Sanctuary Group is (IMHO) a great example of a British-based business continuing to grow on the back of a sound strategy and has done so despite the rocky markets. It is time the share price reflected its success in becoming a big player in the music business.

It had a brief share price flurry in the great internet boom due to its internet strategy, but the web is not an enormous part of its business, just another way to make money.

I believe it will do well this year because it now has a good reputation in the business and is becoming dominant in the live rock scene and artist management.

Crucially, it is not mainly dependent on CD sales but even in that area, it has increased sales and profits because it does not major in the one-off hits. It has built up a huge catalogue in large selling established artists (some would call them "has-beens"!). This is a large and consistent market. Sanctuary has done this by a spate of paper/cash acquisitions and is the reason for the high gearing (albeit this is coming down).

The share price has historically been dragged back by the sector dogs like EMI. Unlike EMI, Sanctuary has many other strings to its bow and certainly doesn't chuck millions away signing up bloated CD deals that it could only recover if the artist takes the US by storm.

The big open-air festivals are this year breaking records (doh) for pre-sale tickets and there seems to be a trend by young people this year towards this and away from clubs. This will benefit Sanctuary which is involved with many of the bands involved. Talk is that if the reformed Led Zeppelin ever tour, Sanctuary will coin it in.

Whatever the merits take a look at the website,

http://www.sanctuarygroup.com/

which is the best designed site visually I have seen. Brilliant stuff!

As for the chart, here it is.



I want to see that 70p-85p area re-tested. I therefore have a target of 70p by the end of the year (Results come out November time for y/e 30.9.03).

Current price 44.5p.

Declaration of interest: Yes, I hold some SGP but I reserve the right to sell if I reach my target (or before if I get bored.............:) )

"Looking forward to the traditionally stronger second half of our financial
year, I am particularly excited about the outlook for live touring as we are
expecting 2003 to be one of the busiest in our history. As the world's premier
live agency booking operation and one of the largest merchandisers globally, we
are expecting to benefit considerably from this continuing growth area of the
music industry. "


With one of the busiest touring years ever and with no disruption from the Gulf
War, our live agency, Helter Skelter, has already seen record ticket sales
generated from summer festivals and major tours by artists including Avril
Lavigne, Blur, Craig David, David Gray, Eminem, Marilyn Manson, Ms Dynamite,
Placebo, Red Hot Chili Peppers and Sugababes. As the largest agency in the world
outside North America, Helter Skelter continues to attract new artists across
all genres whilst continuing to enhance the careers of its current roster.

Our stated aim of increasing the proportion of revenue generated by our Artist
Services division, which includes Artist and Producer Management, Live Agency
and Merchandising, is showing considerable progress. The profit impact of this
growth will be seen in the second half of this year with a significant number of
acts touring.


Sanctuary Artist Management has attracted a good range of established acts,
including Macy Gray, Jane's Addiction and Sarah Brightman, as well as acclaimed
younger acts such as Cave In, Funeral For A Friend and Mull Historical Society.
The roster now has over 50 artists including Guns N' Roses, The Who, Page &
Plant, Pet Shop Boys, Iron Maiden, Elaine Paige, Ray Davies, Super Furry Animals
and 3 Colours Red. The introduction of new managers has strengthened existing
management skills, creating a 'critical mass' effect, where Sanctuary is viewed
more and more as the only international management company that can service an
artist's needs worldwide. With major acts touring and releasing albums this
summer, we expect to see a good second half contribution from this area. The
recently released Led Zeppelin DVD has set a record in the US for debut sales,
with 140,000 units sold in the first week and the album debuting at number one
in the Billboard charts."

Has anyone out there any recent views on Sanctuary group (SGP) ? The price has been drifting to stabilise around 48p level but, interestingly, Fidelity Corp have been buying regularly and heavily, and presently have amassed a nice 13.7% stake. Do they know something we don't? Given Fidelity's impressive track-record, is there favourable news on the near horizon?

I think the diverse music ranges that Sanctuary have entered may be a problem in the longer term. They seem to be moving away from the original role of classic artists with an established fanbase into newer, less secure areas.
Good distribution and sales team though mean they should be able to gain the best of whatever market is still there for high street sales.

NEWS -- Nov 28

Extraordinary general meeting --- something to do with 30,000,000
convertible loan stock.Too complicated to understand in a couple of minutes.
Shareholders should read it. rgds aj

this should consolidate the stock at this level and would hopefully be absorbed by the institutions... this is a steal at this proce and could well be worth a viewing for potential takeover for company's wishing to broaden thier catalogue!!!

The big open air festivals are breaking records.This should happen next year
because of the weather this year.How big a threat is e.m.i? rgds aj