Primary Recommendation

Parkwood - Low rating for support services sector

March 2006

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Managing leisure centres, cutting grass or composting waste on behalf of local authorities might sound a dull business but we think is about to start producing some predictable results for Parkwood, which is trading on a historic multiple of perhaps 10x current year earnings. The reason for its low rating is a chequered past. Some of this was due to painful diversification into outsourced non-emergency ambulance services in London where cost overruns resulted in losses. That non-core business is tiny but has a high profile and investors have been overly distracted by it. There are also some special mitigating circumstances arising from the leisure centre side where Parkwood often tenders for Private Finance Initiative (PFI) contra ...

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Market Comment

Computer Software Group - Strong repeat income stream

Parkwood - Moves into private fitness club sector (February 2007)

Parkwood (October 2006)

Parkwood - Positive trading update (August 2006)

Parkwood - Results ahead of forecast (April 2006)

Parkwood - Bullish on prospects (February 2005)

Parkwood - Makes a very cheap acquisition (May 2004)

Parkwood (February 2004)

Parkwood (February 2003)

Parkwood - Bexley PFI contract expected before year end (September 2002)

Parkwood - Joint venture to target local authority leisure PFIs (July 2002)

Parkwood - PFI start-dates are the key (April 2002)

Parkwood - Wins Bexley PPP contract (February 2002)

With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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