue-Chips Broadcasting giant ITV (ITV) has purchased the freehold of London Television Centre, home to the company's headquarters on the South Bank, for 56 million pounds from Coal Pension Properties. Depending on any further development on the site ITV may be required to pay up to an additional 6.5 million pounds. The 22-story tower and studio complex which was originally built in the 1970's for London Weekend Television has been purchased to give the group more flexibility in its property strategy. Broker Investec maintained its "sell" stance on the company, while increasing its target price to 114.98p. The shares slipped by 1.7p to 114.1p.
Mid Caps I.T systems provider Aveva (AVV) said it has traded "promisingly" since October, a trend evidenced by strong cash generation throughout the third quarter. The group's confidence principally stems from a robust performance in its oil and gas division, which more than offset poor results in the Marine sector. Geographically, Europe, the Middle East and Africa performed well, with an increasing amount of spend from oil and gas customers in the region, while growth in the Americas was adversely affected by delays and local resource constraints in Brazil. The shares fell by 46p to 2,186p. Outsourcing firm Mitie Group (MTO) revealed it has been trading in line with expectations since 1st October 2012, with strong organic growth being driven by new and expanded contracts. Although on-going weak economic conditions are affecting its more cyclical markets, the group is confident that group revenue will continue to grow, boosted by the acquisition of healthcare firm Enara Group and its facilities management contract with Lloyds Banking Group. On the back of the trading update Liberium Capital reiterated its "sell" recommendation on the group with a target price of 240p. The shares slipped by 1p to 280.6p. Software provider Anite (AIE) has acquired Elektrobit Corporation's Propsim business for a cash consideration of 26 million pounds. The Propsim business sells a range of radio channel hardware and software products which are associated with research and development capability. The acquisition by Anite is an attempt to capitalise on an increasing level of market demand for more integrated wireless test solutions in the sector. The Propsim business is expected to have generated 1.3 million euros in operating profit for 2012. The shares were up by 5p at 145.8p.
Small Caps & AIM Digital entertainment specialists Amino Technologies (AMO) reported a 20.8% hike in gross profit to 17.5 million pounds for the year ended 30th November 2011, driven by a 9% increase in gross margin. The company attributed this uplift to an increased product range, faster development of products and a "refreshed" management team. The increase in profits came despite a 6.1% decrease in revenues, as the firm became more efficient and cut costs. The shares increased by 5p to 78p. Engineering group Chamberlin (CMH) announced a significant softening in market conditions for its foundry operations and reduced levels of activity in several of its sectors since it reported its half year results in October. As a result, customers have reduced orders or postponed them to a later date. Subsequently, management expect to deliver pre-tax profits below market expectations for the year ended 31st March 2013. The shares plummeted by 27p to 120p. Marketing group Cello (CLL) has completed the acquisition of Mash Health, a health focussed communications agency, for a consideration of 0.6 million pounds, and an additional 0.9 million pounds depending on performance. The acquisition is in line with Cello's strategy of acquiring businesses which complement its health operations. Separately, the firm announced that trading for 2012 is expected to be in line with market expectations. The shares climbed by 4.5p to 44p. 
Microwave electronic specialist Filtronic (FTC) posted a 56% increase in revenues to 16.4 million pounds for the 6 months ended 30th November, driven by a significant increase in wireless sales. Although the overall sales trend is positive, the company acknowledges that demand for individual product lines is subject to substantial month-on-month variability. In 2013 the company expects the shortfall in broadband products to be more than offset by the general shift towards wireless products. The shares were up by 6.25p at 46p. International media and entertainment firm Reach4Entertainment (R4E) said that it is now beginning to reap the benefits of its restructuring programme; a programme including the reduction of Head Office overheads by approximately 2 million pounds, with further improvements scheduled for 2013. The company expects to have returned to profit for the year ended March 2013, boosted by a healthy performance from its London based theatre marketing company, Dewynters, which more than offset a weaker than expected return from SpotCo, its New York based theatre marketing business. The shares rose by 0.875p to 6.375p. Marketing and development services company Litebulb Group (LBB) has entered into an agreement to acquire Bluwstuff Limited, a global designer, manufacturer and distributor of products in the toy and gift industry. The deal is for an initial consideration of 250,000,000 ordinary shares with a further 125,000,000 share payment dependent on various performance criteria. The acquisition of Bluwstuff, which has established relationships with clients such as Tesco, Debenhams and M&S amongst others, is expected to significantly boost sales over the next year. The shares grew by 0.015p to 0.73p. | 
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