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Quoted Micro 12 August 2024
AQUIS STOCK EXCHANGE
Quantum Exponential Group (QBIT) says potential investors have proposed a minimum investment of £1m at 1p/share. The investors have also agreed to pay the investment company £100,000 to cover costs since incurred since the proposed cancelation was announced. This will be repayable out of the proceeds of the investment when it is completed.
Marula Mining (MARU) is acquiring 80% of Kenyan mineral processing company Agarwal Metals and Ores, which owns the Kilifi manganese processing plant.
Flex Labs Inc (FLEX) is proposing to cancel its Aquis quotation and is holding a general meeting on 30 August. The plan is to seek a listing in Canada. The AI company joined Aquis last December at 6p/share. The share price halved to 0.75p last week.
Ormonde Mining (ORM) investee company TRU Precious Metals has appointed Ormonde Mining technical adviser Steve Nicol as chief executive. The 36.2%-owned TRU Precious Metals is exploring for gold and copper in Canada. Another investee company, Peak Nickel, has commenced a drill programme in Aberdeenshire. There will be a minimum of 1,000 metres drilled.
Gunsynd (GUN) remains on Aquis for a few more days and it has entered a farm-in agreement with Pinwheel Resources over acreage in Canada. It can earn 100% of Falcon Lake U-Co-Cu project and Bear Twit VMS project for a total outlay of £200,000 in cash and shares.
IntelliAM AI (INT) has secured a contract extension with a global alcohol company. The company’s consulting services will be broadened to 35 maltings sites in the UK. The contract value is a minimum of £100,000.
Walls and Futures REIT (WAFR) has been trying to attract institutional investors involved in infrastructure and property, but the General Election led to delays. The process will be restarted at the end of the summer holidays. The scale of any potential fundraising will be larger than previously expected.
Oberon Investments (OBE) raised £2.5m at 3.5p/share and that will help to accelerate growth. First quarter revenues increased by 90% to £2.54m and this came from all the divisions. Like-for-like growth of more than 30% is being targeted for the full year.
Tectonic Gold (TTAU) has sold its 10% stakes in diamond miner Deep Blue Minerals and heavy mineral sands miner Whale Head Minerals to AIM-quoted Kazera Global (KZG). A potential Western Australia gold acquisition opportunity is being assessed.
Investment Evolution Credit (IEC) has raised £100,000 at 20p/share.
Ananda Developments (ANA) has moved to the Apex segment of the Aquis Stock Exchange.
AIM
Hargreaves Services (HSP) reported a fall in full year pre-tax profit, but it was slightly higher than expected at £16.9m. Pre-tax profit was lower because of the reduced contribution from the German HRMS business, although it did have a much better second half. This recovery should continue into the current year. EU sanctions on Russian pig iron has helped prices improve, which is good for the HRMS recycling operations. The enhanced dividend will continue and should at least be maintained at 36p/share. NAV is 583p/share.
Customer engagement and intelligent automation systems supplier Netcall (NET) is spending an initial £9.6m for Govtech, which has a focus on the public sector, and this will be earnings enhancing this year. Govtech helps local authorities to automate council transactions so they can be done more quickly and efficiently. Netcall has local authority clients, and its coverage of UK councils will increase from 26% to 34%. Netcall had £33.7m of net cash at the end of June 2024. Even after the acquisition Netcall could still have £31m in cash at the end of June 2025.
Insurance premium finance and professional funding provider Orchard Funding (ORCH) says its largest customer has gone into administration. Orchard Funding has lent £16.7m to Insure That clients out of a total lending book of £66.8m at the end of June 2024. Management is assessing the recoverability of the Insure That loans. This comes six weeks after a positive trading statement.
Cash shell Earnz (EARN) is making its first acquisitions and raising up to £4m at 7.5p/share. It is buying energy services companies Cosgrove & Drew, which provides public sector project work and compliance services for heating and plumbing, and heating installation and maintenance services provider South West Heating Services. Earnz chair Bob Holt has a stake in Cosgrove & Drew, which will cost up to £196m. In 2023, it generated revenues of £9.1m and lost £832,000. South West Heating Services will cost up to £1.15m and it made revenues of £1.1m and a pre-tax profit of £275,000 in the nine months to March 2024. The focus is cross-selling of services and organic growth.
Ocean Harvest Technology (OHT) has published positive data from trials of OceanFeed Swine. Adding this feed ingredient to the diet of pregnant sows results in more piglets being born and improved milk quality in the sows. Revenues per sow increased by $24/year. More than $100bn/year is spent on swine feed.
Natural resources data analyser and provider Getech (GTC) has raised £1.5m at 2p/share and could generate up to £200,000 more from a retail offer. This will improve the balance sheet ahead of the planned sale of Nicholson House. The cost base is being reduced. There will be investment in the sales and business development teams, as well as in machine learning technology development.
Revolution Bars (RBG) has received court approval for its restructuring plan. This means that some bars can be closed, and others will have rent reductions. There will be 65 bars and pubs left in operation. This should improve annualised EBITDA by £3.8m.
Oil and gas company Prospex Energy (PXEN) raised £3.34m via a placing and subscription at 6p/share. There was also an oversubscribed retail offer that raised £859,000. Prospex Energy wants the cash to acquire an interest of 7.5% in the Vlura producing gas field that generates more than four-fifths of the Spain’s gas production.
Hermes Pacific Investment (HPAC) plans to leave AIM. The share price slumped to 40p. The investment company found it difficult to secure suitable investments in the financial services sector in south east Asia and changed into a property investor in 2022, but only one property has been acquired. There is a low free float, and the shares are trading at a large discount to the September 2023 NAV of 147p/share.
Oil and gas company Bowleven (BLVN) plans to leave AIM and 58.3% shareholder Crown Ocean Capital is offering shareholders the chance to sell shares at 0.225p each up until 11 September. This offer is dependent on the departure from AIM being agreed at a general meeting on 28 August. Management believes that being private will give the company more flexibility and reduce costs.
Floorcoverings manufacturer Airea (AIEA) was hit be a slowdown in second quarter sales. The decline of 5.6% was slightly better than for the market as a whole. Interim sales are lower with international revenues 22% lower. July has been stronger and new product launches are planned. There has been an increase in inventory because of the slow sales. The interims will be announced on 26 September. The full year expectations have been reduced.
