| From UK-Analyst.com: Wednesday 6th March 2013
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The Markets New car sales in February rose by 7.9% year-on-year in Britain as private consumer demand reached a three year high. The figures released by the Society of Motor Manufacturers and Traders (SMMT) illustrated the 12th consecutive month of sales growth. Sales of small cars were particularly strong, with registrations of more modestly sized vehicles up by 135.7% in February. Mike Baunton, Interim Chief Executive of SMMT commented, "February is traditionally a low volume month as motorists look forward to the plate-change in March, but attractive new car deals are sustaining the market." Outgoing head of the Bank of England Sir Mervyn King urged a deep restructuring of the Royal Bank of Scotland (RBS) and has criticised the way it has been run since its government bailout. The fourth biggest bank in Britain has undergone a significant restructuring since the government injected 45.5 billion pounds into it in 2008 and has since shed 900 billion pounds worth of assets, shifting its focus on to lending to British households and small businesses. Sir Mervyn said, "The whole idea of a bank being 82 percent owned by the taxpayer, run at arms' length from the government, is a nonsense. The arguments for restructuring sooner rather than later are powerful ones." According to HSBC's monthly Purchasing Managers Index (PMI) the economies of "emerging markets" grew at a slower pace in February compared with January. The aggregated PMI for 16 leading emerging markets (including Brazil and China) fell from 53.8 in January to 52.3 in February, reflecting a fall in the rate of growth within all of the 16 countries. In recent years rates of economic growth in these emerging markets have been far higher than in developed nations - often coming in at 10% a year. However, investors have started to question whether these rates are sustainable, especially given the dependence of these "emerging market" economies on the health of mature markets around the globe. Murat Ulgen, Chief Economist at HSBC, said, "The slowdown appears to be broad-based across manufacturing and services, with BRIC [Brazil, Russia, India and China] activity moderating after a promising start to the new year."
At the London close the Dow Jones was up by 28.38 points at 14,282.15 and the Nasdaq slid by 5.29 points to 2,793.96 In London the FTSE 100 was down by 4.31 points to 6,427.64; the FTSE 250 finished 61.99 points up at 13,923.27; the FTSE All-Share was up by 0.81 points at 3,387.42; and the FTSE AIM Index crept up by 3.98 points to 741.88.  Broker Notes Canaccord Genuity retained its "buy" recommendation on media group Chime Communications (CHW), increasing its target price from 230p to 271p. The broker was impressed with the group's 2012 results which showed that like-for-like revenues were up by 35% within the group's sports marketing division as the positive impact of the Olympics came through. Canaccord sees 2013 as a year of consolidation for Chime, given the tough Olympics comparables, but does not rule out the idea that Chime could be a potential acquisition target for larger agency groups. The shares climbed by 14.5p to 261.5p. Panmure Gordon maintained its "buy" recommendation on cough causers British American Tobacco (BATS) with a 3,900p target price. The broker feels as if the operating environment for tobacco stocks remains favourable at present, with industry volume declines being more than offset by a positive pricing environment. Panmure sees BATS as a high quality cash generative company attractively valued compared to its peers trading on a P/E multiple of 15 and a EV/EBITDA multiple of 12. The shares fell by 47p to 3,519p. Shore Capital upgraded its "hold" stance to a "buy" recommendation on supermarket Tesco (TSCO) but conceded the group still faces many economic challenges across all of its markets and channels. Despite this warning the broker feels the group has a strong enough asset base to pursue a well-considered multi-channel strategy. It is this multi channel strategy that leads Shore Capital to believe that trading profits will grow, albeit at a more sedate rate than has been the case through much of the past two decades. The shares were up by 5.95p at 378.15p. ADVERTISEMENT Want to learn what some of the UK's most successful investors think of the current markets?
