The Week In Review: Education helps Pearson book profit
Saturday 04 November 2006
Pearson's trading update this week was the envy of much of the media sector. Underlying sales at the publishing group were up 5 per cent and profit up 15 per cent for the first nine months of the year. This in an industry where most companies are struggling to show any growth.
The difference is that Pearson is not much exposed to advertising revenues, except through theFinancial Times (which provided sales of just £179m out of £1.9bn at the half-year stage). The company's fortunes are tied to selling textbooks to the US, where it covers a third of the market for schools and higher education. The other arm of Pearson is its Penguin books division. This went through a difficult period in 2004-05, due to distribution glitches and other issues, but it is now doing OK - full-year sales growth will be 1 per cent this year.
Pearson has a fantastic collection of assets, which are performing well. While Marjorie Scardino is chief executive there is little prospect of a break-up but, while she has announced no retirement date, she turns 60 next year. Hold.
Worries about terrorism and extra security measures at UK airports continue to take their toll on MyTravel. Long-term, however, the growing numbers of people who favour piecing together their own flights and accommodation online are a much bigger threat to the group's business. Avoid
Tinopolis was little know outside its Welsh base until its audacious - and successful - bid for rival independent TV producer Television Corporation last year. This week, the AIM-listed group boasted of strong market conditions and said it was optimistic about the future. It has also made a high-profile hire. John Willis, a former head of programmes at Channel 4 and MD of London Weekend Television, is to become creative director. Buy.
The Innovation Group has kept its head down over the past few years in order to transform its business model after suffering post-tech boom malaise. TIG entered the US earlier this year through the acquisition of SurePlan, which extended the insurance claims outsourcing model that it has employed in South Africa and Australia in recent years. On top of its software, TIG provides outsourcing services to insurance customers. Buy.
ST JAMES'S PLACE
St James's Place, the upmarket wealth manager, is grabbing more than its fair slice of the savings market. Strong third-quarter figures reflect St James's healthy position in the upper reaches of the pensions market, which have boomed since the so-called A-day tax reforms introduced in April. Buy.
Financial Objects is on the road to recovery. The small software provider turned in impressive interim results last month and appointed a new chief executive this week. Karim Peermohamed joined the company in 1997 and rises from the position of chief operating officer. Hold.
Mr Kipling's cakes will help RHM's interim results meet analyst forecasts. That was the key message from the food maker's trading update to the City this week. However, analysts are sceptical about the sustainability of the cakes recovery, and while the company's bread division has recently gained market share, this trend may be reversed. With high energy and wheat costs set to plague RHM for some time, avoid.
Armour Group, the home and in-car electronics firm, has shed a third of its value since the start of the year after a series of profit warnings. Full-year results this week showed a decline in pre-tax profits to £1.6m from £2.1m. However, measures have already been taken to cut the company's cost base and at just nine times forward earnings, the shares are a buy.
Synergy Healthcare's growth over the past five years has been spectacular. When it listed in August 2001, it had a market value of £13m. This week, the group was valued at more than £250m. Synergy makes its money from cleaning bed linen, uniforms and surgical equipment for the NHS and hospitals in the Netherlands. Given the increasing emphasis on hospital hygiene, prospects are good. Hold.
Entertainment Rights has built up a substantial back catalogue and portfolio of characters including old favourites such as Postman Pat, Basil Brush and Rupert the Bear. Children's memories are short and the appetite for repeat viewing tends to be high, allowing the content to be aired on television again and again with no real detriment to viewing. Worth a punt.
Investors were nervous about holding BG Group stock ahead of this week's third-quarter results. Shares in the oil and gas producer trade at a hefty premium to the wider sector and had the group missed City forecasts they would have taken a pasting. As it turned out, BG's figures met expectations. Given the company's reserves and the management's track record of delivering growth, the shares are well worth holding.
Shares in food group Cranswick have roared to an all-time high following its purchase of Delico, a producer of pre-packed cooked meats, for £17.9m. The deal gives Cranswick spare capacity, enabling it to take advantage of the 8 per cent growth in the pre-packed market. The shares now trade at a slight premium to its peer group but for a company with an unbroken profit growth record going back to the early 1990s, this is fully justified. Hold.
The above recommendations are taken from the daily Investment Column
Independent Partners: See how much you could save by switching credit cards. Compare now
food + drinkMichelin-starred Tom Sellers on being this year's hottest property
tvParents (and kids) rejoice! A new wave of fantastic family entertainment is here
booksGeese, gorillas, grandads... and growing up
food + drinkHow one grocery e-tailer is gearing up for the Yuletide rush
food + drink
travelFor broadcaster Mishal Husain, a long-haul Club Med holiday was a chance for her family to explore its sense of 'zen' and 'animation'
- 1 Hundreds arrested as Canadian police smash worldwide paedophile ring
- 2 Sherlock series 3: Benedict Cumberbatch and Martin Freeman provide teasers for the biggest comeback in British television
- 3 Why Barcelona chose Everton to educate their latest prodigy
- 4 Mass murder in the Middle East is funded by our friends the Saudis
- 5 Japan cracks down on leaks after scandal of Fukushima nuclear power plant
- < Previous
- Next >
iJobs Money & Business
£25000 - £50000 per annum + Benefits + Bonus: Harrington Starr: C++ Server Dev...
