Further trouble in store for Sears

IT IS no fun on the high street, as the retail sales figures and the disappointing results from House of Fraser have emphasised over the past few days. It is even worse if, like Sears, you have a mass of specialised chains requiring constant fire-fighting. Sears has untangled its European joint venture at minimum loss, but there are many other potential horrors lurking. Disappointing Christmas trading will have prefigured poor results when the 1995 profits are announced on Tuesday. Steer clear.

BUT there are a number of special situations among narrowly focused retailers. Typical is a long-time favourite, of Citytalk, T&S, the specialist chain of newsagents. Its virtues are highlighted by the 25 bids received by Gallaher for the very similar Forbuoys chain, and by the bigger-than- expected success of the National Lottery.

The shares have raced ahead to 168p from a low of 144p on recent encouraging results, and that was before the lottery bonanza started to roll. They remain good value. What other retailer can say that its only problem is coping with too many customers?

ANOTHER exception reporting this week is fashion retailer French Connection, which has risen a healthy 40p since the shares were recommended in Citytalk last November.

Since founder Stephen Marks sold his shares, the firm has become much less of a one-man band. John Richards, at NatWest Securities, forecasts a jump in earnings per share from 17.7p to 25.5p in the year to end-January 1995. The pace is clearly sustainable. As Mr Richards says: "The continued steady progress in both the UK and the US owes more to improving the quality of the product and efficiency of the business than to chasing sales in what remains a tough environment." A solid buy.

THE market has not yet woken up to the benefits from the weak pound for the upmarket mens- wear retailer and manufacturer, Austin Reed. The shares are still a mere 216p. The only bear factor is the mild winter, which hit sales of overcoats. But this is more than made up by increased sales to continental Europe. Better sales should flow through to profits, as the company has overhauled working practices that were more than a little old-fashioned. Still undervalued.

STRONG bulls of the contract- hire specialist TLS Range include broker Henry Cooke Lumsden.

The shares have more than doubled since they were first recommended in Citytalk back in mid-1993. But they are still good value: pre-tax profits soared in 1993/94 and are set to more than double in 1994/95, thanks to a more conservative accounting policy that deferred profits, to much better utilisation rates and to a rapidly increasing fleet of vehicles.

The broker is forecasting a rise from the present 47p to 60p - and that could be conservative, since the present price is a mere 6.3 times likely 1995 earnings. A good runner.

THERE is more to go for in Farnell Electronics, the high-flying electronics business after the £80m sale of its manufacturing arm at the end of March.

The new chief executive, Howard Poulson, is betting on the company by turning it into a world-scale distributor and removing extraneous businesses to fill his war chest. Even before the acceleration, brokers BZW were forecasting that pre-tax profits for the year to end-January will be up from £49.5m to £61m and that could be conservative.

Even at 593p, up from 512p in the last year, the shares remain good value.

Life and Style
A teenager boy wakes up.
life
Life and Style
Researchers have said it could take only two questions to identify a problem with alcohol
food + drink
Arts and Entertainment
Critics say Kipling showed loathing for India's primitive villagers in The Jungle Book
filmChristopher Walken, Bill Murray, Scarlett Johanssen Idris Elba, Andy Serkis, Benedict Cumberbatch, Cate Blanchett and Christian Bale
Life and Style
Playing to win: for Tanith Carey, pictured with Lily, right, and Clio, even simple games had to have an educational purpose
lifeTanith Carey explains what made her take her foot off the gas
PROMOTED VIDEO
Life and Style
tech
Arts and Entertainment
A still from Duncan Campbell's hour-long film 'It for Others'
Turner Prize 2014
Life and Style
food + drink
News
i100
Arts and Entertainment
Tony Hadley in a scene from ‘Soul Boys Of The Western World’
musicSpandau Ballet are back together - on stage and screen
Arts and Entertainment
From left to right: Ed Stoppard as Brian Epstein, Sheridan Smith as Cilla Black and Elliott Cowan as George Martin in 'Cilla'
tvCilla review: A poignant ending to mini-series
News
i100
Life and Style
Bearing up: Sebastian Flyte with his teddy Aloysius in Brideshead Revisited
lifePhilippa Perry explains why a third of students take a bear to uni
Arts and Entertainment
Sir Alan Sugar appearing in a shot from Apprentice which was used in a Cassette Boy mashup
artsA judge will rule if pieces are funny enough to be classed as parodies
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trust Accountant - Kent

NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...

Graduate Recruitment Consultant - 2013/14 Grads - No Exp Needed

£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...

Law Costs

Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...

SQL Developer (Stored Procedures) - Hertfordshire/Middlesex

£300 - £330 per day: Ashdown Group: SQL Developer (Stored Procedures) Watford...

Day In a Page

Isis is an hour from Baghdad, the Iraq army has little chance against it, and air strikes won't help

Isis an hour away from Baghdad -

and with no sign of Iraq army being able to make a successful counter-attack
Turner Prize 2014 is frustratingly timid

Turner Prize 2014 is frustratingly timid

The exhibition nods to rich and potentially brilliant ideas, but steps back
Last chance to see: Half the world’s animals have disappeared over the last 40 years

Last chance to see...

The Earth’s animal wildlife population has halved in 40 years
So here's why teenagers are always grumpy - and it's not what you think

Truth behind teens' grumpiness

Early school hours mess with their biological clocks
Why can no one stop hackers putting celebrities' private photos online?

Hacked photos: the third wave

Why can no one stop hackers putting celebrities' private photos online?
Royal Ballet star dubbed 'Charlize Theron in pointe shoes' takes on Manon

Homegrown ballerina is on the rise

Royal Ballet star Melissa Hamilton is about to tackle the role of Manon
Education, eduction, education? Our growing fascination with what really goes on in school

Education, education, education

TV documentaries filmed in classrooms are now a genre in their own right
It’s reasonable to negotiate with the likes of Isis, so why don’t we do it and save lives?

It’s perfectly reasonable to negotiate with villains like Isis

So why don’t we do it and save some lives?
This man just ran a marathon in under 2 hours 3 minutes. Is a 2-hour race in sight?

Is a sub-2-hour race now within sight?

Dennis Kimetto breaks marathon record
We shall not be moved, say Stratford's single parents fighting eviction

Inside the E15 'occupation'

We shall not be moved, say Stratford single parents
Air strikes alone will fail to stop Isis

Air strikes alone will fail to stop Isis

Talks between all touched by the crisis in Syria and Iraq can achieve as much as the Tornadoes, says Patrick Cockburn
Nadhim Zahawi: From a refugee on welfare to the heart of No 10

Nadhim Zahawi: From a refugee on welfare to the heart of No 10

The Tory MP speaks for the first time about the devastating effect of his father's bankruptcy
Witches: A history of misogyny

Witches: A history of misogyny

The sexist abuse that haunts modern life is nothing new: women have been 'trolled' in art for 500 years
Shona Rhimes interview: Meet the most powerful woman in US television

Meet the most powerful woman in US television

Writer and producer of shows like Grey's Anatomy, Shonda Rhimes now has her own evening of primetime TV – but she’s taking it in her stride
'Before They Pass Away': Endangered communities photographed 'like Kate Moss'

Endangered communities photographed 'like Kate Moss'

Jimmy Nelson travelled the world to photograph 35 threatened tribes in an unashamedly glamorous style