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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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MWB Business Exchange - High depreciation crimps profits

November 2007

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • MBE
  • Price:
  • 142p
The much-anticipated bounce in the shares of MWB Business Exchange failed to materialise following its first half results to 30 June, in spite of the fact that revenue grew 22% to £47.9m and EBITDA rose a strong 42% to £6.2m. The likely culprit for the torpor was a slightly disappointing 10% rise in pretax profit to £4.4m, while eps also rose 10% to 6.3p, with tax remaining at zero. The blame for the anaemic pretax growth lies squarely with a whopping 228% jump in the depreciation charge to almost £1.9m as start-up costs from new openings finally took their toll. Nevertheless, MWB, which operates a chain of centres providing flexible serviced office space, has traded its socks off and although the period e ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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