Derek Pain: After a few difficult months, prospects are brighter now

It is always a little disturbing when a constituent of the No Pain, No Gain portfolio, which had been happily in profit, slips below my buying price. But I believe there are extenuating circumstances behind Alkane Energy's fall from grace.

The power group has been quite active on the deal front in recent years. However, the latest expansion involved a share placing – often a dispiriting influence – and represented a big swallow for a business then capitalised at less than £50m. To pile on the pressure, the largely institutional placing was a rather convoluted exercise that excluded most, if not all, private shareholders.

So the shares have given ground. As I write the price is 37.5p against the portfolio's 40.75p and a recent high above 50p. However, I think Alkane is still worth supporting and expect the shares to move back into the black. I note that the share tipping website, t1ps.com, rates them a buy.

Alkane is, in effect, a play on the country's power supply. And last week's £12m acquisition of three power response companies strengthens its position. The group supplies general power as well as offering a fast response when shortages occur. With the danger of blackouts looming in years to come, the business could help illuminate some of the threatened lights- out sessions. Much of Alkane's electricity comes from converting methane gas from abandoned coal mines.

The group preceded its expansion with a trading update that revealed output in the first half-year was down but a strong second half was anticipated. The decline was largely due to a shut-down at one of its former coal mines – the Maltby colliery in Yorkshire – which has since resumed production.

In May, in a deal with Egdon Resources, the group disposed of its shale interests in exchange for 18 per cent of Egdon's capital. The sale produced a one-off £9m profit.

Two other constituents have reported trading, one very upbeat, the other not quite so cheerful. Essenden, the operator of 29 bowling and entertainment centres, scored a 6.1 per cent sales advance in the first 26 weeks of its year. Taking a 28-week period, the gain was 7.1 per cent. Chief executive Nick Basing was worried the World Cup would hinder trading; his fears proved groundless.

The shares were recruited at 24p; they are now 74p.

Findel, the home shopping and educational supplies group, was not so lucky. It actually reported a 2.2 per cent sales drop but said its bottom line calculations had improved because of stronger margins and cost savings. Its main subsidiary, Express Gifts, a mail order operation, managed a 6.2 per cent advance.

But trading elsewhere, such as the Kleeneze doorstep seller, was less satisfactory – although overall the group thinks this performance, which occurred in its quietest period, will not blunt the expected year's display.

Findel is one of the constituents that has not excelled in recent months. In March the shares hit 320p but later fell to 238p; they are now 253p. The stock was recruited at the equivalent of 142p.

Coincidentally, March was the month when my star performer, the Booker cash-and-carry chain, began its decent from a 176.5p peak. Essenden also plateaued above 100p in what was to emerge as a painful month for the portfolio.

However, Essenden's retreat to 74p is explained by its decision to exchange its ISDX traded loan notes for shares. The move almost certainly prompted some note holders to sell their resultant shares.

yourmoney@independent.co.uk