Small Cap Report (24 Apr) - BEG, HDD, THT, TAST, DSG

Pre 8 a.m. report

Good morning. I'm walking wounded this morning, after spending half the night putting the world to rights on Twitter. However, I'll do my best & have a rummage through the morning's announcements, to see if we can find anything interesting.

The quarterly "Red Flag Alert Report" from Begbies Traynor (LON:BEG) is always an interesting read, as it provides data on the economy that can't be skewed by politicians. It looks pretty positive - a 34% decline in critical business distress, and points towards economic recovery. All rather artificial of course, with ultra low interest rates & Banks not foreclosing on insolvent companies, because they don't want to recognise the bad debts, but there we go.

 

Hardide (LON:HDD) has been going on about their revolutionary coating for metals for many years now, and they've issued a profits warning today, saying that turnover for the year ending 30 Sep 2013 will only be £2.5m.

So the £14.4m market cap looks set for a tumble.

 

I might have to eat my hat over Thorntons (LON:THT), as they have issued an upbeat trading statement today, saying that profits for year ending 30 Jun 2013 are expected to be "substantially ahead of market expectations". Forecast is for £2.2m, so I wonder how "substantial" the out-performance is compared with the mountain of debt & pension deficit? They've still got a long way to go, but it doesn't look as if they'll be going bust anyway. The strategy of closing shops, and developing corporate sales is looking pretty inspired - it's working.

 

Results from Tasty (LON:TAST) look pretty impressive - it's a small restaurant chain. Revenue of £19.3m and operating profit of £1.7m (almost 10%) suggests that they are on to something, in terms of a format that works. So it could be a roll-out now, and although the shares look a bit pricey at £26m market cap, roll-outs always look expensive early on. This is definitely worth another look, based on the most cursory of glances at their headline figures.

 

Dillistone (LON:DSG) results look quite good, looks to be a PER of about 11. Decent dividend too. They're a recruitment software company, very small, £14m market cap. The name rings a vague bell, but I don't think I've crunched the numbers before on this one?