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Andrew Hore – Quoted Micro 27 July 2020
AQUIS STOCK EXCHANGE
Healthcare IT provider DXS International (DXSP) moved from loss to profit in the year to April 2020. Revenues were slightly lower at £3.28m, while a loss of £200,000 was turned into a pre-tax profit of £239,000. There was £1m in the bank at the end of April 2020, following the recent fundraising. There has only been a marginal drop in revenues due to COVID-19 and growth should return later in the year. Chairman Bob Sutcliffe has bought 46,153 shares at 6.5p each.
KR1 (KR1) has raised $493,000 from the sale of Nexus Mutual tokens. They cost $79,000. KR1 still owns three-quarters of the tokens it originally acquired in the blockchain-based mutual insurance company.
Gunsynd (GUN) has bought a stake in Eagle Mountain Mining at A$0.13 a share. The £110,000 investment in the ASX-listed company provides exposure to copper exploration. The cash will finance exploration at the Oracle Ridge copper mine project.
Clean Invest Africa (CIA) has raised £150,000 at 1p a share. The new shares come with warrants exercisable at 2.75p each.
The Tasmanian government has transferred the mining lease to the Beaconsfield gold mine to NQ Minerals (NQMI).
AfriAg Global (AFRI) had £76,000 in cash at the end of June 2020. There are also £1.16m of investments available for sale.
Eurocann International (BUD) has yet to identify a medicinal cannabis business that fits its acquisition criteria and price expectations, although it has made some short-term investments.
Trading in the shares of Lombard Capital (LCAP) has been suspended following a sharp rise in the share price.
AIM
Tungsten Corporation (TUNG) is benefiting from its focus on building up recurring revenues from its e-invoicing platform. Additional products and services are being added to help accelerate growth. As revenues grow they will cover overheads and profit could increase rapidly after this point has been reached.
Frontier IP (FIPP) has raised £2.33m at 55p a share. This will enable the IP investment company to provide bridge finance and invest directly in funding rounds. Frontier also wants to take on more people to help advise and develop investee companies.
In the year to March 2020, Mercia Asset Management (MERC) generated enough income to cover its overheads for the first time. That was with a part-year contribution from Northern Ventures. However, there were fair value write downs of assets of £15.8m. The NAV is 32.1p a share. Funds under management are £658m. Since the year end there was a gain on the disposal of the stake in Native Antigen.
Oil and gas producer Touchstone Exploration Inc (TXP) has confirmed the major potential of the Cascadura discovery in Trinidad. The estimate for 2P reserves is 45 mmboe of gas/condensate. Touchstone’s production could be multiplied by ten. finnCap has set a risked-NAV of 91p a share.
Scientific instruments manufacturer Judges Scientific (JDG) says that first half order intake was 17% lower. North American orders were one-third lower. Like-for-like interim sales were 12% lower. Cash was generated from operations.
Disinfection products supplier Tristel (TSTL) says that full year revenues were one-fifth ahead helped by an additional £1.5m due to COVID-19. Net cash was £6.2m at the end of June 2020.
Synairgen (SNG) says that its phase II trial of SNG001 in hospitalised COVID-19 patient shows a 79% reduction in the development of severe disease and death. Discussions have started with regulators.
Conroy Gold and Natural Resources (CGNR) has secured a joint venture with Anglo Asian Mining (AAZ) to develop a gold mine in Ireland. Anglo Asian is committing to spend €2m for an initial 17.5% stake with an option to spend the same amount to take the stake to 25%. The maximum stake that can be earned is 55%, which would take the Clontibret gold deposit to the point where the mine is ready for construction. Anglo Asian has been issued with 325,000 Conroy warrants exercisable at 16p a share. Sanderson Capital Partners has cut its stake to below 3%.
Bidstack (BIDS) generated revenues of £275,000 in the first half, but the second half is more important. The in-game advertising company is winning business around the world.
Mattress retailer eve Sleep (EVE) generated slightly lower revenues of £12.2m in the first half of 2020, but the loss will be much lower due to cost savings. Cash was generated in the first half and there is net cash of £9.1m. Some competitors are withdrawing from the European market.
MAIN MARKET
Retailer French Connection (FCCN) has reduced costs during a tough trading period. Websites sales were 24% higher in the past 15 weeks. Stores started to reopen on 15 June, but the recovery is gradual.
Standard list shell Auctus Growth (AUCT) had £780,000 in the bank at the end of June 2020.
Bermele (BERM) intends to acquire Singapore-based East Imperial, which sells premium mixers and New Zealand spring water. There is a nine month exclusivity agreement. Trading in Bermele shares is suspended.
Andrew Hore
Andrew Hore – Quoted Micro 15 June 2020
AQUIS STOCK EXCHANGE
Wheelsure Holdings (WHLP) has published results for the year to August 2019 and the subsequent interims. Following these announcements, trading in the shares has resumed. There was strong growth in the interim figures with revenues of £116,000 but there was still a loss of £75,000. The working capital facility has been increased to £500,000.
Cannabis products supplier World High Life (LIFE) says it intends to list on the Canadian Stock Exchange. Revenues were £1.05m in the nine months to March 2020. Write-offs meant that the loss was £11.3m. Subsidiary Love Hemp’s online sales in May were double the level in January. Sales have switched from high street to online. There will be a rebrand in September
Engineering businesses consolidator Vulcan Industries (VULC) has raised a further £179,000, including £65,000 raised by share issues to employees at 2p a share. There were also shares issued at 4.25p each. The placing price was 3p a share and creditors are taking shares at that price valued at £175,000 in lieu of flotation costs. The current share price is 4.5p (4p/5p).
Gunsynd (GUN) is raising £600,000 at 0.65p a share and this will be used for further investments.
KR1 (KR1) has participated in the Plasm token distribution. KR1 has 1,232 Ether (ETH) valued at $253,000 which it has agreed to be locked up. Access will be obtained in three intervals over 1,000 days. In return for the lockup KR1 receives 66.3 million Plasm tokens. Plasm is launching a platform on the Polkadot blockchain.
Cadence Minerals (KDNC) has raised £650,000 at 9p a share. The cash will be used to help develop the Amapa iron ore project and pay off loan notes. The stockpile of iron ore should be shipped during the summer. Cadence and the joint venture partners are in discussions with creditors. A scoping study will be commissioned.
The Australian government has approved the acquisition of the Beaconsfield gold mine in Tasmania by NQ Minerals (NQMI). This will enable the mine to be reopened. NQ Minerals has raised £119,000 at 7.5p a share.
Walls and Futures REIT (WAFR) has sold a residential property in Wimbledon Park for £656,000, so that it can reinvest the cash in the core supported housing business. The sale was at a 3% discount to book value.
British Honey Company (BHC) has launched a Special Charity Edition Premium Vodka to raise money for COVID-19 research. One-quarter of sales revenues will go towards funding this research.
Lombard Capital (LCAP) has completed the purchase of a property in Preston. Barry Fromson has been appointed as chief executive and Barry Fitzpatrick as non-executive chairman. Trading in the shares has been suspended.
Sport Capital Group (SCG) had an investment property and nearly £12,000 in the bank at the end of 2019. NAV is £206,000.
AIM
Bahamas Petroleum (BPC) and Columbus Energy (CERP) are merging. Columbus shareholders will receive 0.803 of a BPC share for each share they own. Columbus was valued at £25m when the deal was announced. Columbus will generate cash to help finance exploration by BPC.
Escape Hunt (ESC) is raising up to £4m via a placing and one-for-four open offer at 7.5p a share and a convertible loan note issue of £340,000. The escape rooms operator says all the directors are buying shares. The intention is to spend £2.5m on rolling out more sites and the rest will go on operational improvements and working capital. Five or six new sites are planned in the next 12 months. UK sites were growing revenues prior to lockdown.
Hummingbird Resources (HUM) intends to acquire the Kouroussa gold project from Cassidy Gold Corp. First gold production could be within two years. There is a gold resource of 1.18Moz at >3g/t.
Hawkwing (HNG) plans to move to a standard listing. Formerly TLA Worldwide, trading in the shares is suspended because the shell has not found a suitable acquisition. Hawkwing would lose its AIM quotation in September without an acquisition. There is no time limit on acquisitions for shells on the standard list.
