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Hargreaves - Changing mix of business

March 2009

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.

  • Epic Code:
  • HSP
  • Price:
  • 497p
The shares enjoyed a brief spike over £6 ahead of Hargreaves reporting barnstorming H1 results to 30 November. Sales were up 70% to  £296.5m and underlying operating profit (virtually all organic!) was up 76% from £9.2m to £16.2m. Pretax profit went from £7.1m to £13.9m.  As we foreshadowed in October, Hargreaves' production division really shone. The businesses within this division are Maltby Colliery, a coal mine in South Yorkshire and Monckton, which is involved in the production of coke. Together these two more than doubled operating profit contribution from £4m to £8.3m. Maltby production proved strong and was assisted by the lack of a face change (the process of moving to a new area of coal) that had ...

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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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