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Quoted Micro 3 October 2022
AQUIS STOCK EXCHANGE
Kent brewer Shepherd Neame (LON: SHEP) returned to profit in the year to June 2022. The total dividend is 18.5p a share. Net assets increased from 1140p a share to 1194p a share, while net debt is back to pre-pandemic levels at £75.3m. Pubs and hotel revenues are still lower than in 2018-19. Beer volumes have more than recovered, although own beer volumes are 8% lower than three years ago. In the 13 weeks to 24 September 2022, like-for-like retail sales are 9% ahead, while own beer volumes were 1.2% higher – including a 14% improvement in own beer volumes.
Property investor Ace Liberty and Stone (ALSP) increased pre-tax profit by 49% to £2.07m in the year to April 2022. Net assets are 6% higher at £34m. Net debt has reduced from £54.8m to £44.6m. A dividend of 3.4p a share has been announced that will cost £2m.
VSA has downgraded its forecasts for battery storage technology developer Invinity Energy Systems (IES) following interim figures. First half revenues were £1.4m and the order book is worth £13m – mainly relating to the second half. However, 2022 revenues were downgraded from £14.1m to £11m. Next year’s revenues have been upgraded from £20.6m to £23.7m. Cash is likely to run out later next year.
All Things Considered (ATC) investee company Driift has acquired interactive live streaming events platform Dreamstage, which has been used by Driift for its own events. Deezer will invest a further £4m into the combined business. Music management business All Things Considered increased interim revenues by 19% to £6m and the loss was reduced. Net cash is £1.5m. A full year loss is expected compared with previous expectations of a £600,000 profit.
Wine maker Chapel Down Group (CDGP) increased interim revenues by 4% to £6.88m. Sparkling wine revenues were 35% higher. Pre-tax profit improved by 6% to £489,000. The company started harvesting in August and a strong yield is anticipated.
KR1 (KR1) is not immune to the decline in values of digital assets. The value of intangible assets fell by £155.5m in the period, which more than offset realised gains of £2.5m and income of £16.6m. Net assets have declined by nearly three-quarters and NAV is 30.6p a share.
St Mark Homes (SMAP) reported an increased interim loss and NAV fell from 120p a share to 116p a share. As current projects complete management will consider paying a dividend.
Coinsilium (LON: COIN) reported a net fair value gain on financial assets of £163,000 in the first half of 2022. However, the value of cryptocurrency assets has declined. Net assets have fallen from £5.84m to £4.57m.
ProBiotix Health (PBX) generated sales of £306,000, down £537,000 in the first half of 2022. Orders worth £1.12m have been received since the beginning of the year, so the second half revenues should be stronger, as well as higher than last year.
In the six months to June 2022, the value of the equity stakes held by Cadence Minerals (KDNC) fell from £12m to £5.75m. The main decline was in the value of the stake in AIM-quoted European Metals Holdings. There was £1.99m in the bank at the end of the period.
NFT Investments (NFT) has been hit by a reduction in the value of cryptocurrency, particularly Bitcoin. That means that NAV has fallen to £30.1m, including £20.4m in cash. There was a revaluation reduction of £265,000, but that was offset by exchange gains of £362,000, leaving the value of investments at £6.47m. At 0.91p, down 4.21% on the week, the share price is less than one-third of the NAV of 3p a share.
Thixotropic gels manufacturer Unigel Group (UNX) joined the Access segment of the Aquis Stock Exchange in August. There was £800,000 raised at 64p a share. The gels are used in the fibre optic industry. A maiden trading statement says that interim pre-tax profit was 94% ahead at £940,000. New products and higher selling prices boosted revenues and current trading is described as robust.
Clean Invest Africa (CIA) was the worst performer on the Aquis Stock Exchange last week. Loan notes have been converted into shares helping the company turn net liabilities into net assets of £1.72m at the end of June 2022. The company’s CoalTech technology is proven in palletising coal fines or coal waste and management believes that other materials could be palletised.
Hydrogen Utopia International (HUI) had £3.2m left in the bank at the end of June 2022. There were no revenues in the first half. There was progress with waste plastic to energy project developments.
Wishbone Gold (WSBN) had £2.38m in the bank at the end of June 2022. Drilling has commenced in Western Australia and Queensland in recent months.
Screwless spinal stabilisation systems developer TruSpine Technologies (TSP) had £3,471 in cash at the end of March 2022. There was a £390,000 cash outflow from operating activities and £1m of development spending capitalised. TruSpine subsequently entered into a funding agreement with Proffitt Brothers and $100,000 has been received.
Helium Ventures (HEV) is considering widening its investment strategy because of the lack of suitable helium investments. If a suitable acquisition is identified, then shareholders would be asked for their approval.
AIM
Investment in the medical imaging business is holding back short-term profit at engineer Avingtrans (AVG). In the year to May 2022, revenues were 2% ahead at 3100.4m and pre-tax profit rose from £7.6m to £8.3m. Demand from the nuclear sector is growing, but profit growth this year will be modest because of additional medical imaging costs. Net cash was £16.7m at the end of May 2022.
Online building and maintenance products retailer CMO Holdings (CMO) has been hit by softening demand for its products. There was still like-for-like revenue growth in first half of 2022, although Total Tiles sales fell because of tough comparatives. Even if the market gets tougher, there is still potential for growth because of the low share of online sales in the building materials sector.
Crownpeak Holdings is making an agreed 30p a share cash bid for omnichannel retail merchandising software provider Attraqt Group (ATQT). The plan is to combine Attraqt’s merchandising technology the Digital Experience Platform owned by Crownpeak. The share price has not been as high as the bid price since May, and it reached its all-time low of 17.5p prior to the bid.