Ilika (IKA) had cash of £14.9m at the end of April 2020. The battery technology developer is choosing a fabrication facility for the manufacture of its batteries. Four potential partners are in the running. A tool that will increase productivity has been ordered and should be delivered by the end of 2020.
Dekel Agri-Vision (DKL) produced less crude palm oil during May because of a decline in fruit delivered to the mill. There were 3,316 tonnes of crude palm oil produced in May, down from 5,316 tonnes in May 2019. However, more was sold during the month because of the much higher production in April. The average price received per tonne increased.
Be Heard (BHRD) has received a bid approach of 0.5p a share from MSQ Partners.
MAIN MARKET
Lower energy prices have led to a fall in the net asset value of JLEN Environmental Assets (JLEN) but it continues to generate cash and pay dividends. NAV has fallen from 104.7p a share to 97.5p a share. Total dividends were 6.66p a share last year and the target for this year is 6.76p a share. JLEN is joining the FTSE 250 index on 22 June.
Air Partner (AIR) is raising £7.5m at 75p a share. Profit was ahead of budget in the four months to May 2020 with strong freight demand. There is also recovery in the private jets market. The cash will fund organic growth including the opening of offices in new locations.
Seafox International has attempted to requisition a general meeting at Gulf Marine Services (GMS) in order to appoint its representatives to the board. GMS says that the requisition is not valid in its current form. Hassan Heikal and Hesham Helbouny are the proposed directors.
Boston International Holdings (BIH) has secured a new £200,000 loan facility from a major shareholder. The plan is to acquire invoice factor Alexanders Discount.
Associated British Engineering (ASBE) is selling its interest in British Polar Engines and this will mean that it will no longer have any commitments to the pension fund. There will be no debt if the deal goes ahead.
Small Cap Awards 2020
The shortlist for the 2020 Small Cap Awards has been published. The awards are for quoted companies with a market capitalisation of less than £200m. This year the awards dinner has been cancelled. Instead, there will be a live virtual awards ceremony held via Zoom on 25 June. There are eleven awards for companies and individuals.
Company Of The Year
Yourgene Health
Volex
Renalytix AI
SDI Group
Ergomed
Judges Scientific
IPO Of The Year
Diaceutics
Brickability Group
Essensys
Argentex Group PLC
Loungers
Pebble Group
Executive Director Of The Year
Matt Jones – CEO of Blancco Technology Group
Giulio Cerroni – CEO of Ixico
Lyn Rees – CEO of Yourgene Health
Jennifer Winter – CEO of Animalcare
Peter Harrison – CEO of Bioventix
David Cicurel – CEO of Judges Scientific
Transaction Of The Year
Centralnic Group – Team Internet
Rockrose Energy – Marathon Oil and Marathon West of Shetland Limited
Kape Technologies – Private Internet Access
Amryt Pharma – Aegerion
Totally – Greenbrook Healthcare
Inspiration Healthcare acquisition of Vio Holdings
Technology Company Of The Year
SRT Marine Systems
Oxford Metrics
Blackbird
Avacta
Blancco Technology Group
Reneuron
Innovative Financing Of The Year
Yu Group PLC
Simec Atlantis Energy
1pm PLC
Symphony Environmental
Impact Company Of The Year
Good Energy
Eden Research
ITM Power
Inspired Energy
Jubilee Metals
Ilika
Analyst Of The Year
Kartik Swaminathan, Arden Partners
Peter McNally, Panmure Gordon
Jens Lindqvist, Investec
Lorne Daniel, Finn Cap
Kai Korschelt, Canaccord Genuity
George O’Connor, Stifel London
Journalist Of The Year
Simon Thompson – Investors Chronicle
Michael Taylor – Investors Chronicle
Mark Shapland – Evening Standard
Joanne Hart – Mail on Sunday
Emma Agyemang – Financial Times
Hannah Godfrey – Professional Adviser
UK Smaller Companies Fund Manager Of The Year
ASI UK Smaller Companies – Harry Nimmo
JPM UK Smaller Companies – Georgina Brittain and Katen Patel
M&G Smaller Companies – Garfield Kiff and Rory Alexander
Invesco UK Smaller Companies Equity (UK) – Jonathan Brown
TM Cavendish AIM B – Paul Mumford
Kames UK Smaller Companies – Elaine Morgan
VCT Manager Of The Year
Amati AIM VCT PLC – Dr. Paul Jourdan, David Stevenson, Anna MacDonald
Unicorn AIM VCT PLC – Chris Hutchinson
Octopus AIM VCT 2 PLC – Kate Tidbury
Maven Income and Growth VCT 1 PLC – Bill Nixon
Seneca Growth Capital VCT PLC – John Davies
Hargreave Hale AIM VCT 1 – Oliver Bedford
Andrew Hore
Andrew Hore – Quoted Micro 8 June 2020
AQUIS STOCK EXCHANGE
Sativa Group (SATI) has agreed a merger with Stillcana Inc. The share swap is 0.33507 of a Stillcanna share for every Sativa share. That values the cannabis products company at £10.7m and its shareholders will own 65% of the enlarged group. Trading in Sativa shares restarted on 4 June.
Engineering businesses consolidator Vulcan Industries (VULC) floated on 1 June. It was valued at £6.98m at the 3p a share placing price. Vulcan raised £746,500 via a subscription and placing and £239,000 will be spent on costs. . Vulcan has already completed four acquisitions. They supply automotive components, fire doors and frames, nails and architectural metal work. Trading was weaker than expected last year. Zanete Fergusone sold three businesses to Vulcan and her family interests own 47.7% of the company. A manufacturer of pressed steel bearing housings is set to be the next acquisition.
Adnams (ADB) has put its refinancing negotiations on hold since the COVID-19 lockdown. The long-term facilities have been extended by six months. Adnams is considering the government loan scheme. There will be a substantial interim loss.
IFA group AFH Financial (AFHP) believes that £3m of temporary annualised cost savings will help to offset a decline in gross revenues this year. Interim revenues were 5% ahead at £38.2m but pre-tax profit was flat due to higher interest costs. The interim dividend is 5p a share, instead of the anticipated 7p a share. A further 2p a share may be paid later in the year depending on the prospects at the time. Underlying full year pre-tax profit should improve from £16.9m to £18m, which is a small downgrade on previous forecasts.
Good Energy (GOOD) has seen no significant financial impact from COVID-19. Cash collection has been in line with previous years. The generation assets have produced above average output. The final dividend has been deferred.
Altona Energy (ANR) is assessing the potential acquisition of a majority stake in a rare earths project. The Chambe project is in Southern Malawi. Due diligence will take up to three months.
Tectonic Gold (TTAU) has sold a majority interest in Tectonic South Africa to AIM-quoted Kazera Global. Tectonic will retain a 10% interest in the diamonds project. Tectonic has received £100,000.
Investment company Gledhow Investments (GDH) increased net assets from £735,000 to £907,000 by March 2020. Gledhow had £147,000 in cash at the end of March.
Welney (WENP) has published full year and interim figures. At the end of December 2019, net liabilities were £361,000. A consolidation of 100 shares into one new share will be followed by a £15,000 placing at 0.3p a share. A loan stock issue will raise £35,000. Trading in the shares restarted on 3 June. Keith, Bayley, Rogers has been appointed as corporate adviser. The company’s name will be changed to Quetzal Capital
Black Sea Property (BSP) is renegotiating its credit facilities. Management is uncertain how trading will fair this year.
Lombard Capital (LCAP) is changing its accounting reference date from 31 March to 30 June. Barry Fromson has been appointed as an executive director.
Wishbone Gold (WSBN) has raised £300,000 at 1.35p a share and issued £70,000 worth of share for fees and to convert loans. Peterhouse has replaced Turner Pope as broker.
AIM
Mereo Biopharma (MPH) has raised $70m (£56m) including $19.4m (£15.5m) via a share placing at 17.4p each and $50.6m (£40.5m) through a convertible loan note issue. The cash will be used to reduce debt and fund the company into 2022. Mereo plans a phase 1b study for cancer treatment etigilimab during the fourth quarter.
