The chairman and chief executive of building services firm Rok have taken advantage of the share price slump to buy shares following the release of interim figures.
Rok shocked the market less than one week ago when it revealed problems with its plumbing, heating and electrical business. The group finance director was suspended.
At one-stage the share price had slumped by one-third following the trading statement but there has been a small recovery following the interim results.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Chief executive Garvis Snook has invested just over £50,000 on acquiring 250,000 shares. That takes his shareholding to 966,084 shares.
Snook paid 20.25p a share but chairman Stephen Pettit managed to buy his 25,000 shares at 20.2p a share. Pettit owns 80,326 shares.
The buying comes at a time when Lloyds Banking, Standard Life and the BT Pension Scheme have been reducing their holdings.
Pre-tax profit in the half year to June 2010 fell to £3m from £6m, as revenues dropped to £308.1m from £364.5m. Full year profit will be below expectations because of the problems at the plumbing, heating and electrical division.
Rok has focused on good margin work in the construction division and, although the profit is small, it is the only part of the group to improve its contribution. The contribution from social housing was down but it has a strong order book.
Rok has reduced its interim dividend from 0.75p to 0.5p a share.
Panmure Gordon remains a seller after the latest figures. It says that Rok needs to reassure investors that the problems are specific to one division.
Top Director Buys
Babcock International (BAB) Director name: Mr John RennocksAmount purchased: 17,000 @ 521.50p Value: £88,655
ROK (ROK) Director name: Mr Garvis SnookAmount purchased: 250,000 @ 20.25p Value: £50,625
National Grid (NG.) Director name: Mr John Allan Amount purchased: 4,700 @ 530.42p Value: £24,930
ROK (ROK) Director name: Mr Stephen PettitAmount purchased: 25,000 @ 20.20p Value: £5,050
Bitcoin hits new heights - is now a good time to invest?
The value of Bitcoin has surged to a 20-month high. Why is Bitcoin rising and is now a good time to invest?
By Vaishali Varu Published
Gold hits record high - could it soar higher next year?
The yellow metal has hit a new all-time high. We look at market expectations for 2024, whether investors should sell and take profits, and how to invest in gold.
By Ruth Emery Published