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Quoted Micro 25 March 2024
AQUIS STOCK EXCHANGE
S-Ventures (SVEN) has agreed to sell its food and snacks business in return for shares in AIM-quoted RiverFort Global Opportunities worth £3.5m. That would leave S-Ventures as an investment company with shares in the acquirer. Sales for the 12 months to September 2023 were £17.4m, rising to the £21.6m in the 15 months to the end of 2023. Net debt was £7.1m at the end of September 2023. An additional £3m of loans have been agreed, including £1m from RiverFort Global Opportunities.
Marula Mining (MARU) has signed a long-term offtake agreement with Fujax UK for the Blesberg lithium and tantalum mine in South Africa. This an agreement for 100% of production until the end of 2026, with a minimum of 50,000 tonnes at a grade of 6% lithium. There is an option for a further three years. A mining right has been received from the authorities for the plans to expand the stockpile reprocessing operations.
Brewer Shepherd Neame (SHEP) improved like-for-like retail sales by 6.2%, although beer volumes fell 10.5% with own beer volumes down 16.7%. Overall, interim revenues grew 4% to £89m and underlying pre-tax profit was 10% ahead at £3.8m. The brewing division returned to profit. The interim dividend was 5% ahead at 4.2p/share. Beer volumes continue to decline, while the retail sales growth rate has slowed.
Gunsynd (GUN) shares rose 17.9% to 0.165p on the back of an institutional investor investing $1m ($750,000 in cash and $250,000 in support services) in the US spirits subsidiary of Rogue Baron (SHNJ), where it currently has a 17.45% stake. Rogue Baron has also raised £20,000 at 0.5p/share.
Aquis Stock Exchange owner Aquis Exchange (AQX) increased revenues from £19.9m to £23.7m, while pre-tax profit rose from £4.5m to £5.2m. The Aquis Stock Exchange revenues improved from £1.6m to £1.8m. The main growth came from technologies and data. Panmure Gordon forecasts 2024 pre-tax profit of £6.2m.
Macaulay Capital (MCAP) reported a fall in net assets from £1.44m to £1.36m at the end of 2023. There was an exit from the investment in Qualification Check which reduced the reported loss. There are seven portfolio companies. There is a pipeline of potential transactions.
Cadence Minerals (KDNC) says that the capital spending optimisation programme has been completed at the Amapa iron ore project. Savings of $63.2m have been identified and production could be 5% higher at 5.5 Mtpa of iron ore concentrate.
Supernova Digital Assets (SOL) has completed the acquisition of Hyperslot PTE for £225,000 in shares at 0.15p each. Andrew Offit increased his shareholding from 14.1% to 15.2%.
Arsen Torosian has replaced David Carr as chief executive of Tap Global Group (TAP). He is the largest shareholder and was previously chief strategy director. Steven Borg will become finance director.
KR1 (KR1) has invested $600,000 in Moondance Labs, which is building Tanssi, which helps appchain deployment.
Substrate Artificial Intelligence (SAI) has signed up FINRA-registered California-based bank GT Securities to identify potential partners for its Subgen AI subsidiary, which has launched Serenity Star, an ecosystem for scaling generative AI. The company has raised Euro500,000 from a convertible bond issue.
Secured Property Developments (SPD) is changing its name to Mollyroe and it is adopting s new investment strategy focused on the technology sector. There will also be a 20-for-one share consolidation.
Steve Hutchinson has taken his Oscillate (MUSH) stake above 3%. TruSpine Technologies (TSP) chairman Geoffrey Miller has increased his shareholding to 7.24%, while Oberon Investments raised its stake to 12.6%.
Good Life Plus (GDLF) has appointed Tennyson Securities as corporate broker.
AIM
Capital equipment manufacturer Mpac (MPAC) had a stronger second half and revenues improved from £98m to £114m, while pre-tax profit recovered from £3.5m to £7.1m. There was growth in parts and services revenues. The order book was worth £72.5m at the end of the year. The customer base is being broadened. There should be further recovery this year.
Educational software and services provider Tribal Group (TRB) is still hampered by its dispute with NTU, which is currently in mediation. The failed bid for the company also held back sales to potential clients. Even so, annualised recurring revenues grew 13% to £15.1m. Full year revenues moved from £83.6m to £85.8m, while pre-tax profit recovered from £3.7m to £10.7m.
