Investment: Outdoor life is hard for Maiden

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NO ONE likes Maiden. The UK's only quoted outdoor advertising group has been in the doghouse since issuing a shock profit warning a month ago. The shares, which halved on the news, have failed to bounce back and dipped another 5p to 225p yesterday.

Maiden blames a slowdown in advertising spending during the World Cup for the shortfall. However, the group has suffered more than others because of its policy of not booking space early at discounted rates. Add its operational gearing - costs are essentially all fixed - and financial leverage and it's not hard to see why profit forecasts for the full year were cut in half to pounds 6.1m.

The chief executive, Ron Zeghibe, was not helping matters yesterday by insisting it was too early to tell how the second half would go. That said, Maiden's fundamental strategy remains sound. Apart from running its traditional 48-sheet billboard business, it continues to expand its six-sheet poster sites in railway stations and supermarkets.

The smaller format is proving popular with consumer goods groups, which have traditionally avoided large billboards. The proliferation of television channels with the onset of digital also means that the forces driving advertisers towards outdoor media are unlikely to diminish.

Maiden's value is ultimately linked to the future for advertising spending. Although there are signs of a general slowdown, the group is unlikely to suffer as badly as it did in June and July for a long time. The shares do not look cheap on a forward earnings multiple of about 20, though the rating falls rapidly if sales recover next year. Given that an agreed takeover bid - or a management buyout - is a distinct possibility, it's hard to see much downside from here. Despite its current unpopularity, Maiden offers good long-term value.