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4 shares the pros are buying and selling

A roundup of trades by professional investors. This time, we look at Future, Hansard Global, Shoe Zone and Flowtech Fluidpower.

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Key stats
Market capitalisation£31m
No. of shares out334m
No. of shares floating324m
No. of common shareholdersnot stated
No. of employees980
Trading volume (10 day avg.)0m
Turnover£112m
Profit before tax£4m
Earnings per share1.27p
Cashflow per share2.13p
Cash per share1.50p

*Correct as at 6 Jun 2014

Future

Star stockpicker Alex Wright has turned his back to Future (FUTR), the publisher of magazines such as Total Film and Crochet Today!

The Citywire AAA-rated manager sold all 18.9 million shares he owned in Future, equivalent to 5% of the company and worth around £1.6 million.

The stake was held in the £2.9 billion Fidelity Special Situations fund that Wright began managing in January. He made his name running the £292 million Fidelity UK Smaller Companies fund, which has returned 96% over the past three years compared with 53% from its benchmark small-cap index.

So far this year Future’s share price has more than halved from as revenues have weakened. Chairman Peter Allen admitted to being ‘disappointed’ but highlighted a ‘transformative restructuring programme’ underway following the appointment of new chief executive Zillah Byng-Maddick in April.

This has already included the sale of Future’s sports and craft titles for up to £24 million, with the firm now intending to focus on the consumer technology market, and the proposed loss of 170 jobs in the UK.

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Key stats
Market capitalisation£45m
No. of shares out40m
No. of shares floating40m
No. of common shareholdersnot stated
No. of employees172
Trading volume (10 day avg.)1m
Turnover£34m
Profit before tax£-2m
Earnings per share-4.50p
Cashflow per share-2.98p
Cash per share5.66p

*Correct as at 6 Jun 2014

Flowtech Fluidpower

Small company expert Gervais Williams has snapped up a stake in Flowtech Fluidpower (FLOL) for his Diverse Income Trust upon its flotation.

Williams, AA rated by Citywire, bought 1.8 million shares at £1 each for the fund, meaning it now owns 4.55% of the firm.

Flowtech Fluidpower, which is based in Skelmersdale and sells hydraulic and pneumatic products, raised a total of £40 million in the public listing.

The company’s chief executive, Sean Fennon, explained that the proceeds would be used to finance product development and international expansion. In 2013, the business posted an operating profit of £4.3 million from revenues of £34.3 million.

Other prominent fund groups to have bought into Flowtech Fluidpower include Hargreave Hale, whose small-cap veteran Giles Hargreave is also AA rated, and River and Mercantile, which is soon to float in its own right. Flowtech Fluidpower shares jumped 10% in their first day of trading.

Over the past three years, Williams has returned 76% through the Diverse Income Trust compared with an average of 50% from his peer group of fund managers and 30% from the FTSE All Share index.

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Key stats
Market capitalisation£151m
No. of shares out137m
No. of shares floating54m
No. of common shareholdersnot stated
No. of employees209
Trading volume (10 day avg.)0m
Turnover£133m
Profit before tax£10m
Earnings per share7.57p
Cashflow per share8.01p
Cash per share-9,999,999.00p

*Correct as at 6 Jun 2014

Hansard Global

Leonard Polonsky has increased his stake in Hansard Global (HSD), the life assurance group he founded in 1970.

Polonsky, who remains the firm’s chairman but will step down on 30 June, bought another two million shares in Hansard for £1.8 million. That took his total holding to 56.8 million shares, meaning he now owns 41.3% of the company.

Polonsky first floated Hansard in 2006, earning himself almost £100 million. Since then, however, Hansard’s share price has slumped from a peak of £3.62 in early 2007 to 96p today – a loss of 75%.

Hansard’s chief executive Gordon Marr warned in May that he expected new business volumes in the months ahead to be ‘significantly below’ their levels in the equivalent period of last year, when they had been relatively strong.

Marr nevertheless expressed confidence that sales would start to improve from June onwards as Hansard’s efforts to refresh its branding and launch new product features in March paid off.

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Key stats
Market capitalisation£88m
No. of shares out50m
No. of shares floating22m
No. of common shareholdersnot stated
No. of employees4100
Trading volume (10 day avg.)0m
Turnover£194m
Profit before tax£3m
Earnings per share6.91p
Cashflow per share19.91p
Cash per share13.10p

*Correct as at 6 Jun 2014

Shoe Zone

Citywire AAA-rated small cap veterans David Horner and David Taylor have taken a chunky position in the initial public offering of discount footwear chain Shoe Zone (SHOE).

The two managers took a 4% position in the business or 2.01 million shares worth £3.23 million at the admission price of 160p on 23 May, since rising to 176p.

The shares are held in their Chelverton UK Equity Income fund, which over the last five years has returned 222% over the last five years versus an average Equity Income peer group average of 105%.

Shoe Zone, which owns 550 stores in the UK and Ireland, joins Poundland, convenience store McColl’s and off-licence owner Conviviality Group among discount retailers to list in the last year.

In results for the year to October 2013 the company reported profit before tax of £9.3 million on revenue of £140 million. It has promised to adopt a progressive dividend.

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