Extended reality technology developer Engage XR (EXR) says interim revenues reached a record of €2.2m with the main growth coming from licence income. Net cash is €5.5m at the end of June 2024. Management still believes that Engage XR can move into profitability during 2025 without raising additional cash. Full year revenues of €5.3m and net cash of €3.7m are forecast.
EnergyPathways (EPP) says the retention of the decarbonisation investment allowance in the energy profits levy is a positive signal. This should be helpful for the company’s MESH Marram Energy Storage Hub) project. This part of the development of the Marram gas field in the UK Irish Sea.
Tan Delta Systems (TAND) has entered into a product agreement with an engine manufacturer to develop a sensor to monitor coolants and water-based hydraulic solutions. The initial value of the agreement is £200,000, but it could increase to £2m.
Seed Innovations (SEED) has used some of its cash to buy £250,000 of shares in the recent fundraising by AIM-quoted Pantheon Resources (PANR), which is exploring for oil and gas in Alaska. The placing was at 17p/share and the current share price is 18.18p. There is still £3.5m in cash left.
MAIN MARKET
Restaurants operator Hostmore (MORE) says interim like-for-like sales have declined 10% and this accelerated to a 23% decline in July. The first half loss has been reduced. Borrowings are likely to exceed the current debt facilities. Management continues to work on the acquisition of master franchise owner TGI Fridays Inc. The plan is to sell corporate stores to new franchisees and there are agreements to sell stores for more than $40m. A review of options if the acquisition does not happen is being undertaken.
Alkemy Capital Investments (ALK) has updated the market on progress with the Tees Valley Lithium refinery project. A collaboration with Geothermal Engineering intends to develop integrated supply chains in the UK. Project funding partners have been shortlisted, while overheads are being reduced.
Andrew Hore
Quoted Micro 25 December 2023
AQUIS STOCK EXCHANGE
Good Life Plus (GDLF) completed its reversal into Semper Fortis Esports. There was £1.4m raised at 2p/share. The share price improved 11.1% to 2.5p. The business has been trading for just over two years and it offers members daily prize draws. There are more than 21,000 active members and monthly recurring revenues are £210,000. The company is currently loss-making, partly due to investment in marketing, although the increasing scale means gross profit is improving. The cash will fund further investment in marketing. Sportingbet founder Mark Blandford is one of the new investors.
Kondor AI (KNDR) joined the Access segment of Aquis on 21 September having raised £1.5m at 3p/share and by the end of the week the share price was 8.25p. There was £400,500 raised in November. Kondor AI intends to develop artificial intelligence products in areas such as health diagnostics, search and text recognition. A beta demonstration product is being tested.
Secured Property Developments (SPD) has appointed Paul Ryan as executive director and Noel Lyons as non-exec and they have acquired £150,000 worth of shares at 26.11p each. The existing directors resigned. It appears likely that the focus may change to technology and cleantech. Peterhouse has become corporate adviser. The changes sparked a 60% rise in the share price to 20p.
Incanthera (INC) has secured a commercial deal with a subsidiary of health and beauty company AS Watson for the launch of the Skin + CELL skincare range. This should generate significant revenues in 2024. The plan is to roll out the brand to 1,000 stores in Europe, followed by Asia. Manufacturing has been subcontracted. To fund this, £800,000 was raised at 7p/share and £200,000 of debt owed to the University of Bradford was converted into shares. There was net debt of £199,0090 at the end of September 2023.
Vanadium flow batteries developer Invintiy Energy Systems (IES) says full year revenues will be at least £21.6m, which is below forecast, and the EBIDA loss will be higher than expected at £22m. That means net cash will be around £1m. Forecast revenues for 2024 have been downgraded and the loss raised. This is based on exiting projects. Canaccord Genuity believes that there will be a cash injection from a strategic partner, which will offset the cash outflow in 2024.
Valereum (VLRM) has renegotiated the acquisition of the GSX Group, which is dependent on the approval of shareholders. It is paying five million shares and 10 million warrants exercisable at 1p each. The deal includes GATENet DFMI intellectual property, which puts the group in a strong position in tokenisation. The GATE token will the sole token used. As part of the deal former AIM boss Simon Brickles will become a non-executive director. GSX chief executive Nick Cowan will take up that role in the group.
Coinsilium Group (COIN) says a recovery in cryptocurrency markets is having a positive effect on the company. The expected approval of the first spot Bitcoin ETF should create more opportunities.
Aquaculture technology developer OTAQ (OTAQ) had a strong second half and full year revenues will be £4.4m, which is higher than expected. Oil and gas demand has improved. There was positive EBITDA in the second half. There are opportunities in Geotracking for next year.
Wishbone Gold (WSBN) is exercising the option over the Crescent East lithium and gold project in Western Australia. In return, 18.6 million shares worth around £400,000. Gold mineralisation has been confirmed and there is potential for lithium in the southern area.
Personalised medicine company EDX Medical (EDX) had £1.1m in the bank at the end of September 2023. There was £1.5m outflow from operating activities in the six months to September 2023.
Mydecine Innovations Group Inc (MYIG) is the largest faller on the week with a 70.6% decline to 2.5p, even though it has received notice of allowance from the US patent office for the MYCO-005 compound. It mimics psilocin but without some of the side effects.
ChallengerX (CXS) has moved from net assets of £282,000 to net liabilities of £33,000 at the end of June 2023.
Rogue Baron (SHNJ) has raised £50,000 at 0.35p/share. The spirits company is still performing due diligence on the acquisition of a vodka brand.
Marula Mining (MARU) says dual listings on the Nairobi Stock Exchange and JSE should happen in the first quarter of 2024. Indicative terms have been received indicative terms for an offtake agreement with a European commodity trader for the lithium output of Blesberg lithium and tantalum mine. Transportation of the modular processing plant for the Kinusi copper mine will not happen until early 2024.
Cadence Minerals (KDNC) investee company European Metals Holdings (EMH) says that the definitive feasibility study for the Cinovec lithium project in the Czech Republic has been delayed until the first quarter of 2024. This will allow time to complete capital and operating cost estimation and project implementation scheduling.
SulNOx Group (SNOX) says that its Ghana-based distributor has purchased 3,700 litres of SulNOxEco fuel additive and committed to a minimum of 15,000 litres each year, which is valued at £250,000. SulNOx has raised £1.8m at 23p/share. The share price is down 1.92% to 25.5p.
