Smaller companies spotlight

EACH week, former Fleet Street City Editor

Litcomp stakes its claim

THERE was a time when somebody tripped over a pavement and blamed themselves for being clumsy. Today they sue, often helped by “no-win, no-fee” claim management companies.

It has become an increasingly litigious world and that not only lines the pockets of the legal profession, but also of those who do the background work for the lawyers.

One of these is Litcomp, a supplier of medico-legal reports to solicitors and insurers involved in personal injury claims and which is raising up to £500,000 – half of which has already been secured from institutional investors -and is now seeking an Ofex quote.

According to Datamonitor there are 744,000 personal injury claims in the UK each year, a figure which will top one million by 2005; each claim needs at least one report (costing around £400 on average) for the solicitor to assess the amount of compensation that will be sought from the defendant.

The report is detailed, including facts about the accident, the claimant‘s medical history, treatment and care requirements and the effects of the incident on the claimant‘s work and social life. It also gives a prognosis on recovery time.

Litcomp, founded in 1998 by Jason Smart, who is still only 33 and a former lecturer in law and legal practice, already has more than 200 solicitors and insurers on its client base and dealt with more than 5,000 cases last year. Turnover in the first eight months of the current financial year at £775,000, was already 132% higher than the whole of the year to end March 2001.

And, although the group claims only 0.75% of market share, it‘s aim is to reach 3.75% in the next three years.

The process will be helped by a strong board, including chairman Jack Wigglesworth – who set up and developed the LIFFE where he also became chairman – and finance director, Paul Lavender, former finance director of Welpac and holder of several other top corporate jobs.

It does, of course, have some significant competitors, about 15 to be exact, strongest of which is Mobile Doctors, a privately-owned company established in 1989 and whose last filed accounts show revenue of more than £19m.

Medicals Direct, also quoted on Ofex, is another following its purchase of Lancer Group Medico-Legal business last August.

One area for Litcomp expansion could be through acquisition once the shares are traded. Another is to broaden the product range by moving into rehabilitation of claimants.

It appears that insurance companies believe they can reduce the costs of a case if the claimant receives the correct rehabilitation treatment at the right frequency and properly monitored. They outsource this process and Litcomp expects to have a rehabilitation service running by April.

The offer of up to10 million shares at 5p each is being made by broker Ruegg & Co.

Some you may have missed

THOSE who missed the annual meeting of Poptones this week will be delighted to hear that The Hives album Your New Favourite Band released on 22 October, has already sold more than 85,000 copies and “gold status is only days away” according to chairman Mike Blackburn. The album reached number one on Amazon‘s Hot 100 Music Albums chart at the end of last week and the band‘s tour scheduled to start in Portsmouth on 31 January will take in a further nine concerts.

WILLIAMS de Broe, financial adviser and stockbroker to industrial catering supplier Multi Group, has placed four million new shares with selected institutional investors at 13.75p a share, raising around £550,000. The cash will mainly be used to buy Cups and Saucers, an industrial catering partnership.

PLUG-IN smoke alarm group Sprue Aegis has hit the ground running in 2002, announcing that its FireAngel product will be sold in 620 Currys and Dixons stores throughout the UK. The product is now on sale in some 3,000 outlets.

HENDERSON Morley, the provider of anti-herpes treatments, which moved from Ofex to AIM last September, has reported a pre-tax loss of £282,191 (loss £288,138) for the six months to end October. However, chairman Andrew Knight says he hopes to be able to report favourably on potential partnerships and out-licences in his preliminary statement for the year that ends in April.

SHEFFIELD-based medical devices and equipment company The Medical House has been awarded a £563,863 grant from the Invest for Growth scheme of investment, administered by Business Link South Yorkshire. The grant will help TMH to fund development of its range of needle-free injection devices for the delivery of insulin.

A SHIP torpedo defence system is to be developed for the Royal Navy by Sonar & Communication Systems, part of Ultra Electronics Holdings. The system is expected to enter service in 2004 and will cost around £53m.

DELTEX Medical says it total revenue for the current year will be some 40% higher than in 2000.

POSITIVE data on its new XTL-002 human antibody-based treatment for hepatitis C has been released by XTL Biopharmaceuticals.

SUPPORT services group Amey says it expects to meet market expectations of pre-tax profits of £51.5m for 2001. The second half produced strong profitability and sound operating cash inflow for the third successive half-year, says the company.

Some to watch out for

PROACTIVE Sports, which now manages the affairs of 238 footballers worldwide, has issued a trading update highlighting the continued strong performance of its Professional Football and Sports Marketing divisions, prompting Peter Ashworth at broker Teather & Greenwood to write of a 'premiership performance'. He rates the AIM-listed shares as a 'strong buy'.

STEPHEN Thomas, analyst at Teather & Greenwood, believes the time is right to 'buy for recovery' the shares of Longmead Group, which has been through some difficult times as the market for ceramic bathroom accessories has declined and competition from imports increased. However, a major re-assessment of strategy is beginning to pay off and the company is looking for sales growth of 23% in the current year, which could mean an early return to the dividend list says Mr Thomas.

EQUITYLINK sees Trafficmaster, the route guidance system, as an 'attractive gamble' following a recommendation from house brokers UBS Warburg, who expect the group to move from an £11.3m loss in the year just ended to a £2.6m profit this year and £12m profit next. The same group‘s Share Watch publication also suggests Ultimate Leisure, the bar and night club group, is a buy with broker Brewin Dolphin looking for a 21% rise in pretax profits in the year to June. Interim figures are out in February.