S&N loses fizz in Russia

THE prospect of a ban on beer advertising in Russia left

Shares of the UK's biggest brewer of Newcastle Brown Ale, Fosters lager and John Smith's bitter fell 7 1/4p to 393 1/2p on hearing that President Vladimir Putin is about to ban advertising until after 10pm in an effort to curb the heavy alcohol intake of thirsty Russians who consider beer to be a soft drink and tastier than vodka.

S&N is a big player in Russia. Baltic Beverage Holdings, jointly owned by S&N and Carlsberg, is the clear market leader. Its Baltika brand is the second biggest- selling beer in Europe, accounting for almost 200m gallons a year. Sales at BBH grew 13% in 2003.

Broker Citigroup Smith Barney advised clients to sell, but other number crunchers said the ban is not a large setback for the incumbents because newcomers will find it much harder to gain market share.

S&N recently reported a 19% jump in interim profits, helped by heavy costcutting by no-nonsense Australian chief executive Tony Froggatt.

In the doghouse since a Select Parliamentary Committee announced in May that it was launching a probe into the relationships between pub firms and their tenants, Punch Taverns rallied 17p to 451p.

Broker Arbuthnot advised clients to refill their glasses because an adverse outcome to the investigation is unlikely. Analyst Alan Millar believes the inquiry was requested by less than 5% of UK pub lessees, who may be struggling to drive their business forward.

The large pubcos now offer more flexible lease agreements, higher discounts and a wider product range. Market fears have therefore been overdone.

Firm conditions prevailed in London as oil prices eased further and Fed governor Ben Bernanke said that while higher oil costs may slow expansion of the world's largest economy, they would not derail it.

The Footsie rose 15.9 points, but drifted late to finish only 2.2 points higher at 4407.5. Dealers were a trifle perturbed to see Wall Street lose an early 73-point gain and trade nine points lower.

Property giant Land Securities jumped 28p to 1,156p after agreeing to swap most of its industrial sites for an equivalent value of Slough Estates' (8p dearer at 461p) shopping centres. Land's industrial estate is worth around £350m, while Slough's total retail property - including the Lewisham Centre in south-east London - was worth £563m at the end of 2003.

Following an overnight fall in commodity prices due to the stronger dollar, mining stocks were the pits. Anglo American shed 33p to 1251p, Rio Tinto 28p to 1392p and BHP Billiton 9 1/2p to 527 1/2p.

An Investec upgrade to hold from reduce helped engineer Cookson jump 2 1/4p to 33 1/2p.

Aim-quoted Bioprogress advanced 12 1/2p to 107 1/2p on the announcement that its US subsidiary BioTec Films is supplying Colgate with an inthemouth dissolving film technology for the launch of a toothpaste.

Computer-aided design group Planit, in which entrepreneur Bob Morton owns 7%, edged up 1/2p to 26 1/2p. Its AlphaCAM Machinist product has been chosen to make critical components for the Jordan Formula 1 racing team.

Crown Corporation, the active management group, rose 5p to 242 1/2p. IFC Metropol has been appointed financial adviser for its operations in Russia.

Financial website group ADVFN improved 0.4p to 2.9p on active turnover of 3m-plus. Dealers said the rise was in sympathy with the 8p rise to 48 1/2p in rival Hemscott which followed news that Centrepoint is to become its majority shareholder with a 54.5% stake.

First Calgary gushed 17 1/2p to 497 1/2p following upbeat preliminary drilling results from its operations in Algeria.

Drugs minnow Cytomyx firmed 1 1/4p to 16 3/4p on reduced third-quarter losses of £39,000, down from £245,000. Gross margins are up to 61% from 46% in the same quarter last year.