Alexon Group (LON:AXN) (AXN, 15.0p, £21.94m) The Big Freeze in the UK has had an adverse impact on the sales performance in the 3 weeks from 23 November 2011 to 18 December 2010. L-f-l sales in the period are down a phenomenal 19.9%, bringing the year l-f-l sales down by 4.7% and PBT for the year ending 31 January 2011 is now expected to be up to £1.5 (HB view: £2.5m). Between 40-60 stores have been closed over the past three weeks due to the extreme weather conditions.  This is clearly disappointing and driven earnings to fall below market expectations. AT the interims stage, the business was cash neutral. The net borrowings remain comfortably within the Group's current facilities, but the Group has commenced a dialogue in respect of one possible consequential technical EBITDAR covenant infringement. The Bank's response has been constructive and supportive. This morning’s statement confirms our concerns the retail clothing industry is suffering during the busiest and most profitable period of the year. Nevertheless, we remind investors Alexon remains a turnaround story. Store refurbishments, new outlets and building multi-channel capabilities will continue to drive the business going forward. We view a significant slowdown in UK consumer spending in 2011; weaker sterling and increased input cost inflation are key risks to Alexon. We believe 2012 PBT forecasts of £4.0m and EPS of 2.7p are reasonable. In our view, trading on 5.6x 2012 earnings, a discount to the sector is justified given the concerns over the covenant infringement. We therefore reiterate our HOLD recommendation.  

Ceramic Fuel Cells (LON:CFU) Limited (CFU, 10.75p, £129.15m) has announced the sales of a further 3 BlueGen units, this time to E.ON. Encouragingly the one will be installed in E.ON’s trading site with 2 at demonstration sites.  Still a HOLD

E.G. Solutions (EGS, 106p, £15.15m) has won a new contract for data capture and reporting modules of its Nucleus business performance measurement software with the UK branch of one of the world’s largest banks, worth some £0.58m – of which £0.33m will be earned in the year ending January 2011. Forecasts for next year at £0.57m PBT with 2.9p EPS should push up further - but the rating still looks very rich. HOLD

Goodwin (LON:GDWN) (GDWN, 1338p, £96.34m)…

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