THE performance of recently floated Yorkshire companies has far exceeded the rest of the UK, according to new research by wealth manager Brewin Dolphin.
At a time when numerous big names have seen their shares plummet on flotation, five of the seven Yorkshire IPOs over the past year have risen well above their float price.
Bradford-based double-glazing firm Safestyle is leading the pack with a massive 87 per cent increase in share price since floating last November.
Sheffield-based software specialist Servelec came in second with an impressive 44 per cent increase since floating in October and Clipper Logistics, the firm that distributes goods for blue chip retailers such as Asda, Morrisons, John Lewis and ASOS, came in third with a 38 per cent rise since floating earlier this month.
Wakefield-based value fashion chain Bonmarche was fourth with a credible 37 per cent increase and Doncaster-based Polypipe, one of Europe’s biggest manufacturers of plastic pipe systems, was fifth with an eight per cent increase since its float in March.
Only two Yorkshire firms have seen their share price fall below the float price.
Wakefield-based greeting cards retailer Card Factory, which floated last month, has seen its shares fall seven per cent.
The biggest loser was Rotherham-based environmentally friendly washing machine company Xeros, which has fallen 38 per cent.
Yorkshire’s high success rate was in stark contrast to the rest of the UK and Brewin said the majority of floats are currently trading below their flotation price, leaving shareholders out of pocket.
While Yorkshire’s success stories operate in totally different fields, analysts said the one factor they have in common is that they were all were priced sensibly.
Eric Burns at WH Ireland said: “The key thing is pricing. TSB has been priced attractively. That’s the difference between an IPO getting away and not – where investors can see real value.
“The successful Yorkshire floats have been priced sensibly. Where people have been greedy it hasn’t worked.”
Other factors shared by the five Yorkshire success stories are strong management, healthy profits and a wealth of blue chip clients.
“The five that have done well are proper tangible businesses,” said Mr Burns.
“They’re not fluffy or at an early stage. They’re well-run businesses.”
Tim Ward, chief executive of The Quoted Companies Alliance, said: “It’s great to see Yorkshire so well represented in the IPO lists.
“With good quality management and well-founded business models these companies are at the start of an exciting growth path on the stock market.”
Analysts have said that Card Factory has suffered because it has little growth potential other than opening new stores while Xeros is seen as too early stage for investors to gauge its future success.
Michael Craven, head of Brewin Dolphin in Leeds, said: “There have been a number of issues over the last year with Card Factory and Polypipe being of noteworthy size in the region of £300m.
“As with the national picture there has been a mixed outcome for the shares of the Yorkshire companies once in the market with notable rises seen in the issues of Bonmarche, Safestyle and Servelec.”
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