Dr Cameron Davies, a geochemist who founded Alkane Energy (ALK) in 1994, has sold nearly a quarter of his holding in the British coal mine methane producer to raise £400,000 in proceeds. Mr Davies, 69, moved to a non-executive director role in 2009, allowing 50-year-old accountant Neil O’Brien to take over as chief executive and scale up the business. Mr O’Brien has overseen a tripling of revenues since 2008 and has also helped Alkane’s share price rise nearly three-fold during his tenure, with much of those gains coming in the last 12 months.
We tipped Alkane’s shares as a buy at 38p in August because we believe they offer a relatively low-risk way to play the likely rise in UK wholesale power prices, while offering free upside on UK shale gas exploration acreage. Trading on a forward PE ratio of 15 for 2013, falling to 12 in 2014 and 9 in 2015, the shares offer decent value compared with other independent power producers listed in London, which have an average forward PE ratio of 20. So despite the bearish warning signs signalled by Mr Davies’ share sale, we keep our long-term buy rating on the shares at 40p and eagerly await the next trading update in January following a stellar set of interim results in September.
Shareholders will be reassured to know that the sale of 3.35m shares in YouGov (YOU) by chief executive Stephan Shakespeare was no reflection on the health of the online polling specialist. In a refreshingly candid statement that accompanied the share sale (other company directors please take note), Mr Shakespeare revealed that the disposal - which raised a cool £2.56m - was made for personal financial and tax planning purposes, principally in order to finance the repayment in full of a personal loan taken out in November 2009. At that time, the loan was secured through a pledge agreement on 6m shares owned by Mr Shakespeare, and when the shares were trading at 51p.
Following the latest share sale and loan repayment, he still has an interest in 5.719m shares worth around 5.88 per cent of the issued share capital, and has undertaken not to sell any more shares before 2015 at the earliest. True, the sale looks well-timed as shares in YouGov have risen nearly 30 per cent in the last three months. However, this looks fully justified as adjusted pre-tax profits in the year to July 2013 rose by 13 per cent to £6.8m, and the group has been expanding its geographical footprint into the US, France and the Middle East. Rated on 15 times forecast earnings, and given the growth profile, we are sticking with our buy recommendation.
BUYS:
| Company | Director | Date | No of shares | Price (p) | Value (£) | Holding (shares) | Holding (%) |
|---|---|---|---|---|---|---|---|
| Aberforth Geared Income Trust | GR Menzies | 30 Oct 13 | 3,800 | 161 | 6,118 | 97,800 | 0.09 |
| Anite | Paul Taylor | 30 Oct 13 | 27,250 | 92 | 25,070 | 27,250 | 0.01 |
| Anite | Patrick De Smedt | 30 Oct 13 | 19,969 | 89.62 | 17,896 | 19,969 | 0.01 |
| Anite | Nigel Clifford | 30 Oct 13 | 11,166 | 89.55 | 9,999 | 41,166 | 0.01 |
| Anite | David Hurst-Brown | 30 Oct 13 | 50,000 | 89.5 | 44,750 | 230,000 | 0.08 |
| Anite | Clay Brendish (ch) | 30 Oct 13 | 28,250 | 91 | 25,708 | 319,472 | 0.11 |
| Arcontech | Matthew Jeffs (ce) | 24 Oct 13 | 5,000,000 | 0.14 | 7,000 | 28,000,000 | 1.83 |
| Arrow Global | Gillian Key-Vice | 25 Oct 13 | 4,234 | 235 | 9,950 | 6,357 | 0.00 |
| Arrow Global | Gillian Key-Vice | 25 Oct 13 | 2,123 | 234 | 4,968 | 2,123 | 0.00 |
| Asian Plantations | Sri DAL Linggi (ch) | 24 Oct 13 | 5,000 | 204 | 10,200 | 2,037,292 | 4.36 |
