PRESS DIGEST – British business – Aug 20

The Times

INTEC ISSUES WARNING AFTER LOST CONTRACT

Shares in Intec Telecom Systems (ITL.L: ) fell 5.25 pence to
59 pence after the firm, which supplies billing solutions to
telecoms carriers, issued its third profit warning of the year.
The warning was triggered by the loss of a contract that will
leave a 4.1 million pound dent in profits and shares in the
company, which is currently in takeover talks with an unnamed
bidder, are trading more than 50 percent lower than at the start
of the year. The market has already undergone a period of
consolidation this year and Intec’s SingleView billing system,
which is well regarded but faces pressure from low-cost rivals,
is thought to be of interest to potential buyers.

ADNAMS PROFITS PLUNGE AMID TOUGH CONDITIONS

Suffolk-based brewer and hotelier Adnams (ADNM.PZ: ) reported
a 27 percent fall in half-year pre-tax profits, citing tough
trading conditions. Profits at the group fell to 641,000 pounds,
despite sales of its cask ales outperforming the wider market.
Chairman Jonathan Adnams said the company had continued to
develop its range of beers and would install a micro-distillery
at its brewery later in the year.

PROSTRAKAN STEMS LOSS

Specialty pharmaceutical company Prostrakan reported a
reduced first-half pre-tax loss of 2.7 million pounds on
Thursday. The group, which has seen the launch of two of its key
products delayed in the United States, made its first profit at
the earnings level of 1.2 million pounds, up from last year’s
4.3 million pound loss.

TEMPUS

Hammerson (HMSO.L: ) (hold)

Wellstream (WSML.L: ) (sell)

Essar Energy (ESSR.L: ) (avoid)

The Daily Telegraph

CLS HOLDINGS SEES ITS PROFITS DOUBLE

CLS Holdings (CLSH.L: ), the property group, posted first half
pre-tax profits of 28.1 million pounds, up from 13.2 million
pounds last year. The figures were boosted by the 10.6 million
pounds sale of corporate bonds. The underlying value of its
property increased by 0.8 percent during the period. UK and
French growth was 0.5 percent and 2.1 percent respectively. The
company’s portfolio value fell 3.2 percent to 792.3 million
pounds as a result of the weakness of the euro. Future projects
include a prospective 300,000 sq ft redevelopment in Vauxhall
and 123 million pounds of cash and liquid resources to invest.

RIO TINTO CHIEF WANTS MORE JOINT VENTURES WITH CHINA

The chief executive of Rio Tinto (RIO.L: ), Tom Albanese,
wants to see more joint ventures with Chinese companies.
Speaking in Shanghai, Albanese said he welcomed the opportunity
to use the company’s expertise in helping China to locate
mineral resources at home and abroad. Relations between Rio and
Chinalco, the state-owned mining group, broke down last year
after Rio withdrew from a 12.5 billion pound “strategic
investment”. In March, Rio and Chinalco agreed to a joint
venture in Guinea, a union that Albanese welcomed and which
demonstrated the relationship was being rebuilt.

CHAMPAGNE SALES FIZZ FOR J SAINSBURY

Sainsbury’s (SBRY.L: ) reported a 40 percent increase in
champagne sales as consumers console themselves from recession
blues with its 15 pound a bottle offer. A discount on its
own-label brands, Etienne Dumont and Charles Lafitte, helped
Sainsbury’s sell 1.23 million bottles last year. The
supermarket’s champagne buyer, Daniel Bracegirdle, offered an
explanation to what might seem an extravagance in these belt
tightening times. Bracegirdle said: “If you’re used to spending
20 to 30 pounds on a bottle of wine in a restaurant, then
staying at home and spending 15 to 20 pounds on a bottle of
champagne is still good value.”

QUESTOR

EnQuest (ENQ.L: ) (buy)

Cineworld (CINE.L: ) (buy)

The Independent

CHRYSALIS BENEFITS FROM COMMERCIALS

Music publisher Chrysalis (CHS.L: ) has announced a rise in
third-quarter revenue after songs on its back catalogue were
used to advertise Halifax bank and Apple’s iPad. Chrysalis also
made gains thanks to a chart-topping album by Australian band
Pendulum. Net publisher’s share, which is calculated by
subtracting the royalties paid to writers and performers from
the publisher’s total revenue, increased by 5.2 percent in the
third quarter to June 30, having been 1.6 percent at the end of
the second quarter.

MASTERCARD PAYS 333 MILLION POUNDS FOR BRITISH ONLINE
PAYMENTS PROVIDER

MasterCard (MA.N: ), the world’s second biggest payments
network, has agreed to acquire Aim-listed British payment
services provider DataCash (DATA.L: ) for 333 million pounds.
MasterCard said the acquisition would boost its position in the
fast-growing market for online payments. The deal will see
MasterCard pay DataCash 360 pence a share in cash, a 53 percent
premium on the British firm’s share price before the
announcement of the deal. MasterCard’s acquisition follows rival
Visa’s 1.3 billion pound takeover last month of U.S. payment
services provider CyberSource, but MasterCard chief executive
Ajay Banga said the purchase of DataCash was not a reaction to
Visa’s move.

INVESTMENT COLUMN

JD Wetherspoon (JDW.L: ) (JDW.L: ) (buy)

Mitchells & Butlers (MAB.L: ) (buy)

Marstons (MARS.L: ) (buy)

The Guardian

CINEWORLD HOPES 3D HARRY WILL SPELL SALES REVIVAL

Cineworld (CINE.L: ), the cinema chain, is hoping that this
autumn’s 3D cinema releases will draw audiences back after
suffering a slump during the World Cup. Chief executive Steve
Wiener said that box office takings were down by 30 percent in
June, compared to the near ten percent increase witnessed either
side of the South African World Cup. Harry Potter and the
Deathly Hallows, the first instalment of the series in 3D, is
expected to dwarf the recent trading boost driven by Toy Story
3. Nick Batram, an analyst at KBC Peel Hunt, said that the near
four percent increase in sales of 162 million pounds is due to
the higher price charged for a 3D cinematic experience.

Prepared for Reuters by Durrants

PRESS DIGEST – British business – Aug 20