NEX EXCHANGE
Forbes Ventures (FOR) has sold its stake in KCR Residential REIT (KCR) for £145,000. The remaining investment is in challenger bank Civilised Investments Ltd. Nigel Quinton, who has run two building societies, has been appointed as finance director of Forbes. Igor Zjali has become a non-executive director. The investment strategy covers disruptive technology in the property and fintech sectors.
KR1 (KR1) has been raising cash from partially disposing of token holdings. Cash has been generated from sales of tokens issued by six projects and this will be available for re-investment. KR1 has already acquired 30,587 tokens in the Waves project at $6.41 each.
Angelfish Investments (ANGP) says that there has been a further delay in its investee company Rapid Nutrition’s plans to gain a quotation in London. Rapid, which is already quoted on the SIX Swiss Exchange, has developed a nutraceutical product range. One of the terms of a £150,000 loan to Rapid was that it should be admitted to the London market by the end of February, but this date was extended to the end of April and has been extended again to the end of July. The principal and interest, up until the end of February, will convert into Rapid shares. Interest has been payable in cash since the end of February.
EPE Special Opportunities (ESO) reported a 35.6% decrease in NAV to 234.4p a share at the end of January 2018. That was mainly down to the poor performance of fully listed LED lighting company Luceco (LUCE) after sales growth did not turn into higher profit. EPE is considering exercising the option to redeem up to 50% of the outstanding unsecured loan notes. Redeeming £4m of loan notes would save £300,000 in interest. There is £28m in the bank.
Middle East-focused investment company Indigo Holdings (INGO) has lost €165,300 on an Iran-based car ride-sharing app. This will be mainly offset by a book gain of around €160,000 on its investment in Sheypoor following another fundraising round.
NQ Minerals (NQMI) has started to refurbish the Hellyer flotation plant in Tasmania. The mill should be commissioned in the third quarter of 2018.
First Sentinel (FSBN) has invested in AIM-quoted Amur Minerals and unquoted Titan FM Ltd in April. An investment of $250,000 has been made in the form of a contribution to a $10m loan facility made available to Amur. Titan FM is an acquisition vehicle in the facilities management sector with a focus on areas covered by strict regulation. The £50,000 pre-IPO investment helped to finance the first acquisition of a provider of air conditioning and refrigeration services. Two more acquisitions are planned this year as is a quotation on NEX. The latest tranche of First Sentinel bonds has raised a further £1m.
Valiant Investments (VALP) reported a flat full year loss of £216,000 and this would have been higher if there had not been a swing from a £3,000 loss on listed investment movements to a £25,000 gain. Valiant has invested some of its cash in five AIM-quoted, dividend paying companies. Valiant had a NAV of £197,000.
Sandal (SAND) has appointed David Munting as finance director and Richard Green as a non-executive.
AIM
Minds + Machines (MMX) swung from loss to profit in 2017 and it is acquiring four top level domains. Minds + Machines is paying $10m in cash and $31m in shares in two tranches for the membership interests of Florida-based ICM Registry, which owns .xxx, .sex, .adult and .porn. In 2017, revenues were $7.27m (78% recurring) and net income was $3.5m. The recurring nature of the revenues and the reduced dependence on China should help the group to start paying dividends in the next couple of years. Multinational brands buy related domain names with these suffixes so that nobody else can. This helps to boost recurring revenues. Not all of the other purchasers are sex-related, either. The main uncertainty concerns whether the group will get a lower rating because of the association with sex-related businesses.
Sanderson Group (SND) says that its interim results are slightly ahead of expectations and the positive momentum is continuing. The enterprise software supplier’s operating profit has increased from £1.55m to £2m. Two-thirds of the improvement has come from recent acquisition Anisa and the rest is organic.
