In its fourth year on the Unlisted Securities market, Stafford, UK based process control systems company Instem Plc is currently valued at just UKP4.5m at its current share price around the 100 pence mark (CI No 1,334). Having reported a first half increase in pre-tax profits of 26.5% at UKP382,000 and earnings per share 28% ahead at 5.32 pence, the valuation is disappointingly low. According to Kerry Brown, marketing director, this is due to a year of depressed results in 1987 when profits fell by about 67%, combined with the effect of Black Monday when the shares fell to 67 pence. The company has been recovering slowly but steadily from this as investors have been cautious, waiting to see consistent semiannual growth. In 1985 chairman David Gare was looking for a yearly growth of 30%, this has been achieve on average, excluding the figures for 1989. Instem expects its recovery to continue in 1990, over the next two years the company is hoping for a growth of between 30% and 50%. Instem has two major divisions, computer systems, and electronics, focussing on providing systems and solutions for all types of information management, mainly for industrial and technical markets such as power generation, water generation, defence, mining and scientific research, entertainment and industrial processing. Its expertise is in developing and selling systems for data collection. It supplies electronic design systems and software engineering for networked IBM personal computer and Unix machines. On the electronics manufacturing side Instem builds hardware to customers’ particular designs and specifications. Clients are those not wanting invest in in-house hardware manufacturing capabilities. Instem is 10% owned by managment; a major shareholder is Dobson Park Industries Plc with 37.5%. – Elvadia Tolputt
