Boosey's great performance: The Investment Column

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The Independent Online
Yesterday's 30p rise to 792.5p brings shares in Boosey & Hawkes close to the all-time high of 813p hit last month after the musical instruments and publishing group announced a partial victory in its copyright dispute with Disney. Eventual success could bring a windfall of as high as pounds 200m, according to some estimates, more than the group's total market value of pounds 155m.

But the wrangle will run until the middle of next year at least and yesterday's rise had more to do with an excellent set of results. Pre-tax profits jumped 21 per cent to pounds 2.05m in the six months to June, with the interim dividend being hoisted a quarter to 1.91p.

That was an impressive performance, given the sluggish economic background in France, Germany and Japan. The instrument division led the way with an 18 per cent rise in operating profits to pounds 1.52m. Boosey's strong brand names, which command around half the world market for woodwind instruments, enabled the group to lift prices by 2 to 3 per cent on average.

The music publishing and copyright side shrugged off a slight dip in music sales to raise profits 8.9 per cent to pounds 1.78m. Bote & Bock, the German publisher acquired earlier this year, will not contribute until 1997, when Boosey should also see the first benefits of last year's move to extend certain European copyrights by 20 years.

But the immediate excitement lies in last month's pounds 17.9m acquisition of Rico, which dominates the world market for clarinet and saxophone reeds and marks Boosey's first move into the US. The potential to leverage Rico's products off the group's worldwide sales operation could be substantial.

But even if profits hit pounds 7.1m this year, the shares would still stand on a heady multiple of 34. High enough for now, unless there is a bid from Carl Fischer, the US music publisher which controls 48 per cent.

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