| Asian Plantations † | Sri DAL Linggi (ch) | 24 Oct 13 | 25,000 | 201 | 50,250 | 2,056,000 | 4.40 |
| Asian Plantations † | Dennis Melka (jce) | 25 Oct 13 | 25,000 | 200 | 50,000 | 2,376,001 | 5.08 |
| British Sky Broadcasting | Daniel Rimer | 25 Oct 13 | 400 | 928 | 3,712 | 22,716 | 0.00 |
| British Sky Broadcasting | Nicholas Ferguson (ch) | 25 Oct 13 | 546 | 928 | 5,067 | 24,464 | 0.00 |
| Brown (N) | Andrew Higginson (ch) | 28 Oct 13 | 416 | 509 | 2,117 | 84,157 | 0.03 |
| Bunzl | Meine Oldersma | 25 Oct 13 | 2,500 | 1,368 | 34,200 | 2,500 | 0.00 |
| Centrica | Ian Meakins | 25 Oct 13 | 394 | 357.9 | 1,410 | 5,394 | 0.00 |
| Centrica | Lesley Knox | 25 Oct 13 | 568 | 357.9 | 2,033 | 4,068 | 0.00 |
| Centrica | Margherita Della Valle | 25 Oct 13 | 706 | 357.9 | 2,527 | 5,706 | 0.00 |
| Centrica | Rick Haythornthwaite | 24 Oct 13 | 12,500 | 356.58 | 44,573 | 12,500 | 0.00 |
| Chime Communications * | Lord Davies of Abersoch (ch) | 25 Oct 13 | 16,667 | 300 | 50,001 | 19,018 | 0.02 |
| Chime Communications * | Christopher Satterthwaite (ce) | 25 Oct 13 | 16,667 | 300 | 50,001 | 413,542 | 0.50 |
| Chime Communications * | Mark Smith (fd) | 25 Oct 13 | 8,333 | 300 | 24,999 | 353,804 | 0.43 |
| Debenhams | Michael Sharp (ce) | 28 Oct 13 | 100,000 | 97.7 | 97,700 | 6,460,067 | 0.53 |
| Development Securities | Marcus Shepherd (fd) | 30 Oct 13 | 28,347 | 229.3 | 65,000 | 28,347 | 0.02 |
| GeoPark | James Park (ce) | 24 Oct 13 | 3,500 | 515 | 18,025 | 7,154,269 | 16.31 |
| Gresham Computing † | Max Royde | 30 Oct 13 | 25,000 | 126 | 31,500 | 5,037,854 | 8.67 |
| In-Deed Online | Harry Hill (ch) | 30 Oct 13 | 100,000 | 12.5 | 12,500 | 1,830,000 | 8.97 |
| In-Deed Online | Peter Gordon (md) | 30 Oct 13 | 100,000 | 12.5 | 12,500 | 1,830,000 | 8.97 |
| Independent Investment Trust (The) | Maxwell Ward (md) | 30 Oct 13 | 50,000 | 265.25 | 132,625 | 5,200,000 | 8.95 |
| KBC Advanced Technologies † | Oliver Scott | 29 Oct 13 | 75,000 | 89.55 | 67,163 | 7,378,863 | 12.47 |
| Laird | Jack Boyer | 30 Oct 13 | 3,000 | 252.1 | 7,563 | 5,000 | 0.00 |
| Magnolia Petroleum | Ronald Harwood | 25 Oct 13 | 500,000 | 2.8 | 14,000 | 32,112,426 | 3.53 |
| Murray Income Trust † | PAF Gifford (ch) | 30 Oct 13 | 419 | 813.5 | 3,409 | 38,744 | 0.06 |
| Oracle Coalfields * | Adrian Loader (ch) | 30 Oct 13 | 555,556 | 1.8 | 10,000 | 2,967,460 | 0.91 |
| Orogen Gold * | Alan Mooney | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 89,936,994 | 3.75 |
| Orogen Gold * | Adam Reynolds | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 47,366,667 | 1.98 |
| Orogen Gold * | Michael Nolan | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 89,936,994 | 3.75 |
| Orogen Gold * | Ed Slowey (ce) | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 126,222,158 | 5.27 |
| Orogen Gold * | John Barry (ch) | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 127,222,158 | 5.31 |
| Orogen Gold * | Alan Mooney (fd & cs) | 24 Oct 13 | 6,666,667 | 0.3 | 20,000 | 89,936,994 | 3.75 |
| Rare Earth Minerals | David Lenigas (ch) | 30 Oct 13 | 2,000,000 | 0.79 | 15,800 | 2,000,000 | 0.05 |
| Ricardo | Peter Gilchrist | 30 Oct 13 | 820 | 605.25 | 4,963 | 4,970 | 0.01 |
| Rio Tinto | Paul Tellier | 29 Oct 13 | 196 | 3,215.18 | 6,302 | 19,445 | 0.00 |
| Rio Tinto | Richard Goodmanson | 29 Oct 13 | 230 | 3,215.18 | 7,395 | 15,611 | 0.00 |
| Riverstone Energy | David Leuschen | 29 Oct 13 | 5,000,000 | 1,000 | 50,000,000 | 5,000,000 | 7.04 |
| Riverstone Energy | Patrick Firth | 29 Oct 13 | 4,000 | 1,000 | 40,000 | 4,000 | 0.01 |
| Riverstone Energy | Dr Tidu Maini | 29 Oct 13 | 5,000 | 1,000 | 50,000 | 5,000 | 0.01 |
