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Quoted Micro 28 November 2022
AQUIS STOCK EXCHANGE
One Health Group (OHGR) joined the Apex segment of the Aquis Stock Exchange on 24 November. The NHS-funded medical procedures provider raised £1.56m at 150p a share, giving One Health Group a market capitalisation of £15.1m. The share price ended the week at 156.5p. Demand for the company’s services should continue to be strong as the NHS tries to reduce the backlog of operations. In the six months to September 2022, revenues were £9.7m. The plan is to pay 50% of post-tax profit in dividends. Net cash was £3.68m at the end of March 2022. The additional cash will provide working capital.
Electric vehicle drivetrains developer Equipmake Holdings (EQIP) edged up revenues by 3% to £3.71m in the year to May 2022. A much greater proportion of the revenues came from commercial and production contracts. The loss was more than trebled to £5.2m. There was still £1.88m of cash in the balance sheet and since then it raised £10m gross at 4.25p a share in its Aquis flotation. A partnership with an electrical aerospace specialist will generate initial orders for prototypes worth £400,000.
VSA Capital (VSA) has reiterated that it will report a first half loss. The Aquis corporate adviser is holding a showcase event for Aquis companies on 29 November.
Inqo Investments (INQO) has sold its investment in Zambia-based honey producer Bee Sweet Honey There was a ZAR950,000 loss on the investment.
Guanajuato Silver (GSVR) has made a partial early repayment of its silver and gold loans using 97,000 ounces of silver and 846 ounces of gold. In the three months to September 2022 produced 329,297 ounces of silver and 3,226 ounces of gold, while lead and zinc sales have become significant. The trend of quarter-on-quarter production increases is expected to continue.
Clarify Pharma (PSYC) has acquired £250,000 stakes in Nasdaq-listed companies Atai Life Sciences Inc (ATAI) and Compass Pathways (CMPS). Both companies are involved in developing psychedelic treatments.
AQRU (AQRU) is reducing the number of employees by three-quarters to save money. Monthly overheads will fall by 65%. Yields on the company’s cryptocurrency app are being reduced.
Cooks Coffee Company (COOK) has issued up to NZ$2m of convertible notes to wholesale investors. The cash will fund the growth of the café existing chain and acquisitions, as well as paying off some existing debt.
Ananda Developments (ANA) is seeking shareholder approval to acquire the 50% of DJT Group that it does not own, which has a licence to grow >0.2% THC cannabis for research. The cost is £3.2m in shares. The process of gaining approval to grow and manufacture medicinal cannabis has been formalised.
IamFire (FIRE) says investee company WeShop user downloads and transactions are increasing.
Marula Mining (MARU) has increased its stake in the Blesberg lithium mine from 5% to 100%. The cost is $1.7m. This is subject to regulatory approval. Mobile mining equipment and the majority of processing equipment is on the site and the infrastructure is being upgraded. First deliveries of lithium ore are expected in December.
Diesel additives supplier SulNOx Group (SNOX) has appointed Steele Environmental as a US distributor for shipping markets and land-based transportation and revealed a positive evaluation with Caspian Marine Services.
Invinity Energy Systems (IES) has cut the nominal value of its shares so that it can issue more shares. A 2.2 MWh energy storage sale has been made to the company’s Taiwan resale partner. That is ten Invinity VS3 batteries.
EDX Medical (EDX) announced a collaboration for the European cancer biomarker programme with Tianjin Bioscience. This should result in the development of cost-effective cancer tests.
MiLOC Group Ltd has changed its name to Crushmetric Group Ltd. A placing raised £22,000 at 20p a share.
A company owned by NFT Investments (NFT) chairman Jonathan Bixby and non-exec Mike Edwards have has acquired 20 million shares at 0.8p a share. Finance boss Rob Smith has purchased 724,503 Chapel Down Group (CDGP) shares at 25.5p each. A company associated with chief executive David Immelman bought 50,084 DXS International (DXSP) shares at 5.454p each.
