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2012 Winners & Losers: King Coal scuttled

Last updated: 19:00 28 Dec 2012 AEDT, First published: 20:00 28 Dec 2012 AEDT

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If you held shares in coal producer ATH Resources (LON:ATH) throughout 2012 you are probably the sort of person unlucky enough to find nothing but a lump of coal in your Christmas stocking,

The stock was the worst performing UK stock in 2012, starting the year at 42p and ending it suspended at 0.33p.

The writing was on the wall for the company when the company’s lenders, HSBC and Clydesdale Bank sold some of ATH’s banking facilities and related rights to BECAP Fund. BECAP tipped the company into administration in December when it demanded the repayment of the group’s loan facilities in full.

Runner-up for the wooden spoon was Kennedy Ventures (LON:KENV), the company formerly known as Managed Support Services.

The share price fell off a cliff in late March when the company revealed that the £6.5mln it expected to receive from Rentokil Initial (LON:RTO) for the sale of its building services division would only be £4.1mln, primarily as a result of the unforeseen cancellation of one of the division`s largest maintenance contracts.

With no operating activities to its name and no cash once all the creditors had been seen to, the company was effectively worthless, save for the value of its stock market listing.

Cue the transformation of the company into an investment shell via a company voluntary arrangement to undertake a capital reorganisation. 

A completely new management team and a change of name have not led to a change in fortunes; the shares are down 98% in the year so far, and down 26% in the last month.

How the mighty have fallen

In the “how the mighty have fallen” section of the 2012 losers list we have Yellow Pages publisher hibu (LON:HIBU).

This is another company which has had a name change. It used to be called Yell Group but decided that changing its name from something associated with a globally famous publication to a meaningless four letter jumble of lower-case letters was a sound commercial idea.

The shares are up 37% over the last week and up by 46% over the last month, despite which they are still down 93% on the year so far, making them the sixth worst performer of the year.

At the beginning of 2007, before the credit crunch bit, hibu was trading as high as 600p. Now you can buy a share for less than it costs to send a text message – 0.35p.

It was the credit crunch, not to mention the failure to adjust quickly enough to the competitive threat posed by the Internet to its cash cow, the Yellow Pages, which did for hibu.

The group had taken on Herculean levels of debt to fund expansion, but in the post-Lehman environment, rolling over debt became a labour at which even Heracles would have baulked.

The group is currently engaged in a restructuring process and has the support of its lenders, hence the recent share price recovery.

Switching to the good news end of the table, a quick scan of the big winners of the year reinforces the old truth that if you want to hit it big, put your money in to small caps.

Top of the tree is Scancell Holdings (LON:SCLP), the developer of therapeutic cancer vaccines.

The tightly held shares rose 668% on the year, with the major boost coming in August when it announced the development of a new platform technology that stimulates the production of killer CD4 T cells with powerful anti-tumour activity.

A year of two halves

Had the year ended in July, West African Minerals (LON:WAFM) would have been the runaway best performer. It started the year at 10.13p, and the shares were up 507% at 61.5p by December 13, when we took our share price snapshot.

That’s not to be sniffed at, but its high point for the year was 92.25p, which means had you timed it right, you could have cashed in with more than an 800% improvement.

Positive results from an aeromagnetic survey of its six exploration properties in Cameroon were responsible for the share price excitement.

Mid-caps do not feature much at either end of the Winners & Losers list but recovery stock Enterprise Inns (LON:ETI) is the best of the bunch. The pubs group is up 241% on the year.

The story here is of a company selling off pubs to reduce crippling debt and doing a much better job of managing the pubs it has left.

In the year to the end of September the company reduced net debt by £26mln to £2.7bn and while like-for-like (LFL) net income across the pubs estate was down 1.2% year-on-year, the company stressed that, where a publican has been in charge of the pub for at least a year, LFL net income was up 2.2%.

Now, if the pubs trade can just get the Chancellor of the Exchequer off its back, we might all be inclined to raise a glass to him this Christmas.

Winners
1. Scancell (+684%); 2. West African Minerals (+507%); 3. Magnolia Petroleum (+502%); 4. Essenden (+455%); 5. Stratmin Global Resources (+262%); 6. Plexus Holdings (+254%); 7. Iofina (+251%); 8. Enterprise Inns (+241%); 9. Diamond Circle (+233%); 10. Westminster Group (+225%)

Losers
1. ATH Resources (-99%); 2. Kennedy Ventures (-98%); 3. Pursuit Dynamics (-98%); 4. Xtract Energy (-95%); 5. Shidu Capital (-93%); 6. hibu (-94%); 7. Media Corporation (-92%); 8. Powerhouse Energy (-92%); 9. African Medical (-92%); 10. Asia Digital (-92%)

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