Thursday May 15, 09:51 AM
UK small caps open lower; Somero plunges on FY profits warning
LONDON (Thomson Financial) - U.K. small caps were lower in early trade, taking their cue from weaker blue chips, with Somero Enterprises (LSE: SOM.L - news)
the worst performer on the back of a full-year profits warning.
The FTSE Small Cap index was 7.40 points adrift at 3,205.60 by 9.25 a.m., while the FTSE 100 was 23.9 off at 6,192.10.
Somero Enterprises claimed top-spot among small-cap fallers, plunging 45 pence to 40 in the wake of a profits warning.
The company said that taking a cautious view on any potential recovery of large line US sales, it would expect total revenue for the year to end-December 2008 to decline by approximately 10-15 percent compared with the previous year and as a consequence it expects results for 2008 to be materially below market expectations.
A disappointing drilling update clipped 1.875 from Matra Petroleum (LSE: MTA.L - news) , at 5.25, while specialist pharmaceuticals company Meldex retreated 5-1/2 to 53-1/4 as news of maiden full-year profits was offset by the absence of any concrete news on bid talks. Interim losses saw Blinkx (LSE: BLNX.L - news) cede 2-1/4, at 31.
Shares in orthopaedic devices maker Corin Group (LSE: CRG.L - news) came under pressure and plunged 90-1/4 to 259-3/4 as Stryker's decision not to re-order any new products until December 2008 triggered analysts' downgrades.
Investec (LSE: INVP.L - news) slashed its 2008 earnings-per-share forecast by nearly 60 percent, telling clients the forecast risk remains high and Stryker will not make a bid in the short term. The broker shifted its stance on the stock to 'sell' from 'hold' with a new 300 pence price target.
At Brewin Dolphin, Chris Glasper downgraded his 2008 EPS estimate to 8.7 pence and next year's to 12.2. The analyst moved his recommendation to 'reduce' from 'hold'.
On a brighter note, Tower Resources (LSE: TRP.L - news) took top-spot among small-cap gainers, advancing 0.875 to 4.00 on the back of an upbeat update on the company's exploration activities in Namibia and Uganda.
Also making progress, shares in Persian Gold (LSE: PNG.L - news) , the Republic of Ireland-based Iranian gold explorer, edged up 1 to 11 following news the Chah-e-Zard gold discovery is advancing to pre-feasibility stage.
Still on the exploration front, Karelian Diamond moved up 0.25 to 5.375 after the company revealed that two drill holes at its diamondiferous Seitapera kimberlite pipe in Eastern Finland have found mantle-bearing kimberlite.
Elsewhere, Works Media made headway, climbing 15 percent -- or 0.25 to 1.875 -- following news that director Crispin Barker has vacuumed up 75,000 shares at a price of 1.60 pence apiece, and now speaks for 22.9 percent of the equity.
European Minerals (EPM.TO - news) resumed trading at 46, up 3-1/2, following the appointment of Grant Thornton Corporate Finance as the company's nominated adviser.
European Minerals on Wednesday signed a joint venture deal with Lero Gold (LER.V - news) .
Pactolus Hungarian Property (LSE: PHU.L - news) ticked up 3-1/4 to 40 after the group disclosed a year-end net asset value per share of 73 pence, compared with a placing price of 60 -- a compound annualised growth rate of 13.5 percent from the net asset value on admission.
Shares in Freshwater UK (LSE: FWUK.L - news) rose 3 to 73 after the PR and marketing services group turned in a 50 percent increase in first-half pretax profits and expressed optimism about future prospects.
Meanwhile, share buying by the chief financial officer lifted Hellenic Carriers 9 to 230.
Finally, and on the new issue front, Share, parent company of The Share Centre, an independent stockbroker, started life at 36 pence, up from an offer price of 27.
Another AIM newcomer, TGE Marine, progressed from a placing price of 130 to 134-1/2. The company provides engineering services for the design and construction of gas carriers and offshore units.
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