Companies: GOI    NBI    TIME   

GoIndustry, which reversed into Grasshopper Investments in January, is a £29.5 million minnow combining the traditional sale of assets such as machine tools and plastics machinery with web technology, providing financial institutions, insolvency practitioners and second hand industrial machinery dealers with machinery and equipment auctions and disposals.

Having met management I’m led to believe that despite its size, the company punches above its weight as a leader in a large and fragmented market, and investors could profit from plans to capitalise on the quickening manufacturing shift from North America and Western Europe to China, India and even Russia, where there’s huge appetite for sold-on equipment.

Milestone financials for the half to June demonstrated GoIndustry is going places, with operating profits (before interest) recorded for the first time – losses of £1.5 million were turned round to profits of £200,000 – on turnover up 30 per cent to £16.1 million. Tellingly, online penetration exceeded 50 per cent of sales events conducted for the first time, with online auctions generating £19.1 million of the group’s gross asset sales. I would argue that at 15p the shares are worth a punt, with wider online and manufacturing trends giving it a unique edge.

Hook into oil & gas boom
Early noises from Northbridge Industrial Services, a tiny firm run by Eric Hook, who turned round hire venture Andrews Sykes in the 1990s, also made my ears prick up. Maiden interims reflected a three month contribution from Crestchic, acquired at float in March, and a major maker and hirer of what are known as ‘loadbanks’, devices much in demand in the oil & gas, shipbuilding and power sectors.

Investors might expect profits of £1.2 million from £7.5 million sales for 2006, ahead of £1.4 million off £8.2 million turnover the following year, placing the 117p shares on budget forward multiples of 10.5 and 8.8. Upgrades look likely with trading strong and Hook thought to be in talks with targets in the specialist industrial services space. To my mind, a planned maiden dividend for the year only adds further spice.

Riskier is Timestrip, which develops and sells smart labels monitoring how long perishables have been open or in use. Joint chief executive Paul Freedman has high hopes for the model, which involves sales from in-house manufacturing with royalties and raw material sales derived from manufacturing licenses.

Interim sales exceeded £200,000 (£50,000), driven by contracts with Nestlé, John Lewis and Hamilton Beach. Although losses arose, this four-fold leap in sales and rosy prospects in retail underpin an intelligent, though highly speculative, play. German retailer Metro plans to sell the Timestrip and home shopping venture QVC will feature it this year.

A new product that spots whether or not vaccines have been accidentally frozen in transit has upped the stakes prospect-wise. Known as iStrip, this potentially revolutionary product changes colour when frozen, and with hundreds of millions of vaccines for the likes of Tetanus and Hepatitus B administered every year, there’s more to Timestrip than meets the eye.

Analysts see annual losses cut from £1.3 million to £800,000, before a move to pre-tax profits of £100,000 from £4 million turnover by December 2007. On forecast ’07 earnings of 0.02p, the 9p shares trade on a stratospheric multiple. If you are in the mood to make an educated leap in the dark, however, you could be quids-in long-term.