Sustainable biopesticides developer Eden Research (EDEN) has obtained US EPA approval for its three active ingredients and two formulated products. Mevalone (a biofungicide) and Cedroz (a nematicide) sales should start next year via existing distribution partners. State approvals are required before launching in an individual state. Eden Research reduced its interim loss, but cash is still flowing out of the business. There was a cash outflow of £1.9m in the first half, including capitalised development costs and £1.85m was in the bank at the end of June 2020. R&D tax credits will help to replenish cash, but more will be required in the near future if Eden Research is going to take full advantage of the EPA approval.
Xeros Technology (XSG) has signed a joint development agreement with a global domestic washing machine component manufacturer for its XFilter microfibre filtration technology. A full licence dela could be agreed in six months. A placing raised £6m at 5p a share and a six-for-seven open offer could raise up to £1m more. In March 2021, a placing and open offer at 240p a share raised £9m. There was £2.6m of cash at the end of August 2022 and the cash outflow is £500.000 a month.
Digital transformation services TPXimpact (TPX) had a management overhaul last week because trading has been below expectations and there were complications with the integration of the businesses acquired. Chief executive Neal Gandhi and finance director Oliver Rigby. Bjorn Conway is the new chief executive. The order book is increasing in value, but revenue expectations have been cut from £97.4m to £90m. Operating costs are rising. and profit expectations have nearly halved.
musicMagpie (MMAG) has been hit be weak consumer spending with lower sales of technology. Rental income from pre-owned mobiles is growing, though, and that is good for longer-term revenues. The original pre-owned books and music operations are trading as expected. The second half should still be better than the first half, although a full year pre-tax loss is forecast on flat revenues. A small profit is forecast for 2023. Net debt is expected to be £8m at the end of the year.
Structural steel supplier Billington (BILN) increased interim revenues by 22% to £46.2m with nearly doubled pre-tax profit of £1.47m. finnCap has increased its 2022 earnings forecast by one-third to 26.4p a share.
Employee benefits services and insurance provider Personal Group (PGH) has increased revenues by 6%, but profit has declined due to higher insurance claims costs and investment in sales. The benefits of the investment will show through next year and insurance revenues will also recover.
MAIN MARKET
Shell company Milton Capital (MII) intends to float on the Main Market in the coming week. There will be £1m raised at 1p a share and the investors will get two warrants for each share and they are exercisable at 1.5p a share. Total flotation costs are capped at £50,000 and the first year’s operating costs will also be £50,000. The directors will not take salaries. Instead, they will receive a success fee on the completion of a reverse takeover. The initial focus is the technology sector.
Vehicle and property bridging loans both grew in the first half at S&U (SUS) and total net receivables were £370m at the end of July. Credit quality remains high. Pre-tax profit was 5% ahead at £20.9m. The first interim dividend was raised from 33p a share to 35p a share.
Rockwood Strategic (RKW) has transferred from AIM to the Main Market. Rockwood Strategic management believes that there are plenty of undervalued smaller companies that it can invest in and help to grow.
Hawkwing (HNG) is keeping up with the traditions of its previous incarnation TLA Worldwide and published its interim figures after the market closed at the end of the week. The standard list shell had cash of £2.03m at the end of June 2022. There are also more than £16m of convertible loan notes. It has loaned Internet Fusion Group £13.7m and plans a reverse takeover.
Andrew Hore
Andrew Hore – Quoted Micro 2 March 2020
NEX EXCHANGE
Incanthera (INC) raised £1.21m at 9.5p a share prior to joining NEX on 28 February. The price at the end of the first day of dealings was 10.5p (9.5p/11.5p). There were no trades. Incanthera is developing Sol, a topical product for the treatment of solar keratosis and prevention of skin cancer, which could be licenced to a partner within 18 months.
Mechanical and electrical installation services provider Field System Designs Holdings (FSD) continued to be hit by problems with its energy from waste customer in the first half. Revenues dipped from £11.8m to £11.5m, but it went from profit to loss due to litigation costs. The water sector is the main focus of the company. The new AMP7 water investment period starts in April. There was cash of £4.38m at the end of November 2019. The NAV was £3.28m compared with a market capitalisation of £2.4m.
Employee-owned business finance provider Capital for Colleagues (CFCP) broadly maintained its NAV at 43.44p a share at the end of August 2019. A £800,000 investment valuation gain plus a £126,000 write back of provisions was offset by loan impairments of £908,000. Management believes that several investee companies will have encouraging developments this year.
Ashley House (ASH) has decided to withdraw from NEX on 26 March and maintain its AIM quotation. Cash remains in short supply due to the failure to receive more than £1m owed by two debtors. More cash needs to be raised. Non-core assets could be sold. There are good prospects for the business. Three memoranda of understanding / framework agreements have been signed with institutions. There is a pipeline of nine potential affordable housing schemes, four of which have planning permission.
AfriAg Global (AFRI) says it intends to bid for the rest of Apollon UK, which has the right to 95% of net profit of Apollon Formularies Jamaica and the right to acquire a 49% stake in that business. AfriAg owns 2.68% of Apollon UK and is trying to satisfy regulatory requirements for the offer to go ahead.
PCG Entertainment (PCGE) had less than $24,000 left in the bank at the end of September 2019. A proposed deal fell through last year and management is considering a new strategy which could be announced in a few weeks. Trading in the shares remains suspended.
Eastinco Mining and Exploration (EM.P) has signed a joint venture agreement with Dynasty Construction, which owns 600 hectares of land in Rwanda, to explore for tin, tungsten and tantalum. Eastinco says the operation of the wash plant at the Kuaka mine has been delayed. It should be in operation by the end of April.
