London Clubs 2004 ,where next ?

Lemming Investor Brief Updates 16 December 2005


Minorplanet, vehicle tracking company, closed 2p higher at 47.5p after the company posted narrower losses for the year to end September and said trading in the following two months was profitable.

Pretax pre-exceptional pre-goodwill loss of £3.9m compared to a loss of £6.8m a year earlier.

Stanelco finished the week with a bloody nose, despite excellent progress in 2005. There can be no doubting that 2006 will be a key year for the company The shares closed down 7.4% to 15.5p after announcing it received a 'substantial offer' of funding in relation to a proposed production and R&D facility in Wales, allowing it to invest about £3m in the facility.

It added that it made significant progress in the development and commercialisation of its GREENSEAL technology.

It is working with ASDA and four of its key suppliers to fulfil the initial stage of the ASDA contract, it said, adding that current potential placements are expected to lead to orders in excess of 50 conversions with one supplier to ASDA. Another supplier is indicating a requirement for another 30 machines.

Although the shares are 114% higher since our inaugural feature, We still believe Stanelco will be a £2 billion company in five years or so, if Wal-mart takes on where ASDA leaves off. Then they will all want to take up Greenseal - 50,000 of them (m/cs - not clients) However the £144m current cap is up with events and IMO needs at least £5m/pa profits to sustain it. The whole ASDA 200 m/c contract still remains tantalisingly indecisive, (though this weeks news suggests there is some movement in the right direction) and would not produce the £5m annual profit on its own. Biotec is potentially just as big but is a year further away.

This is a share with such a good story ahead of facts that when it becomes cash positive, it could well remain overbought on an astronomical PE say 80, and therefore will always carry a risk of sharp correction, as it did recently to 12p.

Stanelco also announced that it has entered into a landmark cooperation deal with Perseco, a company specialising in cost effective, innovative packaging solutions to the food service and beverage industries. The partnership will focus on utilising Stanelco`s packaging technologies. Amongst Perseco`s clients are some of the world's leading fast food brands in the US.

Howard White, Group Managing Director of Stanelco, commented:

'We are delighted that Perseco have acknowledged that Stanelco has some of the most advanced packaging technology in the world. This includes both our range of biodegradable food packaging materials from Biotec as well as the technologies within the Company's other subsidiaries. With this cooperation Perseco will partner Stanelco with a number of their global resource suppliers both to

present packaging solutions and to achieve sustainability in materials

Axis-Shield, closed 3p down, though represents a 87% gain since our inaugural feature. Full-year numbers are in line with forecasts, and predicted revenues will grow 10% over last year.

In a trading statement ahead of annual results the Scottish medical diagnostics group attributed the sales uplift to increased revenues from tests it makes to measure homocysteine levels, associated with cardiovascular and neurodegenerative diseases.

Products it manufactures for US group Abbott Laboratories also gave a boost.

Gross margins are likely to show the improvement seen at the half year, when a rise to 53.7% from 53.1% was reported.

Marketing costs are likely to rise on the cost of launching Afinion, the company's new diagnostics testing kit, but associated research and development costs should fall, it predicted.

Chairman Nigel Keen said: 'This has been a rewarding year for the company with good all-round performances across the divisions, enabling us to sustain the profitability we reported at the half year.

Separately, Axis-Shield announced another deal with Abbott to develop and manufacture tests for anti-CCP, for the early detection of rheumatoid arthritis, and homocysteine on Abbott's own kit, called Architect.

The deal should generate 'significant future revenues', the company claimed.

Arena Leisure, the UK's largest operator of horseracing fixtures, has signed a deal with Doncaster Borough Council for the £32m redevelopment of the Doncaster racecourse.

Under the deal, which includes the construction of a new grandstand, stable facilities and exhibition centre, a limited liability company has been created with Doncaster council in which Arena holds an 81% stake. The company will hold a 99 year lease over the racecourse and during the first 30 years of the venture, Arena will receive 92.5% of profits.

Mark Elliott, chief executive of Arena said: 'Doncaster Racecourse is in a fantastic location and with a great tradition as home to the St Leger, the world's oldest classic race. We look forward to transforming the racecourse, providing its customers with facilities worthy of such a prestigious race and making Doncaster Racecourse a world class leisure and racing venue.'

The leisure group also said its part owned joint venture, 'At the Races', has won the broadcasting rights for the Doncaster racecourse.

Arena Leisure PLC said it has been informed by At The Races, its joint venture with British Sky Broadcasting Group PLC, that the High Court hearing relating to its claim for monies owing to it from racecourses in the UK under the terms of the original media rights agreement has been postponed after the judge appointed to hear the case stepped down.

Consequently, the case has been rescheduled to commence on March 13, 2006 at the High Court in London.

Arena Leisure has also sold its 1% shareholding in betting office television service Satellite Information Services (Hldgs) Ltd for £1.2m.

The shares are 6.5% down on our inaugural feature.

London Clubs International always seems to find a reason other than its own failings each time results come around. The festival of Ramadan had hit the group adversely when the gaming group posted FY numbers, now, on posting a first-half loss, it says takings at its London casinos were dented by July's terrorist attacks, though the company said trading had recovered strongly in recent weeks. Lets hope this does not change in H2

Britain's third-biggest casino operator posted a £2.6m pretax loss in the six months to Sept 25 compared with a £3.3m profit the previous year.

Turnover fell 3.8% to £73.7m with takings at its flagship London casino, Les Ambassadeurs, particularly badly dented.

London Clubs said its two casinos in Cairo were unwitting beneficiaries as they drew visitors from the Middle East who would otherwise have gone to London.

Timmins said the recent easing of various gambling industry regulations, such as the scrapping of the '24-hour rule' which prevented people from gambling until a full day after joining, had provided a boost.

New laws permitting the installation of an extra 10 slot machines in each outlet, with a higher maximum payout, had provided a further boon in recent weeks.

London Clubs shares closed 2.75p higher at 136.75p, representing a gain of 147%