Smaller companies report: Tuesday close

By This Is Money
Updated: 12:39 EDT, 7 February 2006

SMALLER company stocks remained under pressure at the close, as blue-chips were hit following the release of disappointing results from oil giant BP. Corpora was among the day's biggest losers.

The FTSE Small Cap index was down 10.7 to 3514, while the FTSE 100 was 25.6 off at 5746.8.

Corpora remained the session's main faller, shaving 1¾p at 10¼p as the text analytics software company raised £2.25m via a placing of 28.1m shares with institutional and other investors at 8p per share.

The net proceeds will be used to fund the company's continuing expansion and to strengthen the balance sheet by repaying debt that was raised to fund recent acquisitions.

Fundraising news also hit Black Rock Oil & Gas, which gave out 0.2p to 1.4p on news of a placing of around 62.3m new shares at 1p each, raising around £610,000 after expenses.

Proceeds of the placing will be used to pay for its share of exploration costs, while the company also expects it will need further fundraisings in due course to finance the continued development of its oil exploration interests.

Slightly weaker than expected interim numbers trimmed 9p from Regent Inns, at 101p. The operator of the Walkabout and Bar Risa/Jongleurs late-night bars said trading in the first half was affected by various measures implemented as the company prepared for the UK licensing reform which came into effect late last year.

The group's rating was downgraded to 'hold' from 'buy' by both Dresdner Kleinwort Wasserstein and Insinger de Beaufort.

MedOil also lost 2p to 21¼p after announcing it is considering raising additional equity capital to fund new projects and meet existing financial commitments.

Retailer French Connection lost 7¾ to 258p after Nick Bubb from Evolution said that assuming Baugur bid hopes are over-blown, the shares still look overvalued. Bubb maintained a 'reduce' view and 235p target price on French Connection.

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Meanwhile, Sheffield United lost 2¼p to 21¾p in reaction to the club's 4-1 loss at home to promotion rival Watford.

Among the gainers, Sanctuary topped the chart, adding 1.23p to close at 1.90p, with the stock rallying on recovery hopes. The stock was recovering from last week's knock, when shares closed at five-year record lows of 0.73p on Friday following news the group plans to raise £110m to stabilise business.

Meanwhile, Oil Quest Resources climbed 6¾p to 22½p as the stock resumed trading. The UK onshore and offshore exploration company disclosed the reverse takeover of EnCore Exploration and EnCore Petroleum and the signing of a conditional agreement to acquire EnCore Natural Resources and EnCore Oil and Gas.

QA closed 0.21p higher to 0.83p after the training and consulting company revealed a swing to full-year pretax profits of £141,000 from losses of £2.4m.

Scotty Group maintained a 0.2p gain, bringing the stock to 1.6p after the company secured a substantial initial order from its Indian distributor and business partner, Altosys Software Technology.

Altosys, based in Chennai, is one of the major suppliers of all types of network technology in India, both to private hospitals and to public sector hospitals.

Angel Biotechnology shares took on 0.1p at 1.4p after the group said it has agreed to provide ReNeuron Group with a stem cell bank manufactured to a Good Manufacturing Practice contract for use in clinical trials for Huntington's disease.

Buyers came in for Aurum Mining, 5½p better at 39½p, after the company, formed to acquire gold and other mineral extraction projects in the Former Soviet Union, revealed its exploration licence for the Andash gold and copper project in the Kyrgyz Republic has received an anticipated extension from the Kyrgyz government to 31 December 2010.

Elsewhere, Shanta Gold advanced 2p to 39p after the company disclosed it has identified a large geochemical anomaly in a new greenstone belt at its Singida project in central Tanzania.

Dicom attracted interest in this session, up 18½p to 243p on the back of a strong set of second-quarter numbers. Bridgewell Securities is leaving its 2006 estimates unchanged for the time being, but said the results undoubtedly augment confidence in the company's ability to meet full-year forecasts.

Bridgewell retained a 'buy' stance, noting that recent M&A activity in the form of EMC's acquisition of Captiva leaves Dicom as the only independent global vendor of information capture software.