THE INVESTMENT COLUMN: Lastminute has plenty of time to disappoint afresh

LASTMINUTE.COM was doing a roaring trade in candy-flavoured G-strings yesterday as true romantics prepared for Valentine's day. And the online travel retailer itself raised a few eyebrows with quarterly results which were not only in line with City expectations, but actually beat them.

After spending most of 2004 buying companies, including Holiday Autos, and missing targets while sending its shares into steep decline, yesterday's first quarter results were a welcome relief.

The value of transactions was up 80.4 per cent to pounds 264.4m and gross profit was pounds 43.7m, up from pounds 25m a year ago. The City was expecting a lot worse than the pounds 1.8m loss Lastminute announced on earnings before interest, tax, depreciation and amortisation even though it was still wider than last year's comparable pounds 1.1m.

However, one decent quarter proves nothing. The shares were up 5.85 per cent yesterday at 113p but there is still plenty of takeover speculation helping to buoy the price. In fact, the prospect of a bid seems the only reason for buying the shares right now. Otherwise avoid.