The Faraj List of Exploding Stocks Part 3.04 (FAR3)
melfaraj - Mon, 27 Dec 04 :
Marchpole fashions a new future
Two and a half years ago, Marchpole (27.75p), the group which licences and distributes up-market fashion brands, was on the brink of collapse. It was seen as too reliant on its main asset, the Yves Saint Laurent licence in the UK.
Since then Greg Tufnell, the chief executive, has patched up the group, which moved back into profit earlier this year. Tufnell has signed new deals with Ozwald Boateng, the Ungaro label and has bought Jean-Charles de Castelbajac, one of the best-known Paris fashion houses.
The shares have been hit recently by concerns that changes at Gucci, which owns the YSL label, will mean Marchpole will lose its licence in 2007. This is likely but Tufnell is already on the lookout for more labels. The other issue is a nasty breach of contract dispute with Boateng. But even if that is not settled, Marchpole has a contract to use the brand until 2009.
We last tipped the shares at just 4.25p in April 2002. While they have risen by more than six-fold, Tufnell should yet squeeze out more value and readers should keep buying.
