After a difficult trading year that has seen losses for CCT and the sp nose-dive to 25p at one point the solution to return to profits may come from the launch of electronic Sudoku games in time for Christmas. Character will launch two Carol Vorderman Sudoku products. For Sudoku fans on the move, there are two handy travel size products: a hand-held LCD game (19.99) with over 750 grids, and a touch screen version (29.99), with over 100,000 permutations of the game. A plug and play version, allowing addicts to play Sudoku on their home TV (29.99) will follow later this year. It won't take many sales to rack up good profits if these are anywhere near as addictive as the puzzle books have proved to be so far.
500,000 sold at guess 5 profit per item would rack up 2.5m, with less than 53m shares that is a healthy EPS of 4p on one item alone and my estimate is probably conservative? They also have licensing rights to Dr Who, Little Britain and Batman amongst others.
Also 70% of these shares are in the hands of Directors, Pension Trusts and Funds and as has been seen in recent weeks, moderate buying has pushed up the share price. It has all the hallmarks of a possible recovery stock as was IDS which I tipped last year at 81p and is now 382p. Not saying this will reach those heights but if Sudoku sells well this Christmas expect CCT to show a good start to their financial year. 2005 figures ending August 31st will not be good but we don't buy shares on the past, there is no gearing and 8m of shareholders funds available.
Take a look. The profits could be more pleasing than solving the puzzles.

Agreed DB66, should be a very interesting 4-6 weeks!!

Results due next Thursday, maybe there will also be an update on bid approaches??
If results as I expect then sp is justfied and in fact well undervalued even without a takeover bid which would need approval of Directors as they own a large percentage of the company.

Hi andy I'm still hanging in here.

An excellent set of results.

Dividend 1.65 pence, up from 1.1 pence (an increase of 50%)
Cash in Bank 10.3 million, up from 3.9 million (an increase of 164%)

Pre-tax profit of 2.96m in the first half from a 1.93m loss a year earlier.

'The Board is delighted with the progress made by the remaining core business and, providing we see no further erosion in economic confidence generally and,in particular, in the retail sector, we see no reason why the Group's excellent recent progress will not be maintained.'

Yes, very good results. Full year EPS potential of 10p puts on forward PE of 6.5.
This is way too low. Suggest early drop was due to takeover talks being terminated but this share is worth over a quid on fundamentals alone and must surely rate as a BUY now that continued excellent results have been confirmed.

Amazed !!
The market will wake up to these in the comming months i`m sure.
This company has really turned the corner and from their statement they seem very confident about future growth.
I really hope they do agree to a possible 25% share buy back and then we surely will be laughing all the bank!

I think its worth a read at least.


Interim Results

RNS Number:0739C
Character Group PLC
27 April 2006


Issued by Citigate Dewe Rogerson Ltd, Birmingham
Date: Thursday, 27 April 2006
Embargoed: 7.00am
The Character Group plc
Interim Results for the six months ended 28 February 2006

Highlights

Continuing business (Toys, Games and Gifts)
6 months to 6 months to
28 February 2006 28 February 2005
#m #m

Turnover 40.7 27.2 +50%
Operating profit 3.7 (1.0)
Earnings per share 5.69p (2.45p)

Dividend
1.65 pence, up from 1.1 pence (an increase of 50%)

Group results (including discontinued operation)

6 months to 6 months to
28 February 2006 28 February 2005
#m #m

Turnover 66.6 43.4 +53%
Operating profit 1.1 (1.5)
Profit before tax 3.0 (1.9)
Earnings per share 5.04p (3.8p)

Cash at bank
#10.3 million, up from #3.9 million (an increase of 164%)

Approaches regarding possible offers terminated

"During the first six months of the current financial year the Group underwent a
major reorganisation with the disposal of its Digital Business in February 2006.

"The structure of the Group is now designed to maximise the strength of, and
focus on, the core business of Toys, Games and Gifts.

"The Board is delighted with the progress made by the remaining core business
and, providing we see no further erosion in economic confidence generally and,
in particular, in the retail sector, we see no reason why the Group's excellent
recent progress will not be maintained."
Richard King, Chairman

Apparently a BUY recommendation in the Independent.

andy
Cheers ;-)

Buy recommendation from the Independent on 28/4/06

Character Group

Our view: Buy

Share price: 66.5p (-4p)

January's decision to ditch the digital photography arm of the business looks to have been a shrewd move by Character Group, allowing the company to concentrate on its core games and toys licensing division.