Dozen Savings 5% secured bonds 1 March 2020 have been withdrawn from NEX.
AIM
Netcall (NET) increased its total annual contract value by 10% to £16.6m at the end of 2019. The customer engagement software provider has been increasing the sales of its low-code products, which represent one-third of group revenues just a couple of years after the products were launched. The Liberty Connect conversational messaging platform has generated the first orders.
Fashion retailer Quiz (QUIZ) has been performing poorly almost since it joined AIM and many investors have lost patience. Fidelity sold its 5% stake, but one investor that believes it is a good time to buy the shares is Cavendish Asset Management, which has more than doubled its stake from 5.24% to 11.8%.
Redx Pharma (REDX) has terminated merger discussions with Yesod Bio-Sciences because the offer was not high enough. Redmile Group will provide up to £26.3m of funding to Redx. Redmile will subscribe for 11.5 million shares at 11.2p each, which is higher than the market price in the past six months. There will also be a £5m short-term loan and a £20m convertible loan. The share subscription will provide enough cash until April while the terms of the loans are agreed.
Cora Gold (CORA) has announced further drill results for the Sanankoro gold project in the Yanfolila gold belt in southern Mali. The results confirm significant additional mineralisation with some grades above 2g/t. There are more results to come.
finnCap is not changing its forecast for Surface Transforms (SCE) following its seven month figures. The carbon fibre brake discs developer is changing its year end from May to December. In the 17 months to December 2020, revenues of £3.3m and a loss of £1.7m are forecast.
Empire Metals (EEE) has raised £600,000 at 1p a share in order to invest in its assets in Georgia and identify other assets.
United Oil and Gas (UOG) has completed the acquisition of Egyptian oil and gas assets from Rockhopper Exploration (RKH) and it was readmitted to AIM on 28 February.
Eden Research (EDEN) is raising up to £10.6m at 6p a share via a placing and open offer. The biopesticides developer will spend the cash on gaining regulatory approval and registration for its products, as well as on further development.
AssetCo (ASTO) had cash of £17.1m at the end of September 2019 and since then a further £11m has been received. There are also bonds of £3.5m. Grant Thornton is appealing the judgement for negligence and the decision of the Court of Appeal should be made in the summer.
Billing Services Group (BILL) has completed the sale of its business and will distribute cash to shareholders by the end of March.
Mereo BioPharma (MPH) says it received positive feedback from the FDA following an end of phase 2 meeting for Setrusumab, a treatment for osteogenesis imperfecta in the young. A phase 3 study programme has been agreed.
STM Group (STM) has confirmed previous expectations for its 2019 figures which will be reported on 24 March. An underlying pre-tax profit of £2.5m is forecast.
Firestone Diamonds (FDI) wants shareholder permission to leave AIM. The general meeting is on 13 March. A weak diamond market and lower recovery levels than expected have made it difficult to finance the debt burden. Leaving AIM will reduce costs and there has been little liquidity anyway.
MAIN MARKET
Packaging supplier Macfarlane (MACF) increased its pre-tax profit by 10% to £12m. The full year dividend was raised by 7% to 2.45p a share. Both distribution and manufacturing made higher profit contributions. This year’s profitability is ahead of 2019, so far.
Personal care products supplier InnovaDerma (IDP) has a lot to do to make its full year forecast. Interim revenues increased from £3.9m to £5.4m and there was a slightly lower loss. There is £ in the bank but that could recover to more than £2m by the end of June 2020.
Chief executive George Bennett has leant $1m to Rainbow Rare Earths (RBW) to fund exploration and operations. He already has a 8.6% stake and there are warrants over 2 million shares exercisable at 4.55p each that have been issued in return for the loan, which does not have an interest charge.
Commercial aircraft leasing company Avation (AVAP) trebled its interim profit to $45.2m, including an unrealised gain of $37m on aircraft purchase rights, and the net asset value was 15% higher at $4.29 a share. This is equivalent to 325p a share. The dividend was raised by 5% to 2.1 US cents a share.
Trading in the shares of Mila Resources (MILA) has been suspended following an agreement to progress with the purchase of E-Tech Metals in a share deal. The transaction is subject to due diligence. The attraction is high grade neodymium and praseodymium mineralisation, which are important rare earths, in the Eureka rare earth project in Namibia.
BATM Advanced Communications (BVC) has won a $4m cyber contract from an existing government customer. This customer has and will generate contracted revenues of more than $18m.
Investment company London Finance and Investment (LFI) increased net assets by 7% to 63p a share at the end of 2019, although it fell to 62.6p a share by the end of January. An increase in the value of the stake in AIM quoted cake maker Finsbury Food (FIF) more than offset declines elsewhere in the six months to December 2019.
Andrew Hore
Andrew Hore – Quoted Micro 20 January 2020
NEX EXCHANGE
NQ Minerals (NQMI) generated gross revenues of A$15.5m and gross profit of A$7.4m from Hellyer gold mine in the fourth quarter. Full year revenues were A$53.9m and operating profit was A$12.2m. The profit grew steadily quarter by quarter. NQ has raised £311,000 at 7p a share. In December, £300,000 was raised at 6.5p a share.
Clean Invest Africa (CIA) says that is subsidiary Coaltech has signed a memorandum of understanding with the Uzbekistan ministry of innovation and development and Uzbekistan Railway. The coal fines project could have an initial value of $16m. A plant would be built to process coal fines into coal pellets. Coal mining is an important industry in Uzbekistan. There will be feasibility studies and the development of a business plan. This deal comes via the joint venture with Creon Investments, which is focused on Russia and former Soviet Union countries.