Former Aquis-quoted company Jigsaw Insurance Services is recommending a 204p a share cash offer from insurance business consolidator PIB Group Ltd. There could also be additional consideration of 14p a share depending on completion accounts. That values the bid at up to £24.1m. Harrogate-based Jigsaw was formerly known as NCI Vehicle Rescue and it left what was then known as ISDX in February 2015, so it still comes under the Takeover Panel rules.
AIM
Michelmersh Brick (MBH) expects 2022 pre-tax profit to be ahead of expectations and it is acquiring pre-built brick products manufacturer and brick fabricator Fabspeed for an initial £6.25m. The Fabspeed acquisition will be earnings enhancing. There could be up to £2m more payable depending on performance over 24 months. A share buy back programme of up to £3m is being launched.
Tatton Asset Management (TAM) continues to generate impressive net inflows to its assets undermanagement. They were £907m in the six months to September 2022, helping to offset market declines. The 50%-owned 8AM Global added a further £1bn taking the group total to £12.3bn, which has already risen to £12.9bn in November. Pre-tax profit improved from £6.77m to £7.68m and the dividend was raised by 12.5% to 4.5p a share.
finnCap (FCAP) has ended bid talks with fellow broker Panmure Gordon. It was not possible to find a mutually acceptable structure or terms for the merger.
Osirium Technologies (OSI) is raising £1.53m at 2p a share and the cash will provide additional working capital and help the cyber security business reach cash breakeven earlier than previously expected. Annualised cost savings of £1m have been identified and £650,000 of these have already been implemented. Sales director Stuart McGregor is replacing chief executive David Guyatt and he will become executive chair instead. Allenby has increased its forecast 2022 revenues to £1.8m and slightly reduced the expected loss to £3.22m.
Tissue products manufacturer Accrol (ACRL) increased interim revenues by 64% to £121.1m through a combination of higher prices and volume growth. Net debt was £30.5m at the end of October 2022 and it could fall to £24.4m by April 2023. A full year pre-tax profit of £6.7m is forecast.
Omega Diagnostics (ODX) has received the £4m deferred consideration for the sale of the CD4 business. Net cash is expected to be £6.2m by the end of March 2022. This can be used to expand the health and food intolerance operations. The US is a market where more investment is planned. Omega Diagnostics remains loss making but could move into profit in 2023-24.
Electrolyser developer Clean Power Hydrogen (CPH2) is having problems with the design and operation of its cryostat unit in the MFE 220 test unit. Scaling up the unit has been a challenge. This delayed the expected October deliveries of two initial MFE 220 units. One customer has cancelled the order and is going with a rival electrolyser. A redesign of the unit should cure the issues. On the current forecasts, the cash could reduce to £3m by the end of 2024 and then rise the following year, but further delays could mean the cash reduces more quickly than expected.
Curtis Banks Group (CBP) is in advanced discussions concerning a bid from Nucleus Financial Platforms, which is conducting due diligence. Susan McInnes has been appointed as an independent non-executive director of Curtis Banks.
DeepMatter Group (DMTR) is the latest company with plans to cancel the AIM quotation because management believes that it will be easier to raise cash as a private company. The digital chemistry data analysis business says major shareholders support the plan. DeepMatter wants to raise £1m before leaving AIM and then a larger amount after the departure.
Trafalgar Property Group (TRAF) has moved into hydroponics. The residential property developer has acquired assets and leasehold premises from May Barn Horticultural Consultancy, which is controlled by Trafalgar Property director Dr Paul Challinor, for £30,000. Trafalgar Property will concentrate on assessing plant propagation requirements and studies on tissue culture of plant material. The current work is on lettuce varieties and hydroponic tomato seedlings, as well as seedlings of Nicotiana benthamiana for future development for cosmetics and pharmaceuticals.
Real Good Food (RGD) has secured additional financing of £2.5m from Hilco Private Capital, which lasts for 12 months and is in addition to the £6.3m from the Leumi ABL. This will help to fund restructuring and cost reduction.
Zanaga Iron Ore Company (ZIOC) is acquiring a controlling shareholding in the Zanaga iron ore project from Glencore Projects in return for shares that will give Glencore a 48.26% stake. Glencore can appoint two directors and is required to retain the shares for six months. Glencore has exclusive marketing rights for the iron ore produced at the mine. A general meeting will be held on 13 December to gain shareholder approval for the deal.