Life sciences IT services provider Instem (INS) continues to trade strongly and net cash was £8.3m at the end of April 2020. The 2019 figures show a rise in pre-tax profit from £2.8m to £3.2m and a jump to £4.2m is expected in 2020. Existing business continues but new business may take longer to secure, and this led to a small downgrade.
Amryt Pharma (AMYT) has signed a distribution agreement with Swixx BioPharma for leptin deficiency treatment Myalepta in 17 eastern European countries.
Armadale Capital (ACP) says that the definitive feasibility study update has increased the NPV of the Mahenge Liandu graphite project in Tanzania by 20% to $430m. That is based on a 30% rise in average annual production.
Bidstack (BIDS) has raised £5.5m at 4p a share. The in-game advertising technology developer will use the cash to expand internationally and fund marketing and further technology development.
Telematics firm Quartix (QTX) says that subscriptions have held up and installations are recovering after an initial slump in April. Trading in the first four months of 2020 was ahead of the same time last year. Some clients have been allowed payment deferrals. There is £9.5m in the bank.
President Energy (PPC) has raised £2.24m at 1.85p a share via PrimaryBid. A placing raised a further £2.5m. Trafigura is subscribing a further $6m at the same share price. Along with a $4.1m debt for equity swap this will reduce debt to around $15m. There will be a $98.5m write down of assets, particularly the Paraguay exploration activities. Even excluding this, there will be a loss this year. The crude oil reference price in Argentina has been set at $45/barrel until the end of the year, which is higher than the current global price.
MAIN MARKET
Tex Holdings (TXH) improved sales and gross margins last year, but there was still a slightly increased pre-tax loss due to redundancies and professional fees. Revenues increased from £40.1m to £43.1m, and if exceptional costs are stripped out there was a decrease in pre-tax loss to £661,000. The plastics division is profitable, but the engineering division is losing money. The overdraft has been repaid with the proceeds of a shareholder loan. The pension surplus has increased NAV from 127p a share to 134p a share. There are plans to reduce costs by an annualised £1.5m.
LED lighting supplier Luceco (LUCE) says trading has improved in recent weeks and it expects the first half profit and cash generation to be at least as good as the same period last year. That is despite lower revenues.
Motor dealer Lookers (LOOK) is closing 12 more dealership sites. Annual savings of £50m are anticipated. Trading has recommenced at Lookers sites, but activity is still weak. Net debt was £57m at the end of May.
Andrew Hore
Andrew Hore – Quoted Micro 25 May 2020
AQUIS STOCK EXCHANGE
Daniel Thwaites (THW) closed its pubs and hotels on 20 May and it will not pay a final dividend for 2019-20. Net debt was £65.4m at the end of March 2020 and there are £16.6m of spare bank facilities. Trading had been strong, and the predominance of freehold properties means that rent payments is not as big a concern as it is for some pub operators.
Housebuilder St Mark Homes (SMAP) had a NAV of 127p a share at the end of 2019. The share price is 87.5p. There is cash of £4.8m and the company intends to pay off its bond, which has a 6% coupon. In 2019, pre-tax profit dipped from £117,000 to £114,000.
KR1 (KR1) has raised $353,000 from the sale of RPL tokens, relating to the Rocket Pool, which is developing a proof-of-stake infrastructure service using Ethereum 2.0. The tokens were acquired for $0.21 each and sold at $1.67 each. The majority of the RPL tokens acquired are still held by KR1 even though there was a buyer for all of them. The takeover of digital asset custodian Volt Ltd has generated a further $244,000.
Rutherford Health (RUTH) has signed a framework agreement that will enable it to provide cancer treatment services to NHS trusts. The deal lasts an initial period of two years.
Altona Energy (ANR) has cancelled its open offer because the minimum amount was not raised. Instead, management is in discussions with three companies that could reverse into Altona. Cash will be required to cover the costs of a reverse takeover.
Trading has resumed in Lombard Capital (LCAP) shares. Lombard’s waste and recycling subsidiary is acquiring land in Preston for £1.08m. Lombard needs to issue more bonds in order to fully fund the purchase. Existing bond holders are swapping £507,000 worth into shares at 25p each and £320,000 has been raised from the exercise of warrants at 10p each. The current share price is 27.5p and it is more than five times the level it was two months ago. The site was previously used for recycling and Lombard will reapply for an environmental licence. It will be used for a waste to energy project and a plastic recovering plant.
Coinsilium Group Ltd (COIN) has been appointed as adviser to Kesholabs, a Kenya-based blockchain technology developer. Kesholabs is developing three applications that could be launched within 12 months.
Clean Invest Africa (CIA) says that CASA is set to resume limited operations after the lockdown in South Africa. CASA will produce test work and production of anthracite samples.
Ananda Developments (ANA) subsidiary DJT plants has met with the MHRA to discuss its plans to grow strains of cannabis. This is part of the licence application to grow medicinal cannabis. There will be further consultation with the UK authorities.
World High Life (LIFE) says that subsidiary Love Hemp has increased capacity for its LH Botanicals business.
IWEP is swapping part of its loan to Eight Capital Partners (ECP) into a 29.8% stake at 0.025p a share. Shares have also been issued to creditors to satisfy money owed.
First Sentinel (FSEN) has invested £270,000 in Stabiltech Biopharma as part of a £6m fundraising. The corporate finance subsidiary is advising the investee company on further fundraisings. The vaccine developer is developing a potential vaccine for COVID-19. Clinical trials should start in June.
Secured Property Developments (SPD) is still seeking property investments. There is £514,000 in the bank and net assets of £470,000.
All Star Minerals (ASMO0 has raised £80,000 at 0.02p a share and a further £170,000 is being sought. Ian Harebottle and Richard Lloyd, who both have mining experience, are joining the board.
NQ Minerals (NQMI) has raised £189,500 in placings at 7p a share and 7.5p a share. NQ has raised £340,000 in the past fortnight.
Shareholders have passed the resolution to consolidate 100 existing Wheelsure Holdings (WHLP) shares into one new share.
Sport Capital Group (SCG) has appointed Peterhouse as joint broker.
Engineering businesses consolidator Vulcan Industries is seeking admittance to the Aquis Stock Exchange. The focus is profitable metal fabrication and precision engineering businesses. First Sentinel is corporate adviser. The expected admission date is 1 June.
AIM
Renalytix AI (RENX) plans to gain a Nasdaq listing. The renal diagnostics company has not decided how much money it wants to raise. Renalytix AI has launched a joint venture to develop and produce COVID-19 antibody test kits.
STM (STM) subsidiary Carey has won a court case brought by a client. Adams v Carey related to a non-advisory SIPP taken out by Adams and an investment that he asked to be put in the SIPP. The investment performed poorly, and Adams claimed for loss of value. This case has been going on for more than two years.
Employee background checks provider ClearStar (CLSU) has launched a COVID-19 testing service that will help employers with back to work planning. That could attract additional clients for ClearStar’s services.
Imaging services provider IXICO (IXI) increased interim revenues from £3.43m to £4.56m and that helped to more than double profit from £215,000 to £475,000. There was cash of £6.66m at the end of March 2020. The order book is strong. It was £15.3m at the end of the interim period and more has been added since then. Data analysis from existing trials is continuing during the lockdown.
Tiziana Life Science (TILS) intends to demerge its genomics-based personalised medicine businesses into a separate quoted vehicle. This will enable the business to raise cash to develop the StemPrintER technology for the prediction of disease recurrence in breast cancer patients.
Tissue products developer Tissue Regenix (TRX) raised £14.6m at a share price of 0.25p. This was much-needed cash because existing funds were about to run out.
A share placing by Open Orphan (ORPH) at 11p a share raised £12m after expenses. This will help to finance services for COVID-19 vaccines and tests, as well as more laboratory facilities.
Digital TV technology provider Mirada (MIRA) has extended the term for its revolving credit facility by 12 months to the end of November 2021. Earlier this month, Mirada launched a lower cost version of its technology. Iris in Swift Mode is a pre-packaged platform.
Eddie Stobart Logistics (ESL) has acquired the Eddie Stobart brand from Stobart Group (STOB), which will have to change its name, for £10m. An annual fee of £3m was payable for the brand. This will be saved from now on. There have been some reductions in activity due to COVID-19, but grocery and e-commerce demand remain strong.
Cash shell Summerway Capital (SWC) has £5.55m in the bank as it continues to seek an acquisition.