Walls and Futures REIT (WAFR) had an NAV of 87p/share at the end of September 2023. Property values increased by £60,000.
Capital for Colleagues (CFCP) is involved in a £1.5m fundraising for Rapid Retail, which supplies portable shops and kiosks, and it is investing £100,000 in existing shares and providing a 9% secured convertible loan of £400,000. The rest of the cash is coming from Harrock Investments, which is controlled by Capital for Colleagues non-executive Bill Ainscough.
Trading in Pharma C Investments (PCIL) will resume on 27 December This follows the recent publication of annual results and interim figures. There has been £281,000 raised at 0.01p/share. These shares are 91% of the enlarged share capital. Peter Wall will be executive chairman. The investment strategy has been changed to technology.
Gunsynd (GUN) NAV fell from £3.85m to £2.15m in the year to July 2023, including cash of £164,000.
Oberon Investments (OBE) has received FCA approval for the acquisition of Nexus Investment Management and the Nexus Investments Evergreen EIS Scale-Up Fund. Harry Hyman has increased his stake from 3.82% to 4.98%.
Macaulay Capital (MCAP) is making a £125,000 loan to a subsidiary of investee company Vale Foods. This loan earns 10%/year and provides cash to finance an increase in capacity. Macaulay Capital director David Horner is personally lending £100,000.
Cooks Coffee Company (COOK) is buying back shareholdings of less than 1,125 shares.
Adnams (ADB) director Sacha Berendji acquired 300 A shares at £19 each.
Jared Gurfein has been appointed as chief executive of Looking Glass Labs (NFTX), replacing Dorian Banks.
AIM
Trading has not gone to plan at Hargreaves Services (LON: HSP) but it is able to offer an enhanced dividend pay out. Reduced commodity prices and a slowdown in the German economy have hit the performance of German associate company HRMS, which is expected to make a first half loss. The flipside of the HRMS underperformance is that working capital is unwinding and cash generation has strengthened. Hargreaves Servies has received £8m from HRMS and the two sides have agreed that an annual distribution of £7m can be sustained. This enables Hargreaves Services to pay an annual dividend of 36p/share, compared with previous expectations of 21.9p/share. This will be paid in two equal instalments. The 2024-25 dividend is expected to be maintained.
Filtronic (FTC) has gained two new contracts. There is a £4.8m contract for LEO satellite communications equipment. This is a follow-on contract for second generation Cerus32 solid state power amplifier modules for ground stations. This shows the increasing importance of the satellite market. Filtronic also won a £4.5m defence contract starting in January. Revenues will be recognised in 2024-25 and 2025-26. Interim results will be published on 6 February.
Video games publisher tinyBuild (TBLD) has secured the cash it requires for working capital. The fundraising includes a one-for-six open offer and should raise $14.2m at 5p/share, which is above the current share price. Interactive entertainment company Atari is investing $2m. Chief executive Alex Nichiporchik will underwrite up to $10m of the fundraising. The video games market continues to deteriorate. Full year revenues are likely to be between $40m and $50m with a greater than expected proportion of lower margin games. Cost cutting should reduce cash outflow by up to $10m/year.
Microsaic Systems (MSYS) is negotiating the acquisition of some of the assets of Modern Warter from DeepVerge (DVRG), which is running out of cash, for £100,000. The assets include water testing equipment plus IP and rights to related equipment. It does not include the Australian business. Intercompany debt will be discharged as part of the deal. The exclusivity period lasts until 16 January. Trading in DeepVerge shares will be cancelled on 27 December.
Bidstack (BIDS) has sorted out its problem with Azerion. The in-game advertising technology provider has reached a settlement that means that Azerion will pay €3m to Bidstack. The two parties will form a new non-exclusive commercial partnership in 2024.
Helium One (HE1) announced a placing raising £6.1m at 0.25p/share. This will fund the drilling of the Itumbula West-A well starting in early January. There will also be 25.1 million shares issued in lieu of fees.
SRT Marine Systems (SRT) is raising £10m at 35p/share with up to £500,000 more to come from a retail offer. This includes a £7m investment by Ocean Infinity. There were no revenues from systems in the first half, but they should make a significant contribution as work on contracts reaches points where it can be invoiced. Earlier this year, SRT raised £5.36m from a placing and Primary Bid offer at 50p/share.
Graphene technology developer Versarien (VRS) has found it difficult to complete the disposal of non-core assets. In the year to September 2023, revenues were £5.45m and cash fell to £600,000. There was £450,000 raised since then, but cash has fallen to £420,000. A general meeting will be held to gain shareholder approval for a reduction in share capital and nominal value to make it easier to raise money from share issues.
Bluejay Mining (JAY) has appointed Roderick McIllree, Harry Ansell and Troy Whitaker to the board with the latter becoming chief operating officer. Robert Edwards, Bo Stensgaard and Peter Waugh have stepped down from the board. Roderick McIllree was previously chief executive between 2015 and 2022. The strategy is to focus on the Disko magmatic massive sulphide project in Greenland.
Thor Energy (THR) investee company EnviroCopper has reached agreement with Andromeda Metals to acquire the Alford West property and combine it with Alford East in return for a 5% stake in EnviroCopper and A$50,000 in cash with deferred consideration of a 10% share of any successful mining operations. There will also be a A$150,000 cash payment when a mining lease is granted. Alligator Energy is making a A$900,000 strategic investment in EnviroCopper to help fund its copper projects. That will give it a 7.8% interest and further investments could take the stake to 50.1%. Thor Energy’s stake has been diluted to 26.5%.
MAIN MARKET
A dual listing on the New York Stock Exchange was supposed to give Diversified Energy Company (DEC) a boost, but the share price slumped after Democrats in the US opened an inquiry into the company and questioned its business model. They are concerned about The US oil and gas producer’s methane emissions and abandonment risk.
Bowen Fintech (BWN) plans to acquire 93.49% of the share capital of MINNADEOOYASAN-HANBAI Co (MOH) and the enlarged business is expected to be valued at £42.7m. Japan-based MOH is a crowdfunding platform focused on property. It has been operating since 2007 and raised Y62bn (£378m) during the year to March 2023. Bowen Financial is issuing shares at 15p each and that will value MOH at £34.5m. The share price was suspended at 12p until a prospectus is issued. In October 2022, £2m was raised at 4p/share. At the end of April 2023, there was £1.7m in the bank.
