LONDON (Thomson Financial) - UK smaller companies remained higher at midday,
slightly extending earlier gains, with Cardinal Resources soaring on news of
takeover talks.
At 12.20 pm, the FTSE small cap index was 15.60 points firmer at 3,864.30,
while the FTSE 100 was 15.50 points stronger at 6,318.80.
Ukraine-focused oil and gas exploration and production company Cardinal
Resources soared 5.125 pence stronger to 14.25 - a 56 pct rise - on news it is
currently in takeover talks with several parties.
Bid news also saw Sondex shares jump 30-1/2 pence higher to 453 after
General Electric's wholly-owned unit, Drilling and Wireline Solutions, made an
agreed 460 pence a share cash offer, valuing the oil field technology supplier
at 288.7 mln stg.
Elsewhere on the upside, Messaging International added 0.30 pence to 1.10
after the AIM-traded provider of innovative messaging services disclosed that it
has sold the rights to intellectual property it has developed, and for which a
patent was granted in 2006, to a US-based invention company for 700,000 usd.
Also staying firm was Croma Group, 1 pence stronger at 4.125, as the
AIM-listed surveillance, security and homeland defence specialist reported a
record month of trading in July, a strong performance for August, and said
September trading is looking robust.
The company also revealed a 250,000 stg contract with the Ministry of
Defence.
Positive trading news saw a hat-trick of risers, with Connaught up 21-1/4
pence to 327-1/4, as the group published an in-line full-year trading update and
announced the acquisition of two compliance businesses for a combined total of
up to 4.3 mln stg, prompting Altium Securities to repeat its 'buy' stance.
The trading update said the company's order intake for 2007 stands at 770
mln stg, including 160 mln stg from acquisitions, leading the broker to upgrade
its 2008 and 2009 earnings estimates by 2.5 pct.
Also climbing on trading news was Robert Walters, 18-1/4 firmer at 330-3/4,
after the recruitment company chalked up a 41 pct increase in first-half pretax
profits, and said that current trading remains strong.
On the results front, car dealership group Lookers rose 9 pence to 171-3/4
after the company notched up a 41 pct increase in profits at the half-way mark,
outperforming the market for new cars.
Elsewhere Murgitroyd Group improved 32-1/2 to 492-1/2 after the company
disclosed a 58 pct surge in underlying pretax profit for the full year, helped
by its acquisition of Fitzpatricks, a provider of patent and trademark services.
Meanwhile Acambis extended earlier gains slightly, climbing 6-3/4 pence
stronger at 120-1/4 after the US Food and Drug Administration gave the green
light to the company's ACAM2000 smallpox vaccine, which the company said is a
key step towards the company finalising a long-term "warm-base manufacturing"
contract with the US government.
Cluff Gold remained 4 pence stronger at 71-1/2 after a study showed that a
zone on the Baomahun gold project in Sierra Leone could be economically viable
as an open-pit mine, while buyers came for Hill & Smith, 18 pence up at 395
following positive trading news that first-half underlying pretax profits of the
transport and building group rose 47 pct.
On the downside, however, shares in Aquilo fell 1 pence to 3 a 25 pct drop
after announcing that it is putting its IT Solutions unit into administration.
The company said IT Solutions cannot continue trading and that it has
appointed KPMG as the administrator for the unit.
Shares in Clipper Windpower dropped 48 to 507-1/2 after the company warned
it has found a supplier quality deficiency in its new drivetrain, which has
temporarily slowed turbine shipments and could cost it up to 15 mln usd over the
next year.
Contract delays led to two fallers, the first being supplier of business
management software to broadcasters Pilat Media Global, which ran back 6 pence
to 44 as the company lowered its full-year expectations following contract
delays.
The company posted a lower pretax profit of 253,914 stg for the six months
ended June 30, compared to 967,521 stg, attributing the fall in profits to
higher operating costs and expenses.
Meanwhile, Clarity Commerce Solutions was 3 pence lower at 32-1/2 as the
company swung to a full year pretax loss, hurt by delays in the completion of
new product development, slippage in several anticipated contracts and cost
over-runs in a number of subsidiaries.
The company reported a pretax loss for the year to March 31 of 458,000 stg,
compared with a pretax profit of 953,000 stg last time, though turnover rose 10
pct to 20.8 mln stg.
The company also said costs over-runs and the fact that several prospective
contracts have been lost or delayed will continue to have a material effect on
results in 2007/08.
Goldshield Group stayed 6-3/4 pence lower at 215 following news that the
company will not proceed with the sale of its call centre services unit to
former chief executive and co-founder Ajit Patel after two of the company's
major customers refused to give their consent to the sale.
Finally, Victoria Oil & Gas fell back 3 pence to 29-1/2 as it said tests
conducted so far at the West Medvezhye well 103 in Russia indicate that the well
is "significantly" over-pressured, and also confirm the presence of
hydrocarbons.
However, the mining firm said the key parameter of permeability has not yet
been fully determined.
tf.TFN-Europe_newsdesk@thomson.com
hmb/ejp
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