Roadside Real Estate (ROAD) shares soared 129% to 8p after it sold part of its stake in Cambridge Sleep Sciences to CGV Ventures 1 for £6m. The total stake cost £2.7m and Roadside Real Estate still owns 65%, having sold a 10% stake, so it still has to be consolidated. Management is considering selling the rest or demerging the company so that it can concentrate on its core property interests.
Digital media company XLMedia (XLM) is selling European and Canadian gaming assets to Gambling.com for an initial $37.5m with potential deferred consideration of $5m. Some of this cash may be paid out to shareholders. These assets generated 2023 revenues $21.4m and underlying EBITDA of $6.6m out of estimated group 2023 revenues of $50m and EBITDA of $12m. Pro forma net cash is likely to be around $35m, after taking account of deferred consideration of $4m payable for past acquisitions. Cavendish estimates that XL Media is worth £48m, including the cash.
Biodegradable and antimicrobial plastic additives developer Symphony Environmental Technologies (SYM) has raised £1.4m at 3.5p/share and will raise up to £500,000 more through a PrimaryBid retail offer. The issue price was well above the market price. Chief executive Michael Laurier is subscribing £105,000. Net debt was £740,000 at the end of February. The additional cash will fund the scale-up of the business and provide working capital during trials by potential customers.
Blue Star Capital (BLU) reported a slump in NAV from £11.4m to £5.33m at the end of 2023. That includes cash of £63,000. Writing down the valuations of Dynasty Media & Gaming and Sthaler were a large part of the decline in NAV. Another investee company, SatoshiPay, is undertaking a formal sales process. This stake is valued at £4.65m.
Live Company Group (LVCG) returned from suspension following the announcement of a planned refinancing and sale of majority interest in StartArt. Creditors are being settled in shares and a £1.77m convertible loan provided by the chairman, as well as converting some of his loan notes. A placing raised £352,000 at 1p/share. There could be more cash to come from strategic investors.
Digital payments business Boku (BOKU) increased 2023 revenues by 30% to $82.7m and they are expected to increase to $95m this year. The wallets business grew 153%, albeit from a lower base. The local payments network is being built up and will be a major factor in growth, especially as margins are better. The direct carrier billings business continues to grow and remains the main generator revenues for the time being. The company has more than $70m in cash.
Employee benefits and insurance provider Personal Group Holdings (PGH) reported slightly better 2023 figures than expected with revenues of £49.7m and pre-tax profit recovering to £5.9m. The dividend was raised from 10.6p/share to 11.7p/share. That is well covered by cash generation. Cash was £20.1m at the end of 2023. The insurance business did particularly well.
Three rail clients delaying orders has hit prospects for LPA Group (LPA) and it is unlikely to do any better than breakeven this year – a pre-tax profit of £800,000 was previously forecast on a 6% reduction in forecast revenues.
Light Science Technologies (LST) has received a grant worth £188,000 for a project involving the company’s SensorGROW technology.
Saturn Resources has increased its bid for Shanta Gold (SHG) to 14.85p/share, up from 13.5p/share, valuing the miner at £156.1m. Eligible shareholders will receive a dividend of 0.15p/share on 26 April.
Stem cell-based treatments developer ReNeuron (RENE) has failed to come to an agreement with creditors and the financial uncertain means that it has appointed administrators from Cork Gully. Negotiations continue with creditors and potential providers of finance.
MAIN MARKET
Higher losses from the ReZorce recyclable packaging business masked progress at foams manufacturer Zotefoams (ZTF), where pre-tax profit moved up from £12.5m to £13.1m on flat revenues. That included an operating loss of £4.36m, up from £1.89m, from the MuCell Extrusion division that includes ReZorce. The total dividend is 7.18p/share.
Property investor Town Centre Securities (LSE: TOWN) managed to edge up its net tangible asset value to 286p/share at the end of 2023, due to the 150p/share tender offer last year. There was a 4% decline in property values. Loan to value has risen to 50.3%. The interim dividend is maintained at 2.5p/share.
TheWorks.co.uk (WRKS) is moving from the Main Market to AIM. The plan is to gain shareholder approval to move on 3 May. This should help to reduce costs.
Esken Ltd (ESKN) has appointed administrators from AlixPartners because its restructuring plan was no longer commercially viable. The restructuring of London Southend Airport will continue.
First Tin (1SN) says regional exploration confirmed upside potential at Pound Flat and Battery Hill prospects in the Taronga tin project.