IT services provider Triad (TRD) reported a dip in interim revenues and a more than doubled loss of £990,000. This was worse than expected. Cash has fallen to £2.62m. The interim dividend is maintained at 2p/share. Four new contracts have been won. This should improve the second half figures and next year’s results. Deputy executive chairman Charlotte Rigg has bought 4,444 shares at 135p each.
Andrew Hore
Quoted Micro 28 February 2022
AQUIS STOCK EXCHANGE
Good Energy (GOOD) has finalised the sale price of its electricity generation assets. There was deferred consideration of up to £8.1m. The deferred payment has been set at £4.8m, taking the total payment to £21.2m. The rest of the cash was not paid due to a third-party yield assessment and other due diligence.
Samarkand Group (SMK) has signed a three-year agreement with Revolution Beauty Group (REVB) and it will incorporate the cosmetics company’s existing Tmall Global Flagship store via the Nomad technology, which will make it easier to sell in China. Samarkand will be exclusive ecommerce partner for China. Revolution Beauty has bought the assets of US cosmetics brand BH Cosmetics for $3.9m. Badass with Heart (BH) Cosmetics are vegan and cruelty-free.
Hydrogen Utopia International (HUI) says that it has been advised to apply for a loan under a new programme launched by the Poland authorities. The share price has slumped to 7.5p since the flotation at the beginning of the year.
KR1 (KR1) is participating in the HydraDX crowdloan and Polkadot parachain auction. KR1 contributed 350,000 DOT to secure a parachain slot in the ongoing round and these will be held for 96 days before being returned and KR1 will also receive HydraDX tokens. KR1 is already due to receive 45 million HydraDX tokens due to previous backing of a seed funding round. HydraDX is a protocol to enable frictionless liquidity for crypto assets. All assets can be put into one shared liquidity pool.
Cadence Minerals (KDNC) says that its joint venture rare earths project Yangibana in Western Australia has a NPV8 of $1.01bn, which is an 84% increase on the previous estimate. The $20m project to build the core infrastructure has begun. There was a 48.9% take-up of the recent open offer, which raised £745,000.
Forbes Ventures (FOR) is considering re-domiciling from the Cayman Islands to the UK. This could reduce costs. The medium-term focus includes the potential launch of a blockchain-focused venture fund.
Valereum (VLRM) has exercised its option to take its stake in the Gibraltar Stock Exchange from 80% to 90%.
SuperSeed Capital (WWW) managing director Mads Jensen has bought 24.200 shares at 98p each, taking his stake to 82.1%.
AIM
Hargreaves Services (HSP) has secured a deal for the development and sale of two large distribution units, which will be 191,000 square feet and 375,000 square feet respectively, at the 50%-owned Unity site. Detailed planning permissions are required for the sites and that should be obtained by the end of the year. The deal will be fully completed within 12 months of construction. The total revenues should be more than £50m for the joint venture and Hargreaves should have all or most of its 50% distributed to it, depending on the requirements of the joint venture. On top of this, another 4.6 acres at Blindwells is being sold to Ogilvie Homes. There will be 77 homes built and the deal should generate minimum revenues of £3.5m. The contracts are conditional, and they will not have an immediate effect on the figures.
Synairgen (SNG) announced disappointing phase III data for the SPRINTER trial for SNG001 use in hospitalised Covid-19 patients. The headline data for the trial did not meet primary or secondary endpoints. There is still an ACTIV-2 phase III trail being carried out in mild to moderate Covid-19 patients and other studies where SNG001 could be included.
Sylvania Platinum (SLP) plans to spend some of its cash pile on further increases in production. First half production of platinum group metals was 32,376 ounces, down from 36,335 ounces, and full year production should be between 66,000 and 68,000 ounces. Interim revenues fell from $84.9m to $69.1m, while pre-tax profit slumped from $57.4m to $34.9m. The decline in the Rand exchange rate exacerbated cost increases. A dividend of 2.25p a share will be paid. Short-term investment focus is on additional capacity and extending the life of the chrome recovery operations. In the next three years Sylvania will decide whether to construct new plants on the eastern and/or western limbs of the Bushveld complex.
Transense Technologies (TRT) moved into profit in the six months to December 2021 thanks to growing royalty income from iTrack tyre pressure monitors. Interim revenues improved from £895,000 to £1.2m with a loss of £53,000 turned into a pre-tax profit of £82,000. That is before any tax credits. There are more than £23m of tax losses available to offset against corporation tax. There is £1.07m in the bank and that is set to rise to £1.34m in June 2022.
Seeing Machines (SEE) says interim revenues are 19% ahead at A$21.7m. Revenues of A$56.1m, up from A$46.6m, are forecast for the year to June 2022. There are nine vehicle models that have commenced production that are installing the company’s driver monitoring system. Seeing Machines has also deployed a pilot fatigue detection system for Air Ambulance Victoria. This deal could be worth A$1m over a ten-year period.
Avingtrans (AVG) reported a small decline in interim revenues to £45.1m following the ending of lower margin work in the medical imaging business. Improved margins meant that there was little change in the pre-tax profit, which was £3.6m. The interim dividend is 1.6p a share.
Analysts have raised their full year pre-tax profit forecast for Netcall (NET) following the interim figures. Annualised contract value was £19.8m at the end of 2021. The 2021-22 earnings forecast was increased by 6% to 1.7p a share.
Outsourcing services provider iEnergizer Ltd (IBPO) says it will have another record financial year in 2021-22. The forecast yield is 4.9%.
Tristel (TSTL) is exiting non-core activities to focus on its medical device decontamination and surface cleaning products. In the six months to December 2021, revenues from continuing activities fell 7% to £13.6m. That was due to a large one-off order in the corresponding period. There is underlying growth. There is a £2.4m impairment charge for the discontinued activities. Underlying earnings fell 28% to 4.3p a share. The plans for FDA filings for the company’s products are on course.
Ventilation and door components supplier Titon (TON) warns that supply problems and higher costs are hampering sales and margins. Titon is trying to increase prices to cover higher costs. Overall revenues are slightly higher than in the first four months of the previous financial year, but the overseas operations are loss-making. There is still £4.2m in cash on the balance sheet. A new chief executive is being recruited.
