Smaller companies spotlight

EACH week, former Fleet Street City Editor Patrick Lay keeps This Is Money readers up-to-date with a neglected, but exciting sector of the stock market - smaller companies.

Crown slips

LAST month I introduced you to Wolfgang Menzel, president and chief executive officer of Crown Corporation, a Bermuda-registered company, owned entirely by European investors, and formed to invest in Canadian and US public companies but seeking a quote on AIM.

I remarked how like Mr Ladislas Rice, former head of the Burton Group, he sounded. Charming, old-European-polite, and confident in his presentation but, like Mr Rice, one wondered if he knew what he was into.

One week after I wrote a piece criticising Mr Rice in the 1980s, he lost his job as chairman of Burton Group; this week, Mr Menzel, 54, has resigned as president and chief executive officer of Crown, citing, I am sorry to learn, 'health reasons'.

I do hope it was nothing I wrote.

One can only wish better fortune to chairman Dr Mariusz Rybak, who has taken over the additional role of chief executive officer until someone else can be appointed.

Trading up

WHEN a product is designed to be used on the major trading exchanges of the world, it does no harm to have as your initial customers the Chicago Mercantile Exchange and the Chicago Board of Trade, the two largest futures and options exchanges in the United States, and also to include the London Metals Exchange.

That is what London-based CMS WebView, the data collection and distribution group, is able to claim in its sales pitch.

And it intends making good use of the references that those exchanges are willing to provide. CMS, which was formed to provide commodity trading data to the London International Financial Futures and Options Exchange (Liffe), was the object of a management buy-out in 1997.

Since then, much time and effort has been spent in developing the product in what has been a tough market.

But chief executive, Bob Antell, believes the doors he has been pushing against for so long are beginning to open on both sides of the Atlantic and he is ready to put his head above the parapet for the first time.

It can be no coincidence that since announcing a first half loss of £116,000 in mid-September, he has appointed Gresham, a leading financial public relations agency, to spread his message. Since that appointment in October, CMS shares have soared from 1.5p to 13p, which should be good enough to pay Gresham‘s fees for a few months.

Mr Antell plans to go on the sales offensive in the new year, opening a Chicago or New York office to back up the London operations. All this will need money, so I would not be surprised if a fund-raising exercise was being planned, though this would entail the founding directors having their share stake diluted to below 50% for the first time.

But I‘m sure they would rather hold a third of the shares at 13p than more than 50% at 1.5p.

Corking performance

FORGIVE me if I raise a glass of champagne to my lips, but around the turn of the year I wrote glowingly of Majestic Wine, having paid the company a visit. The shares were just over £5 each at the time; this week they were well over £8 following a £1.6m rise in pre-tax profits to £4.2m in the six months to end September and a 50% increase in the dividend to 4.5p a share.

Some you may have missed

CAMBRIAN Mining has turned a £30,000 loss in the year ending June 30, 2002, into a £187,000 pre-tax profit in the subsequent year.

GWR Group, which claims to be the most listened to commercial radio group, has turned up the revenue volume by 5% to £55.3m in the six months to end September, with profits surging ahead a gigantic 190% to £6.4m. It also reveals that Alastair Ross Goobey has joined the board as a non-executive director and is deputy chairman designate.

BRYAN Bedson, chairman of specialist magazine group Wyndeham Press, alerted the market a couple of weeks ago to the fact that trading had suffered, and was continuing to be affected by the loss of contracts in the first half year. Now he reports that sales in the six months to end September were £3m lower at £59.5m and pre-tax profits were £1.1m lower at £1.9m.

THE largest construction contract for 25 years in northern Scotland has fallen to Ennstone who have been asked to supply and lay 250,000 tonnes of asphalt for the dualling of the A92 between Dundee and Arbroath on the east coast. The value is expected to be around £9m.

GAVIN Casey, chief executive of the London Stock Exchange from 1996 to 2000, has been appointed non-executive chairman of Knowledge Technology Solutions. He has been given options on 2m KTS shares exercisable between the second and sixth anniversary, half of which can be exercised at 15p and half at 25p.

Some to watch out for

MARK Watson Mitchell is, like this column, a strong supporter of support services group MICE, and liked the half year figures showing sales up 12% to £66.4m and pre-tax profits up 13% at £4.2m. He says on his WatsHot website the shares are 'very cheap' at 82p and are a 'buy'.

RICHARD Slape, analyst at Seymour Pierce, knocks the takeover rumours that have boosted the share price of Venture Production this week, saying it is unlikely that any potential bidder would be prepared to pay the current share price (136p), let alone a premium. He suggests investors should take the opportunity to sell.

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