MAIN MARKET
Structural steel supplier Severfield (SFR) improved interim profit and it is continuing to improve in the second half. In the six months to September 2022, revenues improved from £195.9m to £234.9m through a combination of underlying growth and higher steel prices. Underlying pre-tax profit rose from £10.3m to £12.1m, including a doubled contribution of £600,000 from the India business. Net debt was £15.8m at the end of September and the interim dividend was raised from 1.2p a share to 1.3p a share. The UK and Europe order book is worth £464m and the India order book is £143m.
Devro (DVO) has agreed a 316p a share bid from Netherlands-based Saria, which has been interested in bidding for the sausage skins supplier since the beginning of 2022.
Cardiff Property (CDFF) increased NAV from 2549p a share to 2756p a share in the year to September 2022. The current share price is 2420p. The dividend was raised from 18.5p a share to 20.5p a share. There has been a downturn in confidence in the Thames Valley property market.
Alkemy Capital Investments (ALK) says its subsidiary Tees Valley Lithium has received full planning permission for Europe’s largest lithium hydroxide refinery in Teeside. This will supply the electric vehicle battery market. Production could commence in 2025.
National World (NWOR) has decided not to bid for Reach (RCH).
Motor dealer Caffyns (CFYN) improved interim revenues from £110.8m to £119m, although underlying pre-tax profit dipped by one-third to £1.6m. New car volumes were ahead of the market and there was a 12% decrease in like-for-like used car volumes. The interim dividend is unchanged at 7.5p a share.
Ross Group (RGP) has raised £136,000 at 1.5p a share. Ross has entered into a global exclusive supply chain management agreement with the Energy Group LLC in the US to manage green hydrogen production and projects. This could be the start of a significant business for Ross.
Andrew Hore
Andrew Hore – Quoted Micro 10 December 2018
NEX EXCHANGE
TechFinancials Inc (TECH) is developing a blockchain-based sports ticketing business with Footies Tech Ltd. The new company will licence blockchain technology from TechFinancials, which will have a 75% stake in the company. TechFinancials will provide up to $500,000 to the company and this commitment is dependent on a client signing up within three months. The idea is to make the sports club take control of the initial sale and any secondary ticket transactions. Former Liverpool FC chairman Ian Ayre will be chairman of the new company.
Eight Capital Partners (ECP) has invested £60,000 in Pelican House (PHM) at 0.45p a share. Eight Capital will be issued 13.33 million warrants exercisable at 0.45p a share. Eight Capital is appointing John Treacy to the board of Pelican, which is changing its investment strategy from natural resources to sports and leisure.
Crossword Cybersecurity (CCS) has raised £2m at 290p a share and it will move to AIM on 14 December. The share price peaked at 430p in March. Crossword is valued at £13.6m at the placing price. Hargreave Hale AIM VCT has taken a 7.37% stake.
Early Equity (EEQP) is assessing additional investments that fit its strategy. There was £437,000 of cash in the balance sheet at the end of August 2018. The main investment is a 47.1% stake in healthcare products distributor Yicom Global.
Miton has increased its stake in Wheelsure Holdings (WHLP) from 15.5% to 17.8%. DXS International (DXSP) chief executive David Immelman has bought 20,002 shares at 9.9p each, taking his stake to 10.45%.
Welney (WENP) is considering a couple of proposals that can enable the company to move ahead. The loan note holders have agreed not to call in the loans for at least another 12 months. Net liabilities were £268,000 at the end of June 2018.
Block Commodities (BLCC) has launched the Farmer 3.0 (described as an integrated agri-business ecosystem) pilot project, which covers up to 1,000 Ugandan farmers. The plan is to expand the service to up 50,000 farmers.
AIM
Plastics Capital (PLA) has still to see the benefits of its investment in capacity and winning new business. In the six months to September 2018, revenues improved 11% to £40.6m and underlying pre-tax profit recovered from £1.2m to £2.1m. Net debt was £15.7m at the end of September 2018 to £14.5m by March 2019. Cenkos forecasts a 2018-19 profit of £5m, rising to £5.4m next year.