Orchard Funding (ORCH) has raised £2.59m after expenses from its bond offer.
MAIN MARKET
Packaging manufacturer and distributor Macfarlane Group (MACF) increased revenues from continuing operations by 26% to £264.5m in 2021. Pre-tax profit is 50% ahead at £18.7m. The labels division was sold at the end of 2021, and it made a loss. Net cash is £2.5m and the pension scheme surplus is £8.3m. The total dividend is one-quarter higher at 3.2p a share. There is continuing inflationary pressure and supply problems.
Maternity wear brand Seraphine Group (BUMP) says that sales grew in the seventeen weeks to the end of January 2022, although February has been tougher. That means revenues will be below expectations, while lower margins mean that there will be little in the way of profit for the full year. The problems include an underestimation of sales tax and duties in newer markets. This is not the first profit warning. Last July, Seraphine floated at 295p, and the share price has fallen to 58.5p.
Seraphim Space Investment Trust (SSIT) has performed strongly since it floated and there is more to come. The original fundraising was at 100p a share and the NAV at the end of 2021 was 104.7p a share. That is before the announcement of the reversal of Italy-based space logistics company D-Orbit into Nasdaq-listed Breeze Holdings Acquisition Corp, which should be completed by the autumn. There was still £70m in the bank at the end of 2021, although more investments have been agreed since then.
Fasteners supplier Trifast (TRI) says that there is consistent year-on-year growth in monthly revenues. Higher cost are being passed on and there are signs that supply chain costs are stabilising.
Alkemy Capital Investments (ALK) plans to enter into a lease at a Teesside chemical engineering park and the land will be used to build a lithium hydroxide processing facility through a new subsidiary called Tees Valley Lithium. The facility is anticipated to produce 24,000 tonnes a year of lithium hydroxide monohydrate for energy storage markets. This is a reverse takeover and trading in the shares has been suspended.
Kanabo Group (KNB) has acquired The GP Service, a telemedicine provider, for £13.5m in shares at 12.65p each. The business provides NHS video and online consultations and can electronically deliver prescriptions. Consultation services are also offered to corporate clients. GP Service will provide a way of marketing Kanabo’s CBD products. Kanabo raised £2.25m at 8p a share.
Cannabis-based drug developer Oxford Cannabinoid Technologies (OCTP) still had £12m in the bank at the end of November 2021. Cost savings worth £130,000 a year have been made so the cash can last longer. Two compounds are expected to enter phase 1 clinical trials in the next 12 months. Two The year end is being changed from May to April.
Andrew Hore
Quoted Micro 31 January 2022
AQUIS STOCK EXCHANGE
NFT Investments (NFT) plans to acquire Pluto Digital Assets. NFT Investments has a non-binding letter of intent relating to the acquisition, which is valued at £96m – based on the issue of 2.4 billion NFT Investments shares at a nominal valuation of 4p each. That is equivalent to 9.3p a share. However, NFT Investments shares have been suspended at 2.475p (2.35p/2.6p). NFT Investments is lending £5m to Pluto, which is a crypto technology and operations company involved in decentralised finance and NFTs.
SuperSeed Capital Ltd (WWW) is set to join Aquis on 31 January, having raised £2m at 100p a share. SuperSeed is a Guernsey-based closed-ended collective investment scheme operating a fund of funds. Investments will primarily be in unquoted funds managed by SuperSeed Ventures. The initial funds will invest as a limited partner of SuperSeed Ventures II LP.
Capital for Colleagues (CFCP) has redeemed its A shares in investee company Bright Ascension and received the book value of £250,000. It still owns ordinary shares in the space software technology company worth £1.75m. Capital for Colleagues NAV was 70.9p a share.
Valereum (VLRM) has accelerated its purchase of the Gibraltar Stock Exchange. An option will be exercised to take the stake from 10% to 50%. Once change of control is allowed, Valereum will take its stake to 90%. The plan is to make the stock exchange one of the world’s first regulated integrated fiat and digital exchanges.
Samarkand Group (SMK) has become a FedEx alliance partner. FedEx clients will be able to use Samarkand’s Nomad ecommerce platform.
MiLOC Group (ML.P) says that one of its subsidiaries has received a claim for £202,000 that it says it is owed.
AIM
Hargreaves Services (HSP) reported a jump in profit thanks to a large contribution from German joint venture HRMS. In the six months to November 2021, revenues fell from £92m to £76.1m partly due to the past sale of the coal stocks to HRMS, although operating profit improved from £868,000 to £1.06m. Pre-tax profit was £10.4m, up from £1.08m, which includes a share of HRMS profit of £9.27m, up from £944,000. The interim dividend has been raised from 2.7p a share to 2.8p a share. Net assets are 462p a share.
Compliance and energy saving services provider Sureserve (SUR) is not paying a dividend even though net cash is £16.5m. The cash will be invested in acquisitions to grow the business. In the year to September 2021, revenues increased by one-quarter to £244m, while pre-tax profit was 77% higher at £13.8m. There was an improved profit contribution from compliance services, particularly the gas business, and energy services contribution recovered.
Acoustic and thermal insulation material manufacturer Autins Group (AUTG) continues to be hampered by electronic component shortages that have slowed car production. Demand from the automotive sector will return when these components are available. In 2020-21, revenues increased 9% to £23.4m. That is better than it appears because there was a £1m plus reduction in short-term PPE revenues. The main growth came in flooring sales.
Real Estate Investors (RLE) says occupancy is 85.75% and this could move to over 86% if expected lettings are secured. The total dividend for 2021 will be at least 3p a share, which is a yield of more than 7.5%.
Digital advertising services provider Dianomi (DNM) grew revenues by more than one-quarter in 2021. Growth is being supplemented by newer elements such as video and lifestyle. Underlying EBITDA will be slightly ahead of expectations and cash increased to £10.3m.
Velocity Composites (VEL) reported a slump in revenues in the year to October 2021, but the supplier of engineered kits for the aerospace sector is experiencing a recovery in demand. Airbus is likely to ramp up production and this could help revenues improve from £9.8m to £11.7m. It will still be loss making at that level. Longer-term, Velocity Composites has its sights on moving into the US aerospace model using the same model as in the UK.
