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Civica - Very predictable revenue stream

March 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.

Over the month we met with Civica (190p) a supplier of software and consultancy to the public sector. Civica was formed following the privatisation of Sanderson Group in January  2000 following which  all the public sector parts of Sanderson were bundled together and divested from the rest of the business. Both the chief executive, Michael Downing and finance director, Steven Stoddard, were part of the buy out team. The shares joined AIM on 1 March following a flotation set at 175p by broker Seymour Pierce which raised £30m for selling investors and £13.6m net for the company (a free float  of 57%). There were £46m loan notes in existence prior to the float, most from Alchemy which backed the orig ...

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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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