March 24th 2008

Cambridge Index Falls by 3.3%

The Cambridge Index declined 3.3% last week to close at 5,324.9, as the top five weighted index stocks lost values in line with the broader markets. Technology stocks such as Autonomy Corp. PLC, Aveva Group PLC, Brady PLC, Bango PLC and nCipher PLC declined between 4.0% and 21.0% after a profit warning from Sony Ericsson and disappointing outlook from Deutsche Telekom. Netcall PLC lost 16.2% after the company stated that difficult macro-economic conditions might affect its trading in the second half of the year.

Greene King PLC declined 14.9% after Tchenguiz failed to find a buyer for its Laurel Pub Holdings Ltd. Alizyme PLC and ITM Power PLC were the other prominent losers during the week, down 19.6% and 16.0%, respectively.

Meldex International PLC topped the gainers’ list, rising 16.8% amid hopes that the company could receive a takeover bid. Domino Printing Sciences PLC gained 2.5% after it stated that trading in first four months of the current year has been in line with expectations. Kier Group and Plasmon were the other prominent gainers, rising 4.1% and 0.9%, respectively. During the week, a total of 33 stocks declined, 4 stocks advanced and 9 remained unchanged.

The broad FTSE 100 Index fell 2.4% to 5,495.2, led by a decline in mining and energy stocks after metal and oil prices declined. Earlier in the week, markets closed at its lowest level since November 2005, after the sale of Bear Stearns raised concerns over more credit related losses. Banking stocks eased amid speculation that HBOS was facing liquidity problems. During the week, the FTSE techMARK 100 Index declined 1.1% to 1,477.0 and the FTSE AIM 100 Index lost 5.7% to close at 4,706.6.

In the US, the Nasdaq Composite Index rose 2.1% to 2,258.1, after the US Federal Reserve cut interest rates by a hefty 75 bps. Financial stocks in US rallied upwards after the Goldman Sachs Group, Morgan Stanley and Lehman Brothers Holdings posted first quarter earnings that beat Wall Street expectations.

Homebuilders rose after the Office of Federal Housing Enterprise Oversight reduced the capital surplus requirement for Fannie Mae and Freddie Mac, allowing the mortgage lenders to invest billions in mortgages and mortgage backed securities.

Index Movers

Alizyme PLC

Alizyme PLC, a biopharmaceutical development company specializing in products for the treatment of obesity and diabetes, dipped 19.6% to 37.0p.

ANT PLC

ANT PLC, a provider of embedded application software and support services, was steady at 22.5p.

Bango PLC

Bango PLC, a developer and provider of technology for mobile phone users, was among the top losers during the week, falling 17.9% to 32.0p.

Domino Printing Sciences PLC

Domino Printing Sciences PLC, a provider of ink jet and laser technologies, jumped 2.5% to 308.5p after it stated that trading in the first four months of the current year has been in line with expectations. Its revenue grew 11% in first four months of the year compared to the same period last year, of which 3% was attributed to foreign exchange fluctuation. The company expects its first half results to benefit from a small favourable foreign exchange gain. It continues to experience good demand for its products, particularly in Asia.

ITM Power PLC

ITM Power PLC, a company focusing on new technologies using hydrogen as fuel, fell 16.0% to 46.0p. Its Non-Executive Chairman, Peter Hargreaves bought 290,500 ordinary shares in the company, taking his total stake to 6.79%.

Kier Group PLC

Building, civil engineering, and mining and property development group, Kier Group PLC, gained 4.1% to 1,304.0p.

Meldex International PLC

Specialist pharma company, Meldex International PLC, formerly known as BioProgress, jumped 16.8% to 80.0p amid hopes that it could receive a buyout bid shortly. The Telegraph reported that GlaxoSmithKline PLC could be a potential bidder for the company. In January, Meldex had announced that it had received an approach.

nCipher PLC

nCipher PLC, a provider of enterprise level hardware, and software data protection and security solutions, slumped 20.8% to 124.0p. nCipher announced it swung to a full year pretax profit of £3.4 million in the year to December 2007 on a 15% rise in revenue to £24.2 million, as against a loss of £4.7 million recorded in the previous year. nCipher has a target of doubling its sales over three years. However, it added that the profits in 2008 will reduce substantially as it will invest heavily during the year to ensure a strong foundation for scaleable future growth of both sales and profits.