Redx Pharma (REDX) is set to have three phase II clinical trials in process later in 2022. A 2mg dose has been selected for the RXC004 study for colorectal cancer and the other RXC004 study for pancreatic cancer and unselected biliary cancer. Both these studies have already commenced. There is also a phase II study for use of RXC007 as a treatment for idiopathic pulmonary fibrosis (IPF) starting later this year. These studies mean that costs will increase. There was £29.6m in the bank at the end of September 2021 and a further $19m in milestone payments have been received since then.
M and C Saatchi (SAA) independent directors have rejected a revised offer from AdvancedAdvT (ADVT). The offer was 2.245 AdvancedAdvT shares for each Saatchi share or an alternative of 1.633 AdvancedAdvT shares plus 40p in cash for each share. The alternative is worth less than the all share offer. AdvancedAdvT says that it would move to AIM.
MAIN MARKET
ACP Energy (ACPE) is a standard listed cash shell seeking oil and gas acquisitions. It raised £830,000 at 5p a share. The share price ended the first day at 6.5p (5p/8p). The focus is the upstream oil and gas industry, particularly projects where oil and/or gas has already been discovered, which may be producing assets or ones where there has been some development spending. A minimum market capitalisation of £30m after the first acquisition is being targeted.
Air Partner (AIR) is recommending a 125p a share cash bid by Wheels Up Experience Inc, a provider of on demand private aviation in the US. This values the aviation services provider at £84.8m.
Associated British Engineering (ASBE) did not generate any revenues in the year to September 2021. NAV is 43p a share, including £489,000 in cash, although a Nasdaq investment has subsequently fallen in value. The trading business was sold in 2020.
Sivota (SIV) has entered into a conditional deal to acquire a majority stake in digital marketing platform Apester. There has been $36m invested in the technology and revenues were $9.2m in 2021.
OTHER MARKETS
FOS Holdings (FOS) has switched its listing from Vienna to the Cyprus Emerging Companies Market. FOS has decided to build film studios in Cyprus as part of a joint venture with Dias Media. The company’s subsidiary FOS Film Studios will have a 75% stake in the joint venture. The plan is to build a complex of three film and TV studios, plus additional facilities. There are plans to seek a loan from the EU and the Cyprus government is keen to have film infrastructure on the island. The first studio could be finished by the end of 2022. FOS has three films in early-stage development.
IPSX-listed building owner Mailbox REIT (MBOX) has declared a dividend of 1.75p a share for the fourth quarter of 2021. This is the first step in paying an annual dividend total of 7p a share. Mailbox REIT owns a single building in Birmingham and plans to switch 50,000 square feet of retail space into office accommodation. NAV is 101.9p a share.
Andrew Hore
Andrew Hore – Quoted Micro 28 December 2020
AQUIS STOCK EXCHANGE
TruSpine Technologies (TSP) has delayed the application for FDA approval of its Cervi-LOK spinal device for up to three months. This is due to a lack of testing time because of Covid-19. Computer modelling has enabled the company to make minor modifications, which widens the market for the device. A £250,000 cash injection is expected by 5 January.
Daniel Thwaites (THW) reopened its pubs in early July and up until the end of September sales were running at three-quarters of the previous year. Due to the lockdown in the first three months of the period, the interim revenues were 59% lower at £21.8m and the business moved into loss. Net debt was £66.6m at the end of September 2020. There are total borrowing facilities of £90m.
KR1 (KR1) has made two more investments. There is a $200,000 investment in Tidal Finance in return for 222,222,222.22 Tidal tokens. A further $200,000 is invested in HydraDX and the number of tokens has not been determined as yet.
Coinsilium Group Ltd (COIN) has more than £1m of cryptocurrency and tokens with a further $127,000 of RIF tokens due to vest over 23 months.
Tectonic Gold (TTAU) has drilled 11 holes at the Specimen Hill prospect in Queensland. Gold/ copper/silver mineralisation was intersected in the first three holes. The other eight holes have similar characteristics.
Belvedere Leisure (BELV) has entered into an exclusivity agreement to purchase the 160 acre site known as Barnsoul Park in Dumfries and Galloway for £1.4m. The deal is subject to due diligence and 12 weeks after completion there are plans to install at least 28 lodges as part of an upgrade of the park. Bookings will be taken for June 2021 onwards if the deal goes ahead. In two years, there should be more than 150 lodges.
Upper Thames Holdings (UPPT) has non-binding heads of agreement for the purchase of a 10% stake in Sweden-based Ridercam, which supplies mobile camera systems for theme park rides.
Gunsynd (GUN) says that Angold Resources has completed the acquisition of Federal Gold Corp and trading in Angold shares will begin on the TSX Venture Exchange on 31 December. Gunsynd owns 712,500 shares.
Newbury Racecourse (NYR) has appointed Allenby Capital as its corporate adviser.
AIM
Applegreen (APGN) is recommending a €5.75 a share bid from the company’s founders, which values the company at €718.1m. The roadside convenience retailer floated on AIM in 2015 at 277p a share. Applegreen has 559 sites.
Coral Products (CRU) its core mouldings business at Haydock and Interpack to One51 ES Plastics for £7.9m. That is nearly as much as the current market capitalisation, while pro forma net cash is expected to be £6.6m. One51 acquired Straight in 2014. Coral will still own the Haydock freehold and the annual rent will be £300,000. The deal required shareholder approval because it is deemed to constitute a change of business. The remaining subsidiaries are Tatra Rotalac, which produces plastic extrusions and mouldings, and Global One Pak, which supplies lotion pumps and trigger sprays. They generated full year revenues of £5.4m and are profitable prior to central costs. Pro forma NAV is £13.6m.
Equatorial Palm Oil (PAL) has agreed to acquire Capital Metals for £15.8m. The company is raising £2.09m at 12p a share (following a 20-for-one consolidation). Capital has an interest in the Eastern Minerals project in Sri Lanka. There is a JORC resource of 17.2Mt with an average grade of 17.6% total heavy minerals. The Environmental Impact Assessment should be published soon. First production could be in 2022.
Hargreaves Services (HSP) has sold its remaining speciality coal stocks to its German joint venture company for £24m. Hargreaves will market the coal on the joint venture’s behalf for commission. There will be a £3m goodwill write-off, but the profit impact should be neutral.
