Bottom Line: Flower power

IT WAS not in the least surprising that the stock market newcomer Flying Flowers, a floral messenger service, chose St Valentine's Day to publish its maiden annual results.

Not surprising, but a little misleading. Because it specialises in carnations rather than red roses, the favourite bloom of lovers, FF does most of its business on Mothers' Day and at Christmas.

It operates as a mail order company rather than a florist and it is efficiently run. Operating profit margins blossomed from 14 to a vigorous 17 per cent last year.

Its target audience is middle wage earners. FF flies 10 carnations by first-class post from its nursery in the Channel Islands for less than pounds 10. The company now boasts that all orders taken before noon on any given day will be posted that same day.

Apart from dedicated greenhouses in Jersey, FF deals in the world bloom market, where it obtains stock for Christmas delivery in particular. The expertise is a useful back-up if FF's own nursery falls prey to the proverbial swarm of locusts.

Growth opportunities also look promising. Sales of pounds 7m compare with a total UK market for flowers of pounds 1bn.

FF's story is perfectly plausible, but the company is vulnerable. It could be blown off course by anything from an ill-judged acquisition to, more likely, a downturn in consumer spending.

The shares are trading at a p/e ratio of 15 times. Not expensive, but there seems little point in chasing this one.