DX (Group) (DX.) has raised £4.76m at 8.5p a share, which is much higher than the indicated minimum price of 7.41p that is being used to capitalise the company’s loan notes. These additional shares will heavily dilute existing shareholders. The cash will be used to restructure the parcel delivery networks, open new depots and finance IT investment.
Wynnstay Group (WYN) is acquiring eight country stores previously operated by Countrywide Farmers, which has gone into administration. Five of the stores take Wynnstay into Devon and Cornwall. The stores have annual sales of £16.4m.
Berkeley Energia (BKY) has announced plans to move to the standard list and the Spanish Stock Exchanges in Madrid, Barcelona, Valencia and Bilbao. The admissions should happen by the end of May. No money will be raised because the cash injected by the Oman sovereign wealth fund covers the upfront capital costs of developing the Salamanca project in Spain.
A combination of lower costs and higher iodine prices meant that Iofina (IOF) reduced its underlying loss from $5.4m to $3.4m in 2017. There was also a $5.3m impairment charge. There was a cash inflow before working capital movements. The new IO#7 plant started up in February and there could be another plant in the next year. Iofina is on course to be profitable in 2019.
Sinclair Pharma (SPH) has secured a €23m loan facility. This will replace bank debt and help to finance the aesthetics company’s new strategy in the US following the decision to terminate the Silhouette InstaLift distribution agreement with Thermi when reorder rates were disappointing. Negotiations are ongoing with potential distribution partners in the US. There was growth in other markets, including Brazil, and the 2017 loss was lower.
Pelatro (PTRO) provides precision marketing services to telecoms companies that helps them to retain subscribers and generate more income from each of them. Maiden results for Pelatro show a jump in underlying profit to $1.8m but the trade receivables are the most significant number in the accounts. Despite the profit there was a small cash outflow after tax payments. That is because trade receivables were $1.78m and $756,000 of that figure is for more than 121 days. That is because the company used extended payment terms to help to attract a customer. There is $3.1m in the bank so Pelatro has the cash to finance additional working capital for that and future deals. It is best to keep an eye on the trade receivables.
Rose Petroleum (ROSE) has raised £1m at 3.25p a share. The cash will be used to finance progress with the Paradox project towards being drill-ready. There are also other partnership and investment opportunities in the region.
Gloo Networks (GLOO) cannot find a suitable acquisition and it is winding itself up. Shareholders should receive at least 47p a share. The original placing price was 120p, so three-fifths of the cash has gone in less than three years without doing a deal.
Braime (TF and JH) (BMTO) reported a jump in pre-tax profit from £1.3m to £2.2m in 2017. The total dividend has been increased from 9.3p a share to 10.2p a share. Pressings profit was flat and the improvement came from the materials handling division.
Safestyle UK (SFE) says Steve Bermingham will retire as chief executive at the end of this year and he is being replaced by Mike Gallacher, who until recently ran First Milk, the farmer-owned milk business, which he restructured.
Trading in Green and Smart Holdings (GSH) shares was suspended because it did not publish its 2016-17 accounts by the end of March. The audit was expected to be completed by the end of April, but it is still going on and the accounts are not expected before June. Discussions continue with a potential investor.
MAIN MARKET
Stem cell services provider WideCells Group (WDC) is running out of cash and has not been able to publish its 2017 accounts so trading in the shares has been suspended. Directors have loaned the company a further £115,000, on top of a previous £100,000. At the end of June 2017, there was cash of £869,000 and debt of £634,000. That was before any of the director loans. It appears that management has taken too long to sort out the funding it requires and the potential share issue, if it is arranged, could be significantly dilutive.
Nanoco (NANO) has launched Nanoco 2D Materials Ltd in order to develop nanomaterials. The University of Manchester has invested £400,000 via a convertible.
Symphony International Holdings (SIHL) is paying an ordinary and special dividend of 12 cents in total. That will cost $71.5m. The Asian healthcare and hospitality businesses investor has sold investments and realised gains have helped to fund the payment.