Duke Royalty Ltd (DUKE) has exited its investment in IT firm Welltel (Ireland) for £15.4m. This represents an IRR of 27%. There have been follow-on investments in two other royalty companies. Duke has invested £3.1m in recreational vehicle parts wholesaler MRDB, which will use the cash to help buy vendor loan notes for £4.9m. Duke will own 30% of MRDB. Monthly payments will be £147,000. A further £1m has been invested in Irish insurance brokerage company BHPC.
IXICO (IXI) has secured a £3.4m contract to provide data analytics services for rare neurodegenerative condition, SCA3 (Machado-Joseph disease). This will last more than four years.
Driver Group (DRV) chairman Steven Norris has bought 46,000 shares at 53.5p each. He owns 293,062 shares.
Sutton Harbour (SUH) has purchased a 1.5 acre site to the east of Sutton Harbour. Two residential developments totalling 200 units are planned for the site. A planning application has been submitted for another residential and commercial development at Sugar Quay. The company has also gained permission for event pontoons in the harbour.
Microsaic Systems (MSYS) has not received a definitive offer and the board has decided to end bid talks. It has also failed to secure the cash it requires and KRE Corporate Recovery has been appointed to advise on alternatives, such as selling assets. There is a possibility that an administrator may be appointed.
TMT Investments (TMT) received $40.9m for its stake in CRM company Pipedrive Inc and this increases its cash to $42m. It will repay the shareholder loan of $3m.
MAIN MARKET
Residential developer One Heritage Group (OHG) has raised £930,000 at 10p a share when it joined the standard list. This valued the company at £3m. The shares ended the week at 11p. The initial focus is north west England and One Heritage redevelops and refurbishes buildings and has a lettings operation. The company has a marketing network in Hong Kong and also sells developments to institutional investors.
Standard list shell Pineapple Power Corporation (PNPL) raised £1.3m at 3p a share. The focus is renewable and clean energy. The share price increased to 3.25p.
Construction and water infrastructure company nmcn (NMCN) says that its full year loss will be £16.5m. That includes £5.3m of prior year adjustments. There should be a small cash outflow. The one bright area is telecoms, where capital investment by clients increased. The order book is valued at £200m. Shore Capital has been appointed broker.
Andrew Hore
Andrew Hore – Quoted Micro 11 May 2020
AQUIS STOCK EXCHANGE
British Honey Company (BHC) says its hand sanitiser has generated revenues of more than £500,000 since late March. This helps to offset the reduction in sales of alcohol products. There is sufficient alcohol available for the company’s requirements for the rest of the year. British Honey has appointed finnCap as corporate adviser and joint broker with Stanford Capital.
National Milk Records (NMRP) increased first quarter revenues by 1% to £5.61m. The growth comes from testing revenues with other revenues declining slightly. The company remains positive about the prospects for the dairy sector. The supply chain is rebalancing following a drop in demand for milk from coffee shops.
NQ Minerals (NQMI) says that the total gold resources at the Beaconsfield gold mine in Tasmania have increased to 1.454 million tonnes at 10.3g/t for 483,000 ounces of gold. This excludes any estimate for the upper section of the mine.
World High Life (LIFE) says the Love Hemp brand has increased online sales by 39% each month since January. The brand’s CBD products are being stocked by more retailers.
TechFinancials (TECH) has signed a separation agreement with the cofounders of Footies Ltd and it will own 100% of the business. The cofounders get the original source code from May 2019. TechFinancials is ending its B2B brokerage activities by 1 November.
Investment company Gunsynd (GUN) has consolidated 85 shares into one new share.
Adnams (ADB) has appointed Jenny Hanlon to replace Stephen Pugh as finance director, which is a role he has held for 16 years.
EPE Special Opportunities (ESO) reported a NAV of 266.48p a share at the end of April. That represents a decline from 317.18p a share in the latest quarter.
AIM
Best of the Best (BOTB) has sparked another profit upgrade following its trading statement. finnCap has raised its 2019-20 by 27% to £3.8m.
IP investment company Tekcapital (TEK) increased net assets by two-fifths to $22.3m, which is equivalent to 35 cents a share. The biggest gain in value was for Guident, where nearly $7m was added to the valuation. Alternative salt developer Salarius and medical devices company Bellascura also generated good increases. Hi-tech eyewear developer Lucyd’s value fell by nearly $2m. Tekcapital recently raised £925,000 at 10p a share. This will be invested in portfolio companies.
Lower costs meant that ClearStar (CLSU) made a lower loss than expected in 2019. The background checks provider had net debt of $300,000 at the end of the year and this has increased to $1m. The year commenced with a record order book but there have been delays and reductions in volumes.
Genedrive (GDR) has raised £7m at 80p a share to finance the development of two COVID-19 tests.
Filta Group Holdings (FLTA) has launched FiltaShield, a COVID-19 sanitising services. It has also combined with a technology company to provide temperature screening devices.
VR equipment supplier Immotion (IMMO) has raised money for the second time this year. It has raised £1.35m at 2.5p a share, which is much lower than the 7.25p placing price in February.
Beximco Pharmaceuticals (BXP) says that Bangladesh’s economic slowdown and disruption to supplies due to COVID-19 could hamper the fourth quarter of the year to June 2020. Even so, Beximco still expects to report annual sales growth.
ZOO Digital (ZOO) says that strong cash collections mean that it had cash of $700,000 at the end of March 2020. Demand for localisation services weakened at the end of March but demand is recovering.
Hargreaves Services (HSP) has conditionally exchanged contracts for a 79 acre plot on the Hatfield site in South Yorkshire, which will be used to develop a national distribution centre for a retailer. The company is trading in line with expectations other than in the property business, where planned land sales will not complete before the end of May as originally anticipated.
MAIN MARKET
JD Sports Fashion (JD.) has been told by the CMA that it has to sell Footasylum. The formerly AIM-quoted footwear retailer was acquired last year. An appeal is being considered.
BATM (BVC) has launched an antibody test for COVID-19 and sales have begun to European countries.
Argo Blockchain (ARB) mined 319.2 bitcoin during April, down from 333.8 the previous month. The revenues were £1.8m in each month.