MAIN MARKET
Contango Holdings (CGO) has published a prospectus relating to the acquisition of the Lubu coal project. The potential deal was announced more than one year ago. A £1.4m placing at 5p a share in January will finance costs and initial investment in the Lubu project. Readmission is expected on 18 June.
The Takeover Panel Executive has denied Moss Bros (MOSB) bidder Brigadier’s attempt to lapse its offer. Brigadier has asked for the ruling to be reviewed.
Pure Gold Mining Inc (PUR) has secured a $15m investment at $1.52 a share. This will be invested in the Red Lake Mine.
Loans to Shefa Gems (SEFA) totalling £1.25m have been converted at a premium to the market price. The shares issued account for 14.5% of the enlarged share capital.
Andrew Hore
Andrew Hore – Quoted Micro 4 May 2020
AQUIS STOCK EXCHANGE
Ace Liberty and Stone (ALSP) says that £2.2m of loan notes has been converted into shares at 50p each. The property portfolio has a resilient tenant base, with the majority of rents owed by national and local government tenants. During March, 82% of rents were paid. Four tenants are facing short-term difficulty. Ace will defer dividend payments.
SG Recruitment Ltd (SGRL) has signed contracts to supply nurses to Saudi Arabia and domestic workers to Bahrain and Malaysia. There is also a contract to supply personal protection equipment to the NHS. These deals are worth £800,000 in this financial year. Aaamir Quraishi has resigned as a director.
Cadence Minerals (KDNC) is raising £645,000 at 6p a share. The cash will be used to finance the bridging loan, with an annual interest rate of 18%, to fund the start-up of shipping iron ore from the Amapa project.
GP software provider DXS International (DXSP) believes that it can still match last year’s revenues despite COVID-19. New product launches have been delayed. There is cash in the bank to cover working capital.
Ananda Investments (ANA) says that medicinal cannabis strains are being analysed by Dr Dedi Meiri in Israel. Dr Meiri is assessing the anti-inflammatory properties of cannabis for treating coronavirus. Ananda intends to broaden its licence application for cannabis growth to the anti-inflammatory area.
Gunsynd (GUN) had net assets of £1.72m at the end of January 2020, including £225,000 in cash. The investment in Brazil Tungsten has been written down from £400,000 to nil. Management is assessing potential investments in the Australian precious metals sector.
SulNOx Group (SNOX) intends to raise £400,000 at 40p a share. Each share will also come with a warrant exercisable at 40p.
Trading in Lombard Capital (LCAP) shares has been suspended until it makes a full announcement about the proposed recycling acquisition.
KR1 (KR1) has invested $75,000 in the Union Finance project, which is a credit mutual on Ethereum. Loans will be offered via blockchain.
NQ Minerals (NQMI) has appointed VSA Capital as corporate broker.
AIM
NWF (NWF) has traded strongly, although May is likely to be weaker. Even so, pre-tax profit in the year to May 2020 is set to be substantially higher than the previous year. Food distribution was highly active in March and April. There were initial inefficiencies, but the division has adapted. The Crewe warehouse has started operations. The fuels division has benefited from lower oil prices. Heating oil demand has been strong, although the decline in economic activity has hit demand from commercial customers. Feeds demand is in line with expectations, although increased commodity prices could make trading more difficult in the coming months.
Trans-Siberian Gold (TSG) has identified a significant extension of Vein 25 North at the Asacha gold mine. There is potential to significantly increase the mineral resource. Production from Vein 25 North should commence earlier than anticipated this year.
Ariana Resources (AAU) says that its Kiziltepe mine joint venture has repaid its $33m loan that it received to finance the construction of the mine.
MAIN MARKET
Seafox International has proposed a 9 cents a share bid for Gulf Marine Services (GMS) but it has been rejected. GMS will be hit by the low oil price and it has net debt of $390m. GMS argues that it is cutting costs and still winning new business.
Nanoco (NANO) has ended its formal sale process due to economic uncertainty and the lack of a realistic bid. There is enough cash to take the company into the second quarter of 2021.
Cardiff Property (CDFF) edged up its NAV to 23.03p a share in the six months to March 2020. The Thames Valley property market is holding up. The interim dividend was raised from 4.6p a share to 4.8p a share.
Andrew Hore
Andrew Hore – Quoted Micro 3 February 2020
NEX EXCHANGE
Zapp Electric Vehicles plans to join NEX in February. Zapp has developed an electric bike and it is being produced in Thailand. The first production series model was made in September. The flotation will raise cash for manufacturing and marketing the i300 in the European market where cities are promoting electric vehicles. Zapp Scooters Ltd (the previous name) had net assets of £487,000 at the end of September 2018 and most of that was accounted for by an investment in the Thailand-based subsidiary. VSA Capital is corporate adviser.
Hydro Hotel Eastbourne (HYDP) increased its full year pre-tax profit from £193,000 to £282,000. Revenues were 2% ahead at £3.73m, while the cost base was flat. There were lower repair costs and the capital investment of recent years is beginning to pay off. NAV was £3.49m, including cash of £1.11m.
Ananda Developments (ANA) says that investee company DJT Plants has been asked follow-up questions by the government as part of the application to grow more than 0.2% THC cannabis. Sales of hap devices and hapac sachets has recommenced in Italy. The executive chairman has loaned £30,000 to Ananda at an interest rate of 10% a year.
Sativa Group (SATI) has signed a deal with Alliance Healthcare for the distribution of Goodbody Botanicals cannabis-based products through its 10,000 UK high street clients.
Block Commodities (BLCC) has extended its option to acquire Greenbelt Company, which has access to 4,000 acres of farmland in Sierra Leone. Greenbelt also has a licence for medicinal cannabis production and processing. A premium of £10,000 is being paid for a 90-day exclusive option to acquire the company for £4m in shares at 0.1p each, a premium to the suspension price. The proposed acquisition was announced 10 months ago.
Healthcare properties developer Ashley House (ASH) continues to build a pipeline of affordable housing schemes and it has completed six homes for Corby Borough Council. A loss will be reported for the 18 months to October 2019. More cash is still required.
Rutherford Health (RUTH) has given notice to Woodford Investment Management that it expects it to subscribe £7.5m at 176p a share. This will take the LF Equity Income Fund stake to 26.8%. More cash will be required so that a fourth proton therapy centre can be opened in Liverpool. This cash will be spent later this year.
Formation Group (FRM) reported a return to profit in the year to August 2019, although it was down to one-off gains. A loss of £284,000 was turned into a pre-tax profit of £1.27m. There was still an underlying loss. The NAV is £20.9m, including cash of £16.2m. The focus was completing existing property development projects. At the end of 2019, the cash was invested in Irish development projects. Sean O’Brien and Andrew Bennett, who is a director of Rutherford Health, have become directors of Formation.
Gunsynd (GUN) has rolled over its loan notes to Human Brands Inc into one loan note with a repayment date of 20 January 2021. Human Brands’ Japanese whisky called Shinju is being sold by a major US liquor retailer. The plan is to raise more cash and Gunsynd would receive a fee in shares.
Coinsilium Group (COIN) says that IOV Labs Ltd, which owns smart contract platform developer RSK, has subscribed £250,000 at 2.65p a share and the two firms have signed a memorandum of understanding to launch a joint venture in Singapore. This will commercialise RSK’s products in Asia and to promote RIF tokens which power RSK’s platforms. Gibraltar-based IOV owns 6.94% of Coinsilium, while Coinsilium owns 1.95 million RIF tokens. Almon I Holding has increased its stake in Coinsilium to 3.68%.
Black Sea Property (BSP) is acquiring two subsidiaries of European Convergence Development Company (ECDC) plus outstanding debt of €119.2m. Black Sea Property is paying €3.3m. There will also be the purchase of between 28.6% to 29.9%. This adds two development plots.
Lombard Capital (LCAP) made a loss of £131,000 in the last quarter of 2019. It is still attempting to raise cash via a bond issue.
Ganapati (GANP) says that additional regulations in Malta have required additional time for the registration as a Virtual Financial Asset licence. The application will be filed in the first quarter and a systems audit is being carried out. There are plans to apply for software gaming licence in the UK Gambling Commission and for certificates in Sweden, Denmark, Spain and Columbia.
