ITE Group (ITE) boosted revenue from £76m to £95m in the three months to the end of June, and the share price recently touched an all-time high of 309p. That’s a gain of nearly 70 per cent since last November, and executive director Edward Strachan took the opportunity to sell 695,000 shares at 299p earlier this month. However, he still holds another 1.2m shares.
Mr Strachan joined ITE Group 10 years ago and was responsible for launching the exhibition group’s operation in Kazakhstan. Since then, he has opened and managed operations in St Petersburg, Turkey, Uzbekistan and Azerbaijan. ITE’s results for the current year will also include a contribution from the biennial Moscow International Oil & Gas exhibition, and profits will also be boosted by a first-time contribution from Metaltech, which is based in Kuala Lumpur, and which ITE acquired in January this year. And further acquisitions have been made since then, with the group securing a 50 per cent stake in Kuala Lumpur based ECMI, a specialist in running annual exhibitions in the beauty and lab technology sectors in Malaysia, Vietnam and Indonesia. Crucially, the group is generating decent amounts of cash, with last year’s net £1.7m of debt being turned into a £17m cash holding after spending around £26m on acquisitions. And the order book looks impressive too, with sales booked for the current year up from £164m this time last year to £184m. After the strong rise, the shares are trading on 16 times forecast earnings, which is not exactly cheap. However, the group has a strong balance sheet and cash generation. Add in the strong sales momentum, and the shares are a long-term buy.
Jonas Crosland
Pressure Tech insider piles in
It’s only been a month since we tipped Pressure Technologies (PRES), a small engineer making seamless steel cylinders for oil rigs and submarines, but in that time its share price has rocketed 35 per cent to a 4½-year high. We’re not surprised. It is growing fast, has cash in the bank, no debt, pays a tasty big dividend and still looks cheap.
Non-executive director Nigel Luckett clearly thinks so. Pressure Tech chiefs have hardly been prolific buyers of stock in recent times, but the former KPMG partner has just spent over £39,000 on 18,000 shares, taking his stake in the business to 70,000 shares. Of course, directors don’t typically punt their stock and Mr Luckett is unlikely to be after a quick turn. Nor should he be if the charts are any guide. Pressure Tech shares smashed through a key resistance level at 200p last week and another at 240p. A pause here wouldn’t surprise us given the shares are beginning to look overbought on technical measures. It would, in our view, provide a possible springboard for the next drive higher toward 300p.
Like Mr Luckett, we remain positive on Pressure Tech. Even after the recent rally, the shares trade on a cash-adjusted forward PE ratio of 13 for this year, dropping to single figures for 2014. Of course, liquidity and, therefore, volatility can be an issue with smaller companies, but investors who followed our buy advice should continue to run their profits, and at 240p we continue to rate the shares a buy.
Lee Wild
Founder of SuperGroup sells for personal reasons
Divorce proceedings are never easy, and often very costly. For James Holder, a founder of British clothing retailer SuperGroup (SGP) and its brand and design director, the latter must surely be the case. According to a statement from the company, Mr Holder has shed a whopping £20.2m worth of shares due to "personal circumstances associated with recent divorce proceedings".
On 18 July, he sold 2m shares, or 17 per cent of his total stake, at 1,011p per each. This has left him with 9,850,003 shares, which represents 12.2 per cent of the company's issued share capital. Mr Holder's timing was pretty good, as SuperGroup’s share price, currently standing at 1,043p, has done phenomenally well since hitting a low of 269p in June last year. Year-to-date alone, the share price has risen 87 per cent, fuelled by a string of positive results. As well as boasting solid revenue and profit growth, SuperGroup has strengthened its senior management team, expanded globally and made much-needed investments in infrastructure, including a new warehouse to open in October. This kind of investment is made possible because SuperGroup is highly cash generative and sitting on a decent-sized cash pile. A further positive development is that the retailer has thankfully introduced more subtle branding and a range of tailored, more sophisticated clothes, with a focus on womenswear.
That said, these factors are already priced into the shares, now trading on 19 times 2014 earnings estimates, according to Bloomberg consensus estimates. We believe this is high enough, given that there’s no dividend and the share price has already soared by more than 200 per cent since mid-June. Hold at1,043p.