Broker finnCap (FCAP) joined AIM and completed the acquisition of Cavendish Corporate Finance last week. finnCap raised £3.75m at 28p a share.
The People’s Operator (TPOP) has the chance to receive an investment from the owner of LycaMobile. A share capital reorganisation is required before any shares can be issued. Every 2,000 shares will be consolidated into one share. An investment of £1.3m will be in shares (29.9%) and convertible loan notes – convertible at 10p a share.
Evgen Pharam (EVG) says that the final patient in the STEM:SFX-01 trial for metastatic breast cancer will take her last dose by the end of 2018. The final readout for the trial should be in March.
Ceres Power (CWR) has finalised its collaboration with Weichai Power. They will create a fuel cell manufacturing joint venture in China and technology will be licenced to the new venture, which could generate up to £30m in payments. There is also a £9m joint development agreement for range extenders for electric buses. Weichai will invest £28m at 164.5p a share.
Hagai Tal has resigned as chief executive of Taptica International Ltd (TAP) after he was criticised about his actions at a previous company. Rivi Bloch takes over as interim chief executive. The business appears to be changing with revenues not up to expectations but margins improving.
Panther Securities (PNS) is paying a special dividend of 15p a share after what it calls the best year it has experienced. Next year at least 12p a share will be paid.
Woodford has says that it will subscribe £8m in a fundraising for eve Sleep (EVE) and Channel 4 says that it will invest £900,000. Chairman Paul Pindar will invest £1m. Discussions continue with other investors in order to raise the £15m required.
Vianet (VNET) is growing its smart machines operations and it was responsible for the growth in revenues in the first half. The pubs market remains tough and smart zones revenues dipped, but there is the prospect of a large order in the US. Full year profit is expected to improve from £2.7m to £3m. The interim dividend is maintained and the total dividend for the year should be unchanged at 5.7p a share.
Versarien (VRS) has signed a supply agreement to supply a new graphene enhanced polymer range to AECOM. Interim revenues were 19% higher at £5.22m. There was cash of £6.07m at the end of September 2018. There was a £1.1m cash outflow in the six month period.
Omega Diagnostics (ODX) continues to lose money and net debt was £700,000 at the end of September 2018. The £2m overdraft facility should provide enough finance for the company’s needs. The commercialisation of Visitect CD4 is important to long-term progress for the company. CE marking for advance disease should be awarded soon. The timing of approvals and therefore revenues is difficult to predict.
Pebble Beach Systems (PEB) has resolved its dispute with xG Technology Inc over the disposal of its hardware business. No further liabilities are due by either party and the forecast cash balances for Pebble Beach will not be materially different.
Rose Petroleum (ROSE) has agreed an operational plan with the Utah authorities for its acreage in the Paradox Basin and this includes recently acquired acreage. A suitable drilling rig should be available in the first quarter of 2019. The plan is to secure funding for the drilling programme.
Zinc Media Group (ZIN) has appointed Mark Browning, who is currently boss of ITN Productions, as chief executive and he will start in the first half of 2019. He replaces former finance director David Galan, who became full-time chief executive in February.
Adam Formela has stepped down as chief executive of packaging manufacturer Robinson (RBN). Martin McGee has become interim chief executive.
Trading in the shares of MySQUAR (MYSQ) will end on 10 December. Additional cash is required and a sale of assets to a NEX-quoted company in return for shares could happen. The investigation of past financial transactions continues.
Fishing tackle retailer Fishing Republic (FISH) has appointed administrators.
MAIN MARKET
Cryptocurrency mining services provider Argo Blockchain (ARB) estimates that its current annualised revenues are $6.2m (£4.8m). Trading is ahead of expectations. Net cash was £15m at the end of November 2018.
Sand U (SUS) says trading is in line with expectations. There has been a reduction in demand for finance for used cars. This means that the loan portfolio is growing more slowly than expected.
Standard list shell Spinnaker Opportunities (SOP) is evaluating opportunities in the cannabis market.
Andrew Hore