Slater Investments has increased its stake in IFA group AFH Financial (AFHP) from 10.65% to 12.2%.
Early Equity (EEQP) has raised £113,000 at 0.65p a share. There was £174,000 in the bank at the end of August 2019. Management has informed NEX that the company should be classed as an operating company, rather than an investment company with the remaining investments classed as non-core assets. There are still plans to move to the standard list.
AIM
Computer vision technology developer Seeing Machines (SEE) increased first half sales from A$13.5m to A$15.8m. The automotive division has nine ongoing programmes with six automotive manufacturers. Demand for driver monitoring systems will be driven by regulation. The cost of the Guardian fleet equipment has been cut by 21%. Seeing Machines has launched a crew training system for the aviation sector.
Best of the Best (BOTB) has sparked another profit upgrade, following the one in November. The online competitions organiser reported better than expected interim figures and this led to a 18% increase in the 2019-20 pre-tax profit forecast to £2.6m, compared with £2.1m last year, and a 25% jump to £3m in 2020-21. There is currently £4.3m of cash in the bank and a 14p a share special dividend is proposed. That is the eighth since 2014.
Minds + Machines (MMX) is on course to announce a maiden dividend with its 2019 figures. The onerous contract has been sorted out Net cash was $6.6m at the end of 2019.
Cloverleaf 374 has increased its stake in Urban Exposure (UEX) from 9.1% to 12.2%. Invesco trimmed its stake from 15.5% to 14.1%. The ultimate owner is Wellesley Group Investors. The board is still reviewing proposals for the future of the property finance provider.
Open Orphan (ORPH) is raising at least £5m via a placing and subscription at 6.1p a share.
MAIN MARKET
Trading in the shares of Baskerville Capital (BASK) on the standard list has been suspended following the announcement of the proposed acquisition of Oberon Investments, which owns smaller company investor MD Barnard. The plan is to move to NEX. An initial 7.83% stake has been acquired for £851,000 with a commitment to subscribe a further £351,000 by the end of April. The acquisition of the rest of Oberon will be paid in Baskerville shares. The deal could be completed by the summer.
Smaller company-focused telecoms services provider Toople (TOOP) has increased its full year loss from £1.4m to £1.67m. In order to build scale, Toople plans to acquire DMS Holding for £1.56m, including £460,000 in cash and 1.05 billion shares. This is a cash generative business and there are potential cost savings. That should offset some of the enormous cash outflow from the existing Toople business. A placing at 0.1p a share will raise £1.2m gross.
Hemogenyx Pharma (HEMO) is raising £650,000 at 1.8p each. This cash will finance further development of the company’s therapies and treatments for blood diseases.
Haynes Publishing (HYNS) increased interim revenues by 4% to £19m with the growth coming from digital. The publisher’s pre-tax profit was 500% ahead at £1.2m. The formal sale process continues.
Standard list shell Bermele (BERM) is raising £200,000 at 1p a share in order to provide further cash to assess potential acquisitions in the pharma sector.
Andrew Hore
Andrew Hore Quoted Micro 2 September 2019
NEX EXCHANGE
SG Recruitment Ltd (SGRL) generated revenues of £777,000 in the 15 months to March 2019. The nursing staff provider lost £2.63m. Since the year end, more contracts have been signed with NHS hospitals, as well as with a hospital in the UAE. The staff offered to hospitals have all obtained qualifications in English and 76% end up being employed. Most of the previous debt has been converted into shares, so net debt was £91,000 at the end of March 2019.
Lombard Capital (LCAP) reported an increase in net liabilities from £234,000 to £537,000 at the end of March 2019. There were £750,000 worth of bonds issued during the period.
PCG Entertainment (PCGE) hopes that the acquisition of Vox Markets and Align Research should be closed in early October. Previous operations have been provided for in full and have been sold. There was £14,000 in the bank at the end of March 2019.
A new investor to Walls and Futures REIT (WAFR) has subscribed £100,000 for shares at 70p each, which is a one-third premium to the market price at the time. Westerby Trustee Services Ltd owns 3.8% of the company on behalf of Westerby Private Pension (R Prest).
Cadence Minerals (KDNC) says that the judicial restructuring plan for the Amapa iron ore project has been approved by the Sao Paulo commercial court. This will enable Cadence to acquire a 20% stake in Amapa. A further $3.5m investment will take the stake to 27%. Cadence plans to consolidate 100 existing shares into one new share. Shareholders will be asked to approve the proposal at the AGM on 20 September.
Paul Tuson is stepping down as finance director of Rutherford Health (RUTH) and the reappointment resolution was withdrawn from the AGM agenda.
Sativa Investments (SATI) has opened its third Goodbody CBD Wellness store in Bristol, following store openings in Bath and Cirencester. It is seeking franchisees to roll-out further stores around the country.
Panther Metals (PALM) chief executive Darren Hazelwood has acquired 18.87 million shares at 0.3p each. That takes his stake to 10.3%.
First Sentinel (FSEN) has raised £59,000 at 14p a share via a placing with D Beta One EQ Ltd.
AIM
President Energy (PPC) insists that it will continue to be profitable even though the Argentinian authorities are attempting to fix the price that producers can sell oil and the dollar exchange rate used for the price for a 90-day period. President has decided to delay its well drilling programme until the first quarter of 2020 and the focus will be gas wells. Gas sales from four wells in Estancia Vieja and Las Bases will commence production by the end of September. A new gas pipeline should be completed by the end of the year. finnCap has withdrawn its forecasts.
Order books and production volumes are ahead of last year at gift wrap and greetings products supplier IG Design (IGR) thanks to a combination of organic growth and last year’s US acquisition. IG is on course to increase pre-tax profit from £30.3m to £36m.
Online musical instruments retailer Gear4Music (G4M) says that it has taken actions that are already helping to improve gross margin.
Cambridge Cognition (COG) says sales are lower than expected. The digital neuroscience services provider says that full year revenues will fall from £6.13m to around £5.5m. The loss will be around £2.8m. First half revenues were £2.1m and the loss was £1.74m. There is a strong order book, so this augurs well for next year.
Adamas Finance Asia Ltd (ADAM) has funded the second tranche of the investment in Infinity Capital Group. The $2m is being funded equally by Adamas and a Hong Kong family office.
MAIN MARKET
Blockchain Worldwide (BLOC) intends to move to AIM if its acquisition of media-focused artificial intelligence and machine learning company Entertainment AI goes ahead.
At a general meeting, shareholders in Tex Holdings (TXH) approved the 2018 report and accounts and directors’ remuneration report, but they did not approve the reappointment of Scrutton Bland as auditors.
Argo Blockchain (ARB) is reaping the benefits of its investment in crypto mining equipment. The cost of 1,000 machines has already been recouped and Argo is on course to recoup the cost of a further 2,267 machines.
Ross Group (RGP) did not generate any revenues in the six months to June 2019 and the loss was £3.15m. Ross acquired start-up operations during the period. They will supply Chitin.
Asian consumer businesses investor Symphony International Holdings (SIHL) increased its NAV by 14% to $560.4m in the six months to June 2019.
George Bennett has become chief executive of Rainbow Rare Earths (RBW) and Martin Eales has left the board. In the year to June 2019, Rainbow sold 850 tonnes of concentrate from the Gakara project, although bad weather hampered production in the fourth quarter. Sales prices have declined.
China-focused healthcare investment company Cathay International (CTI) reported a decrease in revenues from $49.2m to $38.3m. There was a $7.9m gain on the sale of shares in Zhejiang Starry Pharmaceutical, but that was not enough to cover the operating loss and interest costs.
OTHER MARKETS
Britdaq-quoted Staminier Ltd has secured a three-year option over 13 acres of land near to the south terminal of Gatwick Airport and it wants to build a car park with 2,200 spaces. In July, Staminier acquired a majority stake in eco-friendly housebuilder Eco-Space 41 Ltd. There is a four-year option to acquire the other 49% for £750,000. The strategy is to acquire businesses at a discount to their intrinsic value. There are plans to move to a more liquid stockmarket.
Asset Match will provide a trading facility for shares of former AIM company Albert Technologies Ltd. The first auction will be during September.