Ganapati (GANP) says that its Malta-based subsidiary has signed a two-year endorsement agreement with Welljam, which owns the rights to Usain Bolt’s services and image rights. Ganapati has is launching the first official Usain Bolt online slot game when the Tokyo Olympics are held during the summer. Usain Bolt will be attending the ICE London iGaming event in February. There are initial licence payments for image rights during the development of the slot game and a share of future revenues.
Ananda Developments (ANA) says that its investee company iCAN Israel-Cannabis has raised money via a convertible that places a pre-money valuation of $20m on the company. Ananda invested $200,000 in a convertible loan in August 2018 and $100,000 of the loan has been converted into 120 shares worth $200,000 at the latest valuation. DJT Plants, which is 50%-owned by Ananda, has received planning permission for the construction of a facility for cannabis plant breeding and propagation.
Property investor Ace Liberty and Stone (ALSP) reported a dip in pre-tax profit from £334,000 to £306,000 in the six months to October 2019. The NAV improved from £21.2m to £21.9m over the six month period, even though £349,000 was paid in dividends.
Imperial X (IMPP) has switched its investing strategy back from medicinal cannabis to energy-related businesses. The focus is building a royalty stream from oil and gas interests.
Mark Leigh is taking over from Claire Spencer as finance director of Newbury Racecourse (NYR).
Broadband-focused shell SAPO (SAPO) has raised £27,500 at 2.75p a share.
Diverse Income Trust has reduced its stake in TechFinancials (TECH) to below 3%.
Lawyer Gateley (GTLY) generated organic growth of 10.5% in the first half and it is on course to meet analyst expectations for the full year. The main first half growth was in the corporate and pensions businesses. The most recent acquisition will take annualised non-legal revenues to 12% of the group total. A full year pre-tax profit of £21.3m is forecast.
Regional legal business Knights Group (KGH) increased interim revenues by one-third to £32m through a combination of acquired and organic growth. Underlying earnings were 9% ahead at 5.95p a share. Net debt was £17.1m at the end of October 2019. The interim dividend was raised by 83% to 1.1p a share, although Knights was not quoted for all the comparative period. Two Birmingham-based firms have been acquired since the period end.
Legal firm Ince Group (INCE) raised £12m at 45p a share. The share price has more than halved since the beginning of the year. The January 2019 placing was at 140p a share. There are plans to raise £2m by a one-for-8.398 open offer and £2m via an offer to staff. The cash will enable the working capital facility to be reduced and finance investment in building up staff numbers. Net debt was £10.4m at the end of September 2019.
Pharmaceutical services provider Ergomed (ERGO) has acquired Ashfield Pharmacovigilance Inc for $10m and this will be earnings enhancing in 2020. The deal boosts Ergomed’s position in pharmacovigilance services and gives it a stronger position in the US. Ashfield has annual revenues of $11.6m and contracted future revenues of $9.8m.
Dekel Agri-Vision (DKL) has established a 50/50 renewable energy joint venture with Green Enesys that will operate a 36MW hybrid power (solar and biomass) project in Ivory Coast. This should reduce costs at the palm oil project in Ayenouan. There could be other potential power projects in the region. Dekel is benefiting from the recovery in the crude palm oil price. It produced 37,649 tonnes of crude palm oil in 2019, even though poor weather led to disappointing fourth quarter production. Later this year processing of cashew nuts should commence.
Biopesticides developer Eden Research (EDEN) generated revenues of £2m in 2019, down from £2.8m, and an operating loss of £1.4m. Product revenues grew even though the summer weather restricted usage of Botrytis.
Lettings agency The Property Franchise Group (TPFG) is setting up a financial services division. Acquisitions are planned and the first is a 72.25% stake in Auxilium Partnership, which is the business of newly appointed financial services director Mark Graves. This has been a source of growth for rival Belvoir (BLV).
D4T4 Solutions (D4T4) has confirmed that its second half trading is much stronger than the first half thanks to the contracts won by the Celebrus data analysis software business. The financials sector has been a productive customer base for Celebrus. D4T4 is increasingly winning SaaS business and this could hold back short-term growth, which could lead to the trimming of 2019-20 forecasts.
Instem (INS) continues to increase its recurring revenues. The pharma software company generated organic revenues growth of 12% in 2019. Pre-tax profit is expected to be £3.3m. Net cash was £5.9m. A jump in profit to £4.7m is forecast for 2020.
Estate agency Winkworth (WINK) says 2019 profit was modestly ahead of expectations and a total dividend of 7.8p a share is proposed, which is higher than forecast.
Telit Communications (TCM) did better than expected in 2019 and excluding the former automotive activities revenues grew by 8%. The internet of things technology developer is forecast to make a 2020 pre-tax profit of £20.1m.
Pharma data analytics firm Diaceutics (DXRX) generated more cash tan expected last year and made a small profit. Thee was cash of £11.7m at the end of 2019. The 2020 pre-tax profit could be £800,000.
Barkby Group (BARK) has exchanged contracts on a development site in Huntingdon, which has a gross development value of £10.7m.
Risk management software developer KRM22 (KRM) says 2019 revenues were slightly lower than expected at £4m. Delayed contracts are expected to be signed soon.
Telematics firm Quartix (QTX) managed to maintain revenues at £25.6m in 2019 and a small increase is expected in 2020. The mix of revenues has changed with fleet generating 80%, up from 73%, thanks to growth in the US and France. Insurance revenues fell as expected as low margin business was shed. Pre-tax profit is still expected to decline from £8.2m to £6.6m in 2019, with a further fall to £6.3m forecast for 2020. The dividend is expected to be reduced from 12.4p a share to 12.1p a share, although it will not be fully covered by earnings.
Base Resources (BSE) has increased production guidance for the Kwale mine with midpoints of 78,000t for rutile, 345,000t for ilmenite and 30,500t for zircon. There is a lack of supply of rutile and ilmenite, so this is good news. This should provide a strong boost to profit.