Andrew Hore
Ian Pollard – Next #NXT online sales save the day
Next pc NXT Full price sales in the second quarter were up 2.8% on last year and ahead of the 1% expected at the time of the May update. Next believes believe that this over-achievement was due to the prolonged period of exceptionally warm weather, which greatly assisted sales of summer weight products.Expectations for the remainder of the current year to January 2019 are that full price sales will rise by 2.2%, earnings per share will grow by 3.7% and group profit before tax will be down by 1.3%. Full price sales for the 26 weeks to the 28th July were up by 4.5% compared to last year but therein lies the pending nightmare facing most of the major retail clothing retailers. Sales in retail stores declined by 5.3% whereas online sales rose by 15.5%, providing further proof,if proof were needed, that the high street is dying on its feet.
BAE Systems plc BA. claims to have made good progress in the half year to the 30th June and laid a strong foundation to deliver future growth. The interim dividend is being inceased by 2%. Despite the optimism, on a constant currency basis, sales fell 3% to 8.8bn. as a result of reduced Typhoon production, underlying EBITA was down 6% but underlying earnings per share rose by 2%. As defined in IFRS and on a constant currency basis revenue fell by 5%, operating profit was down by 11% and basic earnings per share by 17%
Direct Line Ins Group DLG with half year falls of 15.75% in operating profit and 13.9% in profit before tax, has decided that attack is the best form of defence and is increasing its interim dividend by 2.9%. It is also brave enough to put on its rose tinted glasses and describe these as a good set of results. Perhaps it is purely coincidence that the CEO has chosen this as a good time to depart after 10 years in office.
Hargreaves Services plc HSP After seeing like for like basic earnings per share fall from 17.8p to 3.8p and last years operating profit of 1.4m. tuned into a loss of 1.4m for the current year, the group describes its preliminary results as being “satisfactory”. With profit before tax falling from 4.7m to this years 500,000 it even tries to get its shareholders to accept that it is delivering against its strategic objectives. Hands up those who have doubts.
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Ian Pollard – BT lines crossed; sacrificial lamb chosen; board saved
BT Group plc BT.A Todays announcement from BT that the Chief Executive is to make an unexpected and unplanned exit illustrates that the Board and the Chairman may have a problem which in turn illustrates that BT has a problem. The problem appears to be that the top management is confused and incapable of expressing itself logically. Reaction to recent results, bemoans the Chairman, has thoroughly demonstrated both to him and to the outgoing Chief Executive that there is need for a change of leadership to deliver the strategy set out by the Chief Executive and his team. So the Chief Executive is to go, whether stabbed in the back or falling on his sword, one know not but this is where the Chairman and the Board just tie themselves into knots. There is nothing wrong it appears with the Chief Executives strategy. It has the full support of the board says the Chairman “The Board is fully supportive of the strategy recently set out by Gavin and his team.”
So why has Gavin alone been selected for the chop. It does seem slightly illogical that the board should escape Scot free from the consequences of something to which it gave its full support. Sacrificial lambs, this way, please.
Games Workshop Group GAW has today announced a dividend of 30p per share, payable on the 27th July, as the sales and profit growth previously announced has continued to the and of the year on the 3rd June. Group profit before tax for the year is expected to be not less than 74m.
Hargreaves Services plc HSP updates that trading has been satisfactory during the year to the 31st May and results are expected to be in line with expectations.
Distil plc DIS Both sales volume and revenue continued to grow strongly across all channels during the year to the 31st March.Turnover and gross profit both rose by 23% and the company expects to build on its success during the coming year.
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Ian Pollard – Galliford Try Cuts Dividend After Strong First Half
Galliford Try GFRD Has done the unthinkable, especially for a housebuilder which claims to have delivered a strong first half performance. It has not just tweaked its interim dividend, it has cut it by a hefty 13% The reason is of course perfectly natural. It wants to increase dividend cover to twice pre exceptional earnings. One of those exceptional items is £25.m lost through its relationship with Carillon.True, revenue did rise by 14% but profit before tax was down 11% and earnings per share 9%. Perhaps shareholders are hoping that the second half will not be quite as strong as the first half.
Sky plc SKY has won four packs of football rights covering 128 games from 2019 to 2022 and they have got away with paying 16% less than before for the so called privilege. Could this be the first sign that the allure of football has at last begun to fade as viewers get fed up watching grossly overpriced and overrated foreign players ducking, diving and brazenly cheating and fouling through 90 minutes of what used to be called sport. If the money continues to shrink may we eventually return to the days when we will see an English team with enough talent to enable it to start winning matches again.
Hargreaves Services HSP is another company to come unstuck in its first half with revenue for the six months to the 30th November falling from £170 .9m. to £150.3m. and earnings per share down from 0p to a loss of 4p per share. A tiny profit of 0.1m was also turned into a much bigger operating loss of 2.7m., results which were in line with management expectations. But the board stood by its shareholders in these difficult times and maintained its interim dividend at 2.7p per share.
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Hargreaves Services; Profits Down 75%, Divi Up 58%
Hargreaves Services HSP warned in December that the half time figures would be bad and they are. Although like for like revenue for the 6 months to 30th November fell by only 2.2%, like for like profit before tax was down by 75% and underlying diluted earnings per share by 95.7%. As is usual in these circumstances the Board decided that it would be wise to look after the shareholders and they have certainly done that with a rise in the interim dividend of of 58.8%. The share price has been strong since the end of October having risen by a maximum of 40%.
The Chairman says it is pleasing to see how much progress has been achieved in meeting the targets which the company set itself a year ago.
NEX Group NXG benefited substantially in quarter 3 from the high volatility and increase in trading activity which followed Trump’s election success. On the day after Trump’s victory BrokerTec enjoyed its second highest volume day on record. Average daily volume for quarter 3 in IS and EU repos rose by 8% and 11% respectively. Volatility in the dollar/yen saw average daily volume surge by 23%.
Group like for like 3rd quarter revenue rose by 11% on a constant currency basis but the arrival of the new year saw volumes become much more muted and NEX admits that it is too early to say that previous long term subdued market conditions have come to a permanent end.
Tracsis TRCS Group revenue for the half year to 31st January rose from £13.1m. to £15.5m. and both EBITDA and adjusted pre tax profit are expected to be slightly ahead. The second half should prove to be significantly stronger than the first half and full year revenue and profit are expected to be in line.
Animalcare Group ANCR reports a very strong first half, ahead of the boards expectations and the interim dividend is to be increased by 11.1%. Revenue for the 6 months to the 31st December rose by 12%. Reported operating profit was up by 23.5% and basic earnings per share by 23%. Exports led the way with export revenue rising by 37.7%