US Oil and Gas (USOP) has raised $382,000 at 31p a share. This follows a fundraising in July of $577,000 at 30p a share. The cash will be spent on exploration.
Andrew Hore
Andrew Hore – Quoted Micro 31 December 2018
NEX EXCHANGE
China-based Gamfook Jewellery (GAMF) joined NEX on 24 December. The online retailer of customised jewellery was introduced at 15p a share, and the shares ended the first week at 15.5p (14p/17p). That values Gamfook at £15.5m. Executive chairman Jindian Lin and his wife own 72.8% of Gamfook. A dividend based on 28% of profit attributable to shareholders is promised.
Part of the £407,000 Sanderson Capital Partners loan to Wishbone Gold (WSBN) has been converted into shares. The conversion of £258,500 was done at 0.1247p a share.
Milamber Ventures (MLVP) reported an increased interim loss of £343,000, up from £263,000. There were net liabilities at the end of September 2018, but the balance sheet has been improved by the issue of shares for cash and to pay off creditors. Problems at apprenticeship training company Eseential Learning are being sorted out.
PCG Entertainment (PCGE) had $913,000 in the bank and shareholders’ funds of £1.02m at the end of September 2018. There was a cash outflow from operations of £817,000 in the six month period to September 2018.
A subsidiary of Lombard Capital (LCAP) is issuing two bonds. The first is a 4% bond, raising up to £50m and expiring at the end of January 2022, and the other is a 4.5% bond, raising up to £90m and expiring at the end of January 2024. It is intended that both bonds should be lised on a recognised exchange.
AIM
For a change the last major announcement of the year is a positive one. Gordon Dadds (GOR) has completed the acquisition of international law firm Ince UK and it will trade as Ince Gordon Dadds. Trading in the shares recommences on 2 January. The deal will cost £27.3m over four years, plus options over three million shares, and the combined group generated fees of £30.5m in the year to April 2018. The deal should be earnings enhancing in the current financial year.
Earthport (EPO) is recommending a 30p a share bid from Visa Inc. This values the payments technology company at £198m. The bid is 50% higher than the 20p a share placing price in October 2017, but lower than the 40.85p a share placing price in September 2014.
Chamberlin (CMH) improved its trading in the first half and the cash from the sale of the Exidor business has improved its balance sheet. The foundries business moved back into profit in the first half as demand continues to increase for turbo charger housings, which are used for hybrid cars as wells as conventinal ones. The company’s debt has been reduced from £10.5m at the end of September 2018 to £3.7m. The pension deficit has been cut from £4m in the last balance sheet to £1.5m.
Facilities management and security services provider Mortice Ltd (MORT) increased its interim revenues by 10% to $116.7m. Underlying pre-tax profit was 5% ahead at $2.3m. Net debt was $20.1m at the end of September 2018.
TUS International has published a circular for a general meeting in January in order to gain shareholder approval for the acquisition of the Telit Communications (TCM) automotive business, whose reorganisation is near completion.
In the six months to September 2018, Stanley Gibbons (SGI) continues to lose money although costs have been reduced. Revenues fell from £7.14m to £5.03m. Coins and medals are the part of the business still making a profit. The overall loss has been reduced from £2.93m to £2.37m.
The People’s Operator (TPOP) does not expect to appoint a new nominated adviser and the share placing with the owner of LycaMobile has been pulled. The investment of £1.3m in shares (29.9%) and convertible loan notes will not go ahead but the potential investor is considering its options. The AIM quotation will be cancelled on 3 January.
TSX-V quoted PetroTal Corp (PTAL) has gained an AIM quotation. The Peru-focused oil producer is developing its interests at Bretana and growing near-term production.
IT compliance and security services provider GRC International (GRC) increased its interim revenues by 54% to £8.91m, thanks to a boost from GDPR, but it moved from a pre-tax profit of £614,000 to a loss of £2.18m. There was additional investment following the flotation of the company in March. Cash is running out and an overdraft and a loan facility have been secured.
Gaming technology developer Nektan (NKTN) is raising £1.5m at 15p a share, although not all the shares will be issued until the company gets shareholder approval at the AGM on 7 February, and it will generate £2m from the sale of 57.5 of US subsidiary Respin. There are also plans to restructure the conversion terms of loan notes and a shareholder loan. These proposals are dependent on each other going ahead and on the successful negotiation with the HMRC over the payment terms for £2.9m of UK point of consumption tax. There was £1.4m in cash at the end of June 2018, which is similar to the cash outflow from operations in the preceeding 12 months.
Functional food ingredients developer Provexis (PXS) improved interim revenues from £124,000 to £194,000. The company’s Fruitiflow products are being more widely sold and the prospects for the deal with BY-HEALTH in China are positive. Pro forma cash was £556,000.
Veltyco Group (VLTY) is going to launch its own regulated financial trading brand in the first quarter of 2019, although this depnds on regulatory approval.
Oil and gas explorer and producer Cabot Energy (CAB) says that it is still trying to raise cash via a share issue and it would be at a large discount to the current share price. The cash needs to bre raised by the end of January in order to pay overdue creditors and provide working capital.
Building materials sector consolidator SigmaRoc (SRC) has announced its plans to redeem its £10m of 6% convertible loan notes. SigmaRoc is offering 105p for each 100p loan note, plus 0.378p a note in interest payments. The last acceptance date for the tender is 16 January.
Mobile commerce services provider Bango (BGO) will be loss-making in 2018, although there was an EBITDA in the fourth quarter. End user spend more than doubled to £550m. There should be £3.5m in the bank at the end of 2018.
WANdisco (WAND) has secured a three-year agreement with an American healthcare company worth £700,000. The deal involves WANdisco Fusion and comes via the sales partnership with IBM.
Paracale Gold is providing a loan of up to $1.224m to Goldstone Resources (GRL) to finance the development of the Akrokeri-Homase project in Ghana. This mine could be in production in 2020. Paracale will receive 40.35 million warrants exercisable at 1.2p a share, which replace existing warrants.
Mobile payments technology provider MobilityOne Ltd (MBO) has secured an agency and reseller agreement with MBP Solutions for the company’s products in Malaysia.
In the six months to September 2018, Vast Resources (VAST) reported a 8% increase in gold production to 13,352 ounes at the Pickstone-Peerless gold mine in Zimbabwe. There was a 61% increase in copper concentrate produced to 1,526 tonnes at the Manaila polymetallic mine and zinc concentrate produced has nearly doubled to 199 tonnes. Revenues increased from $14.9m to $21.9m. There was still a cash outflow from operations of $1.79m.
Michael Principe and Greg Genske have resigned from the board of TLA Worldwide (TLA) following the sale of its core US business. The agreement with SunTrust Bank to defer capital and interest payments has been extended to 31 January.
Phoenix Global Mining (PGM) has raised £358,000 at 28p a share. There is a warrant exercisable at 28p, lasting until the end of 2021, with every four new shares. The cash will be invested in the Empire copper, gold, silver, zinc and tungsten mine in Idaho, where news of the most recent drilling is expected. A new resource statement will be prepared and additional acreage acquired.
Urban Exposure (UEX) had committed new lending of £522m during 2018. It has secured a £165m loan facility for its joint venture with KKR, as well as a £32.8m loan from Aviva for a single transaction by the joint venture.
MAIN MARKET
Nanoco (NANO) has achieved the third milestone in its cadmium-free quantum dots technology development and supply agreement with a US customer and triggered a £1.6m. This is the final milestone of three and they have generated £4.2m.
Robin Boyle has requisitioned a general meeting at Athelney Trust (ATY) in order to get himself reappointed. He also wants David Lawman and Paul Coffin to be appointed and the three existing directors, Dr Emmanuel Pohl, Simon Moore and Jemma Jackson, to be removed. The other two resolutions are to terminate Jason Pohl as alternate director and any other director appointed by the time of the general meeting on 22 January.
Standard list shell Stranger Holdings (STHP) is still awaiting UKLA approval for its proposed reverse takeover of waste energy technology developer Alchemy, which was announced in August 2017. Management is hopeful that the deal could go ahead by the end of the first quarter of 2019. Stranger had net liabilities of £435,000 at the end of September 2018.
