Derek Pain: Aviation soars, but SnackTime keeps my feet on the ground

The no pain, no gain portfolio has so far experienced a decidedly mixed September. Four constituents made stock market announcements – two bullish, with the others decidedly bearish and consequently suffering sharp share reverses.

Aviation, the aircraft leaser, and the Spirit Pub Co provided the cheer; Booker, the cash and carry chain, and, once again, SnackTime, a vending business, offered downbeat contributions.

Let's start with the more joyous side of the equation. After all, in these volatile times, it is unwise to wallow in grief. Shares of Aviation, recruited in January 2011, have not always been high flyers but they are, as I write, standing at 157p against an 83.5p buying price. The stock is at a peak, buoyed by some pretty outstanding results.

Income soared 29 per cent and pre-tax profits came out at $17.3m (£10.7m) against $14m. The dividend is upped 13 per cent. The group increased its fleet in the year and its coffers are well stocked with cash at $23.4m. Chairman Jeff Chatfield believes growth will accelerate in the current year as a 44 per cent lift to its fleet is expected.

Underlining such optimism is the arrival of a new customer, UNI Air of Taiwan: it has just taken delivery of a newly built ATR 72 aircraft. The only low-flying aspect is that Capital Lease Aviation, the AIM-traded company where Aviation has 68.85 per cent of the shares, reported lower pre-tax profits, although revenue was 14 per cent higher.

Now to Spirit, the pub chain split from struggling Punch Taverns. It looks as though this year's profits will reach about £59m, compared with £54.3m last time. Like-for-like sales at its managed houses advanced 4.4 per cent with the leased estate's income growing 4.2 per cent. Such a performance exceeded hopes, prompting a 3 per cent lift to profit forecasts.

Booker shares have had a torrid time since they hit a 176.5p peak in March, when the supermarket price war erupted. Stock market sentiment has also suffered from the supermarkets' attack on the convenience segment. Both moves could damage Booker's corner shop customers. Some indications suggest the unease has been overdone. We will get an idea next week when a trading update is scheduled.

But it is not only trading concerns that are hitting the shares. The price fell to 120.6p after the German cash and carry operation Metro sold its 9 per cent stake at 125p against a then ruling price of 135p. Although Metro has made a handsome profit as the shares were around 80p when it exchanged its British operations for Booker shares, I cannot help wondering about the timing of the transaction.

After all, a few months ago the Germans could have got much more for their stake. Could they be worried about the price war with the German discounters leading the assault on our home-grown supermarkets? The British contingent will be forced to respond to dipping sales and that could affect corner shops.

Finally, SnackTime, which has again offended with an unexpected profit warning. For the year to March, results will be under expectations – with sales down from £20.5m to £19m – and in the first five months of this year returns are below the previous period. Talks are on about refinancing with the Co-operative Bank and new shareholder, the Russian-controlled Versatel.

I will go into more detail when full results appear later this month. The shares are now 9.75p against a 119p portfolio buying price. A disastrous investment.

yourmoney@independent.co.uk