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Mid and small cap news: ASOS, N Brown Group, Travis Perkins, Filtrona, Mouchel Group, Fusion IP

Published: 12:47 15 Oct 2011 BST

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Investors following the retail sector had more news to digest this week as a couple of companies released their half-yearly reports. Online fashion group ASOS (LON:ASC) reported a "strong" first half performance this week, adding that its international business had more than compensated for the challenges faced in the UK.

The company added that it was confident of achieving results for its full year that were in line with expectations.

The firm posted a 60 per cent increase in retail sales to £210.8 million in the six months to September 30 this year compared to £131.4 million in the previous period.

UK sales saw an increase of 8 per cent in the first half compared to last year, however international sales increased an impressive 150 per cent.

Meanwhile, home shopping retailer and FTSE 250 constituent N Brown Group (LON:BWNG) said its first half performance was solid despite the “difficult economic environment” pre-tax profits in the six months to 27 August rose 5.9 percent to £44.8 million as sales climbed 4 percent to £363.7 million.

Another midcap, builders’ merchant Travis Perkins (LON:TPK) said its turnover in the nine months to end September rose 5.9 percent compared to the same period last year, which was in line with expectations.

The figure includes Travis Perkins' plumbing supplies business BSS on a proforma basis. Without this adjustment, the group’s sales jumped 53.4 percent.

Moving to small caps, Israeli life sciences firm Medgenics (LON:MEDG) announced that it is in active discussions with US firm Baxter Healthcare Corporation for possible further collaboration following the expiry at the end of last month of the two companies’ agreement to jointly develop the Factor VIII Biopump.

The Biopump is a tissue-based platform technology, being developed and commercialised by Medgenics, for the sustained production and delivery of therapeutic proteins using the patient’s own skin biopsy for the treatment of a range of chronic diseases. These include: anaemia, hepatitis C and haemophilia.

Medgenics believes that its approach has multiple benefits compared with existing treatments, which include regular and costly injections.

Another biotech company, stem cell technology firm Epistem Holdings (LON:EHP) said his week that a strengthening operational and financial position confirms its belief that the year ahead will continue to generate substantial increases in its forecast revenues.

The firm announced results for its 2011 financial year. These showed that revenue improved to £5.75 million from £5.74 million during the year to June 30, while its pre-tax profit was £357,000 (2010: £350,000). After tax, profit came to £385,000 compared with £290,000 in 2010.

Elsewhere in the markets, Filtrona (LON:FLTR) has performed in line with expectations in the third quarter as the business continued seeing positive momentum, leaving it confident of delivering overall growth for the current year.

In the quarter to 1 October, the fibre products group’s sales climbed 10 percent with protection and finishing products emerging as the top performing division, achieving revenue growth of 24 percent.

The protection and finishing products business, whose like for like sales climbed 13 percent, benefitted from the acquisition of Reid Supply Company and a full contribution period from its recently acquired Stera Tape business.

In other news, embattled outsourcer Mouchel Group (LON:MCHL) has hired a new chief executive and said it is in “constructive” discussions with its lenders over expected covenant breaches resulting from reduced profit expectations.

A week ago, Mouchel Group lost more than a third of its value after revealing that an accounting error and rising contract risks reduced its profit expectations by 60 percent, leading to the resignation of chief executive Richard Cuthbert.

This week, the company introduced former group chief operating officer of FTSE 100 outsourcer Serco Group (LON:SRP) Grant Rumbles as its new CEO and said it has started discussions with its lending banks with the objective of providing the group with a “stable funding structure”.

This week’s research reports included a note on SeaEnergy (LON:SEA) from Edison Investment Research, which said that its current valuation is at a discount to current assets and does not reflect the potential upside of the company’s remaining businesses.

Earlier this year, SeaEnergy sold its renewable energy operating subsidiary SeaEnergy Renewables Limited (SERL) to Repsol Nuevas Energias for £32 million, allowing it to increase its cash balance to £28 million.

SeaEnergy is currently planning to use the funds raised in the SERL sale to develop its marine services business and invest in its 24.68 percent owned oil and gas company Lansdowne Oil & Gas (LON:LOGP), which is about to kick off a drilling campaign in the North Sea.

Elsewhere in the markets, technology commercialisation specialist Fusion IP (LON:FIP) swung to a pre-tax profit in the full year on the back of a 35 percent year-on-year rise in revenue and portfolio returns to £5.9 million.

The firm, which turns university-derived intellectual property into businesses, reported that EBITDA in the twelve months to July 31 2011 soared to £3 million from £0.4 million previously, and it made a pre-tax profit of £1 million, compared with a £1.6 million loss.

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