Netcall PLC

Netcall PLC, a provider of call-back, auto-messaging and contact solutions, lost 16.2% to close at 15.5p after the company stated that difficult macroeconomic conditions might affect trading in the second half of the year. Netcall announced that its pretax profit declined to £133,000 in the first half compared to £375,000 recorded in the same period a year earlier. Revenue dipped 15.5% to £1.69 million. The company mentioned that demand for its
product remained strong.

Plasmon PLC

Plasmon PLC, a supplier of data storage and archiving solutions, rose 0.9% to 9.5p.

Other Movers in the Index

Abcam PLC, a producer and distributor of research-grade antibodies, eased 0.7% to 347.5p after its Chairman David Cleevely, Chief Executive Jonathan Milner and Managing Director Jim Warwick sold 500,000, 1 million and 30,000 shares, respectively, to institutional investors at 345p per share. Sepura PLC, a supplier of network-independent Terrestrial Trunked Radio terminals and digital radios, slumped 11.6% to settle at 84.0p. Sepura won a contract from the Pakistan Interior Ministry to supply 10,000 digital TETRA radios to the Pakistan police force.

Biotech firm, Acambis PLC, declined 3.8% to 119.0p. The company stated that it has extended its ChimeriVaxTM-JE vaccine licensing agreement with Sanofi Pasteur, the vaccines division of the Sanofi-Aventis Group, to include India and the Indian subcontinent. Acambis will receive an upfront payment, a milestone payment on licensure of the vaccine in India and royalties on sales in these territories from Sanofi Pasteur. The company will compensate Bharat Biotech for terminating its existing licensing agreement. The net financial effect is positive for Acambis.

Amino Technologies PLC, a broadband network software and systems company, fell 3.5% to 55.5p. Telefonia Bonairiano NV, the Dutch Caribbean’s telecom, has selected Amino’s AmiNET125 multi-codec Set-Top-Box to power “mitv”, the first IPTV service in the Caribbean island of Bonaire over ADSL2+ network.

Autonomy Corp. PLC, an infrastructure software company, fell 4.4% to 870.0p. It announced that the Institute for Psychology Information at Trier University has extended its license to include Parametric Search on PsychSpider, a free-of-charge search engine. The company also announced that BioLab has selected Autonomy etalk solutions to replace its existing systems in its contact centre.

Shares of DS Smith PLC, a manufacturer and distributor of paper and plastic packaging products, fell 11.3% to 144.5p. The Global Industry Analysts Inc. stated that the world stationery products market will exceed $164.63 billion by 2010, recording a CAGR of 4.0% over the period 2000-2010. Amongst other index heavyweights, Johnson Matthey PLC declined 4.7% to 1,839.0p, ARM Holdings PLC dipped by 0.9% to 83.3p and Aveva Group PLC lost 4.5% to settle at 1,029.0p.

Brewery and pub operator, Greene King PLC declined 14.9% to 538.5p as negative news continued from the sector. The Times reported that Tchenguiz might put his Laurel Pub Holdings Ltd. with administrators as he was unable to find buyers for almost 100 unprofitable outlets. Further, comments from a broker that Mitchells & Butlers PLC might be facing a weak financial position also added to the negative sentiment in the sector.

Intercytex Group PLC, a cell therapy company producing aesthetic medicine and tissue repair products, dipped 1.0% to 51.0p after it announced that its 2007 pretax loss widened to £11.63 million from £9.23 million in 2006, as it continued to develop its regenerative medicine products used for restoring skin and hair. Research and development costs jumped to £9.62 million from £8.57 million and revenues rose to £111,000 from £83,000. The company expects to report strong commercial and clinical progress over the next year.

Medical Marketing International Group PLC, a specialist pharma company focusing on the development of drugs for cancer, declined 9.8% to 23.0p after its shareholder, MF Global UK Ltd, reduced its stake in the company to about 2.3 million shares from 2.8 million shares.