June 30th 2008

Cambridge Index Falls 1.8%

The Cambridge Index fell 1.8% last week to close at 5,233.8, as eight of the top ten Index heavyweights stocks featured on the downside. Declining stocks outnumbered advancing ones by a ratio of about 2.6 to 1, with 9 stocks remaining unchanged.

Kier Group fell 7.7% after Bank of England Governor, Mervyn King warned of further weakness in the UK housing sector. Other prominent losers included Artisan (UK), Netcall, Cyan Holdings, and Abcam, down 20.0%, 13.0%, 11.8% and 9.3%, respectively. Aveva Group lost 0.9% after a series of broker downgrades. DS Smith eased 7.7% after it warned that slowing demand and higher input costs will result in tougher trading conditions this year.

Alizyme was among the top gainers during the week, rising 11.3% as its wholly owned subsidiary, Alizyme Therapeutics Limited, entered into a licensing agreement with Norgine B.V., for marketing its product, Colal-Pred, in Europe, South Africa, Australia and New Zealand. Pursuit Dynamics rose 3.1% after EADS Defence & Security signed a two-year licensing agreement with the company for the use of PDX Basilisk decontamination technology. Hartest Holdings (up 14.7%), Celsis International (up 5.2%) and Xaar (up 4.8%) featured among the other prominent gainers during the week.

The broad FTSE 100 Index lost 1.6% during the week to close at 5,530.0, paced by losses in banking stocks on concerns of more write-downs at US brokerages. Banking and realty stocks lost further ground after the Bank of England Governor, Mervyn King warned about rising inflation and mentioned that housing market will continue to remain weak. Putting further downward pressure on realty stocks was a report from the British Bankers’ Association that showed a fall in mortgage approvals during May. Retail stocks eased after TNS Worldpanel reported that Tesco and Sainsbury’s grocery market share fell in the 12 weeks to 15 June. However, energy stocks climbed in line with oil prices. During the week, the FTSE techMARK 100 Index fell 0.2% to 1,505.8 and the FTSE AIM 100 Index closed lower by 2.8% at 4,947.3.

In the US, the Nasdaq Composite Index fell 3.8% to 2,315.6, paced by losses in financial stocks amid fears that banks would incur further write-downs. A report from the Conference Board highlighting decline in consumer confidence to a 16-year low also weighed on investor sentiments. Rise in crude prices heightened inflationary concerns in the US, and offset gains led by the Federal Reserve’s decision to maintain interest rate unchanged at 2.0% citing lower risk to the economic growth.

Index Movers

Abcam PLC

Abcam PLC, a producer and distributor of research-grade antibodies, declined 9.3% to close at 440.0p.

Alizyme PLC

Alizyme PLC, a biopharmaceutical development company specializing in products for the treatment of obesity and diabetes, climbed 11.3% during the week to 22.3p, after Alizyme announced a licensing agreement with Norgine B.V. Alizyme’s wholly owned subsidiary, Alizyme Therapeutics Limited, granted an exclusive licence to Norgine B.V. for the rights to market Colal-Pred, which is used for the treatment of ulcerative colitis, in Europe, South Africa, Australia and New Zealand. The agreement would result in Alizyme receiving an upfront payment of €2.0 million, with another €40.75 million based on the future development and sales milestones.

Artisan (UK) PLC

House builder and commercial business park developer, Artisan (UK) PLC, was the top loser during the week, down 20.0% at 30.0p. The shares of Artisan (UK) have declined by 82.1% during the past one year.

Celsis International PLC

Celsis International PLC, a provider of diagnostic systems to the pharmaceutical, biopharmaceutical and consumer products industries, jumped 5.2% to 161.0p.

Cyan Holdings PLC

Shares of Cyan Holdings PLC, a fables semiconductor company providing configurable application software, eased by 11.8% to settle at 3.8p.

Hartest Holdings PLC

Shares of Hartest Holdings PLC, a supplier of instrumentation and medical equipment, jumped 14.7% to close at 62.5p, following a similar gain in the previous week. The company, in its full-year results, had announced that its pre-tax profit more than doubled and it expects to witness continuing progress in the coming months.

Kier Group PLC

Building, civil engineering, and mining and property development group, Kier Group PLC, fell 7.7% to 951.5p after Bank of England Governor, Mervyn King warned that housing activity in the UK will continue to remain weak.