Andrew Hore
Quoted Micro 6 November 2023
AQUIS STOCK EXCHANGE
Cadence Minerals (KDNC) says that the 36.2%-owned joint venture that owns the Amapa iron ore project in Brazil has signed a memorandum of understanding with Sinoma Tianjin Cement Industry Design, which will provide a final proposal to complete a definitive feasibility study for the project and then submit a fixed price contract to construct the project. It will also attempt to obtain the financing required. Chief executive Kiran Morzaria bought 100,806 shares at 7.4p each.
Adsure Services (LON: ADS) joined the Access segment on 30 October. It did not raise any additional money and was valued at £4.76m at the introduction price of 45p. Fareham-based Adsure Services acquired TIAA in September. It is a specialist business assurance provider that has been operating for two decades. In the year to March 2023, TIAA revenues improved from £8.82m to £9m, while pre-tax profit dipped from £580,000 to £274,000. That is due to higher overheads. TIAA had £1.86m in the bank and net cash of £1.15m. Dividends have been paid by TIAA and the equivalent last year was 1.35p/share.
Substrate Artificial Intelligence (SAI.B) has agreed the acquisition of 70% of BINIT and DELTANOVA for €5.4m and €600,000 respectively, which is payable in shares. They are software development consultancy businesses, and the share issue has to be approved by shareholders.
CBD products supplier Voyager Life (VOY) expects interim revenues to be more than £165,000 and a gross margin of 43%. The manufacturing division is receiving more enquiries. The government has accepted recommendations for standardised cannabinoid testing and there could be a relaxation of the maximum cannabinoid content of products.
Helium Ventures (HEV) had nearly £65,000 in cash at the end of April 2023, plus interests in Blue Star Helium and Trackimo.
Semper Fortis Esports (SEMP) had cash of £160,000 at the end of July 2023. Management is still assessing a potential reverse takeover of GL Membership.
ChallengerX (CXS) generated cash from operations in the quarter to September 2023, although there was an overall outflow of £47,000, leaving £1,000 in the bank. More cash will be required to develop the FlashBet Wheel App.
Wishbone Gold (WSBN) has confirmed the mineralised base metal system at Cottesloe in the Paterson Range, Western Australia. There is copper, zinc, silver, lead and cobalt. This is before the drilling has hit the target mineralisation zone.
KR1 (KR1) holds an allocation of 7.5 million TIA – the digital asset of Celestia – KR1 plans to start staking activities on the Celestia network. At the end of September 2023, NAV was 45.11p/share.
TruSpine Technologies (TSP) says that the FDA 510(k) application for Cervi-LOK has oved to the substantive review stage.
Fuel additives developer SulNOx Group (SNOX) generated second quarter revenues of nearly £54,000, which was lower than the previous year. There was £562,000 in the bank and a further £700,000 has been raised since then.
Ananda Developments (ANA) has signed a MOU with Nottingham Trent University to pursue grant funding for the medicinal cannabis breeding programme. The intention is to develop a formal strategic partnership.
IamFire (FIRE) had cash of £149,000 at the end of April 2023, following a £768,000 cash outflow from operations. Investee company WeShop is making good progress. However, there is material uncertainty as a going concern and more cash is required or bond terms will need to be renegotiated.
NFT technology company Looking Glass Labs (LON: NFTX) had net assets of C$837,000 at the end of July 2023.
Arbuthnot Banking (ARBB) non-exec directors Jayne Almond bought 3,000 shares at an average price of 912.5p each. Shepherd Neame (SHEP) director George Barnes bought 1,000 shares at 735p each. Marula Mining (MARU) chief executive Jason Brewer has exercised 400,000 warrants at 4p each.
BWA Group (BWAP) is raising up to £900,000 at 0.5p/share with one warrant for every two shares exercisable at 0.6p each up until October 2024 and 0.75p after that up until October 2026. The cash will be used for exploration at two heavy mineral sands claim areas.
Mental health treatments developer Mydecine Innovations Group (MYIG) says that it is filing a prospectus supplement so that it can issue 7.36 million shares at 15 cents/share to raise $1.1m.
AIM
Product management software supplier Sopheon (SPE) has received a bid approach from IOps Buyer Inc, which is a subsidiary of Wellspring Worldwide Inc. The two companies have agreed in principle to a 1000p/share bid. Due diligence has been completed and discussions are advanced. Chicago-based Wellspring Worldwide provides software and data systems for managing technology transfer and intellectual property.