Dukemount Capital (DKE) has forward-funded and pre-sold its first development at West Derby to a fund managed by Alpha Real Capital. Dukemunt will receive £570,000 for the site and the total funding package for the development will be £3m. The development involves demolishing the existing building and constructing 17 supported living appartments and retail space. Dukemount continues to manage and develop the project on behalf of the supported living housing association that has taken a 50-year lease.
Andrew Hore
Andrew Hore – Quoted Micro 24 December 2018
NEX EXCHANGE
China-based Gamfook Jewellery had planned to join the standard list, but it has decided to float on NEX. The online retailer of customised jewellery had intended to raise cash at 15p a share, but the flotation on NEX on Christmas Eve will be an introduction at 15p a share. Management hopes the flotation will help to increase its profile and customer base. A dividend based on 28% of profit attributable to shareholders is promised.
Walls and Futures REIT (WAFR) has maintained its NAV at 92p a share at the end of September 2018. In the six months to September 2018, rents increased from £33,000 to £67,000. Additional supported housing opportunities have been assessed.
KR1 (KR1) has raised £785,000 at 5p a share and paid £40,000 in fees to advisers in shares at the same price. KR1 director Keld van Schreven subscribed for 50,000 shares. The cash will fund further blockchain token investments.
Panther Metals (PALM) has signed heads of terms for the acquisition of Parthian Resources, which owns exploration assets in Australian. Parthian shareholders will own 15% of Panther if the deal goes ahead. One of these shareholders is Kerim Sener, who is non-executive chairman, who will end up with 4% of Panther. The deal should be completed in January 2019.
Blockchain investment company Coinsilium Group Ltd (COIN) says that Gibraltar-based StartupToken has attracted a £193,000 investment from South Korea-based Blockwater Capital in return for a 7.4%. Coinsilium had invested £360,000 in StartupToken during November and the value of the investment has doubled to £722,000. Executive chairman Malcolm Palle has bought 200,000 shares in Coinsilium at 3.6p a share, taking his stake to 6.35%.
Clean Invest Africa (CIA) is acquiring the remaining 97.5% of CoalTech LLC for £24.6m. This will be funded by a share issue. A circular will be published in the first quarter of 2019. A new incentive plan for management, in the form of options exercisable at 2.5p a share, is planned.
IMC Exploration (IMCP) has issued five million shares at 1p ia share and every five shares has a warrant exercisable at 1p a share. The £50,000 will be used to continue exploration in Avoca, County Wicklow. Wishbone Gold (WSBN) has raised £300,000 at 0.1p a share. The cash raised will be used to accelerate production at the Honduras gold facility. NQ Minerals (NQMI) has raised £38,000 at 12p a share.
Milamber Ventures (MLVP) has issued shares valued at nearly £302,000 to creditors at a range of share prices. Management has acquired the majority stake in Milamber USA and Milamber retains a 20% stake. Milamber has also reduced its stake in Vocademia to 5% with the rest of the share capital acquired through the return of 900,000 Milamber shares. A further 166,667 shares were returned for Milamber’s stake in White Cobalt. Milamber has created a new training compliance company called Checkbox and taken a 51% stake in an education joint venture with Black Arrow Space Technologies, which is developing commercial orbital launch services.
Imperial Mining (IMPP) is changing its name to Imperial X to reflect the change in investment focus from resources to the cannabis sector.
Medicinal cannabis investment company Sativa Investments (SATI) says that investee company Rapid Dose Therapeutics Inc has listed on the Canadian Stock Exchange. This has provided a 70% uplift in the initial investment value for a gain of C$140,000.
Lombard Capital (LCAP) had £4,130 in cash and £112,000 in assets available for sale. at the end of September 2018. Lombard still plans to issue an asset-backed investment bond.
Tectonic Gold (TAU) says that initial analysis of drilling at the Specimen Hill project in Queensland has confirmed mineralisation with grades up to 6.06g/t. Full results should be available in January.
Trafalgar Property Group (TRAF) is raising up to £1m through an issue of 8.5% convertible bonds 2025. The issue could eventually be increased to £5m. The bonds will be traded on NEX. The cash will be used to fund residential development and planning applications. Trafalgar has limited cash and it lost money last year.
Filta Group (FLTA) has multipled the size of its grease management operations in the UK through the acquisition of Watbio for £6.9m in cash and shares, plus working capital adjustment. Cenkos has provisionally upgraded its 2019 earnings forecast by 26% to 11.8p, assuming completion of the deal in early January. Filta is raising £3m at 200p a share, which is a premium to the market price, and has obtained a £4m, five-year loan facility. Filta started building a grease management division through acquisition just over one year ago. Watbio generates annual revenues of £10.3m and pre-tax profit of £800,000 so it is much larger than the existing operations. It also offers other drain management services.
A strong performance from property servies more than made up for a weak first half performance of the business recovery division of Begbies Traynor (BEG) and pre-tax profit was 9% higher at £3.2m on revenues 8% ahead at £28m. The number of insolvencies increased in the first half but there was no repeat of the large one-off fee in the first half of the previous year. The interim dividend was raised by 14% to 0.8p a share. Net debt fell 10% to £6.3m. The performances of the divisions will reverse in the second half and 2018-19 pre-tax profit should improve from £5.6m to £6.4m.
President Energy (PPC) has drilled the third Puesto Flores well on budget and there have been good oil shows, but they are lower than the previous two wells. All three wells could be in production by the end of the year.
AssetCo (ASTO) has transferred the loal employees in Abu Dhabi to the new supplier of fire services. There is a possibility of winning work in the region. The litigation against former auditor Grant Thornton continues and a judgement could happen in the first couple of months of 2019.
URA Holdings (URA) was not able to complete the acquisition of Entertainment AI early enough to prevent the cancelation of the AIM quotation on 24 December. The acquisition could still happen.
Real Good Food (RGD) has sold jams maker R and W Scott for £1.5m, of which £500,000 is deferred until September 2019, and the assumption of £2.45m of debt. That takes disposal proceeds to £17.8m and completes the main corporate activity. The cake decoration and food ingredients businesses make up the majority of the remaining group.
Small business financial services provider City of London Group (CIN) continues to lose money as it builds up its activities. Recognise continues to try to obtain a UK banking licence.
HaloSource Corporation (HALO) has not been able to secure additional finance and trading in the shares has been suspended. There is limited cash left.
Thalassa Holdings (THAL) intends to move to a standard listing. No new shares will be issued and the move should take place on 25 January.
Revenue and EBITDA growth in the range of 15% to 20% is expected by Craneware (CRW) in the six months to December 2018. The healthcare accounting software provider has a 100% renewal rate in dollar terms in the first half.
Replacement windows and doors manufacturer Safestyle (SFE) has improved its order intake in the past six months after its agreement with a former employee who was competing with the company. However, costs have increased and the 2018 loss will be between £8.2m and £8.6m. The 2019 performance could be ahead of expectations. Otus Capital Mananagement has taken a 5.42% stake.
Audio equipment supplier Focusrite (TUNE) had a strong November but it is still cautious about the full year. The trade dispute between the US and China remains a concern.
N4 Pharma (N4P) has extended the licence agreement with UniQuest for Nuvec. It has become an exclusive global licence with certain fields licensed back to UniQuest.
finnCap has resigned as nominated adviser and broker to The People’s Operator (TPOP) and that could scupper the placing with the owner of LycaMobile. An investment of £1.3m in shares (29.9%) and convertible loan notes was planned.
Yu Group (YU.) says that the Financial Conduct Authority is investigating the accuracy of its announcements between March and October. Poor internal controls caused a shortfall in profitability. The energy supplier has revealed that its 2018 loss could be as high as £7.85m, which is higher than previously estimated. This is due to a decline in gross margins and balance sheet corrections. There was £11m in the bank at the end of November 2018.
LiDCO Group (LID) will report float full year revenues and this has led to a £800,000 increase in forecast pre-tax loss to £1.9m. The take-up of the high usage programme has been slower than expected and an Asian order was delayed. The patient monitoring equipment supplier is expected to have cash of £1.5m by the end of January 2019.
TLA Worldwide (TLA) has agreed in principle to sell its Australian business to QMS Media and this would make TLA a cash shell.
Rasmala (RMA) left AIM on 19 December. A new holding company is based in the British Virgin Islands.
