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Company spotlight: Michelmershpace

FINANCE

INVESTORS who bought into Inspace when the maintenance outfit was spun out of Willmott Dixon this spring have so far done well.

That stock, which is quoted on the Alternative Investment Market, has risen strongly over the summer and the maiden results suggest that the business looks set to prosper.

Interim operating profits were up by two thirds to £3.6 million, which paints a rosy picture, but is the group big enough to compete with the other major maintenance oufits?

With the debts cleared after the f loat, Inspace has £3.6 million in the bank and shareholders' funds of £13.6 million.

Turnover from continuing operations was also up two thirds to £70.8 million but that is not a huge amount compared to the likes of Connaught.

Big deals around London, including work for Richmond upon Thames Churches Housing Trust, Basildon District Council, the Corporation of London and the London Borough of Hammersmith & Fulham, should prove lucrative.

If all the contract notes sent out by clients translate into work, Inspace should have £450 million-worth of orders.

An interim dividend of 0.933p per share is being paid to investors on at the time of the f loat and that will give the management breathing space, but for how long?

A couple of years ago maintenance businesses were talked of as oversold and the likes of Mears were already looking to have topped out. Inspace has missed that wave but securing a slice of Decent Homes initiat ive work will be crucial.