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Microgen - MMT integration provides non-economic driver for profit

April 2004

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.

Microgen's results for the year to 31 December contained relatively little new news following the update in December. Although sales in the original IT consultancy and document database businesses fell from £25.3m to £21m, operating profit improved 16% to £2.4m. This was not readily apparent in the overall results which were complicated by a lossmaking seven week contribution from MMT, a one time exceptional charge of £3.3m relating to its reorganisation and a large one off project undertaken for one customer by Telesmart (generating a profit of £1.1m). Adjusting for these, underlying profit was £2.5m, for eps of 2.9p.  Net cash at the period end was £8.2m or 9.4p a share. In t ...

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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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