£300 - £350 per day: Harrington Starr: Leading Electronic Trading Software Ven...
£80000 - £100000 per annum + benefits + bonus: Harrington Starr: Project Manag...
£50000 - £60000 per annum + benefits + bonus: Harrington Starr: Business Analy...
Day In a Page
A three-bedroom Grade II-listed mews house with vaulted ceilings and roof garden
A spacious Grade II-listed family home with annexe and equestrian facilities among four acres of land in Itchingfield
A four-bedroom home with exposed brick walls and open fires in the picturesque village of Northill
A Grade II-listed property with five bedrooms and unique tower, overlooking Hastings Old Town
A charming five-bedroom detached family home, set within half an acre in Kew
A two-bedroom maisonette set on the top two floors of a period building, close to Kentish Town Tube.
Take advantage of the extra space provided by former stables and outbuildings at this five-bedroom farmhouse.
This three-bedroom Victorian terrace is near to Queen’s Road Peckham station, Nunhead station.
A five-bedroom modern house with terrace, swimming pool, Zen treehouse and large carp pond
An unexpected gem with four bedrooms, remarkable vaulted reception and a galleried study area
A five-bedroom house in one of Lymington's most sought after tree lined avenues, moments from the marinas and sailing clubs
A grand early 19th century B&B close to the historic harbour, with four en suite bedrooms
A four-bedroom, 17th century home with walled gardens, a landscaped terrace, cellar and open fires
A six-bedroom house with five bathrooms and four reception rooms spread over 4,000sq ft of luxury living space
A stunning three double-bedroom apartment with two decked terraces in the exclusive gated community, Bromyard House
A 10-bedroom period, family home amid beautiful surroundings in the centre of the Wentworth Estate in Longcross village
A stylish three-bedroom apartment with two bathrooms and private landscaped garden, moments from Fitzroy Square
A Grade II-listed Elizabethan barn with landscaped gardens, exposed elm beams and four bedrooms, all with lovely views
A six-bedroom family home, dating back to 1280 with four reception rooms, barn, swimming pool and tennis courts in Harwell
A spacious two-bedroom flat, refurbished to a very high standard with private landscaped garden, close to Kentish Town station
An exceptional two-bedroom apartment with balcony and underground parking in the centre of Richmond
A one-bedroom, luxury, duplex apartment in the grand landmark building, Imperial Hall
Run a fabulous boutique shop, live above it in a one-bedroom flat and let a second one-bedroom flat that comes part and parcel
A Grade-II listed, thatched cottage in Hundleby village, with five bedrooms, a coach house and three and a half acres
A spacious two-bedroom flat in the heart of Hoxton Square with wooden floors and roof terrace
A five-bedroom family home with stunning pool and gym complex set among two acres of land
A six-bedroom period house with heated swimming pool and a separate two-bedroom annexe cottage in Townlake, £795,000
A spacious and contemporary two-bedroom flat arranged over three floors, with garden patio close to St George Square, £600,000
A one-bedroom flat in a beautiful Regency building opposite the beach in Kemp Town, £190,000
A two-bedroom flat with London skyline views close to Surrey Quays. £395,000.
A seven-storey tower with three bedrooms and a stunning roof terrace. Guide price: £850,000.
A 16-bedroom country pile with nine reception rooms, four self-contained flats and a 13th century Peel Tower. £850,000.
A classic six-bedroom Victorian Manse house 10 miles from Edinburgh. £495,000.
John Lennon's childhood home in Liverpool to be sold at auction. Guide price: £150,000-£250,000.
A six-bedroom detached period property with secluded gardens, ample parking and a double garage in Rye, £675,000.
A large split-level property with three double-bedrooms and roof terrace, close to Crouch End Broadway, £625,000.
A charming barn conversion in the picturesque Cotswold village of Ilmington with three bedrooms, a detached garage, workshop and beautifully manicured gardens £675,000.
A three-bedroom new build, ground-floor flat with two bathrooms, close to Bermondsey tube, £445,000.
A three-bedroom house in an enviable new development moments from Oxshott High Street, with secluded garden and decked area, £385,000
A two-bedroom split-level flat with stunning south-west facing roof terrace in the popular Brondesbury Conservation Area, £549,950.
A charming 16th century, three-bedroom detached house in Bidborough with picturesque garden