The Insider: BT, Lavendon

BT finance chief bags big profit

BT has been one of the stockmarket's star performers over the past few years. Worth as little as 157p in August 2011 and 352p as recently as October last year, BT shares are currently changing hands for 449p. Last month they hit a 14-year high at 465p.

Targeting sports channels has worked out for BT - it recently paid £960 million for rights to show English Premier League football. Recent third-quarter results were encouraging and the telecoms giant is tackling its monster pension deficit. Buying mobile operator EE for £12.5 billion also underpins its ambition to dominate the so-called quad-play market - home phone, broadband, mobile, and TV.

But as any sensible investor will know, it's never wrong to trouser a profit, and BT finance director Tony Chanmugam is taking some money off the table. Having held the purse strings at either BT Global Solutions or BT Retail for 11 years before taking the big job at the end of 2008, Chanmugam has built up quite a stake, much of it from share bonuses and incentive schemes.

Now, less than three weeks before the beginning of a close period (1 April) ahead of fourth quarter and full-year results due on 7 May, Chanmugam has turned seller. He's offloaded 400,000 shares at 442p each, banking almost £1.8 million. Wife Frances sold 9,000 at 445p apiece.

It's sensible financial planning from the man who should know. But even now, Chanmugam has a personal holding in BT worth almost £2.6 million. Include stock in his deferred bonus and incentive share plans and, at 449p, his total stake is worth almost £11.3 million.

Lavendon rout over, reckons CEO

Tool hire firm Lavendon has had a difficult year. Its Belgian business has done badly, which forced the company to write-down the value of goodwill by £8.8 million at the full-year results in February. The rest of Europe was weak in 2014, too, and although the UK did well, year-on-year revenue in 2015 so far is down, offset by growth in the Middle East where margins are better.

These issues are reflected in the share price, down a third since March last year. But chief executive Don Kenny has seen enough. The qualified accountant and former Carillion director who took the reins in 2011 has just spent £180,000 on shares in the £284 million company.

Buying 106,774 shares at 168.32p each takes his stake to 312,588, worth over half a million pounds. And Kenny's appetite for Lavendon stock is shared by others in the City.

Panmure Gordon analyst Paul Jones liked the better-than-expected annual results, especially the 30% increase in the full-year dividend to 4.6p.

The broker leaves estimates unchanged given challenging conditions in its core UK markets, and still expects £37 million of pre-tax profit in 2015, giving EPS of 16.7p. It's looking for £40.1 million and 18.1p in 2016 (2014: £34.1 million/15.5p).

"We remain confident in the improving returns possible, with a good chance of upgrades and better than anticipated returns as the year progresses. We remain buyers with a 229p target price," says Jones.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.