Pressure Technologies (PRES) has been fined £700,000 and will have to pay prosecution costs of £169,000 following the guilty verdict relating to a fatal accident at one of its sites in 2015. The first instalment of £215,000 is due in April with a further six equal instalments payable every six months between July 2020 and January 2023.
Oil and gas explorer and producer Empyrean Energy (EME) is raising £420,000 at 9p a share and chief executive Tom Kelly has contributed £200,000 of that cash. The placing was at a 9% premium to the market price. The cash will be spent on drilling offshore of Indonesia. There is a potential resource upgrade for the Mako gas discovery in Indonesia.
Mereo BioPharma (MPH) says that there have been positive results from the phase 2b study of Setrusumab in adults with osteogenesis imperfecta. They show that it is helping to build bone. A study with children is planned. A meeting with the FDA is due in the coming weeks. Earlier this year, Mereo signed a licence agreement for the use of Navicixizumab in ovarian cancer with Oncologie Inc. An upfront payment of $4m is due.
Nutrition provider Science in Sport (SIS) expects to report 2019 sales of £50.5m with underlying growth of nearly one-quarter. The fastest growth is outside of the UK. River and Mercantile has taken a 5.5% stake.
MAIN MARKET
Shareholders in AIM-quoted Anglo African Oil and Gas (AAOG) have agreed to the sale of 80% of its Congo subsidiary to Zenith Energy (ZEN) and it is waiting for government approval. There is a put and call option over the other 20%. If the call option is exercised Zenith will pay £1m in shares. If the production at the Tilapia oilfield averages at least 4,000 barrels of oil per day for 30 consecutive days, the put option can be exercised and Zenith would pay £2.5m in shares.
Endeavour Mining Corporation has ended its merger discussions with gold miner Centamin (CEY) blaming a lack of information. Endeavour still believes that a combination would be positive. Centamin is raising its final dividend to 6 cents a share, taking the 2019 total to 10 cents a share, up from 5.5 cents a share. Net cash was $348m at the end of 2019. The higher gold price will further boost cash generation. A new chief executive still has to be appointed.
Standard list cash shell Trident Resources (TRR) has £3.29m in cash at the end of October 2019, which is similar to NAV. Management is assessing a few mining project acquisition opportunities.
Stevia sweeteners producer PureCircle Ltd (PURE) says that shareholders owning more than 10% of the share capital have put forward three proposed directors to be voted on at the AGM on 10 February. The company is happy for Sridhar Krishnan, Lai Hock Meng, a former PureCircle director, and Oliver Maes, who was previously a PureCircle director, to be appointed to the board.
Books publisher Quarto (QRT) is raising £13.9m at 68p each. The open offer is underwritten and it will help to reduce the debt burden.
Menswear retailer and hirer Moss Bros (MOSB) Total sales were 3% lower in the 24 weeks to 11 January, but gross margin improved. Hire revenues fell by 17.7%. Cash is £12m.
OTHER MARKETS
Pallets manufacturer RM2 International (RM2) intends to move from AIM to matched bargains market Asset Match (www.assetmatch.com).
Andrew Hore
Andrew Hore – Quoted Micro 13 January 2020
NEX EXCHANGE
NQ Minerals (NQMI) says that in 2019 the Hellyer mine in Tasmania produced 24,980 tonnes of lead concentrate, 15,646 tonnes of zinc concentrate and 77,853 tonnes of pyrite concentrate. Metal recovery has improved with average lead recoveries of more than 50%. The focus will be on generating lead revenues. Additional high-grade underground resources have been acquired from Bass Metals, which was subleasing the area. The purchase includes 1.175 million tonnes of underground JORC resources.
Inqo Investments Ltd (INQO) is investing natural insecticide developer Kentegra Biotechnology. The Kenya-based company produces pyrethrum, a natural ingredient from the chrysanthemum flower for use in the home, agricultural and pharma markets. There is a shortage of supply of pyrethrum, which can only be produced in a limited number of places around the globe. There is a move away from synthetic versions of the ingredient.
Panther Metals (PALM) has completed its move to the standard list.
Black Sea Property (BSP) has raised €4.79m via a placing at 1.1 cents a share. The cash will be used for property investments. Mamferay Holdings, which is owned by majority shareholder Phoenix Capital Holdings, is swapping €1.4m of debt for shares at the same price.
Equatorial Mining and Exploration has changed its name to Eastinco Mining and Exploration (EM .P).
Wishbone Gold (WSBN) says that the 100p-for-one share consolidation will take effect on 21 January.
EPE Special Opportunities Ltd (ESO) reported a NAV of 273.9p a share for the end of 2019.
AIM
Packaging equipment supplier Mpac (MPAC) says that the 2019 profit is going to be much better than expected. The pension deficit should be eliminated by 2024.
Ultrasound simulation equipment developer Intelligent Ultrasound (MED) expects its 2019 revenues to grow to between £5.7m and £5.9m. There will be a slightly higher loss due to higher development spending. There was £7.3m in the bank at the end of 2019. The agreement signed with FUJIFILM SonoSite Inc will help sales this year in the training market.
Shield Therapeutics (STX) has licenced its Ferracru/ Accrufer iron deficiency treatment to Beijing Aosaikang Pharmaceutical for an upfront payment of $11.4m. This means that there should be net cash of £7.5m at the end of 2020. A further $11.4m payment is due when the treatment gains approval in China, following a clinical trial funded by the licensee, possibly in 2023. There could be further milestone payments of up to $40m depending on sales. Ongoing royalties on sales will be 10% or 15%,
Biopesticide products developer Eden Research (EDEN) says that its three EU-registered active ingredients have been approved for use in organic farming. A one-year exclusive agreement with Corteva Agriscience, will give the company time to evaluate Eden’s Sustaine encapsulation technology for use with seeds. Coreva could be granted exclusive distribution rights in the EU, Turkey, Russia and Ukraine.
