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Delcam - Higher software sales

February 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.

Shares in CAD CAM supplier, Planit (28.5p), have barely moved since we recommended them last month, but the sector is seeing a strong  pickup if this month’s highly positive trading update from Delcam (191p) is anything to go by. Delcam is the sixth largest CAD CAM supplier worldwide in licence sales (with 3% of the market) behind Planit (which has 3.5%) and has announced that December saw record sales and that results for 2003 will therefore beat expectations. Before the announcement, broker Williams de Broe was forecasting £1.1m pretax for 2003, a similar level to 2002, for eps of 13.1p. But like all software companies, higher software sales could now disproportionately benefit the bottom line. Delcam f ...

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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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