UK smaller companies: Tuesday close

By This Is Money
Updated: 12:29 EDT, 24 January 2006

UK small caps closed firmer with Meridian Petroleum shares standing out with over a 125% surge after a gas find.

At the close, the FTSE Small Cap index was 10.2 points higher at 3,416.1, the session peak, having hit a low of 3,405.9. Meanwhile the FTSE 100 index closed 27.1 points lower at 5,633.8.

News of a major gas find at the Calvin field boosted Meridian Petroleum shares 9.63p higher to 17&frac14p, a 126% jump in value.

The company found commercial quantities of gas at the Calvin field in Louisiana. The well, known as Calvin 36-1, flowed at a rate of up to 1m cubic feet per day.

'The production pattern in this field, and from this formation, is that wells generally start at modest production levels and build up over time,' Meridian said in a statement.

Punters also moved in on Empire Online shares, 131/2p higher at 100p as the online gaming group reaffirmed its forecast for a $37m pre-tax profit this year from all its gaming platforms excluding Empire Poker.

The forecast accompanied figures on the group's fourth quarter, which saw new player sign-ups fall 6% from the third quarter to 49,788.

Net gaming revenue rose to $22.5m in the quarter from $22.0m a year earlier but were down from $31.4m in the third quarter.

Elsewhere, shares in nCipher added 31p to close at 251p after the IT security company said it has received an approach which may or may not lead to an offer for the company.

In a statement referring to recent movements in the company's share price, nCipher said the approach is of a preliminary nature and there is no certainty that it will result in an offer. No other details were released.

Shares in diagnostics group Osmetech gained 3¼p to 34¾p after the firm announced that US regulators have cleared its kit that detects the presence of the gene for Cystic Fibrosis, allowing sales to begin in the first half of the year as planned.

More modestly, buyers nibbled away at Hidefield Gold shares, 0.62p firmer at 7.12p after the company revealed encouraging gold-copper-silver assay results from Piper Capital's Long Creek prospect.

And shares in Aortech International added 12½p to 220p after the group said it has been awarded grant funding from various Australian government agencies to support its investment in R&D activities and infrastructure.

The medical device group said the anticipated total grant for the first half of 2006 is about $1m Australian, equivalent to about £422,000.

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Meanwhile shares in YooMedia ticked up 0.25p to 6.50p as the AIM-traded interactive media and games group signed an agreement with its strategic partnership agency Inferno to provide all the digital elements for Inferno client Anheuser-Busch's UK 2006 FIFA World Cup on-pack promotion.

A better-than-expected final dividend, along with in-line results gave a boost to Porvair shares, 7½p higher at 128½p.

In reaction, KBC Peel Hunt hiked its rating for Porvair to 'buy' from 'hold' noting that the group is building an enviable pipeline of specialist filtration products in the

Advanced Materials business, which would be attractive to a larger player. And the same broker also hiked its stance on NSB Retail to 'buy' from 'hold', with a raised price target of 39p, up from 32p previously following an upbeat trading statement from the group.

In its update, the provider of software solutions to the retail industry predicted operating profits for the year to Dec 2005 of not less than £9.3m. This compares with £6.2m after discontinued operations and £7.3m from continuing operations.

Bridgewell Securities also initiated coverage on NSB with a 'buy' recommendation today. NSB shares added 2¾p at 32¼p.

On the downside, shares in Euro Capital Projects resumed trading on AIM at ¾p today, down ¼p following details of the proposed acquisition of certain residential property assets in Cyprus.

At the same time, the company revealed sharply higher full-year losses. Shares in Cassidy Brothers lost 3p to 24½p as the toymaker swung to a first half loss, and said that the retail sector 'malaise' it identified in July has continued through 2005.

Cassidy reported pretax losses of £84,750 for the six months to October, compared with profits of £38,699 in the corresponding period.

And shares in Amino Technologies dropped 16p to 143p after revising its full year 2005 guidance due to a change in license revenue recognition. nvesting links

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Amino said it has been advised by its auditors that a revision of its licence agreement with AS Intercom means that approximately £1.3m of revenue and £1.2m of profit can not now be recognised in the year to 30 November 2005 and will instead be included in the results for the current financial year.

Elsewhere, a mixed trading update and forecast of full-year profits of £7m clipped 2p from The Real Good Food Company shares at 70p.

In reaction, Numis cut its target for Real Good Food to 105p from 185p, while retaining its 'buy' rating.

And news that full-year trading will be slightly below market expectations saw Intelligent Environments soften 0.13p to 2.87p. The company blamed the slippage of a single large contract from the final quarter into the early part of 2006.