Companies: CIU   

Martin May, corporate recovery expert and chairman of global industrial services play Cape, is in bullish mood with its core business outperforming and restructuring coming through. Calendar 2003 numbers beat forecasts showing rising sales and profits at its remaining division Cape Industrial Services (CIS) - here turnover was up 19.1% to £228.3m and operating profits improved by 8.7% to £10m. Loss making manufacturing business 'CCS' was ditched in 2002. Also encouraging for shareholders was the group's year end net debt, which was cut to £5.4m (£19.3m). Among the year's many restructuring highlights was the settlement, without admission of liability, of an asbestos compensation claim by South African mineworkers. As well as the closure of Cape's head office, the sale of former CCS manufacturing sites for profits over book value, and the negotiation of improved bank facilities. CIS has seen rising demand for its services in 'virtually' all its regions, won a number of new deals in the UK and, snared projects in the Liquefied Natural Gas, LNG, market. May also says the bumper business levels enjoyed in the fourth quarter have kicked through to the current year. Analysts have upgraded 2004 pre-tax profit forecasts from £8.1m to £9.4m, giving earnings of 14.2p, and forward multiple of 5.3. May is turning things round at this business. We are buyers.