FTSE 250 movers: Gem shines after shimmering results

20th Mar 2012 14:12

Diamond miner Gem Diamonds was a big riser after it produced a sparkling set of 2011 results, with underlying profits shooting up on the back of record carat production at its Let?eng mine in Lesotho. The mining team at Northland Capital Partners, said: "The operational issue encountered at Ellendale at the beginning of 2011 has not derailed an impressive performance from Gem in 2011. The new sales agreement with Tiffany & Co. for the yellow fancy diamonds resulted in a substantial improvement in diamond price achieved at Ellendale, and strong prices were also achieved at Let?eng. Costs are up on 2010 but broadly in line with guidance for 2011, resulting in a 119% increase in EBITDA and 235% increase in EPS. We expect this positive performance to continue as Gem progresses its internally funded development projects at Let?eng and Ghaghoo."The broker rates the shares a "buy" and has a 351p price target, while its current earnings estimates are under review following what it described as a "polished performance" from the diamond miner."Construction at project Kholo, the Let?eng expansion, has begun and will ramp up to full production by July 2014. This will increase production 44% to 10mt [million tonnes] per annum, reduce diamond damage, cut unit costs and extend the mine life to 25 years," the broker added. SuperGroup, the fast-growing owner of the Superdry brand, rose after revealing that it is to change its finance director and create a new role of chief operating officer. Fellow retailer Debenhams was in demand after saying that like-for-like sales in the first half of its financial year edged higher, with growth accelerating towards the end of the period. Peel Hunt noted that the like-for-like sales increase was stronger than anticipated, albeit against weaker comparatives. It also suggested that there might be some disappointment that the firm has not released details of its forthcoming share buy-back programme. Oil firm Cairn Energy also advanced after it racked up a $1.19bn loss in 2011 but said it was still optimistic about striking it big in Greenland. Office space provider Regus tumbles despite reporting operating profits that more than doubled in 2011. The firm said profits came in at £50.6m, up from £23.9m in 2010, with sales up 12% to £1.16bn, in line with analysts expectations, although broker Peel Hunt said the numbers were slightly below market consensus, reflecting accelerated growth costs. Price and occupancy, seen as two key drivers by the broker, "are not reported as showing strength (i.e. prices are still not recovering despite occupancy now at good levels) and the outlook states does not particularly encourage," with the macro environment described as "challenging"). Peel Hunt, which has a "hold" rating on the shares, believes that Regus is bumping along sideways, "which would be consistent with the peer group (employment agencies, Adecco in particular)." This may hold back sentiment, the broker reckons.FTSE 250 - RisersCable & Wireless Worldwide (CW.) 37.29p +6.88%Gem Diamonds Ltd. (DI) (GEMD) 293.00p +4.27%Essar Energy (ESSR) 147.80p +4.23%Cairn Energy (CNE) 342.70p +3.25%Spirit Pub Company (SPRT) 57.75p +3.12%COLT Group SA (COLT) 103.10p +2.89%Babcock International Group (BAB) 761.00p +2.35%Dunelm Group (DNLM) 508.00p +2.32%St James's Place (STJ) 376.30p +1.07%Domino's Pizza UK & IRL (DOM) 456.70p +1.04%FTSE 250 - FallersExillon Energy (EXI) 188.00p -8.29%Regus (RGU) 105.10p -6.83%Bumi (BUMI) 722.50p -6.77%Perform Group (PER) 297.10p -5.53%Ophir Energy (OPHR) 418.10p -5.15%Invensys (ISYS) 200.00p -4.67%Hochschild Mining (HOC) 466.50p -4.50%BlackRock World Mining Trust (BRWM) 670.50p -4.49%Ruspetro (RPO) 187.00p -4.35%Redrow (RDW) 127.40p -4.21%NR