Julia Bradshaw
Buys
| Company | Director | Date | No. of shares | Price (p) | Value (£) | Total shares held | Value (%) |
|---|---|---|---|---|---|---|---|
| Aurora | James Nelson | 18 Jul 13 | 10,000 | 140.6 | 14,060 | 20,000 | 0.19 |
| EG solutions | John O'Connell (ch) | 19 Jul 13 | 127,389 | 78.5 | 100,000 | 127,389 | 0.8 |
| EG solutions | Rob Glen (coo) | 19 Jul 13 | 19,108 | 78.5 | 15,000 | 19,108 | 0.1 |
| Flowgroup | Tony Stiff (ceo) | 17 Jul 13 | 172,245 | 11.55 | 19,894 | 727,790 | 0.55 |
| Flowgroup | Clare Spottiswoode (ch) | 17 Jul 13 | 85,961 | 11.5 | 9,886 | 547,247 | 0.41 |
| Frontier Mining | Yerlan Aliyev (ceo) | 19 Jul 13 | 752,000 | 1.75 | 13,160 | 1,612,000 | 0.09 |
| Mediterranean Oil & Gas | Keith Henry (ch) | 19 Jul 13 | 150,000 | 6.5 | 9,750 | 1,400,000 | 0.33 |
| Mediterranean Oil & Gas | Bill Higgs (ceo) | 19 Jul 13 | 130,769 | 6.5 | 8,500 | 454,838 | - |
| Monks Investment Trust | Karl Sternberg | 08 Jul 13 | 1,700 | 360 | 6,120 | 1,983 | - |
| Pressure Technologies | Nigel Luckett | 22 Jul 13 | 18,000 | 217.5 | 39,150 | 70,000 | 0.62 |
| Quintain Estates | Maxwell James | 22 Jul 13 | 30,000 | 87.75 | 26,325 | - | - |
| Quintain Estates | Richard Stearn | 22 Jul 13 | 20,000 | 87.75 | 17,550 | - | - |
| SABMiller | Ms HA Weir | 22 Jul 13 | 200 | 3,247.72 | 6,495 | - | - |
| Scancell | David Evans | 22 Jul 13 | 30,000 | 31.8 | 9,540 | 5,130,000 | 2.6 |
| Scancell | Kate Cornish-Bowden | 22 Jul 13 | 45,000 | 32 | 14,400 | 45,000 | 0.02 |
| Trinity Exploration & Production | Joel Pemberton (ceo) | 18 Jul 13 | 3,145 | 100 | 3,145 | 525,960 | 0.55 |
| Verona Pharma | Stuart Bottomley | 22 Jul 13 | 3,000,000 | 1.67 | 50,100 | 15,700,000 | 4.67 |
| Wynnstay Properties | Paul Williams (md) | 17 Jul 13 | 9,412 | 275 | 25,883 | 9,412 | 0.35 |
Sells
| Company | Director | Date | No. of shares | Price (p) | Value (£) | Total shares held | Value (%) |
|---|---|---|---|---|---|---|---|
| Akers Biosciences | Raymond Akers (ch) | 22 Jul 13 | 7,000,000 | na | Gifted | 1,824,338 | 0.7 |
| Cropper, James | PJ Willink | 19 Jul 13 | 3,500 | 243.00 | 8,505 | 46,245 | 0.52 |
| eg solutions | Elizabeth Gooch (ceo) | 19 Jul 13 | 789,897 | 78.50 | 620,069 | 6,514,080 | 40.7 |
| ITE | Edward Strachan | 18 Jul 13 | 695,000 | 299 | 2,078,050 | 1,200,255 | 0.48 |
| Lo-Q | Leonard Sim (eco) | 19 Jul 13 | 250,000 | 600.00 | 1,500,000 | 1,943,575 | 9.96 |
| Sports Direct | David Singleton | 18 Jul 13 | 75,000 | 626 | 469,500 | 78,621 | 0.013 |
| SSE | Mark Mathieson | 18 Jul 13 | 6,500 | 1,616 | 105,040 | - | - |
| Supergroup | James Holder | 18 Jul 13 | 2,000,000 | 1,011 | 20,220,000 | 9,850,003 | 12.24 |
Table compiled by Robert Ansted
Key to abbreviations: ch = chairman; ce = chief executive; cfo = chief financial officer; fd = finance director; coo = chief operating officer; cs =company secretary; md = managing director
