Should the coal price strengthen and the sterling-dollar rate weaken, RJB will be looking attractive to larger quoted miners such as Lonmin and Anglogold.RJB is already trading below its net asset value; its agricultural property assets are worth its share price alone. The further contracts remaining to be sealed are even smaller, together amounting to about the same value.Meanwhile, RJB continues to suffer from the strength of sterling and depressed world coal prices. It is struggling to compete with cheap imports from South Africa, South America, Indonesia and Australia. The shares tipped up 2p at 51.5p, just above a recent all-time low of 47.5p. Should bargain hunters pile in? The contract, with Alcan Smelting and Power UK, is hardly of the scale of existing deals with other UK power generators. Although Druck's long-term prospects are firm, the shares are not cheap.uRJB MiningRJB MINING, the UK's largest coal producer which was formed from the privatisation of British Coal, yesterday clinched the largest of the coal supply deals it is currently negotiating. Analysts expect pre-tax profits of pounds 14.5m and earnings of 14.2p per share this year, giving it a forward p/e of 18.
Druck's small size and the illiquidity of its stock make it a volatile share. In the meantime, Druck is launching a range of new products this year and has the Australian airforce and civilian airlines in its sights. Although the Typhoon contract is worth only pounds 1m, it could lead to further orders worth pounds 10m or so. Meanwhile, 85 per cent of sales are destined for outside the UK while 75 per cent of Druck's manufacturing is based here The strong pound is taking its toll. The slump in the oil and petrochemicals industry has hit demand for Druck's products.On the upside, Druck is enjoying healthy demand in Germany, Italy and France. The order from the US Army has been terminated earlier than expected and Druck is to supply 500 units instead of 1000. The market is highly fragmented, with each of its four divisions all facing different competitors in different parts of the pressure sensor industry.Although Druck's results look impressive - sales up 16 per cent, pre- tax profits up 18 per cent - the immediate underlying outlook is less firm.
Exceptional orders from the US Army and Navy bolstered the numbers. One needs courage to invest in the stock.John Salmon, the chief executive who with co-founder Mike Bertioli owns 51 per cent of the shares, says the company does not enjoy any niches, despite the sophistication of its technology.It wins contracts on the basis of its existing reputation and the quality of its engineering technology. It makes pressure sensors for oil rigs and Formula One racing cars, altimeter calibration equipment for USAF F16s Its latest contract is for the Eurofighter, the Typhoon. Investors should take profits before the competition really bites.uDruck HoldingsLEICESTER-BASED engineering company Druck Holdings is a company for the boys. Of course, Pace may become an attractive takeover target, but capitalised at pounds 449m that looks unlikely.
