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THE CONTINUOUS slide in the stock of LMA International is an oddity given the strong recovery in the broader market in recent weeks.

On Tuesday (Apr 8), LMA touched a new bottom in intra-day trading at 18.5 cents – which is below its Dec 31 net assets per share of around 21.4 cents (US$0.1547).

Some background on the business of this relatively unknown company: It designs, develops, markets and distributes medical equipment, principally the LMA™ laryngeal mask
airway range of supraglottic airway management devices.

These devices are used by physicians to allow respiration,
provide ventilation to, and support the airway of patients undergoing surgical procedures and life-saving interventions.

Incorporated in the Netherlands Antilles in 1998, LMA listed on the mainboard of the Singapore Exchange in March 2005.

In recent months, i
ts stock price has been on a steep slide from a high of 71.5 cents in the middle of last year.

At Tuesday's closing price of 19.5 cents, its historical PE is 5.3X and market capitalisation $115 million.

The business fundamentals have been anything but sterling. Its operating margin has slid incessantly,
from 35% in Q1 of 2005 to just 7.3% in Q4 of 2007.

G
roup net income for FY2007 (excluding non-cash stock compensation charge and non-cash U.K. tax charge) was US$15.5 million, down 36% year-on-year.

However, LMA insiders, the company itself and funds have been scooping up shares of the company as the following tables show:
 

Share
buyback
Date of purchase No. of shares purchased Average price/share
(S$)
Total value (S$) No. of shares bought back to date
  28-03-2008  323,000  0.2199 71,187 8,149,000
(1.40 %)
  27-03-2008  400,000   0.21998 88,209  
  27-03-2008  405,000 0.225   90,222  
  19-03-2008  700,000  0.226 158,640  
  18-03-2008  300,000  0.23 69,170  



Buyer Date of purchase No. of shares purchased Average price/share
(S$)
Total value (S$) Total shareholding

John Lim,  exec deputy chairman

08-04-2008   52,000   0.20   10,400  1,245,000
(0.21 %)
  07-04-2008   48,000   0.20   9,600   
  02-04-2008   200,000   0.204   40,800  
  01-04-2008   275,000 0.21   57,750  
Chew Heng Ching,  Independent Director 31-03-2008   150,000 0.215  32,250 500,000  
(0.09%)
UBS 18-03-2008 200,000   N.A.  N.A.  105,886,000  (18.18%)
  01-02-2008   819,000 N.A.  N.A.   
  31-01-2008   8,194,700 N.A.  N.A.   
Porter Orlin LLC  20-02-2008   4,914,000 N.A.  N.A.  88,012,000  (15.11%)
  31-10-2007   5,500,000 N.A.  N.A.   
Robert Gaines-Cooper, chairman 11-01-2008   237,000   0.45   106,650 195,489,000 (33.26%)
  08-01-2008   265,000   0.46 121,900  
  07-01-2008   100,000 0.45 45,000  

The company (www.lmanv.com) initiated a buyback scheme on Nov 2 last year at the 42-cent level.

It has since bought back shares frequently but in small quantities each time. To date, it has bought back a total of 8,149,000 shares, or 1.40% of the total issued share capital.

In recent months, LMA’s chairman and deputy chairman have also bought small quantities from the open market. In contrast, a New York fund - Porter Orlin LLC – has scooped up massive amounts, as have UBS
prime brokerage clients
.

In their latest action, UBS prime brokerage clients, however, sold a small portion while another fund, Wasatch Advisors, unloaded about 6 million shares.

There is a ray of optimism. Mr John Lim, deputy executive chairman of LMA, said in a statement in Feb '08: "We expect that our efforts in 2007 will result in a better overall performance in 2008."

Seller Date of sale No. of shares sold Average price/share
(S$)
Total value (S$) Shareholding left

Wasatch Advisors

31-03-2008 5,526,270   N.A.  N.A.  29,023,600  
(5.01 %)
  22-02-2008   555,990   N.A.  N.A.   
UBS 24-03-2008   967,000 N.A.  N.A.  105,319,000 (18.13 %) 


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