It gets worse at Paragon Entertainment (PEL) with another loss in the second half on lower than expected revenues. A 2018 loss of £2.4m is forecast. Overheads have been reduced so the loss could be smaller next year.
Scientific Digital Imaging (SDI) increased interim revenues by 23% to £8.05m through a combination of acquisitions and organic growth, while pre-tax profit was one-third higher at £1.5m. finnCap is cautious about the full year for the scientific instruments supplier and has maintained its full year pre-tax profit forecast at £2.6m, which suggests a lower second half profit.
Management has launched a 12p a share bid for former AIM-quoted PR firm Freshwater as a way of enabling existing shareholders to exit the business.
MAIN MARKET
Trading in standard list shell Fandango Holdings (FHP) shares has been suspended ahead of the proposed reverse acquisition of Konnect Mobile Communications Inc, which owns PaySocial Inc, a mobile banking and payments eWallet.
Standard list shell Papilon Holdings (PPHP) has acquired 50% of Pace Cloud Ltd, which owns CarCloud, a fintech company involved in the used car sector. This represents a fundamental change in the business. Papilon is raising up to £500,000 via a convertible loan note issue. The conversion price is 1.25p a share.
Telecoms services provider Toople (TOOP) lost £1.4m in the year to September 2018, which was slightly more than the previous year. The gross profit of £203,624 was enough to cover the directors pay of £196,713. There was a cash outflow of nearly £1m in the period. There was £2.14m in the bank at the end of September 2018, but there is a loan from former shareholder David Breith with a cash value of nearly £607,000, which could become repayable from 3 May 2019.
Zegona Communications (ZEG) has decided not to tender €7.75 a share for up to 14.9% of Euskaltel, where it is trying to improve performance, because it has not been abe to secure funding. Zegona has secured a relationship with Talomon Capital, which will own up to 2.4% of Euskaltel on top of Zegona’s existing 15% stake, which will be increased via market purchases. That requires a share issue by Zegona.
Investment company Athelney Trust (ATY) is consulting with existing and potential shareholders, concerning a tender offer to existing shareholders at the same time as an issue of new shares.
Andrew Hore
Andrew Hore – Quoted Micro 27 August 2018
NEX EXCHANGE
Crossword Cybersecurity (CCS) has signed a memorandum of understanding with IP Group, covering the commercialising of cybersecurity intellectual property from universities.
Ananda Developments (ANA) says that investee company iCAN Israel-Cannabis Ltd has signed a memorandum of understanding with Yom Chai. The deal involves the development and validation of a cannabis-based treatment for Crohn’s Disease, Autism and other neurological and gastrointestinal diseases. The agreement will generate revenues for iCAN, as well as obtaining a stake and potential future royalties.
Supported housing developer Walls and Futures REIT (WAFR) ended March 2018 with a NAV of 92p a share. Full year revenues were 127% higher at £103,000 and the company moved into profit. The first supported housing property was completed during the period. The board wants shareholders to approve a new management incentive plan at the company’s AGM.
There was a £88,000 cash outflow for Lombard Capital (LCAP) in the year to March 2018, but the investment company has moved from net assets to net liabilities. There is £2,154 in the bank plus £112,500 in investments. Since the year end, £320,000 has been raised from subscriptions for 7.5% 2020 unsecured loan notes.
Primorus Investments (PRIM) and Gunsynd (GUN) are selling their direct interests in the Horse Hill prospect to UK Oil and Gas (UKOG) for cash and shares. Primorus will receive £375,000 in cash and £1m in UK Oil and Gas shares at 1.75p each for its 5% stake in Horse Hill Developments Ltd (HHDL), while Gunsynd will receive £50,000 in cash and £500,000 in shares for its 2% stake.
AIM
Tracsis (TRCS) says that full year revenues were ahead of expectations at around £40m and profit will be better than expected. There was £22m in the bank at the end of July 2018. The margins of the traffic and data division are improving.
Audio visual equipment distributor Midwich Group (MIDW) is acquiring Nuremberg-based Bauer und Trummer, which has annual revenues of €21m.
A potential partner has ended its interest in the Bahamas-based oil and gas prospects of Bahamas Petroleum (BPC) and that knocked two-thirds off the share price. BPC received $1m in exclusivity payments from the international oil and company and it has started talks with other third parties.
KEFI Minerals (KEFI) has signed heads of agreement with Ethiopian investors which are setting up a vehicle to make a $35m investment to finance the Tulu Kapi gold project. The first investment of $9m should be made in the current quarter.
Caledonia Mining Corp (CMCL) has agreed to acquire a further 15% of the Blanket gold mine in return for the cancellation of a $11.5m loan and 730,000 shares. That takes the Caledonia stake in Blanket to 64%. The dividend will be kept at 27.5 cents/share.
Waste gasification to energy technology provider EQTEC (EQT) has finished a strategic review following the appointment of a new chief executive. The focus will change to the delivery of customer requirements. Additional technological expertise will come from an alliance with CT3 Ingenieria.
AdEPT Telecom (ADT) is a paying an initial £5m for Shift F7 and this should be earnings enhancing. The two companies have worked together for more than a decade. AdEPT chief executive Ian Fishwick has bought 10,196 shares at 373p each.
Thor Mining (THR) has completed the definitive feasibility study for the Molyhil open pit tungsten project. The post-tax NPV is A$101 and project payback would be less than 18 months. Molyhil has opex costs of tungsten of $90/mtu, compared to an average of $157/mtu for other tungsten projects.
Data and analytics services provider D4T4 (D4T4) says that it has received the £19.5m of trade debtors in the balance sheet at the end of March 2018.
Restaurants operator Fulham Shore (FUL) says revenues generated by The Real Greek and Franco Manca have increased. New openings will be financed out of cash flow. Chief executive Nabil Mankarious has acquired 127,000 shares at 12p each, taking his stake to 19.9%.
Versarien (VRS) has signed two collaborations. A deal with AXIA Materials will lead to the development of graphene enhanced composite materials and smart graphene devices. The first two projects will be for smart buildings and electric vehicles. An agreement with AECOM will be focused on developing large-scale polymer structures for civil engineering infrastructure projects.
Broadcast software provider Pebble Beach Systems (PEB) has moved back into profit at the adjusted level in the first half of 2018, but that is after adjusting for £400,000 of amortisation of capitalised development costs. If that amortisation charge is not excluded the company would have been around breakeven. Net cash generated from operating activities was £126,000, but there is an outflow of £254,000 after capitalised investment. Most importantly, net debt is £10.5m. Debt repayments have started with £850,000 due to be repaid in the second half.
Facilities management services provider Mortice Ltd (MORT) reported a 29% decline in pre-tax profit to $3.9m. Net debt was $18.4m at the end of March 2018. The minority interest in Singapore-based Frontline Security has been acquired for $3.5m.
Wey Education (WEY) says it is planning for significant growth next year, having exceeded market expectations of revenues of £4.1m in the year to August 2018. The first sales from the Chinese joint venture should be in September. A general meeting is being held to enable the issue of more shares and to create distributable reserves to allow a dividend to be paid.
Tekmar Group (TGP) intends to acquire Subsea Innovations for up to £4m. Subsea is focused on the oil and gas sector and it is involved in back deck equipment and subsea pipeline repair clamps. The deal includes £3m of fixed assets.
Veltyco (VLTY) has trade receivables of €8.9m, higher than in July, with €5.4m owed by Celestial, €1.5m of which relates to 2017. The current cash balance is €1.3m. Veltyco will launch its own regulated online trading brand. Betsson Services has renewed its contract until May 2021.
MAIN MARKET
Packaging manufacturer and distributor Macfarlane Group (MACF) increased its interim pre-tax profit by 39% to £3.53m. The growth in profit came from the distribution division on the back of higher sales to internet retailers. Net debt was £11.1m at the end of June 2018. The interim dividend is increased by 8% to 0.65p a share.
London and Associated Properties (LAS) is broadening its investment remit to areas other than retail property. Diluted NAV was 54.5p a share at the end of June 2018.
Bisichi Mining (BISI) increased its pre-tax profit from £243,000 to £3.97m on the back of strong demand for coal.
Standard list shell daVictus (DVT) still has £431,000 in the bank. The board continues to look at food and beverage businesses.
Andrew Hore