The Investment column: Flying Flowers soars even higher

FLYING FLOWERS' share price has certainly lived up to the group's name. Since it floated in 1993, the shares have soared from 65p to close at 499.5p, up another 8p yesterday.

The group has proved it can do the simple things, like delivering a dozen carnations to mum on Mother's Day, very well and very profitably. Now is has dug up another lucrative enterprise by setting up a mail-order gardening business.

This helped propel the Jersey-based company to produce a 59 per cent increase in pre-tax profits to pounds 6.25m for the year to January 2, and saw its dividend more than double to 7.35p.

Gardening Direct, which sells bedding plants by phone and mail, saw sales increase by 150 per cent. Walter Goldsmith, chairman of Flying Flowers, said the increase would have been even higher if the capacity had been there.

It will be. Flying Flowers is developing a 16 acre site near Chelmsford. This will house amongst other things, 100 telephonists, needed to handle up to 20,000 calls a day.

Flying Flowers is a remarkable story but how can it retain such strong growth in the longer term? The answer lies in the group's ability to make sensible acquisitions and seek out new markets overseas.

Yesterday Flying Flowers teamed up with the largest flower grower in Hong Kong to have a go at the Japanese market. It has already formed a similar joint venture in the US which will sell cut flowers via the internet as well as through newspaper adverts.

Flying Flowers is forecast to produce current year pre-tax profits of pounds 7.7m, putting the shares on a prospective p/e ratio of 19. Investors who have stayed away so far should consider turning to flower power.