Accrol Group (ACRL) management believes it has turned the fortunes of the toilet paper manufacturer around. Even so, it still lost £3m in the six months to October 2019. Net debt was £24.8m and this could fall to £20m by the end of April.
Telecoms services provider Maintel (MAI) has warned that public sector contracts continue to be delayed. finnCap has cut its 2019 pre-tax profit forecast from £10.4m to £8.1m, while the 2020 estimate has been reduced by one-quarter to £8.8m.
Software company CloudBuy (CBUY) wants to leave AIM and it expects to save £100,000 a year in overheads. Lyn and Ronald Duncan subsequently sold 11.1 million shares at 0.414p each. The share price has fallen but it is still 0.6p.
Promotional products software supplier Altitude Group (ALT) has signed a strategic alliance with the Advertising Speciality Institute, which will use its software platform.
Surface Transforms (SCE) expects more contract announcements with OEMs this year. In the seven months to December 2019, revenues were £1.45m, nearly treble the same period in the previous year, but lower than expected due to delays. The new financial year end is March. There was £768,000 in the bank at the end of 2019 and a further £425,000 has already been received.
Asimilar Group (ASLR) has raised £6.8m at 40p each. This will be received in two tranches. Formerly known as YOLO, the company will invest the cash big data, machine learning, telematics and internet of things businesses.
MAIN MARKET
Avation (AVAP) has started a strategic review, which could include the sale of the aircraft leasing business. Avation has 49 aircraft with an average fleet age of 3.7 years. It has also purchased a spare engine that can be leased.
InnovaDerma (IDP) grew interim revenues by 28% to £5m. This represents a slowdown in growth in the later part of the period and is slightly lower than expected. Skinny Tan was responsible for most of the growth. The second half will benefit from the launch of new skincare products in Superdrug.
Pembridge Resources (PERE) says its Minto Explorations business has received a $5.4m payment for copper concentrate produced during December. The Minto mine produced 2,247dmt of copper concentrate in the fourth quarter 2019.
BATM Advanced Communications (BVC) says that its molecular diagnostics business Ador Diagnostics has received its first commercial order from an Italian customer for meningitis testing.
Andrew Hore
Andrew Hore Quoted Micro 29 April 2019
NEX EXCHANGE
Adnams (ADB) says that beer volumes grew year-on-year in the first quarter, helped by low alcohol Ghost Ship and pubs are also doing well. Margins are coming under pressure and gin sales have been hit by increasing competition. A new IT system has gone live.
KR1 (KR1) has cashed inn some of its tokens. It has sold the remaining OmiseGo tokens for $206,000. They were bought for 27.38 cents each and sold for 205.4 cents each. KR1 has sold 50% of its tokens in the Nash Exchange product for nearly $51,000, at a more than doubled price per token, which means that the cost of the remaining 25,000 tokens have been covered.
High Growth Capital (HASH) has appointed Mark De Smedt as chief executive. He is a Belgian who previously worked for recruitment firm Adecco and already owns a 0.6% stake in High Growth Capital. He has been awarded options over 125 million shares at 1.75p each and further options over 150 million shares, which are exercisable at 3p a share, but only if the share price reaches at least 7.5p and stays there for a consecutive period of six months. Girod Equities has taken a 3.81% stake in the company, which is proposing a name change to MESH Holdings.
SG Recruitment (SGRL) has been appointed to recruit international nurses for more than 20 hospitals in England. This is under the Health Education England Global Learners Programme, which offers three year packages. Also, the Royal Berkshire NHS Foundation Trust has appointed SG to recruit 140 nurses. A contract has been gained with Thumbay Hospital in UAE to recruit at least 150 healthcare professionals each year.
Metal Tiger (MNRG) is holding a general meeting on 15 May in order to gain shareholder approval for the directors to issue new ordinary shares without the requirement to offer them to existing shareholders.
AIM
Franchise Brands (FRAN) says that Micro Rod had a record quarter in the first three months of 2019. System sales were 12.9% higher. The business to consumer franchises have also had a good start to the year.
International payments services provider FAIRFX (FFX) increased revenues by 69% to £26.1m, while pre-tax profit jumped from £900,000 to £6.79m. City Forex was acquired in February 2018 but there was like-for-like growth. In the first quarter of 2019, revenues are 43% ahead at £7m.
Tekcapital (TEK) says that investee company Salarius has secured the first commercial order for its low sodium MicroSalt from a snack food manufacturer. Investee company Belluscura has raised just over £500,000 from a crowdfunding offer, including further investment from Tekcapital. The cash will be used to market and further develop a portable oxygen concentrator called X-PLOR.
More good news from Eden Research (EDEN) as partner Eastman has received a 120 day emergency use authorisation for Cedroz, which is used to combat plant-parasitic nematodes, in Italy. This will enable sales while the Italian authorities process the application for authorisation.
Aviation services provider Gama Aviation (GMAA) has reported 2018 figures with the comparatives for 2017 restated. Pre-tax profit slumped from $16.6m to $11m. That is before more than $40m of exceptional charges, including a $27.7m impairment charge. A final dividend of 2p a share is being paid. Hutchison Capital Holdings has bought more shares to take its stake to 25.45% after a shareholding limitation was ended.
Software company WANdisco (WAND) reported a fall in revenues from $19.6m to $17m in 2018, but this was down to a change in the revenue model to subscription-based business. The loss increased from $14m to $19.4m, but this will fall sharply over the next two years as revenues grow rapidly.
