Afternoon everyone.

CHCP today released a nice set of annual results for the FY to end Nov 2006. Bullet-point highlights are below, but in summary: the fact that EPS has increased 58% to 2.09p per share, with a current mid-price of 15.25 (I believe it's 16p to buy), has this stock on a PE of 7.3 (7.7 to bid price).

PEG would therefore be 7.7/58 = 0.13, and you don't need to be Jim Slater to see that that is actually quite low!

The highlights:

CHEMISTRY COMMUNICATIONS GROUP PLC
("Chemistry Communications" or "Group")

ANNOUNCEMENT OF PRELIMINARY UNAUDITED RESULTS
FOR THE YEAR ENDED 30 NOVEMBER 2006

The Board announces the unaudited preliminary results for the year ended 30
November 2006. A copy of the Chairman's statement and extracted financial
information is provided below:

PERFORMANCE HIGHLIGHTS

53% increase in turnover to GBP 15.06 million (2005: GBP 9.86 million)

51% increase in gross profit to GBP 8.45 million (2005: GBP 5.60 million)

122% increase in operating profit before interest and tax to GBP 1.21 million
(2005: GBP 0.54 million)

58% increase in earnings per share to 2.09 pence (2005: 1.32 pence)

3 acquisitions successfully completed during the year


The stock is listed on Plus.

For a quote see http://www.plusmarketsgroup.com/details.shtml?ISIN=GB0005543706

Apologies but I can't post the active link. Can't post a chart either, but this and lots of other info are available on the Plus site via the link mentioned above.

The stock was at a low of 9.75p in early October, so has advanced 50% already, but ought to be due a rerating on the current news.

Current market cap for the company is just over 5 million.

I'm not going to say any more about the stock in this post as it is one of those little-known ones that could do well or disastrously depending upon whether or not the world wakes up to it. Everyone's big enough and old enough to do their own research, so rather than go on for too long about its merits, I'd rather simply draw your attention to the stock and let you make up your own mind. I have been holding for a few weeks now - with thanks to a certain Mr. Goldfinger for drawing it to my attention. Would be interested to hear what anyone else has to say.

Good luck, PDYOR, etc.

ST.

One thing that is a bit bothersome is the large amount of creditors on the balance sheet. The company owes 8.9 million, with 6.9 of that falling due within one year. There is no cash position as the co is currently making use of bank borrowing facilities.

From the results:
"Total debt at 30 November 2006 increased to GBP 3.88 million, of which GBP 1.74
million is unsecured loan notes, repayable over the next three years, and
issued as part of the consideration for our three acquisitions made during the
year. Our Group banking facilities include a mixture of bank overdraft and
medium term debt that is repayable over three years.

"The Group's future operational cash flow is expected to provide sufficient
funding for our normal working capital requirements and to meet scheduled debt
repayments. "

Hopefully, with increasing profits, the position should get better. As long as the co doesn't spread itself too thin with endless acquisitions . . .

Probably not one for widows or orphans.

I wonder if some of the "creditors" covers deferred consideration arising from the acquisitions. which obviously doesn't look so bad.

Off 0.5p this morning, mid-price 14.75p.

Yep its the debt thats worrying ST, although EPS would have been even greater if it were not for exceptionals.

Jury still out on this one at present.