Although the proceeds, 10.3m, were disappointing, the sale helped the group return to operating profitability to the tune of 3.7m.
It registered a loss of 1m in the corresponding period of 2004. Turnover rose by nearly 50 per cent to 40.7m, stripping out revenues from the digital arm, thanks to a year which saw the group gain the No 1 and No 2 products in the UK toy market. They are the Dalek from Dr Who and Roboraptor, an electronic dinosaur model.

Looking ahead to the second half of 2006, the company has licensing agreements in place for games linked to two potentially blockbuster films: Superman Returns and Pirates of the Caribbean 2.

The group is also poised to launch Roboreptile, a successor to the Roboraptor, along with more Sudoku games endorsed by Carol Vorderman and exclusive products featuring Peppa Pig, a very popular children's pre-school character.

Character shares trade on an undemanding earnings multiple with the potential for a substantial re-rating should Superman and Pirates do well in cinemas. A 50 per cent rise in the first-half dividend should be followed by the same in the second half, giving the shares a prospective 4.5 per cent yield, impressive for a small company.

Given the ongoing consolidation in the children's entertainment industry, there is always a chance that a suitor will swallow the newly refocused Character Group. But even without a bid its shares are worth buying.

Charles Stanley have a recommendation to accumulate.
All coming out of the woodwork, hopefully more to come and the market may eventually recognise that the recovery is well and truly in place.
Full year forecast EPS >10p, good dividend, cash in the bank ans still potential for a takeover but it would have to be at a good price much higher than todays as this sp is too low.

Growth, Good Dividend Yield, Undervalued, Bid Potentials.

Any of the above are things that encourage investors, CCT has them all.
They just need good analysts and coverage now and this should really drive the sp forward.

Character Director Aldo Horvat acquires 360,000 shares.
That is a good endorsement of current progress of value >216-225k.
He acquired these from Giochi Preziosi S.p.A.

Major Shareholders after todays news

Directors Shareholding and Interests
Richard King 5,345,428
Kiran Shah 5,645,000
Joe Kissane 1,462,300
Jon Diver 1,690,640
Aldo Horvat 360,000
Ian Fenn 9,000
Lord Birdwood 8,750
Tops Pension Scheme 1,725,000
Employees Share Ownership Trust 285,000

Other
Giochi Preziosi S.p.A 11,525,898
Valtidone S.p.A. 5,000,000
Sweet Briar Investments Limtied 1,675,000

andy
Cheers andy could have missed that with such a late announcement, should get a tick up tomorrow.

Just in.

Thank you for your enquiry regarding the possible buy back of the Group's shares.
The board is monitoring the position with regards to this on a continual basis.
As soon as a definitive decision has been reached or action taken,we shall of course keep the shareholders informed.
Richard King,
Chairman

Nice one driver,this has got to be the sort of share to hold in these market conditions.Holding up well and a decent divi waiting just around the corner.

Hopefully the sp holding reasonably well in the last week of claret is a good sign.
In fact I have a few small caps that are making profits and paying a divi that have held up, maybe a better place to be than the speculative oilers and miners right now? I have one speculative in my portfolio that I will hold as they have patents on potential money-spinning application and will start a thread shortly.

Just in after my last email I sent them.

With regards to the sale of the digital division,our net cash position will have improved by around 4m once the sum withheld by the purchaser is paid next February.

As you would expect,whilst the remaining business is going through a period of substantial growth,our first consideration is to ensure that we are financed properly to maximise this growth.

Once we are satisfied that our working capital is sufficient to allow for the expected growth,as we have stated in our interim accounts,we shall consider a share buy back if it felt that it is in the interests of the company and or the shareholders.

At this time,we are not considering any acquisitions or other major capital expense.

We are well aware that the current share price is disappointing, but we are confident that it will follow the performanc of the business in due course.

As you are aware,we moved brokers recently,and we expect them to issue a detailed note within a month,at which time we shall commence to market the Group in its new and exciting format.

I trust that I have explained our current position and thinking.

Kind regards,

Richard King

It looks like we are not going to see an immediate buy back of shares they haven't ruled it out, and that they are aware of the disappointing share price is encouraging. Going through a period of substantial growth also sounds good to me.

Driver, Looking forward to a brokers note that might just provide some impetus to share price. Good EPS, Dividend Yield, Growth and take-over potential.
This share is currently under-valued IMO.