Velocys (VLS) is the worst performer today because the conditions for the $15m strategic investment from Carbon Direct have not been met. To receive this cash the sustainable fuel developer needs to raise $40m, including $8m already raised, and management is still trying to secure investors. The $15m cash injection is no longer binding. Velocys needs more cash before the end of the year. There is a significant market opportunity in sustainable aircraft fuel, but Velocys is in a weak position when discussing additional funding.
Carbon ceramic disc brakes developer Surface Transforms (SCE) has reduced revenue guidance for 2023 to £8.6m, having generated £6.3m up until October. The previous forecast for 2023 revenues was £13m. There have been problems ramping up production in the second half and it will not be completed until early next year. A new debt facility is being negotiated to enable an increase in annual capacity to £150m.
MC Mining (MCM) has received a bid approach. Two companies that own a 64.5% stake in the South African coal miner say they intend to acquire the shares they do not own, and the indicative offer is A$0.2 to A$0.23 for each share. Independent directors are assessing the indicative offer.
Cerillion (CER) has secured a five-year software deal with a European telecoms company. The deal is worth €12.4m and there is potential for selling other software modules. This deal helps to underpin forecasts.
OptiBiotix Health (OPTI) says that restructuring the management has improved account management and the focus of commercial discussions. The microbiome company has improved its online operation. There are ongoing discussions over potential large contracts.
Roebuck Food Group (RFG) is acquiring Motherwell-based food ingredients supplier Moorhead & McGavin for £2.225m in cash and shares. A placing will raise up to £2.5m at 13.5p/share. Moorhead & McGavin supplies cereals, pasta and rise to the catering sector and generated revenues of £7.26m and EBITDA of £377,000 in 2022. Roebuck Food Group sold its cold storage division, and it has been seeking an acquisition to scale up the business.
In October, podcast company Audioboom (BOOM) generated more than one billion advertising impressions in a month for the first time. The removal of old adverts after 90 days and replacing them with a new focused advert is helping advertising impressions to continue to grow. Fourth quarter revenues are still expected to be at least $19m.
Thor Energy (THR) has completed the stage 2 earn-in spending required to acquire a further 29% of the Alford East copper-gold-real earths project in South Australia. This takes the stake to 80%. Thor Energy has issued 9.26 million shares at A$0.027 each, plus 18.5 million warrants exercisable at A$0.03 each, to Spencer Metals as consideration for the stake.
Seaweed-based animal feed producer Ocean Harvest Technology (OHT) has conducted a successful trial in Georgia for its poultry feed. Mortality rates for the poultry with necrotic enteritis with the company’s feed in their diet fell from 49% to 33%. It also enhances weight gain. Necrotic enteritis costs the poultry sector up to $6bn/year.
Technology businesses developer Frontier IP (FIPP) moved into loss last year because of realised and unrealised losses on its portfolio against a large gain in the previous year. The value of the portfolio fell 17% to £33m, although there were net disposals of nearly £5m. There was a £3.25m cash outflow from operations offset by disposals, leaving £4.6m in cash at the end of June 2023.
Neometals (NMT) has decided not to progress with vanadium tailings retreatment project in Finland because of difficulty in financing. The price of vanadium has been falling in recent months. Neometals will concentrate on licensing its vanadium recovery process. There was cash of A$14.2m at the end of the first quarter.
Real Good Food (RGD) says first half revenues were 2% ahead at £16.1m, although volumes fell by 10%. October revenues appear set to be 6% higher. The cake decorations supplier has significantly reduced its loss due to higher margins. A shortage of cash has held back growth, but the company could be profitable for the full year. Talks continue concerning the extension of the loan agreement with Hilco Private Capital. Interim results will be published in December.
Reconstruction Capital II Ltd (RC2) plans to ask shareholder approval for leaving AIM so that costs can be reduced. It is taking longer than expected to sell investments, so the investment company also intends to extend its life. A matched bargain facility will be arranged.
MAIN MARKET
Esken (ESKN) is selling Esken Renewables to Pioneer Balmoral for £77.6m, plus loan reimbursement of £6.9m. The portfolio of renewable assets has been built up by investing small amounts in equity in businesses. The deal requires shareholder approval. Net proceeds will be £78.5m and £70.6m will be used to repay the committed funding. There are plans to sell Southend Airport. Esken will move from the premium list to the standard list.
Mike Whitlow has requisitioned a general meeting at standard list cash shell More Acquisitions (LON: TMOR) to get Nicholas Tulloch and Jeremy Woodgate to the board and remove the existing directors Charles Goodfellow and Roderick McIllree. The board believes it has enough backing to defeat the resolutions.
Andrew Hore