ReNeuron (RENE) has positive news from the first three retinitis pigmentosa patients given its human retinal progenitor cell product. Vision has improved after 60 days and 120 days. Longer-term evidence is required, but this is a good start and three more patients are being provided with the treatment.
Kestrel has increased its stake in Pebble Beach Systems (PEB) from 23.1% to 24.2%.
Satellite communications equipment provider Global Invacom (GINV) has terminated the proposed acquisition of Tactilis and related fund raisings. The two companies will provide equal funding of the costs of the terminated deal. Group revenues were $122.3m in 2018. Electronic component shortages have eased, and pricing is normalising. Trading in Global Invacom shares resumed and the share price jumped from 4.5p to 7p.
Angling Direct (ANG) has opened its 27th store on a former Majestic Wine site in Nottingham. The fishing equipment retailer has started the new financial year strongly. Overall sales were 50.7% higher in February and March. Full year figures for the year to January 2019 will be reported on 13 May.
Piling company Van Elle (VANL) reported that its full year profit will be slightly worse than expected but the share price still bounced back from recent lows. Volumes have recovered in the fourth quarter, but full year sales are 3% below expectations. A new director of the piling division will join in June.
The microCHP boilers developer Inspirit Energy (INSP) is still developing its product and it still has to commercialise its boilers.
MAIN MARKET
Standard list shell Fandango Holdings (FHP) has ended discussions with Konnect Mobile Communications Inc because it could not raise the finance for the acquisition. Fandango has been making loans to another standard list shell, Stranger Holdings, where Charles Tatnall is also a director. There was £141,000 outstanding at the end of August 2018, plus accrued interest of £38,721, and this has been reduced to £108,000, excluding interest. There was cash of £53,000 in the balance sheet at the end of August 2018.
Zenith Energy (ZEN) chief executive Andrea Cattaneo has acquired 593,289 shares at 3.3p each, taking his stake in the Azerbaijan-focused oil and gas company to 8.46%.
Former finance director Michael Mousley has been appointed as a non-executive director of Quarto (QRT). A new finance director will join the company in July.
Andrew Hore
Andrew Hore Quoted Micro 22 April 2019
NEX EXCHANGE
IMC Exploration Group (IMCP) has published the prospectus for its move to a standard listing. No fundraising is planned to accompany the flotation. Management believes that IMC has enough working capital for 12 months. There was €152,878 in cash available at the end of January 2019. This takes account of the statutory spending on its licences.
Block Commodities (BLCC) is calling a general meeting to enable shareholders to decide whether the company should become involved in the medicinal cannabis sector.
Ananda Developments (ANA) owns 15% of LHT, the owner of hapac medicinal cannabis inhaling technology. The hapac products are being sold in Italy and the product range is being widened. Other investments are being assessed.
Ace Liberty and Stone (ALSP) has declared a second interim dividend of 0.83p a share.
Anne Yerburgh has been replaced as chairman of Daniel Thwaites (THW) by chief executive Richard Bailey, although she remains as a non-executive director in order to represent family shareholders. A replacement is being sought for former non-executive director Nick Mackenzie.
Queros Capital Partners (BFD) has raised £305,000 from the issue of 8% unsecured bonds 2025. This will be used to provide bridging finance to UK businesses.
Chris Akers has a 3.97% stake in High Growth Capital (HASH) following the purchase of the intellectual property of Malta-based BDD, a company he founded. RRNB Capital Ltd has increased its shareholding from 1.92% to 9.95%, while Fujairah has raised its stake from 2.31% to 8.59%. High Growth Capital has completed the acquisition of additional shares in AI company Sentiance to take its stake to 15%. Whitman Howard has been appointed as corporate adviser and broker.
AIM
Modern Water (MWG) reported its 2018 results at 6.19pm o the Thursday before Good Friday. Revenues increased by 18% to £4.2m and the reported loss was more than halved from £5.23m, although this included a £1.53m goodwill write off, to £2.47m. This appears to be the first time that Modern Water has slipped out results after the market has closed for the week. Let us hope that this does not become a habit. Serial offender Immunodiagnostic Systems Holdings (IDH) managed to put out its statement a bit earlier but after the close of the market. More can be found at https://ukinvestormagazine.co.uk/why-you-should-avoid-immunodiagnostic-systems-holdings/.
Enterprise software provider Sanderson (SND) says interim trading was ahead of expectations and further progress is expected in the second half. Interim revenues improved from £14.6m to £17m and underlying operating profit is one-third higher at £2.8m, which is partly due to accounting changes. Like-for-like operating profit would be one-fifth higher. Net cash was £3.29m at the end of March 2019. The order book is worth £8m. The interims will be published on 15 May.
Sheikh Ahmed Bin Dalmook Al Maktoum is investing £534,000 in MX Oil (MXO) for a 29.86% stake. He will appoint a non-executive chairman. This is part of a placing raising £680,000 at 0.04p a share. There are also 800 million warrants being issued that are exercisable at 0.04p over a five year period. Options over 10% of the enlarged share capital will be issued to management. The Aje field, where MX has a 5% investment is producing at around 3,150 barrels of oil per day and cash generated is being used to reduce project debt. The Aje field should start generating free cash in 2020 and that could move MX into profit in the first half of 2020. MX plans to consolidate 100 existing shares into one new share and change its name to ADM Energy.
Chief executive Sean Smith has bought 126,624 shares in biopesticide products developer Eden Research (EDEN) for 10.25p each. Finance director Alex Abrey has acquired 50,000 shares at 10.1p each. House broker Shore forecasts an increase in revenues from £2.8m to £3.7m in 2019, although the loss is expected to rise to £900,000. Shore expects Eden to move into profit in 2021.