| Riverstone Energy | Peter Barker | 29 Oct 13 | 5,000 | 1,000 | 50,000 | 5,000 | 0.01 |
| Riverstone Energy | Richard Hayden | 29 Oct 13 | 10,000 | 1,000 | 100,000 | 10,000 | 0.01 |
| Riverstone Energy | Sir Robert Wilson (ch) | 29 Oct 13 | 20,000 | 1,000 | 200,000 | 20,000 | 0.03 |
| Rurelec | Brian Rowbotham | 28 Oct 13 | 200,000 | 12.5 | 25,000 | 270,000 | 0.05 |
| Rurelec | Andrerw Morris (fd) | 30 Oct 13 | 337,700 | 13.25 | 44,745 | 687,700 | 0.12 |
| Share | Gavin Oldham (ce) | 28 Oct 13 | 10,000 | 21.4 | 2,140 | 109,337,447 | 76.11 |
| Somero Enterprises Inc | Jack Cooney (ce) | 30 Oct 13 | 10,300 | 99 | 10,197 | 4,227,102 | 7.50 |
| Stobart | Iain Ferguson (ch) | 24 Oct 13 | 15,000 | 130 | 19,500 | 15,000 | 0.00 |
| Stobart † | Iain Ferguson (ch) | 24 Oct 13 | 85,000 | 130 | 110,500 | 100,000 | 0.03 |
| Tandem | Stephen Grant (ce) | 30 Oct 13 | 5,000 | 81 | 4,050 | 150,000 | 3.21 |
| Tissue Regenix | John Samuel (ch) | 28 Oct 13 | 250,000 | 12.25 | 30,625 | 24,128,928 | 3.70 |
| Tracsis | John McArthur (ce) | 30 Oct 13 | 4,032 | 186 | 7,500 | 972,474 | 3.81 |
| Tungsten Corporation | Michael Spencer | 28 Oct 13 | 75,000 | 228 | 171,000 | 1,055,485 | 1.06 |
| Tungsten Corporation | Michael Spencer | 29 Oct 13 | 25,000 | 225.75 | 56,437 | 1,080,485 | 1.08 |
| Verona Pharma * | HS Bottomley | 25 Oct 13 | 2,272,727 | 2.2 | 50,000 | 17,972,727 | 4.82 |
| Verona Pharma * | Dr. SJ Karlsson (ce) | 25 Oct 13 | 909,091 | 2.2 | 20,000 | 1,709,091 | 0.46 |
SELLS:
| Company | Director | Date | No of shares | Price (p) | Value (£) | Holding (shares) | Holding (%) |
|---|---|---|---|---|---|---|---|
| Advanced Computer Software | Michael Jackson (ch) | 30 Oct 13 | 1,000,000 | 87.038 | 870,380 | 2,422,884 | 0.51 |
| Alkane Energy | Dr Cameron Davies | 24 Oct 13 | 1,000,000 | 40 | 400,000 | 2,895,932 | 2.34 |
| ARM Holdings | Peter Rowley | 25 Oct 13 | 10,000 | 981.5 | 98,150 | 40,000 | 0.00 |
| Central Asia Metals | Howard Nicholson | 30 Oct 13 | 158,173 | 160 | 253,077 | 446,715 | 0.53 |
| Dillistone | Giles Fearnley | 24 Oct 13 | 140,000 | 111 | 155,400 | 453,435 | 2.49 |
| dotDigital | Ian Taylor (coo) | 30 Oct 13 | 1,100,000 | 21 | 231,000 | 43,776,667 | 15.78 |
| dotDigital | Simon C Bird | 30 Oct 13 | 1,100,000 | 21 | 231,000 | 35,776,667 | 12.89 |
| Goals Soccer Centres | Keith Rogers (md) | 30 Oct 13 | 50,000 | 165 | 82,500 | 3,992,986 | 7.59 |
| Good Energy † | Garry Peagam (fd) | 29 Oct 13 | 10,000 | 202 | 20,200 | 51,000 | 0.35 |
| Gresham House | Derek Lucie-Smith (ce) | 29 Oct 13 | 20,000 | 312 | 62,400 | 77,537 | 1.44 |
| Hargreaves Services | Kevin Dougan | 24 Oct 13 | 100,000 | 900 | 900,000 | 113,213 | 0.34 |
| Hargreaves Services | Gordon Banham (ce) | 24 Oct 13 | 170,000 | 900 | 1,530,000 | 2,259,011 | 6.83 |
| Ironveld | Rupert Fraser | 28 Oct 13 | 293,724 | 12.66 | 37,185 | 0 | 0.00 |
| Law Debenture Corporation (The) | Caroline J Banszky (md) | 25 Oct 13 | 10,000 | 525 | 52,500 | 243,466 | 0.21 |
| Menzies (John) | Dermot Jenkinson | 30 Oct 13 | 27,187 | 803.1 | 218,339 | 1,885,860 | 3.11 |
| MyCelx Technologies Corp | Connie Mixon (ce) | 29 Oct 13 | 25,000 | 498 | 124,500 | 934,402 | 7.05 |
| Proton Power Systems † | Dr Faiz Nahab (ce) | 24 Oct 13 | 2,300,000 | 6.15 | 141,450 | 596,279,682 | 93.18 |
| SpaceandPeople | Martin Kemp | 30 Oct 13 | 75,000 | 112.25 | 84,188 | 123,064 | 0.63 |
| YouGov | Stephen Shakespeare (ce) | 24 Oct 13 | 3,350,000 | 76.5 | 2,562,750 | 5,719,110 | 5.88 |
*Placing/subscription **On admission †Spouse/connected party
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
