AIM listed active value investor Douglasbay Capital (LON:DBAY) saw its shares soar more than 25% to 9.25p this morning on news that it was making “substantial progress” in generating value from its first major investment, the European logistics group TDG.

DouglasBay took control of TDG in October 2008 and under its first full year of ownership managed to boost the company’s operating profit by 8% before costs, despite a recession-induced fall in revenue of 10%.

Reporting its full year results today, DouglasBay said that revenues for 2009 were £662.1m, delivering an underlying operating profit of £22.5m after operating expenses of £639.6m. After exceptional charges of £9.5m and net finance charges of £8.9m, profit before tax for the year was £4.1m. This compares to a loss of £7.3m in the three months to December 31, 2008. In addition, the company slashed its debt by 33% to £86.7m at the year end.

Alex Paiusco, DouglasBay’s chief executive, said: “TDG is now far better positioned to take advantage of improving economic conditions and slowly recovering trading volumes, with the full benefit of the cost reductions implemented during 2009. Our priorities for 2010 are clear – to continue to grow TDG, further deleverage the company to create value for shareholders and raise funds to apply our expertise to new investments.”

DouglasBay Capital listed on AIM in October 2008 and changed its name from LIT last summer. The company’s investment strategy is to offer shareholders a combination of income and capital growth over time through the acquisition and revitalisation of quoted and unquoted companies.

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