By
Geoff Foster
Last updated at 10:37 PM on 14th March 2011
Mention the name of St Ives to any old market professional and he or she will immediately wax lyrical about Bob Gavron.
The multi-millionaire and philanthropist founded the specialist printing group in 1964, took it public in 1985, retired as chairman in 1993 and sold out in 1998. He was the group’s driving force and put it into the FTSE 250 at one stage. He was a hard act to follow and it has certainly been a uphill struggle for management to keep the group in profit during and after the recession.
Buyers chased the shares 9.5p higher to 108.5p after the company announced the sale of its loss-making magazines business, which prints titles such as Time Out and the Economist, to private equity company Walstead Newco3, owner of rival Wyndeham, for £20m – £15m in cash and 5m in loan notes. The division lost £5.1m on revenues of £70.5m in 2009/10.
Loss-making: St Ives sold its magazine business which print titles such as Time Out and the Economist
Chief executive Patrick Martell had warned many months ago that its
magazines business was in a decline that would continue long past the
end of the recession. Advertising is being increasingly lured to the
internet, particularly in the area of classified ads.
He repeated yesterday that the company had continued to
experience tough conditions in the magazines unit’s markets in recent
years, where excess capacity has exerted significant downward price
pressure, resulting in poor levels of profitability.
The cash proceeds of the sale will not only strengthen its
balance sheet but help it invest in the fast-growing segment of its
business, direct marketing. This involves the printing of leaflets,
newspaper inserts and direct mail products.
Imagination Technologies was another special situation
which helped take dealers’ minds off the depressing events on the other
side of the world. Shares of the microchip designer shot up 23.18p to
459.38p in anticipation of a trading update tomorrow. RBS lifted its
target price to 590p from 470p, saying the group could command 10pc of
the notebook market in 2015.
Despite the Nikkei’s overnight collapse of 6pc following the
disastrous Japanese earthquake and tsunami which has left thousands dead
and homeless, the Footsie dug its heels in. It traded only 10
points or so lower for most of the morning with investors obviously
reassured to hear that the Bank of Japan had injected a record 15
trillion yen into money markets and expanded its asset purchase
programme to 10 trillion yen. However, London drifted when Wall Street
opened 115 lower and closed 53.43 points off at 5,775.24.
It stands 5.4pc below its February 52-week high.
Britain’s largest coal-fired power station Drax surged
12.4p to 408.7p. Gas prices have risen 25pc in the past month and demand
for coal should remain robust as Japan comes to terms with the
devastating after-effects of the earthquake.
Broker Matrix said that once Japan gets back on its feet, the
country’s immediate source of replacement generation is gas fired, and
that means Japan will need to import greater quantities of liquefied
natural gas. BG Group, 54p better at 1514p, recently finalised a
20-year liquefied natural gas supply deal with Tokyo Gas for 1.2m tonnes
a year, starting in 2015.
African Barrick Gold, staring relegation from the Footsie in the face, rallied 4.5p to
518.55p.
Mobile phone giant Vodafone lost 3.9p to 175p as investors
hung up following a report that Vivendi is unwilling to pay much more
than £6bn for Vodafone’s stake in French group SFR.
Retailers were friendless with JD Sports Fashion closing 43.5p cheaper at 886.5p. Shareholders were delighted to hear on Friday-that it will not bid for beleaguered rival JJB Sports, unchanged at 13.75p.
NewRiver Retail was unchanged at 245p after announcing two
assets sales for £10m. The property investment special ist exchanged
contracts on a £9.6m sale of a shopping centre in Shrewsbury for a net
yield of 7.2pc and a £1.3m unit in Glasgow.
Atlantic Coal, the AIM anthracite producer in the US,
firmed 9pc to 0.72p after signing an option to acquire a 158-acre coal
property in Pennsylvania. The board is evaluating further prospects in
the area where it currently produces 250,000 tonnes of mine anthracite
coal at the Stockton colliery.
Satisfactory annual results helped AFC Energy improve 1.13p to 58.3p. The company is a developer of pioneering technology that uses hydrogen to produce clean electricity.
Hambledon Mining slipped 0.25p to 4.38p following a £6.6m
placing masterminded by broker Fairfax. Proceeds will be used for
surface infrastructure upgrades at the Sekisovskoye gold mine in
Kazakhstan.
PROFIT-TAKING after recent strength left AIM-listed Mobile
Streams 1 .5p easier at 31p. Buyers should soon switch on again because
word is another ‘interesting’ partnership deal could be announced with
next week’s results. The mobile content group recently said it has been
selected to distribute Infosys Technologies’ portfolio of mobile
applications (apps) in Latin America and globally.
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