Shopping-at-work outfit Premier Direct, down three-quarters from its all-time high of 185.5p in February last year, needs to regain the confidence of investors after a shaky couple of years.

From sales down 17% at £21.2m, Newcastle-based Premier reversed 2006’s £3m loss and posted a pre-tax profit of £0.5m, turning negative earnings of 14p into a positive 2.9p in the year to July. Cash generation increased £0.8m to £1.6m and a dividend of 1p is proposed.

Chipper chief executive Eric McClenaghan – who hasn’t enjoyed the smoothest of rides since his predecessor, Barry Moat, stepped down – has finally settled on a successful strategy: focus on core values. Salesmen have been set free to sell, costs have been cut and product-sourcing has been improved.

Such has been the uplift that sales per call improved by 11% and a profit was even made in the historically loss-making second half. McClenaghan attributes this to ‘better buying’ and a ‘strengthened product range’.

May 2006 acquisition Oriflame, where 4,500 women sell cosmetics directly, has been slightly ignored until recently, as it freely delivered profits and cash. McClenaghan believes a new Oriflame-at-work concept can succeed despite a failed experiment so far: ‘We’ve launched a new model – and now I’m going to give it my full focus,’ he says.

The company having had its fingers burnt, investors have been slow to get back behind it, leaving the shares looking decidedly unloved. Now back on a growth path, they could reward a punt.

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