Netcall PLC

Netcall PLC, a provider of call-back, auto-messaging and contact solutions, lost 13.0% to 10.0p.

Pursuit Dynamics PLC

Pursuit Dynamics PLC, engaged in the development and commercialization of its PDX platform technology, rose 3.1% to 215.0p. EADS Defence & Security and Pursuit Dynamics signed a two-year licensing agreement for the use of PDX Basilisk decontamination technology.

Pursuit Dynamics announced that its turnover rose 50% to £1.8 million in the six months ended 31 March 2008 (2007: £1.2 million). The company mentioned that it is adopting an outsourced fabrication model in the US to accommodate its anticipated rapid penetration of the ethanol industry. It will be posting a number of its key processing personnel in the US to achieve this. The company anticipates the revenue streams to commence from its various license agreements before year end. Chairman, Andrew Quinn said, “…The second half of the year has started strongly and the commercial value of our PDX technology is being demonstrated.”

Xaar PLC

Xaar PLC, a provider of inkjet printing technology, gained 4.8% during the week to close at 198.0p.

Other Movers in the Index

Autonomy Corp. PLC, an infrastructure software company, lost 0.2% during the week to close at 883.5p. Autonomy won a multi-year order worth more than $65 million to provide its software to a major global bank.

Engineering technology company, Aveva Group PLC, lost 0.9% to 1,513p after a series of broker downgrades.

Domino Printing Sciences PLC, a provider of ink jet and laser technologies, lost 6.9% to settle at 280.0p. Domino Printing Sciences announced the acquisition of Photon Energy GmbH and its subsidiary, NWL Lasertechnologie GmbH, in a cash deal valued at €4.0 million. The acquisition will enable the company to address the growing demand from its customer base for solid state laser systems and expand its reach to include the automotive, aircraft, electronic, tool and medical sectors that are currently served by the Photon Group.

DS Smith PLC, a manufacturer and distributor of paper and plastic packaging products, fell 7.7% to 113.8p after it warned of tougher trading conditions this year amid slowing demand and higher input costs. Its pre-tax profit rose 11% to £109.1 million in the year to April 2008 on a 11% rise in revenue to £1.97 billion from £1.77 billion last year.

Falkland Islands Holdings PLC, the international services group operating in the Falkland Islands, declined by 5.6% to 425.0p after it announced that its net profit fell to £1.38 million or 16.1p per share during the year ended 31 March 2008 from £1.6 million or 18.8p per share recorded last year. Revenues rose to £17.2 million from £15.62 million in the previous year.

Brewery and pub operator, Greene King PLC, lost 4.8% to settle at 432.5p. Greene King raised £350 million of long-term finance through a further securitisation of its pub estate. These funds would be used to pay off part of its existing bank facilities.

Among other index heavyweights, Johnson Matthey PLC rose 0.2% to 1,832.0p and ARM Holdings PLC lost 3.6% to 87.3p.

Specialist pharma company, Meldex International PLC, lost 7.1% to 32.5p after Aquisitek confirmed that it did not intend to make an offer for Meldex.

Minster Pharmaceuticals PLC, a pharmaceutical company specializating in developing drugs for the treatment of neurological and psychiatric conditions, was steady at 25.5p after stating that trading in its current year had started on a good note.

NXT PLC, lost 3.3% to 14.8p after it raised approximately £0.5 million through the placing of 3,759,398 million new ordinary shares at a price of 13.3p per share to its institutional investors, representing a discount of 9.8% to its closing price of 14.75p on 23 June 2008.

Plasmon PLC was unchanged at 5.1p after it announced a partnership with NetApp to create a range of fully integrated archiving solutions.

Sareum Holdings PLC eased 4.7% to 0.2p. Sareum secured three repeat business agreements with its existing collaboration partners.

Screen Technology Group PLC, a provider of display solutions to the commercial AV market, was steady at 0.8p after its loss narrowed to £3.03 million or 8.61p per share for fiscal 2007, compared to a loss of £4.61 million or 14.06p per share last year.

Sepura PLC, a supplier of network-independent Terrestrial Trunked Radio terminals and digital radios, lost 4.1% to 88.3p. The company signed an agreement to supply TETRA digital radios and accessories to VIDA TETRA, the Wireless Systems business of Tyco Electronics.

Tristel PLC eased 1.1% to 45.5p after it extended its distribution deal with US-based Bio-Cide International Inc. by 20 years to distribute Bio-Cide’s products throughout the European Union.