Then make sure you come to this year's Master Investor show. Speakers include the UK's 112th richest man Jim Mellon, Innocent Smoothies founder Richard Reed and infamous bear raider Evil Knievil, amongst many others. To claim a free pair of tickets (worth £40) CLICK HERE and enter the promo code UKA2013 Blue-Chips Turbogenerator supplier Melrose (MRO) reported a 43% increase in revenues to 1.55 billion pounds for 2012, while pre-tax profits grew from 154.7 million pounds to 214.3 million pounds. The results were primarily driven by the impact of the 1.8 billion pound acquisition of Elster, a utilities maintenance firm, back in August last year. Stripping out the effect of the acquisition group revenue growth stood at 7%, primarily driven by an uplift in activity within the group's core Brush business, which exhibited a 7% uplift in turnover and strong cash generation. The shares gained 6.7p to 266.7p. Investment group Legal & General (LGEN) announced a 9% increase in pre-tax profits to 1.04 billion pounds for 2012 on a 300 million pounds increase in sales to 2.1 billion pounds. The group, which also acts as insurer, attributed the increase in profitability to an ageing population, cuts in welfare state spending and contraction of the banking sector. Over the last year shares in the company have grown by 35%, heavily outperforming the 9% rise of the FTSE 100 over the same period. Earlier in the week broker Panmure Gordon retained its "buy" recommendation on the company, increasing its target price from 154p to 190p. The shares increased by 3.4p to 166.1p. Car insurance firm Admiral Group (ADM) posted a 15% increase in pre-tax profits to 345 million pounds for 2012 and revealed that it will propose a 20% increase in total dividends for the year to 90.6p. The owner of brands such as confused.com, elephant.co.uk and Diamond had its results boosted by a 6% increase in vehicle count over the year. However, the company warned that its confused.com website continues to face "challenging conditions" reflecting a saturated market and reduced motivation for motorists to shop around if their renewal rate has fallen. The shares jumped by 67p to 1,334p ADVERTISEMENT Spreadbet on the UK banks at t1pspreadbetting.co.uk - as well as other Equities, Stock Indices, Commodities, Bonds & Forex - CLICK HERE to open an account at our brand new trading platform
Mid Caps Short-term loan provider International Personal Finance (IPF) reported a 20% increase in underlying pre-tax profits for 2012 but reported profit figures actually fell from 100.5 million pounds to 95.1 million pounds as a result of early settlement rebates and weaker exchange rates. The underlying growth was boosted by increased activity in Poland, Hungary and Mexico, with all three markets demonstrating strong increases in net revenue. The group went on to stress that it intends to expand into more markets and pledged to offer more financial products in 2013. The shares gained 67p to 473.4p. Funeral services provider Dignity (DTY) posted a 9% increase in pre-tax profits to 229.6 million pounds for 2012 while pre-tax profits were up by 13% at 45.4 million pounds. The only listed funeral services group in the UK acquired 18 funeral locations in the period for 10.8 million pounds and increased the number of pre-arranged funeral plans on its books to 290,000. So for this year Dignity has agreed to buy rival Yew Holdings in a deal worth 58.3 million pounds, bringing 40 extra funeral locations and two crematoria into its portfolio, significantly improving its presence in the north of England. The shares increased by 28p to 1,327p. Business consultancy firm SDL (SDL) revealed that it has acquired mobile web designer Bemoko in an attempt to enhance its presence in the sector. Bemoko was founded in 2007 and has worked on behalf of major US and UK brands to help organisations get the most out their web channels. Recent consensus on SDL amongst brokers has been positive, with Investec and Goldman Sachs issuing respective "buy" and "strong buy" recommendations in recent weeks. The shares slid by 2.5p to 504.5p. 
Small Caps & AIM IT firm Enables IT Group* (EIT) announced that Hill and Knowlton, a subsidiary of WPP, has decided to terminate its managed services contract. The contract loss is significant as the agreement with the WPP subsidiary accounted for approximately 25.4% of Enable's revenue base following its recent merger with Nexus Management. The group was keen to stress that it had developed plans to mitigate the financial impact of the contract loss in terms of overhead reduction and will now put these plans into action. The shares plummeted by 4p to 9.5p. Alexander Mining (AXM) announced that its subsidiary, MetaLeach, has been granted a patent for a method of oxidative leaching of sulfide ores and concentrates in Mongolia, a technique which has the potential to yield higher metal extraction rates. The company is adamant that the majority of the country is still underexplored and feels it is likely to recover more metal in the region as a result of the newly patented technique. On the back of this news broker Northland Capital retained its "buy" recommendation on the group with a 7.3p target price. The shares were up by 0.18p at 4.8p. Payment services provider Earthport (EPO) revealed that it has entered into a deal with American Express to expand its existing foreign exchange international payment service. The announcement comes just a day after the company revealed it has entered into a partnership with hyperWALLET Systems inc, using part of its software in order to offer a product which attempts to optimise the process of how corporations pay their employees. The shares shot up by 2.3p to 22.42p. 
Machine tool manufacturer 600 UK (SIXH) has invested 600,000 pounds in its manufacturing facility in Heckmondwike, West Yorkshire. The factory will be "radically" redeveloped in an attempt to improve sales operations and bring benefits to customers. Once completed the new site will exhibit the full range of 600 UK products and will house all of the sales, support and head office staff. The shares edged up by 0.2p to 14.7p. ZincOx Resources (ZOX), the hazardous waste recyclers, revealed that its Korean Recycling plant was subject to stoppages for repairs and power saving restrictions imposed by the Korean government during the first 2 months of the year. The group went on to say that over the last fortnight "the plant has run well" and has achieved 82% of required throughput at a monthly rate of 12,700 tonnes of electric and furnace dust as it gets back to speed with operations. The shares were down by 3.65p at 27.35p. Advanced Medical Solutions (AMS) posted a 53% increase in revenues to 52.6 million pounds for 2012 while pre-tax profits grew by 53% to 12.1 million pounds. The increase in profitability was driven by the positive impact of the acquisition of RESORBA, the woundcare specialist. Organically, the group's core advanced wound care division grew revenues from 27.7 million pounds to 31.7 million pounds while its wound care and sealants division exhibited an increase in income from 6.7 million pounds to 20.8 million pounds. The shares climbed by 8.75p to 74.75p. * Enables IT is a corporate client of Rivington Street Holdings, the ultimate owner of UK-Analyst. | 
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