St Ives (SIV) has completely exited book printing with the sale of Clays for £20m. The pension liabilities will stay with St Ives and it will contribute £2.5m to the pension fund. Net debt was £42.2m on 2 February 2018.
Trading in Sealand Capital (SCGL) shares has been suspended because it could not publish its 2017 accounts by the end of April.
Small Cap Awards (14 June, Montcalm Hotel, Marble Arch, London) Nominees
IPO of the Year
Alpha FX Group
Appscatter Group
Boku
Keystone Law Group PLC
K3 Capital Group
Rainbow Rare Earths Ltd
Ramsdens Holdings
Xpediator
Company of the Year
Bilby
Bioventix
Faron Pharmaceuticals
Frontier Developments
LoopUp Group
Nostra Terra Oil and Gas Company
TMT Investments
Water Intelligence
Wey Education
ZOO Digital Group
NEX Exchange Company of the Year
Chapel Down
Crossword CyberSecurity
Field Systems Designs
KR1
National Milk Records
Sandal
Daniel Thwaites
Walls & Futures
Executive Director of the Year
Zillah Byng-Thorne (CEO) and Penny Ladkin-Brand (CFO) – Future plc
Dr. Stuart Green, CEO – Zoo Digital Group PLC
Chris Gurry, Group Managing Director – CML MicroSystems PLC
Tom Ilube, CEO – Crossword Cybersecurity PLC
Dr Markku Jalkanen, CEO – Faron Pharmaceuticals
Bobby Kalar, CEO – Yu Group PLC
Dr. James Millen, CEO – Physiomics PLC
Ian Simm, CEO – Impax Asset Management Group PLC
Frazer Thompson, CEO – Chapel Down Group PLC
Andrew Wass, CEO – Gear4Music Holdings PLC
Impact Company of the Year Sponsored by Impact Investment Network
Ashley House
HaloSource
Walls & Future
Fintech Company of the Year
FairFX Group
FreeAgent Holdings
Proactis Holdings
ULS Technology
Transaction of the Year
Proactis Holdings PLC – Acquisition of Perfect Commerce
Work Group PLC / Gordon Dadds Group PLC – Reverse takeover
Atlantis Resources Limited – Uksmouth power stations deal (SUSPENDED)
Frontier IP Group PLC – Transactions FairFX Group PLC – Acquisition of CardOne
7digital Group PLC – Acquisition of 24-7
Impax Asset Management Group PLC – Acquisition of Pax World Management LLC
Analyst of the Year
Vadim Alexandre, Head of Research – Northland Capital Partners
Kevin Ashton, TMT Analyst – Cantor Fitzgerald
Eric Burns, Deputy Head of Institutional Research – WH Ireland Limited
David Johnson, Research Director – Allenby Capital Limited
Rob Sanders, Head of Growth Companies Research – Stockdale Securities Limited
Simon Strong, Head of Research Growth Companies – Cenkos Securities PLC
Journalist of the Year
Smit Berry – Small Company Sharewatch
Joanne Hart – Midas
Jamie Nimmo – Mail on Sunday
Paul Scott – Stockopedia
Mark Shapland – Evening Standard
Merryn Somerset Webb – Financial Times
Simon Thompson – Investors Chronicle
Fund Manager of the Year
Daniel Nickols – Old Mutual UK Smaller Companies
James Thorne – Threadneedle UK Smaller Companies
Nick Williamson – Old Mutual UK Smaller Companies
James Zimmerman – Jupiter UK Smaller Companies
Microcap Fund Manager of the Year
Guy Feld – Cannaccord (Hargreave Hale Limited)
David Horner – Chelverton Small Companies Dividend Trust PLC
Judith MacKenzie – Downing LLP
Katie Potts – Herald Investment Management
Gervais Williams – Miton Group PLC
Lifetime Achievement Award To be announced on the evening
Special Services to Small Caps To be announced on the evening.
Andrew Hore