PowerHouse Energy (PHE) has gained its first revenue generating contract for its DMG technology in conjunction with partner Waste2Tricity. Revenues will come from IP, design rights and licensing, followed by operational engineering.
Parity (PTY) is increasing its focus on the data analytics market and has appointed a new boss of consultancy services. Pre-tax profit halved to £850,000 in 2018 and a further decline is expected in 2019. Net debt is expected to remain at around £1m. Revenues are expected to continue to decline but there should be a greater proportion of the business coming from higher margin activities and profit is expected to bounce back to £1.5m in 2020.
Fryer and grease management services provider Filta (FLTA) increased revenues by 23% to £14.2m in 2018, while underlying pre-tax profit improved from £1.81m to £2.2m. This is before any significant contribution from the Watbio acquisition, which cost savings appear to be on course. A 2019 pre-tax profit of £3.8m is forecast.
Nektan (NKTN) is selling a 57.5% stake in Respin for £300,000 to a new purchaser because the previous deal could not be completed at a higher price due to the fact that buyer could not raise the finance. The online gaming firm says that it owes £3.6m in tax to the HMRC and it is likely to need additional cash to pay the bill.
TruFin (TRU) plans to sell its stake in unsecured consumer finance provider Zopa for £44.5m, an increase of 22% on the 2017 valuation, and investing £25m in manufacturing finance provider Distribution Finance Capital, which will be floated on AIM in early May. There should also be £10m returned to investors later this year. That will leave early payment services provider Oxygen Finance and Satago Financial Solutions, which provides working capital to small businesses.
Delayed results from consumer care products supplier Venture Life Group (VLG) show revenues 17% ahead at £18.8m and nearly all the growth came from the company’s brands. Pre-tax profit improved from £63,000 to £710,000. Net cash was £5.8m so the company has funds to make additional acquisitions.
Yourgene Health (YGEN) has raised £11.8m at 10.25p a share and that will be used to fund the £6.3m cash payment for molecular diagnostics developer Elucigene, which will cost £9.2m in cash and shares.
Managed services provider Redcentric (RCN) says net debt was £17.6m at the end of March 2019, compared with estimates of £20.2m. Pre-tax profit is expected to rise from £8m to £8.7m.
D4T4 Solutions (D4T4) has announced that its 2018-19 results will be ahead of expectations. This led to a pre-tax profit upgrade from £5.7m to £5.8m, but earnings per share were upgraded from 12.1p to 13.3p due to a low tax rate.
Evgen Pharma (EVG) has raised £5m through a placing at 13p a share. The cash will boost the balance sheet while management undertakes partnership discussions and additional work on SFX-01. The phase IIb data for SFX-01 in subarachnoid haemorrhage is expected in the third quarter of 2019.
Directa Plus (DCTA) doubled its total income to €2.5m in 2018. The graphene-based products developer has net cash of €5.2m, following a €3m outflow from operations.
Ariana Resources (AAU) says that the Kiziltepe gold mine produced 7,296 ounces of gold in the first quarter of 2019. That was lower than the fourth quarter of 2018, but it is ahead of the average annualised quarterly guidance.
IG Design (IGR) is set for 10% organic sales growth in the year to March 2019 and total revenues rising from £327.5m to £447m. Pre-tax profit is expected to grow from £21.4m to £29.5m. There could be further merger benefits to come from the Impact Innovations acquisition.
Europa Oil and Gas (EOG) is selling its 20% stake in PEDL143 in the Weald Basin to UK Oil and Gas (UKOG) for £300,000.
MAIN MARKET
Plastics and panels supplier Tex Holdings (TXH) made a small loss in 2018 following accounting changes to the recognition of revenues and there is no final dividend. Trading levels were lower in the second half. Tex is in breach of some of its bank loan covenants. The major shareholder continues to support the group. The share price fell by more than one-quarter.
Electronic products distributor DiscoverIE (DSCV) is on course to improve its full year pre-tax profit from £21.8m to £27.7m. The group has raised £29m at 400p a share in order to finance the acquisitions of US-based transformers and magnetic components manufacturer Hobart Electronics and UK-based rugged and submersible sensors manufacturer Positek. The total initial consideration is £15.9m.
Fasteners supplier Trifast (TRI) says full year profit is slightly better than expected even though demand from China has been reduced due to tariff wars with the US. Net debt was £15m at the end of March 2019 and it has agreed a new four-year bank facility of £80m. This could be used for acquisitions.
Argo Blockchain (ARB) has set the date for its requisitioned general meeting, which will be held on 16 May. The requisition came from an entity owning 13.8% that is controlled by Frank Timis, who does not believe that the company will provide a satisfactory return to shareholders with its current cryptomining strategy. The plan is to remove Jonathan Bixby and Mike Edwards as directors and appoint another director. Argo has more cash than its market capitalisation. Cash operating costs have been reduced to £280,000, compared with £500,000 of potential revenues expected in May.
Kazakhstan-focused vanadium miner Ferro-Alloy Resources (FAR) is already spending the money it raised when it gained a standard listing last month. Equipment, a mobile crane and vehicles have been acquired. The design of the extension to the existing facilities and for the connection to the high voltage power line has been completed. The share price has almost halved from the placing price of 70p to 37.37p. More background information can be found at https://ukinvestormagazine.co.uk/ferro-alloy-resources-goes-to-discount-on-first-day/.
BATM (BVC) has won an initial $2m armed forces contract for cyber security and this lasts 18 months.
Emmerson (EML) has signed heads of agreement for an offtake agreement for 100% of the production from the Khemisset potash project.
Andrew Hore