Looking good since the demerger. Lots of potential growth opportunities, a potential bid target and green credentials to boot. what more could you ask for?!

Biffa has posted first-half profit before tax up 19.9% to 41.6m, boosted by organic growth.

The waste management services company, which recently demerged from water company Severn Trent, also saw revenues up 5.8% to 376.5m in the six months to September 29th.

Biffa's maiden interim dividend was set at 2.1p per share.

CEO, Martin Bettington, said, 'Biffa has delivered a strong set of maiden results, with all divisions achieving organic growth in the first half of the year.'

I wasn't expecting that either although to be fair this wasn't a profits warning. They will still come in within analysts expectations, just the wrong end. That's why although there has been a drop it's not been as drastic as some I've seen. It wouldn't surprise me to see this jump again tomorrow.

I am confident they will be higher in a few months time queen.

This may calm a few nerves.

Price is reclaiming its old position but may consolidate for a while.




THIS IS FROM THE TIMES TODAY (5-4-07)





Private equity tricks could help Biffa thrive in the public arena

Tempus: Robert Cole

Kerpow! Biffa, a separately listed company for barely six months, yesterday learnt what it is like to deal with frisky and fickle public market investors. Six per cent was punched out of the value of the company on publication of a downbeat trading statement.

Some Delphic comments about pricing in the industrial and commercial waste-disposal division may have left some investors scratching their heads and, in their confusion, assuming the worst. The truth appears to be that volumes and pricing on national accounts where Biffa collects waste for supermarket chains and the like is OK but that the company is reappraising its approach to smaller industrial and commercial clients. Some customers, Biffa seems to believe, are more trouble than they are worth. By increasing prices selectively, it may make some of the clients worth the trouble they cause. Biffa seems to think that if some clients object, there will be no net loss to it, but it does admit that profits were constrained during the second half.

Biffas residential rubbish collection business is doing more than OK. Most of the market is served by one or other provider, but Biffa is showing that it can win local authority contracts. Just yesterday, it was talking about its deal with the Metropolitan Borough of the Wirral.

Waste-disposal companies have been talking about the positive business impact of enhanced environmental legislation for longer than anyone cares to remember, but it remains true that regulatory obligations are creating opportunites. Biffa, in common with similar companies, is becoming more of a processor of waste than a disposer of the stuff. That said, Biffas access to landfill, remains valuable and although it it is hard to get planning permission to fill new holes in the ground, Biffa is securing some new capacity.

Biffas shares fell yesterday partly because the company said that profits would be at the lower end of expectations. Whether this constitutes a profit warning is moot and may be a matter of pure semantics. In any case, the more powerful reason behind the shares fall may have been that the disappointment, such as it was, blew the froth off bid speculation.

Biffa has many of the attributes admired by private equity buyers. It adheres to a relatively simple business model and throws off good quantities of cash that could be used to pay down gearing.

Its shares trade at a chunky premium to its peers, however, and may be beyond any sensible buyers price range. They sit on a prospective price/earnings ratio of 22 and give a yield of just 1.8 per cent. The enterprise value of the company is a full 11 times the cash operating profits.

Biffa might see the sense of pulling the private equity tricks while retaining the public listing, which might release more value. Hold.

Seems a reasonable appraisal on events I think Fred, SP on the way back north as well.

As predicted, back up yesterday. Quality share with good prospects. Thanks for the article Fred1new.

http://moneyam.uk-wire.com/cgi-bin/articles/200704161257519190U.html

Interesting move. Believe JP Morgan Cazenove provide takeover advice among other things.

Don't they all Stan (not that I wouldn't appreciate takeover speculation!)?

I had not looked at It like that Queen1 -):

"Meanwhile, upbeat broker comment helped Biffa and Shanks Group, up 20p at 339p and 14.75p at 266.5p, respectively.

Goldman Sachs placed both waste management group's on its Conviction Buy List and said the UK sector lacks the scale to cope with the expected necessary investment programme and predicted consolidation."

"Conviction Buy List"?....not heard that one before -):

Goldmans 400p target seems a bit low I would consider 500p a more likely buy out price, still a good day today might see 400p before too long.

Well it's been a good bounce - I thought we may have been moving back towards 300p. If we can get to 350p by the end of the week I think that will be a good platform.

On the up still so far this morning, Support Services seems a good sector to be in at the moment.

Results announced today really weren't that bad - in fact they were very positive in many aspects - so why the large drop in SP so far?

It does look overdone to me. Believe there was an article in the Times or Guardian yesterday saying that if results aren't good, it's only bid activity that will support the price. The general lacklustre day is not helping.

There's also this to factor in:

Turning to the midcap downside, Biffa was the biggest faller, down 27 or 8.39 pct at 295 after the group's in-line full year numbers as the outlook disappointed.
The group posted a full-year pretax profit of 72.8 mln stg, an increase of 11.1 pct on the previous year.
The waste management firm said revenue rose 6.3 pct to 742.7 mln stg in the same comparison.
Merrill Lynch reiterated its 'sell' stance on Biffa, citing the fact that the company's statement is cautious about current year outlook, and suggesting that further downgrades may yet be necessary.

I decided to ditch this, better elsewhere with likes of Eaga and PVCS.

I still think it was overdone. Still, what do I know?!

Don't tempt me :-)

Worth buying this morning after yesterdays poorly received results.

3 directors bought stock at around 285p

That doesn't surprise me. This is still a quality play with a lot of long-term potential (or the potential to be taken over). The Directors know this and saw the post-results slump as a buying opportunity.