NEX EXCHANGE
Good Energy (GOOD) continues to refocus on the small business market and services, such as electric vehicle charging. The renewable energy supplier increased revenues from continuing operations by 3% to £63.5m. Higher cost of sales were offset by lower overheads. Pre-tax profit edged up from £2.4m to £2.5m. Disposals helped to reduce net debt to £35.5m. The dividend was increased by 10% to 1.1p a share. There was a surge in feed in tariff (FiT) customers prior to the closure of the scheme earlier this year, but domestic supply customers declined.
IFA consolidator AFH Financial (AFHP) has made two more acquisitions. Twickenham-based Mulberry Independent Financial Advisers will cost up to £5.3m, while AE Garment Independent Financial Services will cost up to £1.9m. There is an initial total cash outflow of £3.3m. Following the deals, AFH has assets under management of £5.6bn.
World High Life (LIFE) joined NEX on 12 September. The investment company intends to acquire businesses involved in medicinal cannabis and related products, including nutraceuticals and cosmetics. There is enough cash in the company to assess acquisitions and undertake due diligence. Chairman and chief executive David Stadnyk has been involved in the cannabis sector in Canada since 2012 and he helped to develop the regulations for the sector.
Bracken Trading 1.5% preference shares (BRAC) have started trading on NEX. Bracken is involved in lending in the residential property sector and also operates two solar farms. The quotation is expected to provide finance through the placing of additional preference shares. So far £10,000 worth have been issued. Bracken has repurchased ordinary shares valued at £9m. A pre-tax profit of £1.46m was generated in 2018.
Rutherford Health (RUTH) is raising a further £12.5m at 176p a share from LF Woodford Equity Income Fund and Woodford Patient Capital Trust.
EPE Special Opportunities (ESO) increased its NAV by one-fifth to 245.5p a share, helped by a strong recovery in the share price of fully listed-Luceco (LUCE) and that business is continuing to improve its trading.
LED lighting and electrical accessories supplier Luceco increased interim revenues by 10% to £82.7m and gross margin improved from 26% to 35%. That enabled Luceco to return to profit in the period. Underlying pre-tax profit was £6.1m. An interim dividend of 0.6p a share was announced and the dividend payout percentage will be raised from 20% to 25%. There have been manufacturing efficiency improvements in China and UK retail demand has rebounded. The main profit improvement was in the wiring accessories division, but both LED lighting and portable power divisions returned to profit. There has been director share buying following the results.
Kyler Hardy has been appointed as chief executive of Imperial X (IMPP) and Emma Priestley and Kyle Hookey have also joined the board. Hardy has a 12.5% stake and Priestley owns 5.4%. Palace Trading Investments has sold 4,615,000 shares at 2p each, leaving it with 685,000 shares.
Equatorial Mining and Exploration (EM.P) has raised £500,000 at 0.01p a share, which includes £95,000 of shares to pay creditors. Director Michael Staten has converted £82,500 of convertible debt into shares. He subsequently sold 550 million shares at the 0.1p conversion price.
Vi Mining (VIM) says Jilde Zeitlin has stepped down as chairman and he will be replaced as non-executive chairman by David Summer. Allan Rowley will take over as chief executive from Summer and he will remain finance director.
AIM
Eddie Stobart Logistics (ESL) says that DBAY adviser has made a bid approach. The chief executive left last month after a review of accounting policies. Trading in the shares was suspended at 71p.
Pensions and financial services provider STM Group (STM) reported a decline in interim profit, but there should be a full year improvement from £4m to £4.4m. The Carey acquisition is being integrated and a new brand name will be announced soon. The balance sheet is strong and STM is seeking further UK-based acquisitions.
Cybersecurity consultancy and software company ECSC (ECSC) reported flat interim revenues of £2.6m because growth in managed services was offset by lower consultancy income. The loss was lower and ECSC could move into profit in the second half even though revenue forecasts have been trimmed. Consultancy revenues are growing again.
Filta (FLTA) is continuing to integrate the Watbio grease management services acquisition. The benefits are beginning to show through, but not as fast as hoped. The core fryer management services franchise business continues to prosper. There was a dip in interim profit and full year profit could be flat this year. Even so, the interim dividend was raised 39% to 1p a share. A jump to £3.1m is forecast for 2020 as the full benefits of the Watbio acquisition come through.
Property finance provider Urban Exposure (UEX) had a solid first half but the second half is always stronger. Deals in legal due diligence should mean that more than £700m of loans will be provided this year. The main uncertainty is timing. Loan to value is around 45%. There is 29p a share of cash in the balance sheet and loans worth 53p a share. Even excluding intangibles, NAV is 85p a share.
Credit hire and legal services both grew strongly in the first half for Anexo (ANX) although the start-up costs of the new Bolton office reduced the profit contribution from legal services. It will take time for the new fee earners to get up to speed. Anexo is still on course to improve full year pre-tax profit from £16.1m to £23m.
MAIN MARKET
Haynes Publishing (HYNS) increased revenues by 7% to £36.2m in the year to May 2019. Pre-tax profit improved from £2.9m to £3.5m. Net cash almost doubled to £4.9m and the dividend is maintained at 7.5p a share. Digital and technical data generates the majority of revenues. First quarter revenues are 9% ahead.
Icon Labs (ICON) has acquired the IP of Gay Star News, which runs a website focused on LBGTI news and events and it is number three in the market. The media business paid £1 to a company owned by Iconic Labs director David Sefton, who bought the asset after the previous owner went into liquidation. There is a further £33,000 payable to the liquidator, though. A management services agreement has been agreed with Medium Channel Marketing along with a £150,000 loan and in return Iconic has been issued a 24% stake in the company. The agreement will generate fees of at least £25,000 a month. MCM is acquiring student-focused publisher Tab Media. European High Growth Opportunities took advantage of the good news to reduce its stake from 5.79% to 4.29%.
Tex Holdings (TXH) wants shareholder approval to move from the premium list to the standard list. This means that it will no longer be eligible for the FTSE Fledgling index. A company associated with director ARR Burrows will provide Tex with up to £7m of loan facilities after the company failed to find an alternative funder to replace its overdraft facility.
OTHER MARKETS
Fashion On Screen has agreed a $55m loan facility with The Ambient Partnership Group that will help to finance its films and on acquisitions. The facility can be drawn down over The Vienna Stock Exchange-listed film company raised £100,000 when it floated and has also received an investment from Twickenham Studios. Some of the finance will be used to film REVolution, a film based on the kidnapping of racing driver Juan Fangio in Cuba before the 1958 Cuban Grand Prix. Pre-production is set to begin, and the film could be completed in time for a cinema release in 2020.
Andrew Hore