ITV has commissioned an AIM-listed media company to produce its Saturday morning music television slot. DCD Media has won the commission from the broadcaster to make the programme that will replace the long-running CD:UK. The news will be unveiled today and is expected to boost shares in the AIM group.
Done and Dusted, the company's music production unit, secured the contract after fending off competition from six other UK rivals. DCD, which is chaired by David Elstein, the former head of Channel 5, bought the business in February. In the past it has filmed rock concerts by the likes of Robbie Williams, Madonna, Britney Spears and Norah Jones.
The win is a significant endorsement of Done and Dusted, which will produce 15 one-hour shows for ITV. If the yet-to-be-named format proves successful, it could run for many years. The deal should be good for DCD earnings as each show is forecast to be profitable. It should also raise the media company's profile.
Optimisa on the up
Investors looking for a profitable, dividend-paying and fast-growing company should take a peek at Optimisa. Its chairman, Ron Littleboy, a former Nomura banker, has steadily built up the company. He has taken it from cash shell to an £8m cash-generative marketing services house via a series of acquisitions and is believed to be working on further purchases. Last week came news that Optimisa had raised just under £1m from a placing at 900p, which only enhances its ability to do deals.
At present, the group, where financier Vincent Tchenguiz has a 6 per cent stake, runs two consulting-based marketing services businesses, both of which boast a series of blue-chip clients such as Barclays, BT, Eli Lilly and Nokia. For the year to the end of December 2005, Optimisa registered earnings per share (EPS) of 61p and paid a final dividend of 15p a share. In 2006, EPS should rise to about 90p and shareholders can also expect a chunky dividend rise.
This forecast leaves the group trading about 10.5 times forward earnings, a hefty discount to listed rivals like Cello and Creston.
A move from the lightly regulated Ofex exchange to AIM looks to be on the cards at Wren Homes. The management of the retirement homes builder is believed to be considering making the switch some time in the summer or autumn. Wren, which started trading in 1996, operates around the M25 corridor in the south and is working on 15 developments. It recently appointed JM Finn as its broker and is likely to raise fresh cash on its promotion.
Coming to AIM ahead of Wren Homes is Mariana Resources. The group has raised £3.6m from the sale of 18.1 million new shares at 20p and hopes to list on Friday. Since 2004, Mariana has been focused on select gold projects in Ecuador, Chile and Argentina. The cash raised will be used to fund the group's drilling programme, which tries to target high-grade, high-value and low-cost mining.
Developers await EU decision
For investors in the half dozen or so AIM companies set up specifically to cash in on Bulgaria's remarkably low property prices, tomorrow is an important day. The European Commission will announce whether the Balkan country will join the EU in January 2007 or in 2008, although there is an outside chance that a decision will be delayed until the autumn to give Bulgaria more time to push ahead with judicial reforms.
Over the past 18 months, companies such as Orchid Developments, Black Sea Property, Bulgarian Property Development, Lewis Charles Sofia Property Fund and Bulgarian Land Development have raised a collective £180m by listing on London's junior stock market, spending the cash on a mixture of commercial, tourist and residential property assets.
Once Bulgaria joins the EU it is expected to receive billions of pounds in grants and aid from the community which should give the economy and local asset prices, already enjoying stellar growth, an added boost. Property in the capital, Sofia, sells at about £70 to £85 per square metre, compared with £1,000 per square metre in some parts of London.
That's the plus side. On the down side, the Balkan country has yet to convince the EU that its socialist-led government has made enough progress in reforming the judiciary and stamping out corruption. Commission members have often criticised the lack of action on this front. And they have a point. Underworld gangs comprised of communist-era secret service operatives are believed to control large parts of the economy, as do some members of parliament and government.
And they may well defend their own interests with impunity. Question marks remain about 150 unsolved contract killings, including the shooting of several top businessmen, since 2001. However, many people argue that Bulgaria is no more corrupt than Italy was at the height of its post-war fight against the Mafia. Rightly, the Commission has so far taken the view that matters will only get worse if Bulgaria is left out of the fold.